Will Removing Regulations Hurt Business in the Long Run?

Last week, the FCC voted 3-2 to repeal net neutrality. Net neutrality was the regulation that ensured internet websites and services were treated equally by internet service providers. Internet broadband providers are insisting they will not do anything to harm the overall user experience for internet customers and those in favor of the repeal, including the large telecommunications companies, felt it was an unnecessary and overly burdensome regulation that discouraged investment in broadband networks.

In a completely separate move, the Department of Transportation removed two regulatory proposals as part of the Trump Administration’s efforts to reduce regulations and promote business. The first proposal from 2011 proposed to collect detailed information about airline fees on 19 services including priority check-in, baggage, in-flight entertainment, food and seat assignments. The January proposal from this year would have required airlines and ticket agents to disclose upfront all fees for the first and second checked bags, and for carry-on bags adjacent to the fare.

The reasoning behind both of these decisions was removing regulations will reduce costs and encourage business growth. But, what if it doesn’t? What if, instead, the unintended consequences of these decisions hurt a broad array of businesses in the long run – particularly small businesses? How will this affect a company’s ability to optimize their travel expenditures to drive future economic growth?

Our concern is that these unintended consequences will not benefit the business travel industry. Changes in net neutrality could potentially lead to restricted access for certain travel sites or steeper barriers to entry for travel start-ups.

Lack of transparency in airline fees has a much more immediate direct impact on the industry. The benefit of transparent fees and knowing the full cost of an airline ticket upfront is a no-brainer for business and consumer travelers alike. When it comes to the business of travel, lack of information can prevent third-party sellers from being able to provide their clients with the full cost of airfare – a lose-lose situation for ticketing agencies, travel managers and the companies that foot the bill for business travel.

Why should the Administration consider the business travel impact when making these decisions? Because business travel drives lasting business growth. Business travel is a major economic driver, with every 1 percent change in business travel spending resulting in the U.S. economy gaining or losing 74,000 jobs, $5.5 billion in GDP, $3.3 billion in wages and $1.3 billion in taxes.

GBTA will closely monitor the impact of these decisions over time, and will work with the Administration to encourage pro-business travel policies for the good of our entire economy.