Speaker 1: Bloomberg Audio Studios, podcasts, radio news.
Speaker 2: It's twenty twenty four, a year that started badly for
Speaker 2: air travel. It began with the door of an airplane
Speaker 2: falling off mid flight and enters its last months with
Speaker 2: two astronauts stranded in space because of issues with a
Speaker 2: Boeing spacecraft. One man who's trying to target these problems
Speaker 2: and weigh in on the fraught politics of the moment.
Speaker 2: Pete Buddha Judge the US Transportation Secretary. He first captured
Speaker 2: national attention in twenty nineteen when he made a surprising
Speaker 2: play for the Democratic presidential nomination.
Speaker 1: My name is Pete Buddhajudge. They called me they Pete.
Speaker 2: He was a thirty somethingter openly gay mayor of the
Speaker 2: mid sized city of South Bend, Indiana.
Speaker 1: And I am running for president of the United State.
Speaker 2: He stunned the nation by winning the Iowa caucuses, beating
Speaker 2: out Joe Biden, and he ultimately landed a role in
Speaker 2: Biden's cabinet. As Transportation Secretary, he has the tough job
Speaker 2: of getting our national transportation system in check. In the
Speaker 2: last couple of years. That's meant refereeing battles between airlines
Speaker 2: and consumers over everything from inflight safety to the value
Speaker 2: of loyalty programs. Now just forty two years old in
Speaker 2: an increasingly aging government Putajedge has a long career ahead
Speaker 2: of him in politics if he wants it, and even
Speaker 2: from his perch running dot, which is usually a low
Speaker 2: profile job, he hasn't shied away from what's happening in
Speaker 2: national politics. Kamala Harris's team vetted him as a possible
Speaker 2: vice presidential candidate, and he's gone viral for his lively
Speaker 2: debates with anchors on Fox News. I talked with Buddhajedge
Speaker 2: earlier today, Thursday, September twelfth, about the future of his
Speaker 2: party and how he's setting out to address the many
Speaker 2: challenges of modern air travel. Wonderful to have you on, Secretary,
Speaker 2: but Judge, glad to be with you only a minute late.
Speaker 2: My last commercial flight I think departed thirty minutes late.
Speaker 1: I'm glad we're doing better than your last flight.
Speaker 2: From Bloomberg's Washington Bureau. This is the Big Take DC podcast.
Speaker 2: I'm Saliah mosen.
Speaker 1: So.
Speaker 2: I want to start by asking you about one of
Speaker 2: the most high profile challenges that your transportation department has faced,
Speaker 2: making airlines consumer friendly. We've seen Boeing under scrutiny for
Speaker 2: some major safety issues with its seven thirty seven Max
Speaker 2: consumer jets. There are delays and doors literally falling off
Speaker 2: of airplanes. So I do have to ask you, do
Speaker 2: you enjoy flying commercial?
Speaker 1: Mostly? I think we've all had our headaches. I am
Speaker 1: on an airliner, maybe not every day, but almost, and
Speaker 1: like millions of Americans, experienced the benefits but also the
Speaker 1: huge frustrations that go with air travel. We've worked hard
Speaker 1: to establish America's safety record that has made air travel
Speaker 1: the safest way to get around. We work hard to
Speaker 1: keep it that way and press the airlines to do
Speaker 1: their part. And then there's the customer service side, where
Speaker 1: it's clear that airlines need to do a better job
Speaker 1: of taking care of passengers, and we have not just
Speaker 1: pressed them and encouraged them to improve their performance, but
Speaker 1: introduced new passenger rights that have created protections that didn't
Speaker 1: exist just a few years ago that we think are
Speaker 1: much needed and overdue.
Speaker 2: I'm from Ohio. I live in Washington, d C. So,
Speaker 2: like a lot of Americans, I am going to be
Speaker 2: flying to see family in Ohio this holiday season, and
Speaker 2: I do have to tell you I'm dreading it. What
Speaker 2: is the Transportation Department Under Secretary Pete Buddha Judge doing
Speaker 2: to make holiday travel a little less frustrating this year.
Speaker 1: Well, the first thing we've done is press the airlines
Speaker 1: to improve their performance. It's one of the reasons why
Speaker 1: last year saw the lowest rate of flight cancelations in
Speaker 1: about it decade, and we're working to make sure that,
Speaker 1: through things like realistic scheduling and adequate staffing, they build
Speaker 1: on improving that record. The other thing that's important is
Speaker 1: that they take care of passengers when there is a
Speaker 1: delay or an issue. One of the things we've done
Speaker 1: is introduce a new toolflight rights dot gov that's got
Speaker 1: airline by airline information about what you can expect your
Speaker 1: airline to do to take care of you when you
Speaker 1: have a problem, and those are customer service promises that
Speaker 1: we enforce and hold them accountable for meeting. We've also
Speaker 1: taken action to increase the benefits that go back to
Speaker 1: a customer when there's an issue, For example, automatic refunds
Speaker 1: when your flight is canceled, something that has been a
Speaker 1: real headache and led to us imposing hefty penalties on
Speaker 1: airlines that weren't following through. We're trying to take the
Speaker 1: drama out of that by saying that you don't even
Speaker 1: have to ask to get a refund. And lastly, a
Speaker 1: lot of enforcements. We have issued the toughest enforcement actions
Speaker 1: in the history of the department in cases like that
Speaker 1: of Southway Airlines that melt it down almost two winters
Speaker 1: ago now and left so many passengers stranded. We're investigating
Speaker 1: what happened with Delta over the summer right now.
Speaker 2: So this holiday season November and December, can consumers expect
Speaker 2: that some of these things are already in play. We
Speaker 2: can expect that we can sit with our family members
Speaker 2: as Joe Biden promised. We can expect that we can
Speaker 2: get refunds. The way you're describing.
Speaker 1: As a passenger today, you have protections that you did
Speaker 1: not have a year ago, or two years ago or more,
Speaker 1: and we're going to continue building on those. So yes,
Speaker 1: if you're heading to see family for the holidays, for example,
Speaker 1: those automatic refund protections are the law of the land now,
Speaker 1: and if you don't get treated that way, let us know,
Speaker 1: because we'll follow up with enforcement. We have seen more
Speaker 1: airlines comply with what we've been asking them to do
Speaker 1: with regard to family seating and for passengers who are
Speaker 1: wheelchair users, now we've been acting to make sure that
Speaker 1: they have a better experience because some of the stories
Speaker 1: we've about what they have faced traveling on airlines are
Speaker 1: just completely unacceptable, and we're developing rules that would change
Speaker 1: that experience and empower those passengers significantly.
Speaker 2: You're talking about enforcement and penalties is one aspect. There
Speaker 2: are you thinking millions of dollars, How high a penalty
Speaker 2: are you willing to levy on these airlines.
Speaker 1: Well, in the case of Southwest, it was a one
Speaker 1: hundred and forty million dollar enforcement action, which was more
Speaker 1: than we had seen in a decade or more put
Speaker 1: together before that, partly because we thought it was very
Speaker 1: important to send a message to airlines. What we saw
Speaker 1: was at some of the past levels of penalties a
Speaker 1: million here to a million there really wasn't enough to
Speaker 1: change behavior. And we're going to continue to be ready
Speaker 1: to do that now. One thing I want to mention
Speaker 1: is when we talked about one hundred and forty million,
Speaker 1: that's not all cash going back to the treasury. We
Speaker 1: did impose a cash fine about thirty five million dollars,
Speaker 1: but part of what we did in the enforcement orders
Speaker 1: have the majority of those dollars actually go back to
Speaker 1: passengers in the form of vouchers, compensation and other things
Speaker 1: that went back to the consumer, because the whole point
Speaker 1: of this, of course, is to make sure consumers are
Speaker 1: better taken care of.
Speaker 2: I want to talk about Boeing. What have you been
Speaker 2: able to do to get that company back on track?
Speaker 1: We Lefay took an unprecedented measure in restricting Boeing's ability
Speaker 1: to produce aircraft at a higher rate until they demonstrated
Speaker 1: the safety of their production and the quality of their
Speaker 1: production process. Aviation in America by far the safest way
Speaker 1: to travel and has made the last decador to the
Speaker 1: safest period in the history of aviation. That means that
Speaker 1: when there is a near miss or an incident something
Speaker 1: like the plug door blowing out in January and Alaska,
Speaker 1: we treat that as seriously as the FA used to
Speaker 1: treat the most recent fatal crash. I think that's part
Speaker 1: of why they have been able to say that there
Speaker 1: has not been a fatal airliner crash in years, and again,
Speaker 1: it takes a lot of work to keep it that way,
Speaker 1: Boeing was put on notice that they were under a microscope.
Speaker 1: They've provided an updated plan and now we are watching
Speaker 1: to see how they're doing and meeting the terms of
Speaker 1: that plan. They also have new leadership, and I've conveyed
Speaker 1: to Boeing the importance of them prioritizing a culture of
Speaker 1: quality and safety so that they can meet the FA's
Speaker 1: expectations and really the expectations of the American public.
Speaker 2: I asked Secretary Buddha Judge about a new investigation into
Speaker 2: airline loyalty programs and we discussed the future of the
Speaker 2: Democratic Party and where he might fit into it. That's
Speaker 2: after the break, I had a chance to sit down
Speaker 2: with Transportation Secretary Pete Buddha Judge. We talked about air
Speaker 2: travel and all that comes with it. There's another place
Speaker 2: where trust and air travel is really low right now.
Speaker 2: Since we're talking about trust, I'm talking about pricing and
Speaker 2: rewards transparency, So what it actually costs to take the
Speaker 2: trip that you've planned and the value of the loyalty
Speaker 2: points that you've signed up to get. One example that
Speaker 2: you guys have been working on at the department is
Speaker 2: a lot of work on junk fees, the fees that
Speaker 2: are not disclosed upfront when you're buying the ticket, like
Speaker 2: checking a bag, things like that. Share a little bit
Speaker 2: about what you're doing on that front with consumer productions.
Speaker 1: Well, when it comes to fees, first of all, we're
Speaker 1: making sure that you get refunded if you don't get
Speaker 1: what you paid for on your fees, same as we
Speaker 1: do on your ticket. So you pay for Wi Fi,
Speaker 1: the Wi Fi doesn't work, get your money back. Same
Speaker 1: with baggage if you don't get the baggage services you
Speaker 1: paid for. And we have a new rule that's requiring
Speaker 1: that we have another rule about transparency, and this is
Speaker 1: really about making sure that you can tell when you're
Speaker 1: comparison shopping for an airfare the all in cost of
Speaker 1: the ticket that you're buying, including those ancillary fees or
Speaker 1: bags or picking a seat or something like that. Now,
Speaker 1: I thought that being transparent about fees was a relatively
Speaker 1: low bar to require the airlines to meet. But when
Speaker 1: we finalize that as a rule, the airline industry lobby
Speaker 1: responded by suing us. We believe that our rule is
Speaker 1: based on strong legal authorit, so we're standing our ground,
Speaker 1: but it's disappointing that they are so reluctant to do
Speaker 1: something I think most consumers would expect of anybody selling anything,
Speaker 1: which is to be upfront and transparent about what you're
Speaker 1: going to charge.
Speaker 2: Let's talk about the rewards points more specifically, you've launched
Speaker 2: an investigation on frequent flyer programs. Americans actually love these
Speaker 2: kinds of programs. Decide on which credit card to sign
Speaker 2: up for based on this. Tell me why you are
Speaker 2: taking these programs on.
Speaker 1: Well, these programs are very important to Americans. That's exactly
Speaker 1: why we want to look into them, to make sure
Speaker 1: that they are fair, transparent, and predictable. There's real value
Speaker 1: in these rewards balances. I think a lot of us
Speaker 1: think of our points and miles as part of our savings.
Speaker 1: But unlike savings in cash and a bank account, the
Speaker 1: value of your points in miles could be changed arbitrarily
Speaker 1: by the airline that controls them. And so we want
Speaker 1: a better sense of how airlines manage and maintain the
Speaker 1: value of these points and miles when there are situations
Speaker 1: where they are being devalued, what's behind that, and making
Speaker 1: sure that there's a level of transparency and fairness, because
Speaker 1: again You've got folks who decide which airline to take
Speaker 1: sometimes pay more for a ticket in order to have
Speaker 1: it be on their preferred airline. Because of the mileage program,
Speaker 1: some consumers are not just choosing a certain credit card,
Speaker 1: but choosing a credit card with a higher annual fee
Speaker 1: and a higher interest rate, which is a choice that
Speaker 1: could affect them to the two new hundreds or thousands
Speaker 1: of dollars just based on these points and miles if
Speaker 1: they're if a consumer is putting that much stock in
Speaker 1: the points and miles, we want to make sure that
Speaker 1: they're getting what they were promised.
Speaker 2: So what can the Transportation Department do once the investigation
Speaker 2: is done, is our penalty is a factor there?
Speaker 1: Well, I don't want to prejudge what might come of
Speaker 1: the investigation because we've just launched it. But what we've
Speaker 1: requested the four largest airlines to do is provide thorough
Speaker 1: data about how they value these points and how customers
Speaker 1: could be affected by decisions that they make. And we
Speaker 1: do have an authority and therefore, in my opinion, or
Speaker 1: responsibility under the law, to address any unfair or deceptive
Speaker 1: or anti competitive practices that may be out there. If
Speaker 1: we find such practices we're going to take action.
Speaker 2: Let's talk briefly about infrastructure money. Are you worried about
Speaker 2: getting that money out the door so that it can
Speaker 2: be spent on projects, especially because we might have a
Speaker 2: Trump administration coming up.
Speaker 1: Well, we're certainly working to make sure that these dollars
Speaker 1: turn into projects as quickly as possible. Now, building a
Speaker 1: bridge or a new airport terminal, unlike some other policies,
Speaker 1: is not something that happens the moment that it's signed off,
Speaker 1: the way a tax credit could take effect in a
Speaker 1: matter of weeks. But we do think that there are
Speaker 1: steps that could help make it all happen more quickly.
Speaker 1: Now we're about three fifths of the way through the bill,
Speaker 1: if you think of it that way. We're a year
Speaker 1: three of a five year bipartisan infrastructure bill. So we're
Speaker 1: trying to tear down some of the barriers and speed
Speaker 1: up that process because I do sometimes worry about what
Speaker 1: a policy change would do to the available of these
Speaker 1: transportation and infrastructure dollars that I think Americans are really
Speaker 1: counting on in their communities.
Speaker 2: Secretary Boudage, if we end up with the Harris presidency,
Speaker 2: what cabinet job would you like.
Speaker 1: Well, if that happens, that'll be up to the new president.
Speaker 1: All I know is that I've got what feels to
Speaker 1: me right now to be the best job in the
Speaker 1: federal government, and I'm working hard at meeting the expectations
Speaker 1: of that job.
Speaker 2: If you had another four years, what would you do.
Speaker 1: I'm really not allowing myself to speculate on that, especially
Speaker 1: because there's so much still to be done. Even in
Speaker 1: this the fourth year of President Biden's term. We've got
Speaker 1: billions more in projects that we're working to select and announce.
Speaker 1: We're trying to help states and cities deliver the projects
Speaker 1: that we've already read to fund, and we're working on
Speaker 1: the regulatory side on these issues like consumer protection. I
Speaker 1: think getting that Railway Safety Act passed through Congress that
Speaker 1: we've been calling for is a major piece of unfinished
Speaker 1: business that I'd like to see happen. I'm going to
Speaker 1: do everything I can to help that happen. So determined
Speaker 1: to sprint through the tape and we'll see what if
Speaker 1: you holds after that.
Speaker 2: It's hard not to notice that your policy work has
Speaker 2: gone beyond the typical boundaries of the Transportation Department. So
Speaker 2: One example is that you've been vocal on childcare policy proposals.
Speaker 2: Is that an area of policy that you would like
Speaker 2: to be involved in.
Speaker 1: Well, I'm certainly passionate about childcare. I always believed in
Speaker 1: it intellectually, but had a whole new way of thinking
Speaker 1: about it after Chasten and I became parents to our
Speaker 1: son and daughter, our twins, just a little over three
Speaker 1: years ago. I work on that, of course, within the
Speaker 1: job that I have, on things like making sure vehicles
Speaker 1: and streets are safe and making sure you can sit
Speaker 1: next to your kid on a plane with that I
Speaker 1: having to pay extra for it. But certainly also feel
Speaker 1: strongly about our administration's push to make sure that we
Speaker 1: have things like paid family leave, something that we could
Speaker 1: probably have tomorrow if congressional Republicans would change their mind
Speaker 1: and support us on that, and a number of other
Speaker 1: measures like the child tax credit that maybe a little
Speaker 1: bit outside of my lane here at the USDOT, but
Speaker 1: I know what they're going to do to reduce poverty
Speaker 1: to support families, and whether I'm in government or in
Speaker 1: some other life, I'm going to do whatever I can
Speaker 1: to push for those good policies.
Speaker 2: There's so much talk about the future of the country
Speaker 2: and also the future of the Democratic Party. Should we
Speaker 2: expect that, regardless of what happens and what job you
Speaker 2: might have the next four years, that you are going
Speaker 2: to remain as a key influencer and leader in the
Speaker 2: Democratic Party. You did run for president once before, maybe
Speaker 2: you'll do it again.
Speaker 1: Well. I'm always looking for some way or another to
Speaker 1: make myself useful. Right now, that's the job right in
Speaker 1: front of me. But I care a lot about policy.
Speaker 1: I care a lot about how families are going to
Speaker 1: do in this country, and I think our future depends
Speaker 1: on us being committed toward a longview about how some
Speaker 1: of the choices we make, whether it's how you design
Speaker 1: a bridge it's going to be around for one hundred years,
Speaker 1: or how we invest in the affordability of raising kids
Speaker 1: who are just being born, we take that long view,
Speaker 1: and I'm going to work toward that in whatever capacity
Speaker 1: I find myself in from one year to another.
Speaker 2: So you have not ruled out another run.
Speaker 1: Ruled anything un around. I'm just trying to do my
Speaker 1: job right now.
Speaker 2: All right, Thank you so much for your time. Thanks
Speaker 2: for listening to the Big Take DC podcast from Bloomberg News.
Speaker 2: I'm Salaiah Mosen. This episode was produced by Julia Press
Speaker 2: with support from Alex Sugia and Thomas lou. It was
Speaker 2: mixed by Alex, who also fact checked the episode with Thomas.
Speaker 2: It was edited by Wendy Benjaminson. Our senior producers are
Speaker 2: Kim Gettleson and Naomi Shaven, who also edited this episode.
Speaker 2: Elizabeth Ponso and Wendy Benjaminson both provide editorial direction. Nicole
Speaker 2: Deemster Bower is our executive producer. Sage Bauman is Bloomberg's
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