4 ms·

If these fees are outlawed, I wonder what the new equilibrium will be. The govt talks about how this costs Americans hundreds of billions of dollars, which mak

If these fees are outlawed, I wonder what the new equilibrium will be. The govt talks about how this costs Americans hundreds of billions of dollars, which makes it sound like the money will magically be transferred back to consumers. But the reality is more complicated, and likely involves businesses migrating these fees into their base prices. More transparency is good, for sure, but I wonder how much money will actually be saved.

nerdbert 3y ago
These proposals don't say you can't charge fees. They say that the actual total price has to be displayed from the beginning. If Ticketmaster wants to break down a $250 concert ticket as $180 for the ticket and $70 for an issuing fee, that's fine. But since the fee is mandatory, they have to advertise it as $250, not $180. They still get the same amount of money but people aren't being lied to, and are better able to make smart decisions about what to buy without having to wade through a morass of fine print.
- bruceb 3y ago
  President Biden in speeches doesn’t say fees should be visible, he says they be ended. It’s not unreasonable people might think proposals are to end the not just makes the visible when scrolling hotel rooms, tix, etc.
  - Macha 3y ago
    Well, yes, the only reason the fee exists is so they can break it out of the price for a lower sticker price while recieving the same revenue. If it needs to be included in the sticker price, then there's no reason for ticketmaster to designate it a seperate fee at all
Zak 3y ago
Of course for many items the advertised price will simply increase to the true price, as some advertised prices are unsustainable without the hidden fees. That alone is a big win for consumers because they won't have to waste time finding out what the real price is. It probably will bring some prices down though, by making comparison shopping easier, and by preventing some sales where the customer would have accepted the fee after getting partway through the buying process, but would have rejected the true price up front.
wnc3141 3y ago
which I think is fine, consumers will have a transparent and readily available price figure with which they can make a choice
- gnicholas 3y ago
  That’s true, and I guess what I wasn’t accounting for is that some people on the margin will choose not to purchase, and have a staycation instead of shelling out for airline tickets and hotel stay, if the fees are all displayed upfront. Right now, those people see artificially lower prices and end up being the proverbial boiled frog, as price increases are revealed through the checkout process.
  - deleted 3y ago
    [deleted]
quickthrowman 3y ago
I just want all costs and overhead to be priced into the price of the good or service. I’d rather pay an advertised $200+tax/night for a hotel room than $150+$50 resort fee+tax/night. You’re paying the same amount in the end, but the $200 lump sum price is more honest. I sell services and I give my customers one lump sum price, where all of my costs (including taxes), overhead, and profit are included with no gotcha fees.
- sib 3y ago
  Local governments would love it if all hotel taxes were embedded into the price. Travel (hotels & car rentals) in the US are industries where the average tax rate is much, much, much higher than the standard sales tax rates for goods sold in the same location. There are all sorts of taxes at that are levied because most of the customers who pay them, don't live there and therefore can't vote against the politicians that imposed them.
- gnicholas 3y ago
  I’d actually want the taxes to be enumerated for hotel rooms, since the rate can be much higher than regular sales tax, and varies greatly by location. I generally assume hotel taxes will add 20-25% if it’s not shown otherwise.
  - yencabulator 3y ago
    Taxes enumerated is in no way incompatible with taxes being included in advertised price.
Crunchified 3y ago
IF the fees are just "fluff" that adds pure profit to the goods or services rendered, then these new fees regulations will have the government's desired effect. But if the fees are needed to cover costs and expenses, they WILL be incorporated into the bottom line prices, and the regulations will force the advertised prices to rise in lieu of the fees. As in any "free-market" system, the cost structures of each business will govern its competitiveness and the amount of profit that competition will allow. And, as usual, the government will find out that further regulating free markets (a three-word oxymoronical phrase) will not achieve the stated goals of lowering the public's costs of goods and services. It might, however, level the playing field in ways that appeal to voters who rely on government to solve all their woes.
- Espressosaurus 3y ago
  If it just causes prices to rise to their actual level so we can make an informed decision instead of being surprised by the price changing when we go to check-in, check-out, or whatever, that's a win.
- xoa 3y ago
  >And, as usual, the government will find out that further regulating free markets Free Markets require information symmetry to function properly and efficiently. The sticker price is ideally supposed to include every cost along with profit margin, such that the buyer pays exactly that price and receives the product/service that's the end of the transaction. Externalities and hidden fees are anti-Free Market, they distort the core fundamental incentive that is supposed to make it work, allowing more expensive products/services to deceive people into buying them over less expensive ones they would have chosen otherwise. >(a three-word oxymoronical phrase) Only if you have an extremely understanding of how these tools work. Free Markets are meta-stable constructs without any inherent service to humans, without regulatory maintenance keeping them functional and linking them to people they'd collapse in various ways, or at least be extremely inefficient which defeats the whole point. >will not achieve the stated goals of lowering the public's costs of goods and services That is a systemic, long term goal, not just the next week or month. Information symmetry allowing people to make more efficient decisions is the basic driver of competition and sellers improving the value of their offerings. That is what creates lower costs/high value over time, in the same way that breaking up monopolies or monopsonies might well temporarily increase the price of goods/services in certain cases, but leaving them be indefinitely always results in lower efficiency/productivity long term.
dkjaudyeqooe 3y ago
The whole point is to hide the price so you can't compare so they can neuter competition. Companies can charge whatever they like, but you have to be told. If it's a mandatory fee it has to be disclosed upfront. Money will be saved when competitive pressures save money for consumers. I don't agree with regulating late fees, especially since there are cards without late fees at all. I did agree with banning over limit fees since there was no way to instruct your bank to decline transactions that would take you over the limit.

nerdbert 3y ago

These proposals don't say you can't charge fees. They say that the actual total price has to be displayed from the beginning. If Ticketmaster wants to break down a $250 concert ticket as $180 for the ticket and $70 for an issuing fee, that's fine. But since the fee is mandatory, they have to advertise it as $250, not $180. They still get the same amount of money but people aren't being lied to, and are better able to make smart decisions about what to buy without having to wade through a morass of fine print.

bruceb 3y ago
President Biden in speeches doesn’t say fees should be visible, he says they be ended. It’s not unreasonable people might think proposals are to end the not just makes the visible when scrolling hotel rooms, tix, etc.
- Macha 3y ago
  Well, yes, the only reason the fee exists is so they can break it out of the price for a lower sticker price while recieving the same revenue. If it needs to be included in the sticker price, then there's no reason for ticketmaster to designate it a seperate fee at all

Zak 3y ago

Of course for many items the advertised price will simply increase to the true price, as some advertised prices are unsustainable without the hidden fees. That alone is a big win for consumers because they won't have to waste time finding out what the real price is. It probably will bring some prices down though, by making comparison shopping easier, and by preventing some sales where the customer would have accepted the fee after getting partway through the buying process, but would have rejected the true price up front.

wnc3141 3y ago

which I think is fine, consumers will have a transparent and readily available price figure with which they can make a choice

gnicholas 3y ago
That’s true, and I guess what I wasn’t accounting for is that some people on the margin will choose not to purchase, and have a staycation instead of shelling out for airline tickets and hotel stay, if the fees are all displayed upfront. Right now, those people see artificially lower prices and end up being the proverbial boiled frog, as price increases are revealed through the checkout process.
- deleted 3y ago
  [deleted]

quickthrowman 3y ago

I just want all costs and overhead to be priced into the price of the good or service. I’d rather pay an advertised $200+tax/night for a hotel room than $150+$50 resort fee+tax/night. You’re paying the same amount in the end, but the $200 lump sum price is more honest. I sell services and I give my customers one lump sum price, where all of my costs (including taxes), overhead, and profit are included with no gotcha fees.

sib 3y ago
Local governments would love it if all hotel taxes were embedded into the price. Travel (hotels & car rentals) in the US are industries where the average tax rate is much, much, much higher than the standard sales tax rates for goods sold in the same location. There are all sorts of taxes at that are levied because most of the customers who pay them, don't live there and therefore can't vote against the politicians that imposed them.
gnicholas 3y ago
I’d actually want the taxes to be enumerated for hotel rooms, since the rate can be much higher than regular sales tax, and varies greatly by location. I generally assume hotel taxes will add 20-25% if it’s not shown otherwise.
- yencabulator 3y ago
  Taxes enumerated is in no way incompatible with taxes being included in advertised price.

Crunchified 3y ago

IF the fees are just "fluff" that adds pure profit to the goods or services rendered, then these new fees regulations will have the government's desired effect. But if the fees are needed to cover costs and expenses, they WILL be incorporated into the bottom line prices, and the regulations will force the advertised prices to rise in lieu of the fees. As in any "free-market" system, the cost structures of each business will govern its competitiveness and the amount of profit that competition will allow. And, as usual, the government will find out that further regulating free markets (a three-word oxymoronical phrase) will not achieve the stated goals of lowering the public's costs of goods and services. It might, however, level the playing field in ways that appeal to voters who rely on government to solve all their woes.

Espressosaurus 3y ago
If it just causes prices to rise to their actual level so we can make an informed decision instead of being surprised by the price changing when we go to check-in, check-out, or whatever, that's a win.
xoa 3y ago
>And, as usual, the government will find out that further regulating free markets Free Markets require information symmetry to function properly and efficiently. The sticker price is ideally supposed to include every cost along with profit margin, such that the buyer pays exactly that price and receives the product/service that's the end of the transaction. Externalities and hidden fees are anti-Free Market, they distort the core fundamental incentive that is supposed to make it work, allowing more expensive products/services to deceive people into buying them over less expensive ones they would have chosen otherwise. >(a three-word oxymoronical phrase) Only if you have an extremely understanding of how these tools work. Free Markets are meta-stable constructs without any inherent service to humans, without regulatory maintenance keeping them functional and linking them to people they'd collapse in various ways, or at least be extremely inefficient which defeats the whole point. >will not achieve the stated goals of lowering the public's costs of goods and services That is a systemic, long term goal, not just the next week or month. Information symmetry allowing people to make more efficient decisions is the basic driver of competition and sellers improving the value of their offerings. That is what creates lower costs/high value over time, in the same way that breaking up monopolies or monopsonies might well temporarily increase the price of goods/services in certain cases, but leaving them be indefinitely always results in lower efficiency/productivity long term.

dkjaudyeqooe 3y ago

The whole point is to hide the price so you can't compare so they can neuter competition. Companies can charge whatever they like, but you have to be told. If it's a mandatory fee it has to be disclosed upfront. Money will be saved when competitive pressures save money for consumers. I don't agree with regulating late fees, especially since there are cards without late fees at all. I did agree with banning over limit fees since there was no way to instruct your bank to decline transactions that would take you over the limit.