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California AG and state senators introduce bill to ban hidden fees

oag.ca.gov

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Re: California AG and state senators introduce bill to ban hidden fees

#221

Post by jmyeet »

Airfares are another big culprit for this. When oil was at a high price, airlines started charging "fuel surcharges". There's no such thing. That service simply costs more. I think they also did it to (further) erode awards redemptions because they still had to pay any additional fees.

Uber famously did this with a safety fee when there was a string of negative news reports. What did this fee do? Literally nothing. They just pocketed it.

Airbnb is an obvious one of course.

Whenever I see anything like lack of transparent pricing and the necessary for such legislation, I have to chuckle at the expense of anarchists and libertarians because a strong government is necessary for any market to function. How are there any anarchists or libertarians at all?

Re: California AG and state senators introduce bill to ban hidden fees

#222

Post by yamtaddle »

wpietri wrote: post #161
tomschlick wrote: post #109

Earlier quoted context omitted.

It has way less to do with any "awareness campaign" and more to do with how tax rates are different in many municipalities that are very close to each other and how hard that makes advertising. For instance, the famous "$5 footlong" from Subway couldn't be advertised that way nationally, or even within a single state or metro area due to different taxes on prepared food.

I'm pretty skeptical there. Do you have any evidence that was a big motivation? I'll note that the costs of labor, space, and other inputs also can vary widely across a state, so tax differences don't strike me as unsolvable. And regardless, "prices and participation may vary" is an extremely common disclaimer for ads with prices.

Subway national ads & coupons (among other practices) in particular are notorious for immiserating or ruining their own franchisees. My nearest one keeps a sheet with the list of the ones they'll actually honor.

I wanna say Little Caesars had kind of a similar situation. I think they actually had a fight at one point with their franchisees over their too-static-to-be-realistic very-low prices.

In practice, these national campaigns seem to kinda be a bad thing, anyway—either abusing franchisees who can't evade them, or else not actually being offered universally (which is pretty damn close to false advertising, "participating locations" fine-print being more a bullshit dodge than something intended to truly communicate the truth of the offer).

Re: California AG and state senators introduce bill to ban hidden fees

#223

Post by II2II »

stillsleepy wrote: post #154
xbar wrote: post #150

Earlier quoted context omitted.

Agreed. It seems that the A/B testing proves that humans are easily tricked, not that they like hidden fees.

[flagged]

In my neck of the woods, it is called public health care or public health insurance. Oddly enough, neither the government nor the media feel compelled to make it sound like you're getting extra value by calling it free. Of course, this applies to a broad range of public services such as education and libraries. (As for why these services should be offered at no cost to the users, it has to do with accessibility to people regardless of their income. No one pretends that no cost to users means that it is free. Everyone understands that it is wrapped into their taxes and that taxes are tied to their income.)

Re: California AG and state senators introduce bill to ban hidden fees

#224

Post by bcrosby95 »

hn_throwaway_99 wrote: post #82

I think a lot of comments here are missing the reason as to why these hidden fees have become so much more prevalent in the past 20 or so years. The short of it is that comparison pricing is now much easier to do because of the Internet, and many, if not a majority, of shoppers will just sort by price ascending and pick the first result (or, only pick from the first couple results). Thus, there is a huge incentive fo…

Basically, bait and switch is an effective tactic, especially after factoring in the sunk cost fallacy.

Re: California AG and state senators introduce bill to ban hidden fees

#226

Post by criddell »

adolph wrote: post #116

Are hidden fees like the fuel taxes that get bundled into the stated price, or like sales taxes that are calculated at purchase time?

No.

Hidden fees are for items that are broken out from the sales price and they aren’t optional. A good example used earlier in this thread is hotel resort fees. Even if you don’t use any of the amenities that the charge is for, you are still charged that fee and it isn’t part of the advertised price.

Re: California AG and state senators introduce bill to ban hidden fees

#227

Post by megaman821 »

themitigating wrote: post #206
megaman821 wrote: post #78

Earlier quoted context omitted.

Regulation isn't a singular thing. People want more good regulations and less bad regulations. Even when good regulations exist, people want competent enforcement of the regulations. California passes a lot regulations, so there is a lot of red meat for either side of the regulations good/bad arguments.

Republicans say they don't want more legislation, not "bad" legislation. Also good and bad are subjective

You can't think of a single thing that Republicans want to legislate?

Of course good and bad are subjective. That is the whole point, the concept of regulations can't be generally put into a good or bad basket. No one is advocating for absolutely no regulations. You are arguing against a straw man that you made up.

Re: California AG and state senators introduce bill to ban hidden fees

#228

Post by yamtaddle »

lotsofpulp wrote: post #210
yamtaddle wrote: post #124

Earlier quoted context omitted.

Nb. health insurance profit margins are now capped, in the US.

At 15% to 20%. So smaller profit margins indicate downward pressure on pricing from competitors.

Well, in point of fact, the limit is actually a mandate on how much they must spend on medical care. Their own operating expenses, salaries, advertising, et c., have to come out after that. So they could theoretically make 15% under that limit—except in practice that's actually impossible. Which means margins aren't necessarily 5% because of competition.

[EDIT] That is, I'm skeptical that if one removed that limit, competition would keep margins where they are. Forcing all profit to come out of 15% of revenue probably does play a major role in keeping the actual margin as low as it is.

Re: California AG and state senators introduce bill to ban hidden fees

#229

Post by nostromo »

hn_throwaway_99 wrote: post #82

I think a lot of comments here are missing the reason as to why these hidden fees have become so much more prevalent in the past 20 or so years. The short of it is that comparison pricing is now much easier to do because of the Internet, and many, if not a majority, of shoppers will just sort by price ascending and pick the first result (or, only pick from the first couple results). Thus, there is a huge incentive fo…

> airlines where the base price is akin to "we let you hang on to the wing", and everything else is an upcharge

This legislation wouldn't stop that, nor resort fees, because they're not required.

It would however effect Airbnb, one of the worst offenders, because their fees are mandatory and not shown until checkout.

It's funny the government has exempted its own taxes and fees (the largest last minute fees we all pay everyday) from this requirement.

Re: California AG and state senators introduce bill to ban hidden fees

#230

Post by californical »

hn_throwaway_99 wrote: post #212
slg wrote: post #100

Earlier quoted context omitted.

>This is also a case where consumers say they want one thing, but their behavior is a different matter. For example, pretty much everyone says they prefer the full price to be shown up front in search result pages. But, as someone who is privy to a ton of A/B testing in this area, the opposite nearly always results in higher conversion, where there is a lower up-front price and fees are only tacked on during checkout…

I don't think fraud is a good analogy - the whole point with fraud is that you are getting something different after you agreed to it, when it's too late to back out. Going back to the airline example, most people say they hate getting nickel and dimed on things like paying to pick a seat up front or paying even for the first carry-on, but they will still pick one flight over another if the base rate is $5 cheaper. A…

I know I’m not an outlier, but this is why I’ve historically stuck with Delta as an airline. They’re not perfect either, but they give you the main things you’d need for a flight in the base price, and are generally pretty flexible and reasonable with things like bag size.

Unless they’re way more expensive, I’ll still pick them for a slightly higher price over the others, because I know that I’ll get a good experience and it’ll be way less stressful. They also always have staff available in the airport when things go wrong.

Frontier has been doing this thing where they make everyone put their backpack into the little measuring box so they have a chance to charge you $100 for being an inch oversized. They haven’t gotten me on that personally, but I’ve sworn off of flying with them entirely because it’s like they want you to suffer. I have 40 other complaints about them but I’ll save it for now

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