So I was reading yesterday that the airline industry is about to change for the worse (that is if you are a consumer). There will soon be higher prices for aisle and window seats. It will cost $1 for a can of Coke, and you will be charged for all of your luggage. Sounds terrible, right? I agree.

Here’s the deal. The airline industry has decided that they want to stop losing money. That sounds reasonable, but I really don’t want to help them make money either. I think that $200 is a good price for a person to pay to fly from the Midwest to Florida. I don’t think that the $400 ticket that is on the way is in any way appropriate. I recently had a friend get his flight to Hawaii canceled because the airline went out of business while he was in the air. He then had to pay $2,400 for a new ticket on a different airline to get to Hawaii. He had to get there to conduct business. Flying has become a very accessible mode of transportation for Americans, and that is all about to change.

• Oil is expensive for lots of political reasons.
• Therefore jet fuel prices are high
• Therefore airlines profit margins shrink
• Therefore some airlines go out of business
• Therefore other airlines have less competition
• Therefore they raise prices
• Therefore less people fly
• Therefore less people vacation
• Therefore people are more stressed
• And tourist destination cities lose money
• Therefore businesses in those cities lose money
• Therefore they lay off their already stressed out workers
• Therefore people have less money to live on
• Therefore they don’t even drive due to high gas prices
• Therefore fuel demand decreases
• Therefore fuel prices fall
• Therefore jet fuel prices fall
• Therefore airline prices will fall
• Therefore people will be able to afford tickets
• Therefore airlines will have more flights
• Therefore they will hire more people
• BUT they will start losing money!

Okay, I don’t have it figured out. Maybe you do. Let me know. askpete@petetheplanner.com

Pete the Planner®

Peter Dunn a.k.a. Pete the Planner® is an award-winning financial mind and a former comedian. He’s a USA TODAY columnist, author of ten books, and is the host of the popular radio show and podcast, The Pete the Planner Show. Pete is considered one of the foremost experts on financial wellness in the world, but he’s just as likely to talk your ear off about bass fishing.