July 27, 2011

Airlines Appear to be Only Winners in Budget Debate

<a href="http://www.flickr.com/photos/shyb/63692776/sizes/m/in/photostream/">shyb</a>/Flickr

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The noise generated by the debt ceiling debate has largely drowned out the news that the Federal Aviation Administration was crippled last week after Congress failed to reauthorize its funding. This has put 4,000 aviation workers on furlough, halted construction projects, and even stopped the FAA from collecting airline taxes.

But the shutdown isn’t hurting the airline industry. Instead of passing the savings from the missing taxes on to consumers, the airlines have decided to increase ticket prices and keep the money that would have gone to taxes for themselves—a windfall of up to $30 million a day. Here’s the Wall Street Journal:

The suspended levies include a 7.5% sales tax on domestic tickets, a $3.70-per-takeoff segment fee, a $16.30 (each way) international arrival and departure tax, and an $8.20 tax for flights linking the U.S. mainland to Alaska and Hawaii. Airlines must continue to collect security fees.

Airlines including US Airways Group Inc., AMR Corp.’s American Airlines, Southwest Airlines Co. and JetBlue Airways Corp. began Friday marking up their fares, although the fares didn’t appear to be higher because the totals didn’t change, says Rick Seaney, chief executive of tracker FareCompare.com.

Over the weekend, more carriers joined in, including Delta Air Lines Inc. and United Continental Holdings Inc., Mr. Seaney says. By and large, they raised fares 7.5% and added charges of $6 to $12 a ticket to account for the other fees.

So in addition to charging you to print a boarding pass, charging you for both checked and carry-on items, charging you for the convenience of using a credit card, and charging you for just booking a ticket to begin with, airlines have now figured out how to profit off the budget stalemate.

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WE'LL BE BLUNT

It is astonishingly hard keeping a newsroom afloat these days, and we need to raise $253,000 in online donations quickly, by October 7.

The short of it: Last year, we had to cut $1 million from our budget so we could have any chance of breaking even by the time our fiscal year ended in June. And despite a huge rally from so many of you leading up to the deadline, we still came up a bit short on the whole. We can’t let that happen again. We have no wiggle room to begin with, and now we have a hole to dig out of.

Readers also told us to just give it to you straight when we need to ask for your support, and seeing how matter-of-factly explaining our inner workings, our challenges and finances, can bring more of you in has been a real silver lining. So our online membership lead, Brian, lays it all out for you in his personal, insider account (that literally puts his skin in the game!) of how urgent things are right now.

The upshot: Being able to rally $253,000 in donations over these next few weeks is vitally important simply because it is the number that keeps us right on track, helping make sure we don't end up with a bigger gap than can be filled again, helping us avoid any significant (and knowable) cash-flow crunches for now. We used to be more nonchalant about coming up short this time of year, thinking we can make it by the time June rolls around. Not anymore.

Because the in-depth journalism on underreported beats and unique perspectives on the daily news you turn to Mother Jones for is only possible because readers fund us. Corporations and powerful people with deep pockets will never sustain the type of journalism we exist to do. The only investors who won’t let independent, investigative journalism down are the people who actually care about its future—you.

And we need readers to show up for us big time—again.

Getting just 10 percent of the people who care enough about our work to be reading this blurb to part with a few bucks would be utterly transformative for us, and that's very much what we need to keep charging hard in this financially uncertain, high-stakes year.

If you can right now, please support the journalism you get from Mother Jones with a donation at whatever amount works for you. And please do it now, before you move on to whatever you're about to do next and think maybe you'll get to it later, because every gift matters and we really need to see a strong response if we're going to raise the $253,000 we need in less than three weeks.

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