Canadians need to grow a consumer backbone: Neil Macdonald
We just smile and pay more for milk, airfare, cellphones — believing it somehow makes us more virtuous
So, United Airlines, after three weeks of groveling and apologizing for that terrifying police-state video on one of its flights a few weeks ago, is doing the sensible thing.
Instead of calling in police goons to brutalize seated passengers and drag them off overbooked flights, United will from now on offer up to $10,000 US to passengers who volunteer to take a later flight. A United spokeswoman quickly returned my call to confirm that.
But then, that's the way the American market works.
Any U.S. company facing a blast-wave of consumer anger, and, in United's case, watching its stock price wither, does what it has to do, knowing that customers can easily choose the competition.
Flight crews in the United States acknowledge that a thousand times a day upon landing: "Thanks for choosing us, we know you have a choice, and we appreciate your business," or something to that effect.
Ever hear that on Air Canada? I haven't.
Flying in Canada
Currently, Air Canada pays a bumped passenger a maximum of $800 Canadian. And that's only recently; it used to be a lot less. An Air Canada spokesperson, communicating by email (the company no longer publishes a phone directory), wrote: "We are of course well aware of recent events in the U.S. and have reviewed our own policies. We have no further comment at this time."
If you are bumped off a U.S. flight, the airline must tell you why, and how you were chosen to be bumped. If you are bumped on Air Canada, "generally agents will do their best to explain the circumstances, but each situation is unique."
The airline recently confirmed seats for three members of a P.E.I. family flying off on holiday, but bumped their 10-year-old son. No explanation offered, said the father.
The family then drove frantically all over the Maritimes, first to Moncton airport, where it was told the flight from there was regrettably cancelled, and then to Halifax.
- P.E.I. family's 10-year-old son bumped from overbooked Air Canada flight
If passengers want to complain about treatment like this — which the P.E.I. family tried repeatedly to do — they can either fill in an online form, or spend forever on hold waiting for an Air Canada agent to tell them to fill in an online form.
And we all know why things are so different for passengers in Canada. Air Canada crews should announce it on landing: "You should feel lucky to fly with us. We know you don't have any real choice, and we take your business for granted."
It's all part of the Canadian birthright.
From big fat banking fees to astronomical telecommunications prices to much more expensive mortgage terms than Americans enjoy, Canadians just smile and pay up, believing it somehow makes us more virtuous.
"It's just our fatalistic screw-me-over mentality," says Garth Turner, a former member of Parliament who now works as an investment adviser and writes a tart blog about the housing market.
He points out that Canadians think it's normal to pay grossly inflated prices, dictated by supply management boards, for milk and cheese and poultry (and we even get upset when President Donald Trump calls it unfair).
It can cost far more to fly from Toronto to Halifax than from New York to Los Angeles, or even from New York to Europe. Many Canadians accept that as the price of being Canadian.
Americans can order just about anything online, including wine, from anywhere, without penalty or obstruction. Shipments from abroad aren't taxed unless they exceed $800 US.
In Canada, wine is mostly sold at tax-vacuuming government monopolies, and border agents start tacking taxes and duties onto any shipment from abroad worth more than $20 Canadian.
Clogging the border
One peer-reviewed study last year concluded the federal government spends $166 million a year at the border to collect $39 million in taxes and duties. Which of course means the whole point is to clog up the border and discourage Canadians from e-shopping abroad.
We also pay much higher taxes, largely in exchange for a cherished public health system that treats us like children, and, in some regions, is hopelessly broken. Meanwhile, unlike the rest of the world, we aren't allowed to spend whatever money we have left on private surgery. Because that would be unfair.
In some of our cities, housing prices have crossed into lunacy. Yet we seem to think that what happened in America won't ever happen here: "We're different," we tell one another.
Garth Turner marvels at the gullibility of buyers in southern Ontario and on the West Coast, where people take on just about any debt necessary to jump in, willingly participating in bidding wars, effectively competing to pay the highest price possible: "$1.6 million for the average detached piece of crap."
Turner says buyers are taking out high-interest, subprime loans just to obtain a down payment.
Consumer indebtedness per capita in Canada long ago passed the nosebleed levels where Americans were in 2008, just before the market there collapsed. (Prices in Canada kept marching upward relentlessly).
Turner suggests people "should just stop buying," and see what happens. Markets are a matter of buyer psychology, driven by greed and stopped by fear; if people just stopped playing the game, the bidding wars would vanish pretty quickly.
Actually, what Canadians need is a real consumer movement, led by smart individuals able to fight for ordinary punters, speaking on their behalf to business and government.
It would be interesting to see what a few carefully orchestrated boycotts would do to cellphone rates, or book prices, or bank fees, or smug airline overbooking policies.
Rather than yelling at one another, political leaders campaigning for re-election could deal with a panel of educated advocates reflecting the will of consumers.
But Canada's political and business class needn't worry; that would require consumers to have a will in the first place.
"We are a population of sheeple," says Turner.
Actually, that's unfair to sheep. Sheep have no choice.