The Stalwart: Aviation Inflation

The aviation business can offer us some good lessons about the overall economy. Their pension woes are a warning to the government to get its act together on social security, and their frequent flier programs demonstrate the issue of inflation. From WSJ:

Being an elite-level frequent flier won't be quite as special next year.

Eager to raise cash and satisfy their credit-card company partners -- who have propped up struggling airlines financially -- several carriers have made it easier to qualify for premium-level status as an enticement to spend more on credit cards. Some recent offers have also made it a banner year for "mileage runs," trips made solely to push mileage totals over qualifying thresholds.

As a result, the ranks of premium travelers who get perks like upgrades, exit-row seating and preboarding privileges are swelling -- eroding the exclusivity long associated with elite status.

By one count, the number of elites could grow by more than 300,000 travelers in 2006 -- an 8% increase. This comes at a time when many frequent travelers are already nursing a raft of complaints: That first-class upgrades are harder to score. That crowds of premium customers elbow each other when boarding some flights. And that special elite-only lines for security screening sometimes move slower than regular queues.

Travelers say peak business-travel flights at hub airports already typically produce crowds of premium passengers. "For Delta in Atlanta," says frequent-flier Geoff Williams, "everybody seems to have elite status."

You can't print money to make everyone richer, and you can't just offer free miles to give everyone a better flying experience. Everything's gotta be paid for somewhere.

(via View From the Wing)

Update: Perhaps you can't blame the government or the airlines for causing inflation. It seems to happen everywhere. In boxing, the divisions and associations have become so splintered that every boxer, somewhere is the "Champion of the World". Every play on Broadway gets a standing ovation, deserved or not, thus totally ruining that form of social currency. At Brown, every student gets at least a B. The smallest size at Starbucks is a Grande. And of course, every independent film puts those wreaths on the poster, to show they won some sort of audience award at the Tuscaloosa Film & Video festival.

More: If you can think of any more examples like the ones above, please put them in the comments.