'I Didn't Change My Opinion on Pete Buttigieg; He Changed His Position Regarding Me.'
The former McKinsey consultant faced criticism for his close ties to corporations, but he later took on the role of Transportation Secretary.
TroibNews 
During the winter holidays of 2022, a severe blizzard wreaked havoc across much of the western United States, resulting in Buffalo receiving an astounding 56 inches of snow. The storm also led to the closure of a 200-mile stretch of Interstate 90 and triggered a significant crisis at Southwest Airlines. The airline canceled nearly 17,000 flights, impacting approximately 2 million passengers. Many of those affected found themselves stranded far from home, missing important commitments such as work and weddings, and faced with the dilemma of either paying hundreds of dollars for hotel accommodations or sleeping on airport floors using duffel bags as makeshift pillows.
This was not an isolated incident. The previous summer, after a spike in travel post-Covid, was labeled the “summer of hell.” Despite receiving $54 billion in federal aid during the pandemic, airlines struggled with operational challenges. Customers often received only partial refunds and vouchers with expiration dates. Frustrated passengers began to look for someone to hold accountable, and many pointed fingers at Pete Buttigieg, who was nearing two years as Secretary of Transportation.
By the time the Southwest crisis hit in December, Buttigieg was under intense scrutiny. The legal director of Open Markets, a notable economic populist organization, stated that “The Secretary of Transportation has consumer protection and antitrust powers to stop and remedy the airlines’ misconduct and negligence. Buttigieg appears uninterested in using them.” Activist Cory Doctorow also criticized Buttigieg in a piece titled “The Learned Helplessness of Pete Buttigieg,” while a Verge editor suggested that Buttigieg’s management of the airlines weakened his presidential prospects: “his opponents would wreck him on this issue alone.” In January 2023, a New York Times headline read, “Air Travel Debacles Put a Star of Biden’s Cabinet in the Hot Seat.”
Buttigieg made appearances on various news networks—from Fox to PBS to MSNBC—denouncing the airline's actions as “unacceptable.” However, some critics interpreted his stance as suggesting that the $17 billion airline was beyond government reach.
Reflecting on the chaos surrounding Southwest today, Buttigieg, now 42, noted, “It sent me into orbit,” adding that the experience solidified his resolve to tackle the issues facing the aviation sector. He committed to leveraging the authority of his office to facilitate change.
In the months following, Buttigieg made a series of decisions as Secretary of Transportation—prompted by administration antitrust advocates and allies calling for reforms in the airline industry—that resulted in former critics reassessing his position. No longer did they view him as overly cautious or aligned with corporate interests; some stated that Buttigieg had emerged as a crucial ally in the movement to rein in industries that had become excessively powerful.
Bill McGee, an advocate with an antitrust group and former flight-operations specialist, spent much of that tumultuous year criticizing Buttigieg’s inaction on social media and in public forums. “Buttigieg was allowing them,” he said of the airlines, “to just day after day, week after week, for months and months, screw over passengers.” However, McGee feels that things have shifted. “I didn’t have an about-face on Pete Buttigieg. Pete Buttigieg did an about-face on me.”
When Buttigieg took office as Transportation Secretary at the age of 38, he inherited a massive bureaucracy with a budget of $144 billion and 57,000 employees, but it was also a political backwater. Whereas past secretaries transitioned to corporate or lobbying careers, Buttigieg’s national visibility—and rumored presidential ambitions—placed him under constant scrutiny. His early tenure included missteps, notably his slow public response to the toxic train derailment in East Palestine, Ohio. However, he was present at the collapse of Baltimore's Francis Scott Key Bridge in March 2024.
But arguably, nothing will define his term more than the crisis in American air travel and how he chose to respond.
High-profile economic populists in President Joe Biden’s administration, like Federal Trade Commission Chair Lina Khan and Department of Justice antitrust chief Jonathan Kanter, may garner more headlines for their efforts at reshaping American industry. Still, Buttigieg may be undertaking similarly radical initiatives. He has moved past merely punishing bad actors, using his executive authority to restructure the airline market he oversees.
The lasting impact of Buttigieg's changes remains uncertain. Regulatory adjustments he has initiated “could be a smashing success, or could get caught up in the machinery,” says Diana Moss of the Progressive Policy Institute. Some new regulations are currently stalled in court, while others won’t be fully implemented until the next presidential administration—pending resources and commitment from agency staff. The airlines continue to merge, and the commercial aviation landscape is just one aspect of his expansive portfolio.
Surprisingly, Buttigieg has emerged as a valuable ally for the Democratic left advocating for antimonopoly policies, a faction now striving to maintain its foothold in a post-Biden political landscape that once viewed him as an opponent.
In late July, I interviewed Buttigieg in his office on the 9th floor of the Department of Transportation's expansive building in Washington, where he wore a crisp white shirt and cobalt blue tie. It was the first of two discussions aimed at understanding his seemingly evolving perspective on aviation regulation. I engaged with numerous antitrust activists, consumer advocates, DOT officials, and insiders to gain broader insights.
Despite some attributing his evolution to a significant ideological shift, Buttigieg describes his approach to airline issues as consistent with his pragmatic problem-solving style: “Often what I find is, you take a very pragmatic approach,” he reflected, “and that might lead you to a bold place.”
When Joe Biden assumed office, he carried a belief that the American tech sector had become dangerously overconfident, selecting aggressive antitrust advocates like Khan and Kanter to reinforce this vision within his administration. These officials embodied a leftist approach that had gained momentum since the 2008 financial crisis, emphasizing the need to check powerful corporate interests.
Although Buttigieg was not initially considered one of the key antitrust thinkers in Biden's inner circle, Tim Wu recognized his potential for recruitment. During the administration's early days, Wu circulated a memo called “The Grand Unified Theory of Antitrust Revival,” which critiqued reliance on traditional antitrust enforcers, arguing the need for a more robust approach through executive agencies. The memo indicated that federal agencies with significant oversight should leverage their existing competition enforcement powers.
In July 2021, seven months into Biden's term, the president issued a sweeping executive order promoting competition across various sectors, tasking the entire government with revitalizing competition. The directive also established a White House Competition Council, which included Buttigieg among its members. The council convened for its inaugural meeting in September 2021.
In Wu’s view, Buttigieg was an ideal candidate for action within this framework: "He was smart, ambitious, and atop an agency with grossly under-utilized competition powers."
Bharat Ramamurti, former deputy director of the Biden White House economic council, recognized Buttigieg’s oversight of air travel and noted, "There’s only a small handful of competitors. On a lot of routes, it’s really one airline. There’s real problems that need to be addressed."
Deregulation of airlines in the 1970s led to significant consolidation, creating the "Big Four": Southwest, Delta, American, and United. While the industry claimed that consolidation enhanced service options and reduced prices, critics argued it surrendering customer interests. This dynamic was exacerbated by the Covid recovery period, which revealed numerous service inadequacies; complaints exceeded 102,000 in the pandemic's first year.
The White House’s economic-policy staff weren’t the only ones attentive to Buttigieg’s role. Senior FTC officials consulted with him on consumer protection issues and the extensive authority granted to the Department of Transportation. Consumer advocates also pressed their case, urging Buttigieg to assume a leadership role as the foremost defender of airline passengers.
In discussions with members of the National Economic Council and later formal meetings of the Competition Council, Buttigieg displayed an interest in adopting a more vigorous approach to competition within his department. At one point, Wu recalled being surprised when Buttigieg reached out to discuss the potential for using his authority more effectively. However, Wu noted that the first year was "kind of dismaying," referring to Buttigieg’s perceived hesitance in addressing industry challenges.
Buttigieg had numerous responsibilities, including overseeing the implementation of the $1.2 trillion Bipartisan Infrastructure Law that Biden signed in November 2021. Critics also pointed to the weakened regulatory authority he inherited from the previous administration.
Ultimately, the pressure escalated during the tumultuous summer of 2022. Buttigieg began pushing airlines for assurances regarding their operational capacity and adaptability. However, when cancellations surged, he faced mounting public criticism and dissatisfaction from own party members. In a letter, Representative Ro Khanna urged Buttigieg to act with more “urgency, imagination, and boldness” to rein in the airline industry.
As Labor Day approached, Buttigieg's team developed user-friendly online dashboards that tracked airline performance on various criteria, making it easy for passengers to compare service quality. These dashboards were launched on a federal site called FlightRights.gov, receiving acclaim from consumer advocates. However, the airlines primarily viewed it as unfavorable.
In December 2022, when Southwest Airlines faced its debacle, the publicly available performance metrics provided a means to hold the airline accountable. Yet, Buttigieg expressed his frustration with the situation, saying, “When you’re doing a half-dozen interviews about what’s going on with a private company, at a certain point you ask yourself, ‘Why isn’t this company on television twice as much as I am?’”
During meetings following the crisis, Buttigieg's team realized that airlines could benefit financially from extended holds on passenger funds while facing minor penalties. The historical fines had been comparatively insignificant, often in the millions. Buttigieg proposed increasing the penalties: “What if we add a zero?” he recalled thinking. Southwest would ultimately agree to a historic $140 million penalty in December 2023, marking the largest fine in DOT's history by a factor of thirty.
However, Buttigieg recognized that enforcement had limitations; his department was equipped with only about 30 enforcement personnel and had been tracking complaints manually. He concluded that robust enforcement alone wouldn’t alter airlines’ behavior, leading to a recognition that “chasing symptoms” wouldn’t resolve systemic issues.
Around this time, Buttigieg began seeking fresh ideas and perspectives from economists and policy thinkers. He established the role of chief competition officer at DOT, appointing Jen Howard—an influential figure in the antitrust movement who had previously worked as Khan’s chief of staff.
Buttigieg also consulted with Ganesh Sitaraman, a law professor at Vanderbilt and an expert in competition policy. From Sitaraman's work, Buttigieg developed a more unified vision, realizing that industries like aviation cannot be left entirely uncontrolled: “These are economic scenarios where power comes into play. History matters a lot. And government matters a lot.”
With this understanding, Buttigieg tackled the urgent issue of airline refund policies. He had suspected that airlines engaged in what is termed unrealistic scheduling—selling seats on flights they realistically couldn’t staff or operate. He believed that this practice allowed airlines to keep customer funds even after cancellations.
Buttigieg was adamant that refunds should be automatic and issued promptly in the original form of payment. This approach would not only streamline enforcement but also empower customers to shift their business to competitors in the event of poor service. “If an airline knows that everybody on the plane is going to get their money back,” he stated, “that changes the whole economics of even considering a schedule you can’t really support.”
He worked on creating a binding, enforceable rule for automatic refunds on significantly delayed flights, which was officially implemented in late April 2023. Additionally, he targeted ancillary fees that airlines charged for various services, which Buttigieg argued obscured true costs for passengers and complicated price comparisons. He mandated transparency around these fees in conjunction with the refund rule.
Following the introduction of these regulations, airlines challenged Buttigieg's authority, filing lawsuits against the new rules. They contended that Buttigieg was overstepping his jurisdiction. A judge in the conservative-leaning 5th Circuit Court of Appeals temporarily suspended the rule, stating that Congress had not explicitly conferred the authority for such regulatory actions regarding airline fees.
As legal proceedings progress and with recent changes affecting agencies' regulatory powers, Buttigieg's approach faces potential hurdles. However, those who have worked alongside him recognize his capabilities in policy-making and political strategy.
In February 2022, Sen. Elizabeth Warren publicly criticized Buttigieg for not using his authority to prevent anti-competitive airline mergers. Yet in March 2023, Buttigieg opposed the JetBlue-Spirit merger, a bold decision that contradicted previous norms for Transportation secretaries. This was lauded by industry observers, and in May 2023, he even delivered the keynote address at an “anti-monopoly” summit hosted by McGee's group, the American Economic Liberties Project. Buttigieg openly acknowledged the shift in his approach to airline regulation.
Leveraging his visibility, Buttigieg has actively engaged in public discourse on regulatory matters. When Congress was reviewing the FAA funding, Buttigieg worked to ensure that automatic refunds remained a part of the legislation. His advocacy drew the attention of the White House, which supported him in the effort.
“I eat my hat on Buttigieg, who I thought of as a McKinsey operator,” remarked Zephyr Teachout, a notable law professor, praising his performance. The push towards automatic refunds attracted bipartisan support and, with Buttigieg’s involvement, the FAA bill was successfully passed with those provisions included.
Buttigieg's initiatives are generating mixed responses. Some industry leaders are beginning to criticize what they characterize as regulatory overreach, while others see his actions as revolutionary. Diana Moss of the Progressive Policy Institute argues the department could utilize its substantial authority more effectively to foster fair competition and suggests that it hasn't fully explored its capacity for enforcing regulations.
As Buttigieg's political future remains unclear, he is being considered for various roles, from governor of Michigan to a potential ambassadorship in a future Harris administration. His assertive approach to aviation regulation may alleviate some political burdens and enhance his career prospects, but the path ahead is unpredictable.
Despite criticism from airlines over his strategies, Buttigieg has garnered support from influential figures, including longtime opponents who have begun recognizing progress under his leadership. Warren, for example, praised Buttigieg’s accountability measures as significant steps toward protecting consumer rights.
Wu acknowledged that the Department of Transportation under Buttigieg is not receiving adequate recognition for its accomplishments in competition enforcement, remarking that it "took two years to get there." This evolution in Buttigieg’s approach marks a substantial pivot, signaling potential shifts within the Democratic Party regarding the regulation of concentrated corporate interests.As Buttigieg navigates the complexities of his role as Transportation Secretary, the airline industry's response to his regulatory efforts will be crucial in shaping both his legacy and the future of U.S. aviation policy. While he has made strides in advocating for consumer rights and enforcing accountability against airlines, his tenure is also marked by the challenge of striking a balance between regulatory oversight and industry cooperation.
The airline industry, traditionally resistant to external scrutiny, has been put on notice. Critics argue that Buttigieg's proactive stance represents a necessary shift in a sector long dominated by a few powerful players. However, the industry's pushback reflects the inherent tension between corporate interests and governmental oversight. As noted by Airlines for America's statement, “Secretary Buttigieg is a gifted communicator who has elevated the Department of Transportation’s platform in the public eye,” but there are signs that the industry perceives him as an adversary rather than a collaborative regulator.
Moreover, Buttigieg's actions have triggered broader dialogues about consumer protection across multiple sectors, echoing the sentiments of the growing antimonopoly movement within the Democratic Party. His administration is now seen as part of a larger framework working to combat corporate concentration, aligning with the broader goals set by President Biden.
As Buttigieg continues to refine his approach, he faces a dual challenge: managing the expectations of progressives who demand aggressive oversight while simultaneously cultivating goodwill among industry stakeholders who fear the implications of stringent regulations. The imminent legal battles concerning his proposed rules will further test his resolve and policy direction.
Looking forward, Buttigieg is likely to encounter increasing scrutiny of his decisions as new developments arise in the aviation sector. Consumer advocates will closely monitor the implementation of refund policies and transparency regulations, while industry leaders will be vigilant in their efforts to curtail what they see as overreach. The ongoing tension could dictate the pace of reforms and Buttigieg’s effectiveness as a regulator.
Additionally, Buttigieg’s political ambitions remain an undercurrent in his work. His capacity to translate these regulatory battles into tangible political capital will be crucial, especially if he aspires to higher office in the future. As a visible figure tied to significant economic reforms, Buttigieg's actions will continue to resonate within the party, where perceptions of vulnerability in the airline sector could also play into larger electoral strategies.
Ultimately, if Buttigieg successfully implements robust consumer protections and fosters a more competitive airline industry, he might emerge as a key figure in reshaping the economic landscape in a way that aligns with the Democratic Party's populist base. Such achievements could facilitate his political future while potentially positioning him as a national leader on corporate accountability and consumer rights.
The response from various stakeholder groups — airlines, consumer advocates, and the general public — will be pivotal in defining the narrative of his tenure. As Buttigieg continues to grapple with the complexities of regulating an industry undergoing transformative pressures, the effectiveness of his initiatives will hinge on how well they resonate with the public’s increasing demand for accountability in corporate practices.
In conversations surrounding economic reform, Buttigieg’s role in the airline industry could become a template for addressing broader issues in other sectors facing similar consolidation and consumer protection challenges. As the landscape evolves, all eyes will be on how Buttigieg navigates these turbulent waters, making prudent choices that prioritize both consumer welfare and the realities of industry dynamics.
Should his vision for reformed airline regulation take hold, Buttigieg could very well be seen as a pioneer of a new regulatory era—one where the government not only holds corporations accountable but also works to ensure a fair and competitive market for all consumers. The coming years will reveal whether this vision materializes or if he will face continued resistance from entrenched industry interests determined to maintain the status quo.
In conclusion, Pete Buttigieg’s handling of the airline sector not only carries significant implications for travelers and consumers but also sets a precedent for how government can engage with powerful economic players in the future. As he continues to adapt to emerging challenges and criticism, his actions may well define a crucial chapter in the ongoing narrative of American transportation policy and regulation.
Aarav Patel for TROIB News
This was not an isolated incident. The previous summer, after a spike in travel post-Covid, was labeled the “summer of hell.” Despite receiving $54 billion in federal aid during the pandemic, airlines struggled with operational challenges. Customers often received only partial refunds and vouchers with expiration dates. Frustrated passengers began to look for someone to hold accountable, and many pointed fingers at Pete Buttigieg, who was nearing two years as Secretary of Transportation.
By the time the Southwest crisis hit in December, Buttigieg was under intense scrutiny. The legal director of Open Markets, a notable economic populist organization, stated that “The Secretary of Transportation has consumer protection and antitrust powers to stop and remedy the airlines’ misconduct and negligence. Buttigieg appears uninterested in using them.” Activist Cory Doctorow also criticized Buttigieg in a piece titled “The Learned Helplessness of Pete Buttigieg,” while a Verge editor suggested that Buttigieg’s management of the airlines weakened his presidential prospects: “his opponents would wreck him on this issue alone.” In January 2023, a New York Times headline read, “Air Travel Debacles Put a Star of Biden’s Cabinet in the Hot Seat.”
Buttigieg made appearances on various news networks—from Fox to PBS to MSNBC—denouncing the airline's actions as “unacceptable.” However, some critics interpreted his stance as suggesting that the $17 billion airline was beyond government reach.
Reflecting on the chaos surrounding Southwest today, Buttigieg, now 42, noted, “It sent me into orbit,” adding that the experience solidified his resolve to tackle the issues facing the aviation sector. He committed to leveraging the authority of his office to facilitate change.
In the months following, Buttigieg made a series of decisions as Secretary of Transportation—prompted by administration antitrust advocates and allies calling for reforms in the airline industry—that resulted in former critics reassessing his position. No longer did they view him as overly cautious or aligned with corporate interests; some stated that Buttigieg had emerged as a crucial ally in the movement to rein in industries that had become excessively powerful.
Bill McGee, an advocate with an antitrust group and former flight-operations specialist, spent much of that tumultuous year criticizing Buttigieg’s inaction on social media and in public forums. “Buttigieg was allowing them,” he said of the airlines, “to just day after day, week after week, for months and months, screw over passengers.” However, McGee feels that things have shifted. “I didn’t have an about-face on Pete Buttigieg. Pete Buttigieg did an about-face on me.”
When Buttigieg took office as Transportation Secretary at the age of 38, he inherited a massive bureaucracy with a budget of $144 billion and 57,000 employees, but it was also a political backwater. Whereas past secretaries transitioned to corporate or lobbying careers, Buttigieg’s national visibility—and rumored presidential ambitions—placed him under constant scrutiny. His early tenure included missteps, notably his slow public response to the toxic train derailment in East Palestine, Ohio. However, he was present at the collapse of Baltimore's Francis Scott Key Bridge in March 2024.
But arguably, nothing will define his term more than the crisis in American air travel and how he chose to respond.
High-profile economic populists in President Joe Biden’s administration, like Federal Trade Commission Chair Lina Khan and Department of Justice antitrust chief Jonathan Kanter, may garner more headlines for their efforts at reshaping American industry. Still, Buttigieg may be undertaking similarly radical initiatives. He has moved past merely punishing bad actors, using his executive authority to restructure the airline market he oversees.
The lasting impact of Buttigieg's changes remains uncertain. Regulatory adjustments he has initiated “could be a smashing success, or could get caught up in the machinery,” says Diana Moss of the Progressive Policy Institute. Some new regulations are currently stalled in court, while others won’t be fully implemented until the next presidential administration—pending resources and commitment from agency staff. The airlines continue to merge, and the commercial aviation landscape is just one aspect of his expansive portfolio.
Surprisingly, Buttigieg has emerged as a valuable ally for the Democratic left advocating for antimonopoly policies, a faction now striving to maintain its foothold in a post-Biden political landscape that once viewed him as an opponent.
In late July, I interviewed Buttigieg in his office on the 9th floor of the Department of Transportation's expansive building in Washington, where he wore a crisp white shirt and cobalt blue tie. It was the first of two discussions aimed at understanding his seemingly evolving perspective on aviation regulation. I engaged with numerous antitrust activists, consumer advocates, DOT officials, and insiders to gain broader insights.
Despite some attributing his evolution to a significant ideological shift, Buttigieg describes his approach to airline issues as consistent with his pragmatic problem-solving style: “Often what I find is, you take a very pragmatic approach,” he reflected, “and that might lead you to a bold place.”
When Joe Biden assumed office, he carried a belief that the American tech sector had become dangerously overconfident, selecting aggressive antitrust advocates like Khan and Kanter to reinforce this vision within his administration. These officials embodied a leftist approach that had gained momentum since the 2008 financial crisis, emphasizing the need to check powerful corporate interests.
Although Buttigieg was not initially considered one of the key antitrust thinkers in Biden's inner circle, Tim Wu recognized his potential for recruitment. During the administration's early days, Wu circulated a memo called “The Grand Unified Theory of Antitrust Revival,” which critiqued reliance on traditional antitrust enforcers, arguing the need for a more robust approach through executive agencies. The memo indicated that federal agencies with significant oversight should leverage their existing competition enforcement powers.
In July 2021, seven months into Biden's term, the president issued a sweeping executive order promoting competition across various sectors, tasking the entire government with revitalizing competition. The directive also established a White House Competition Council, which included Buttigieg among its members. The council convened for its inaugural meeting in September 2021.
In Wu’s view, Buttigieg was an ideal candidate for action within this framework: "He was smart, ambitious, and atop an agency with grossly under-utilized competition powers."
Bharat Ramamurti, former deputy director of the Biden White House economic council, recognized Buttigieg’s oversight of air travel and noted, "There’s only a small handful of competitors. On a lot of routes, it’s really one airline. There’s real problems that need to be addressed."
Deregulation of airlines in the 1970s led to significant consolidation, creating the "Big Four": Southwest, Delta, American, and United. While the industry claimed that consolidation enhanced service options and reduced prices, critics argued it surrendering customer interests. This dynamic was exacerbated by the Covid recovery period, which revealed numerous service inadequacies; complaints exceeded 102,000 in the pandemic's first year.
The White House’s economic-policy staff weren’t the only ones attentive to Buttigieg’s role. Senior FTC officials consulted with him on consumer protection issues and the extensive authority granted to the Department of Transportation. Consumer advocates also pressed their case, urging Buttigieg to assume a leadership role as the foremost defender of airline passengers.
In discussions with members of the National Economic Council and later formal meetings of the Competition Council, Buttigieg displayed an interest in adopting a more vigorous approach to competition within his department. At one point, Wu recalled being surprised when Buttigieg reached out to discuss the potential for using his authority more effectively. However, Wu noted that the first year was "kind of dismaying," referring to Buttigieg’s perceived hesitance in addressing industry challenges.
Buttigieg had numerous responsibilities, including overseeing the implementation of the $1.2 trillion Bipartisan Infrastructure Law that Biden signed in November 2021. Critics also pointed to the weakened regulatory authority he inherited from the previous administration.
Ultimately, the pressure escalated during the tumultuous summer of 2022. Buttigieg began pushing airlines for assurances regarding their operational capacity and adaptability. However, when cancellations surged, he faced mounting public criticism and dissatisfaction from own party members. In a letter, Representative Ro Khanna urged Buttigieg to act with more “urgency, imagination, and boldness” to rein in the airline industry.
As Labor Day approached, Buttigieg's team developed user-friendly online dashboards that tracked airline performance on various criteria, making it easy for passengers to compare service quality. These dashboards were launched on a federal site called FlightRights.gov, receiving acclaim from consumer advocates. However, the airlines primarily viewed it as unfavorable.
In December 2022, when Southwest Airlines faced its debacle, the publicly available performance metrics provided a means to hold the airline accountable. Yet, Buttigieg expressed his frustration with the situation, saying, “When you’re doing a half-dozen interviews about what’s going on with a private company, at a certain point you ask yourself, ‘Why isn’t this company on television twice as much as I am?’”
During meetings following the crisis, Buttigieg's team realized that airlines could benefit financially from extended holds on passenger funds while facing minor penalties. The historical fines had been comparatively insignificant, often in the millions. Buttigieg proposed increasing the penalties: “What if we add a zero?” he recalled thinking. Southwest would ultimately agree to a historic $140 million penalty in December 2023, marking the largest fine in DOT's history by a factor of thirty.
However, Buttigieg recognized that enforcement had limitations; his department was equipped with only about 30 enforcement personnel and had been tracking complaints manually. He concluded that robust enforcement alone wouldn’t alter airlines’ behavior, leading to a recognition that “chasing symptoms” wouldn’t resolve systemic issues.
Around this time, Buttigieg began seeking fresh ideas and perspectives from economists and policy thinkers. He established the role of chief competition officer at DOT, appointing Jen Howard—an influential figure in the antitrust movement who had previously worked as Khan’s chief of staff.
Buttigieg also consulted with Ganesh Sitaraman, a law professor at Vanderbilt and an expert in competition policy. From Sitaraman's work, Buttigieg developed a more unified vision, realizing that industries like aviation cannot be left entirely uncontrolled: “These are economic scenarios where power comes into play. History matters a lot. And government matters a lot.”
With this understanding, Buttigieg tackled the urgent issue of airline refund policies. He had suspected that airlines engaged in what is termed unrealistic scheduling—selling seats on flights they realistically couldn’t staff or operate. He believed that this practice allowed airlines to keep customer funds even after cancellations.
Buttigieg was adamant that refunds should be automatic and issued promptly in the original form of payment. This approach would not only streamline enforcement but also empower customers to shift their business to competitors in the event of poor service. “If an airline knows that everybody on the plane is going to get their money back,” he stated, “that changes the whole economics of even considering a schedule you can’t really support.”
He worked on creating a binding, enforceable rule for automatic refunds on significantly delayed flights, which was officially implemented in late April 2023. Additionally, he targeted ancillary fees that airlines charged for various services, which Buttigieg argued obscured true costs for passengers and complicated price comparisons. He mandated transparency around these fees in conjunction with the refund rule.
Following the introduction of these regulations, airlines challenged Buttigieg's authority, filing lawsuits against the new rules. They contended that Buttigieg was overstepping his jurisdiction. A judge in the conservative-leaning 5th Circuit Court of Appeals temporarily suspended the rule, stating that Congress had not explicitly conferred the authority for such regulatory actions regarding airline fees.
As legal proceedings progress and with recent changes affecting agencies' regulatory powers, Buttigieg's approach faces potential hurdles. However, those who have worked alongside him recognize his capabilities in policy-making and political strategy.
In February 2022, Sen. Elizabeth Warren publicly criticized Buttigieg for not using his authority to prevent anti-competitive airline mergers. Yet in March 2023, Buttigieg opposed the JetBlue-Spirit merger, a bold decision that contradicted previous norms for Transportation secretaries. This was lauded by industry observers, and in May 2023, he even delivered the keynote address at an “anti-monopoly” summit hosted by McGee's group, the American Economic Liberties Project. Buttigieg openly acknowledged the shift in his approach to airline regulation.
Leveraging his visibility, Buttigieg has actively engaged in public discourse on regulatory matters. When Congress was reviewing the FAA funding, Buttigieg worked to ensure that automatic refunds remained a part of the legislation. His advocacy drew the attention of the White House, which supported him in the effort.
“I eat my hat on Buttigieg, who I thought of as a McKinsey operator,” remarked Zephyr Teachout, a notable law professor, praising his performance. The push towards automatic refunds attracted bipartisan support and, with Buttigieg’s involvement, the FAA bill was successfully passed with those provisions included.
Buttigieg's initiatives are generating mixed responses. Some industry leaders are beginning to criticize what they characterize as regulatory overreach, while others see his actions as revolutionary. Diana Moss of the Progressive Policy Institute argues the department could utilize its substantial authority more effectively to foster fair competition and suggests that it hasn't fully explored its capacity for enforcing regulations.
As Buttigieg's political future remains unclear, he is being considered for various roles, from governor of Michigan to a potential ambassadorship in a future Harris administration. His assertive approach to aviation regulation may alleviate some political burdens and enhance his career prospects, but the path ahead is unpredictable.
Despite criticism from airlines over his strategies, Buttigieg has garnered support from influential figures, including longtime opponents who have begun recognizing progress under his leadership. Warren, for example, praised Buttigieg’s accountability measures as significant steps toward protecting consumer rights.
Wu acknowledged that the Department of Transportation under Buttigieg is not receiving adequate recognition for its accomplishments in competition enforcement, remarking that it "took two years to get there." This evolution in Buttigieg’s approach marks a substantial pivot, signaling potential shifts within the Democratic Party regarding the regulation of concentrated corporate interests.As Buttigieg navigates the complexities of his role as Transportation Secretary, the airline industry's response to his regulatory efforts will be crucial in shaping both his legacy and the future of U.S. aviation policy. While he has made strides in advocating for consumer rights and enforcing accountability against airlines, his tenure is also marked by the challenge of striking a balance between regulatory oversight and industry cooperation.
The airline industry, traditionally resistant to external scrutiny, has been put on notice. Critics argue that Buttigieg's proactive stance represents a necessary shift in a sector long dominated by a few powerful players. However, the industry's pushback reflects the inherent tension between corporate interests and governmental oversight. As noted by Airlines for America's statement, “Secretary Buttigieg is a gifted communicator who has elevated the Department of Transportation’s platform in the public eye,” but there are signs that the industry perceives him as an adversary rather than a collaborative regulator.
Moreover, Buttigieg's actions have triggered broader dialogues about consumer protection across multiple sectors, echoing the sentiments of the growing antimonopoly movement within the Democratic Party. His administration is now seen as part of a larger framework working to combat corporate concentration, aligning with the broader goals set by President Biden.
As Buttigieg continues to refine his approach, he faces a dual challenge: managing the expectations of progressives who demand aggressive oversight while simultaneously cultivating goodwill among industry stakeholders who fear the implications of stringent regulations. The imminent legal battles concerning his proposed rules will further test his resolve and policy direction.
Looking forward, Buttigieg is likely to encounter increasing scrutiny of his decisions as new developments arise in the aviation sector. Consumer advocates will closely monitor the implementation of refund policies and transparency regulations, while industry leaders will be vigilant in their efforts to curtail what they see as overreach. The ongoing tension could dictate the pace of reforms and Buttigieg’s effectiveness as a regulator.
Additionally, Buttigieg’s political ambitions remain an undercurrent in his work. His capacity to translate these regulatory battles into tangible political capital will be crucial, especially if he aspires to higher office in the future. As a visible figure tied to significant economic reforms, Buttigieg's actions will continue to resonate within the party, where perceptions of vulnerability in the airline sector could also play into larger electoral strategies.
Ultimately, if Buttigieg successfully implements robust consumer protections and fosters a more competitive airline industry, he might emerge as a key figure in reshaping the economic landscape in a way that aligns with the Democratic Party's populist base. Such achievements could facilitate his political future while potentially positioning him as a national leader on corporate accountability and consumer rights.
The response from various stakeholder groups — airlines, consumer advocates, and the general public — will be pivotal in defining the narrative of his tenure. As Buttigieg continues to grapple with the complexities of regulating an industry undergoing transformative pressures, the effectiveness of his initiatives will hinge on how well they resonate with the public’s increasing demand for accountability in corporate practices.
In conversations surrounding economic reform, Buttigieg’s role in the airline industry could become a template for addressing broader issues in other sectors facing similar consolidation and consumer protection challenges. As the landscape evolves, all eyes will be on how Buttigieg navigates these turbulent waters, making prudent choices that prioritize both consumer welfare and the realities of industry dynamics.
Should his vision for reformed airline regulation take hold, Buttigieg could very well be seen as a pioneer of a new regulatory era—one where the government not only holds corporations accountable but also works to ensure a fair and competitive market for all consumers. The coming years will reveal whether this vision materializes or if he will face continued resistance from entrenched industry interests determined to maintain the status quo.
In conclusion, Pete Buttigieg’s handling of the airline sector not only carries significant implications for travelers and consumers but also sets a precedent for how government can engage with powerful economic players in the future. As he continues to adapt to emerging challenges and criticism, his actions may well define a crucial chapter in the ongoing narrative of American transportation policy and regulation.
Aarav Patel for TROIB News
