Companies push back on Biden’s effort to eliminate junk fees

  • FTC: Junk fees have cost Americans tens of billions in unexpected costs
  • Biden's mission: Ban junk fees, require companies to show full cost upfront
  • Lobbying groups: Limit on fees could decrease customer rewards

(NewsNation) — President Joe Biden is on a mission to get rid of junk fees — those surprise charges seen when purchasing concert tickets or hotel rooms. The hidden fees have nothing to do with taxes and are often unexplained.

However, some have argued it’s important to keep those fees, pushing back against the president’s mission.

Junk fees have cost Americans tens of billions of dollars in unexpected costs each year, according to the Federal Trade Commission.

Some companies are concerned having upfront pricing will impact their bottom line, too.

Biden has vowed to get rid of these hidden fees that he calls “unfair and deceptive.”

The FTC proposed a new rule, banning them and requiring companies to show the full price upfront.

According to the Washington Post’s review of lobbying records and of filings submitted to government agencies, the companies most impacted have taken their concerns to Washington, D.C., and are working to keep the fees in place.

Some have even claimed that customers could be negatively impacted if they’re removed.

Lobbying groups for credit card companies said a limit on late fees could decrease rewards offered to customers, the Washington Post reported.

Airline lobbyists said it could cause “confusion” and that baggage fees and other charges have “very few complaints.”

Cable company representatives insist the government doesn’t have the authority to do this and warned of a possible lawsuit.

“People that work for the industry, obviously, they’ll want to maintain this system of hiding or kind of concealing the true cost from consumers. It’s natural to expect that they’re going to fight anything that would kind of increase transparency for prices,” Patrick Gourley, an associate professor of economics at the University of New Haven, said.

The president has requested Congress pass a bill that would set rules for how companies can add extra fees.

States like California aren’t waiting for the federal government. Gov. Gavin Newsom signed a bill last month that would ban junk fees.

Some companies, like Ticketmaster, have already started showing upfront pricing so consumers know the full price of the ticket when they go to buy it.

Biden has requested Congress pass a bill that would set rules for how companies can add extra fees.

NewsNation reached out to several companies supporting the fees, as well as government agencies working to implement the ban, but has not yet received a response.


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