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Comment by mikeash | Hacker News Reader

The regulation says that airlines must offer at least this amount before they start involuntarily removing people. Airlines are free to offer more, they just can't stop at a lower amount.

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Right.. but far back up, the poster (not the one I replied to, which is just agreeing) stated that regulations got us into the mess by allowing a cap of ~$1300. But regulations don't stop the airlines from offering higher, and neither does the non-existence of regulations stop airlines from independently capping at ~$1300.

So back to the point, how is it correct that regulations got us into this mess of ~$1300 capping?

I guess it depends on what you consider to be the "natural" regulation-free state of things.

Without this regulation, would airlines be able to bump people involuntarily with no compensation at all? If so, then the regulation is a clear improvement.

Or would airlines be unable to bump people involuntarily without this regulation, being required to offer potentially unlimited compensation? If this was the case, then the regulation gets a huge share of the blame for this.

I'd think it would me more like the second one here, but I could be wrong.

If offering potentially unlimited compensation would increase profits for airlines, then they would do it regardless of regulation of minimums wouldn't they? I make that assumption because Delta seems to be testing that theory right now. So I still don't see how regulations are impeding anything; doesn't seem to be stopping Delta whatsoever.

It looks like this will result in a big loss to United, but this is an unusual case. Many people have been involuntarily bumped before. They lose out, but the airline wins. It's basically a form of theft. The purpose of regulation wouldn't be to force the airlines to make more money (since, as you point out, they'll try to do this on their own), but to protect their customers in a situation with a huge imbalance of power.

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