Here are the latest examples of airline gouging. ---------------------------------------------------------------------- This article was sent to you by someone who found it on SF Gate. The original article can be found on SFGate.com here: http://www.sfgate.com/cgi-bin/article.cgi?file=3D/chronicle/archive/2003/04= /06/TR273401.DTL ---------------------------------------------------------------------- Sunday, April 6, 2003 (SF Chronicle) Ominous change in credit card charges, frequent-flier program Ed Perkins War has brought some unprecedented bargains for people who are planning = to go on with their travel plans. But don't let that lull you into thinking you don't need to keep a lookout for potential gouges and anti- consumer actions. Right now, I see two key changes looming that have not yet reached our shores. Credit card surcharges. According to trade reports, Qantas has just made= a deal with banks in Australia that allow it to add a 1 percent surcharge for all credit card purchases. The extra money is going to Qantas, not the banks. Although you might think 1 percent is a paltry sum, the Qantas deal represents a breakthrough of the worst sort -- and could well lead to ever-increasing surcharges and extras. For as long as I can remember, a bedrock policy among all charge cards h= as been "no surcharge over the posted retail price." Consumers have paid no penalty for the convenience of using charge cards. The costs of operating the charge card system have been covered by merchant fees, cardholder annual fees and high interest charges on unpaid balances. As best I can tell, that bedrock principle originated with the card issuers, who insisted on a no-surcharge policy as an incentive for consumers to use cards. As a result, no-surcharge clauses have been routinely included in mercha= nt agreements. A few retailers (including some discount travel agencies) have evaded those restrictions by offering a "discount" of 3 percent to 5 percent for cash, but for the most part the principle has been honored. That's why the Qantas deal is disturbing: It represents a major breakdown of the no-surcharge principle. I'm sure Qantas sold the idea to local banks as a way to glean a few extra dollars in today's terrible airline marketplace. But to me, a charge card surcharge is, in effect, a fare increase and should be identified as such. After all, most airlines give their best prices through their Internet sites, and the only way to buy a ticket online is with a charge card. So far, I know of no U.S. line that has adopted a similar policy. But given the airlines' dreadful financial plight, I'm sure the big U.S. carriers are looking closely at the idea. Frequent-flier devaluation. British Airways just announced a severe devaluation of its frequent-flier program. Starting July 1, when you fly on an inexpensive economy excursion ticket (the kind you and I buy), you'll no longer earn the usual mile of credit for each mile flown. Instead, in BA's "improved" program, you'll earn just one-fourth of a mile of credit for each mile flown. A round trip from New York to London, which used to earn about 6, 600 miles, will now earn a paltry 1,650 miles. As far as British Airways is concerned, the upshot is simple: If you earn credit mainly by flying, switch to some other airline. However, if you earn most of your credit through a BA credit card, you can stick with it: BA did not devalue its award schedule -- at least not yet. I'd guess that comparatively few readers fly primarily on BA, so this ne= ws might not mean much to you immediately. The worry, of course, is that the big U.S. airlines will decide to follow BA's example and set off a complete round of frequent-flier devaluations. If the U.S. airlines decide to gouge you -- either with a charge card surcharge or a frequent-flier devaluation -- there isn't much you as an individual consumer can do about it. At best, you can vote with your feet and your money by switching to an airline that decided not to gouge you -- if you can find one. E-mail Ed Perkins at eperkins@xxxxxxxxx=20 ---------------------------------------------------------------------- Copyright 2003 SF Chronicle