If you sell this guy a ticket to your all-you-can-eat buffet and he eats the table, is he at fault, or are you?

A strange subplot of the American Airlines bankruptcy is the saga of its unlimited AAirpass, a special deal offered by the airline in 1981. The company sold passes for a lifetime of free and unlimited First Class travel with no limitations at a price of $250,000. An additional $150,000 permitted AAirpass customers to buy one “companion ticket” that would let one person—anyone— accompany them on any flight, anywhere, again, for life.

Apparently eschewing competent market research—and you wondered why this airline went belly up?—American assumed that the lifetime luxury travel passes would be bought by corporations for their high-flying employees. But no; the purchasers were almost all very rich people with a lot of time on their hands. As designed, American got a quick influx of cash, but at an unacceptable and strangely unanticipated cost: the AAirpasses placed the company at the mercy of  few profligate travelers who exploited American’s carelessness to the edge of absurdity, thereby raising a fascinating ethical question: If someone lets you have the right to ruin them, is it ethical to do it? Continue reading →