Airline Miles: Not Rewards, But Financial Tools

0:00It's April 22nd. This is Anchorage News Today, driven by AI. Alaskans rack up frequent flyer miles faster than most folks because we fly so much just to get around. But those miles often sit unused, and that's straight profit for the airlines. They call it breakage. Every unredeemed mile turns into revenue, with carriers like United Estimating 14% never get cached in. Airlines sell those miles to banks. Treat them like their own currency, and bank on folks forgetting to use them. During COVID, when cash dried up, Delta borrowed $9 billion against SkyMiles, United grabbed $6.8 billion for Mileage Plus, and... American pledged $10 billion, the biggest airline loan ever. Travelers get hit hard because airlines can pledge your miles as collateral without asking, but you can't even pass them to your spouse if you die. Fine print locks that in across Alaska, American, United, and Southwest. Alaska Airlines took it further, using the Mileage Plan to help buy Hawaiian Airlines, turning our loyalty into their financial tool.

1:07No consultation. No payout for us flyers who keep the state connected. Next time you earn miles, remember they're not lock rewards. They devalue over time by design, controlled fully by the airline. Burn them quick before they fade.