Junk Fees, Junk Promises, Junk Politics

Rather than focus on small potatoes, Biden should confront the elephant in the room

In his State of the Union address, President Joe Biden asked Congress to pass a bill banning so-called “junk fees” so that the government can end “deceptive pricing.” It was a good political choice for the president, whose administration has overseen record inflation that’s forcing everyday Americans to pay 20 percent more on groceries, 60 percent more on gas, and 25 percent more on airfare.

But good politics doesn’t make for good policy. So-called junk fees are small dollars compared to the price increases Biden has caused. And those junk fees for booking a room, buying a ticket, or paying your bills? They often come from the government in the first place!

Take a hotel bill. Way down at the bottom, before the total, you’ve probably seen something like a “transient occupancy tax.” This add-on comes from local and state governments or area tourism development administrations—not a fee that goes to the corporate hotel brand or the individual proprietor. According to the American Hotel and Lodging association, these taxes generate nearly $50 billion in revenues across the country.

And if you think that’s bad, don’t try renting a car anytime soon. In Colorado, there’s a daily fee of $2.13 on every car rental (the state government is currently trying to increase it by as much as $3) and that’s on top of a 7.25 percent sales tax on car rentals in Denver. Then, if you’re renting at the Denver airport, you’ll get hit with a “concession recovery fee” for the airport authority and “energy recovery fee.” When it’s all said and done, the government-mandated “junk fees” could add an additional $400 to an 8-day rental.

Now, all levels of government need revenue to pay for the essential services like roads and police. But time and time again, local governments aren’t using these fees to balance the budget—they’re diverting funds to their pet projects.

In San Luis Obispo, California, the city government is earmarking part of the tourism tax from hotel bills for planting trees as part of a Climate Action Plan to achieve carbon neutrality. Not to be outdone, Maricopa County, Arizona has used its $2.50 daily car rental fee to fund sports stadiums for billionaire-owned football teams.

I’d prefer car renters keep that money instead of sending it to corporate welfare.

And government “junk fees” scam isn’t limited to a few rogue states and municipalities. The federal government plays this shell game, too. Every time you buy an airplane ticket, you’re paying a 7.5 percent federal excise tax. Then, at the bottom of your receipt you’ll see a $5.60 “9/11 Security Fee” tacked on for each leg of your trip. This was supposed to fund the post-September 2001 enhanced security measures implemented by the Transportation Security Administration. But—shocker—Congress has diverted at least $13 billion from these fees to “deficit reduction” and other federal programs.

Pay attention to your cell phone bill next month. It includes a Federal Universal Service Fee of 10.8 percent. Do you have cable television at home? Then you’ve probably seen the FCC Administration Fee added to your monthly bill. And don’t forget the federal taxes already baked into the price you’re paying whenever you make a retail purchase, like the gas tax and corporate income tax.

Now, if Biden came out with a plan to eliminate government “junk fees” and simplify the tax code, that would be a great idea and it would actually help the Average Joes across America. But, instead, Big Joe wants you to blame businesses instead of understanding that—once again—government is making the food too expensive to end up on your table.

Paul Revere is the pseudonym of a conservative writer.