of the columbus zoo. thanks so much for coming on. really appreciate it. >> thank you. liz: thank you. "the willis report" is next. thank you so much for joining us. david: no elephants as far as i know on "the willis report" tonight, unfortunately. we'll see you tomorrow. >> hello everybody, i'm gerri willis and this is "the willis report," the show where consumers are our business. jobless claims rise unexpectedly today. there are new concerns about the weakness in the labor market ahead of tomorrow's big jobs report. >> the mood is anxious angry, we're not feeling prosperous. gerri: the congress pressure president obama to go it alone and raise your taxes? >> president is an imperial person who thinks he is in a person to do anything he wants by using as he said, the pen or the telephone. gerri: would you like to retire with nearly 50% more mon? of course you would. who wouldn't? some of us are giving up free way to do it. we'll explain. >> no matter what if you have to

ask, positive at this do it, do not take money out of retirement accounts. gerri: get a bigger home without moving an inch. how do you do that? home improvement expert tom cite letter is here. airlines try sneaky way to charge more money. some say it is downright dishonest. we'll expose it. all that coming up on "the willis report," where consumers are our business. ♪ tonight is the president turning his back on the middle class? mounting evidence like rising jobless claims and stagnant wages flying in the face of obama's rosy comments on the economy. in fact majority of americans say government policies are not helping their bottom lines. so will obama's middle class economics push morerpeople out of the middle class? we're asking peter morici, economist and professor at university of maryland smith school of business and republican strategist brad blakeman who served as deputy assistant to president george w. bush.

welcome to you both. i will start with you, peter. big jobs report out tomorrow. some reporting, adp report that looks at private sector jobs, disappointing. weekly jobs numbers, not good. what do you see tomorrow morning? >> about 230,000 jobs less than in january, in turn less than in december. things are trending down. the economy has slowed. and, mr. obama's policies have a lot to do with that. >> brad blakeman, let's talk about those policies. i think it is quality of jobs people are worried about upset about, concerned about. income in particular. what is it that the president has done to reduce those expectations? >> well i think gerri the president talked about the middle class but his policies have not affected the middle class in positive way. democrats in this town in washington are running all over the place talking about a national minimum wage. you don't get to the minute middle class by a minimum wage job. the thing about obamacare, there

is a trillion dollars sitting on the sidelines. we believe republicans believe in the velocity of money. every time a dollar changes hands among the private sector gins up the economy, not us sending more taxes to the government to spend it. what obama doesn't realize he create ad policy of dependence. one out of five americans is on some form of food stamps or public assistance. you don't get to the middle class that way either. gerri: right. >> we to free up money and give people in the private sector to spend it. gerri: i haven't heard velocity of money since i was in business school. >> yeah. gerri: peter, get to one of the facts from a pew research survey i found fascinating today. 30% of the americans say their finances have yet to recover from the recession. that recession, six years in our rear view mirror. when will americans stop feeling the hurt? >> when he start getting more and better of paying jobs. median family income is lower today than when mr. obama took office. lower than just before the

financial crisis. things simply haven't recovered. there is a lot of anecdotal evidence, low wage jobs, mcdonald's jobs are paying a little better. middle class wages have not moved. local and state governments take a bigger bite out of taxes and everything is harder to do with the terrible bureaucracy he put on us. if you want a waiver from the health care mandate because you have a good reason the form is 12 pages long. it is absurd. everything is that way. gerri: 12 pages. that is ridiculous. another pugh research survey saying 72% of the folks out there, say government policies that were designed to help the middle class are not doing it. what do you say brad? >> i say absolutely. there is uncertainty in the marketplace. when there is uncertainty they will not act. they will not employ people and there is no incentive to employ under obamacare full-time employee when obligations are such better off hiring a few more temps or part-time workers

than full-time workers. the obama policies have not targeted people they claim they're trying to benefit. it is just not happening. it won't happen until the president understands that it is regulation it is burden, it is uncertainty that is causing this funk, the obama funk that we're experiencing. gerri: lower class 1% super fine or even better under obama. middle class is really getting killed here in my opinion. want to play a game with you guys. i will read three obama policies. get you to respond to which ones you think have helped middle class. starting with this list. cut retirement tax breaks for the wealthy? tax 529 college plans. he had to backtrack on that. raise the minimum wage to $10.10. peter, any of those helping folks? >> i don't think so, no. if you raise the tax on retirement earnings, if you raise the minimum wage to make hamburgers more expensive that hurts the middle class. the estate tax i don't see how

raising estate tax helps middle class at all. on every available front he talks about helping middle class he pinned to takers. people think via government regulation or change in statute they get an extra $10 a month. basically, mr. obama marshalled a army of takers people who don't work very hard, the 10 million men who sit on their buts at home, don't look for a job, aren't employed. that is obama's army of voters. that not the middle class. gerri: brad, give you a list of three different policies. think if any helped middle class. extending emergency unemployment insurance. during aftermath of recession. wants to make community college free for two years. tax breaks for companies shipping jobs overseas. any giving a big boost to middle class folks? >> absolutely not. particularly college. i teach at a college. look, nothing is free. and college is a business just like anybody else. it has healthy competition

between private colleges and public colleges. the fact of the matter is you're now encouraging students to study and tell them, they don't have to pay for it. anything you pay for is of value. and you go into a contract with a school if you need public assistance, or financing with the obligation to pay it back. not what the democrats say, don't worry about it. you should worry. it is an obligation you went into with, with open eyes. >> open eyes. everybody will pay that bill. american taxpayers share that burden. >> absolutely. gerri: peter brad, thanks for coming on. good luck getting home in the snow in washington. >> it's a mess. gerri: we want to know what you think. here is our question tonight is this administration helping or hampering the economy? log on to gerriwillis.com to vote. i will share results at the end of tonight's show. the president's pen, not just policies he goes through congress with, his pen. gearing up for more executive action just as he did with the controversial immigration

reform. president obama suggested he will use executive authority to initiate corporate tax law changes, bypassing congress completely. can he do this? let's ask american for tax reform president author of a new book coming out next month, end the irs before it ends us, grover norquist is here. >> thank you. gerri: i'm not sure, i read in the intro it is limited to corporate taxes but i'm not sure with we're talking about here. i think it could be open season. where do you think the president will go with this idea? >> josh earnest, his press secretary said the president may do it himself. you asked the question can he do it really? -- really. my favorite cartoon in the world is far sidecar toon where two cavalry men watching flaming arrows coming at for the. one says the indians are lighting their arrows on fire. can they do that? the answer, the president can do a lot of things may not be legal but take you years to unravel that. companies and individuals, you

want to argue with the irs today never get refund and pay the tax and sue later? if you think suing city hall is tough, imagine suing the federal government. gerri: so, can i just read you something? this may sound familiar to you. >> sure. gerri: important to note tonight, all bills for raising revenue shall,nate in the house of representatives. article i section one origination clause of the constitution. >> yeah. gerri: you remember that document. founding document kind of critical in our nation's history. lines up what everybody is supposed to be doing. why are we ignoring it? >> i don't know. the president's claims to be constitutional scholar, taught at university. this is serious stuff. i mean the constitution was set up and they specifically said the house of representatives the people's body, not the senate, not the president, are in charge of initiating any tax changes. you will also find in that same constitution all taxation has to be uniform. the first income tax was struck

down because it was graduated income tax in 18894. we need to go back and reread that document -- 1894. no way to have graduated income tax to maintain uniformity of taxes that is required. gerri: a lot to debate. i want to keep focused on possibility the president could come in sort of unilaterally on his own, by himself, lone wolf, change the tax code and change it dramatically. senator bernie sanders from vermont said hey we could close corporate tax loopholes. what he says grover, some of these loopholes were actually originated by presidents who took executive action to do it. is he right? >> well, the irs and others by executive order define certain things, the basis in capital gains. and you could come in and redefine the basis based on historical costs. that's one.

historical costs plus inflation. replacement value. you could come in and change some of these rules, in ways that cut taxes or raise them. but, all of the ones that exist, all the rules that were there, whether put in by congress or by the irs itself, the treasury department, they have all been thought through worked over, legislation, they were put in. congress didn't undo them if they were done by the irs. these are not open questions. these are settled questions of law. people have been paying taxes for decades on these rules. gerri: people's representatives for the most part have said yes to this. this is where it came from. >> if they wanted to change it they could have. gerri: bottom line grover should the president be initiating tax policy on his own? >> no. he should not. will he? quite possibly. >> scary world we live in, grover. thank you very much for coming on. >> thank you. >> still a lot more to come this

hour including more and more homeowners are improving their home instead of moving but is it right for you and your family? next, survey after survey shows americans not saving enough for retirement but one small, tiny little change can make a big impact to your retirement savings. let us know what you think. tweet me @gerriwillisfbn send us an email through our website, gerriwillis.com. we'll be right back.

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gerri: it's a problem all americans face, how to save enough for retirement. many turn to actively managed mutual funds think it will give them a leg up. legendary investor jack bogle gives a warning. he says other funds can give you a better return. david bock from edelman financial services. welcome back to the show. >> sure. gerri: first of all, if you're working family, approaching

retirement, 64 to 55 you probably have $104,000 retirement saved. is that enough. >> that is not close. that is 20% of average american family ideally needs to be but that was median number. we have one in three americans right now have less than 25,000 in savings. gerri: oh. >> that is retirement account. go below that. less than $1,000 in savings. we're not even close. reason a big issue gerri lent of retirement much tough plan for 25 to 30 years. gerri: hey i will live to 105. i'm saving everything i can. i want to turn to some of this bogle research which i think is interesting. he is talking his book, an old wall street phrase promoting what it is you sell. >> of course. gerri: he makes a good case. look at these numbers. 2:30-year-olds make same amount of money, same amount of raises over 40 years they set aside same amount of money but only difference one puts in money in passive index fund and one puts in actively managed fund.

passive index fund does far far better. you're practically giving away $400,000 in fees to somebody you could have had. what is reaction? >> john bogle is inventor if you will and creator of index funds. he is obviously very well-respected. i didn't see where backup data came. here is key to passive versus active. on average in any given year about 2/3 of active money managers underperform indexes. gerri: 2/3. >> 2/3. that is average. so when you go to large cap certain funds it is 85% of active money managers underperforming. >> back up for a second. passive index fund, s&p 500, you buy all stocks all the time over and over again. actively managed, manager is in there making choices, better one stock will do better. >> there is reason why active money management underperforms

active. i'm big believer for passive. at edelman financial services we do passive money management. not only consistently underperform with the funds. the costs are higher. cost of actively managed mutual fund is 1.57%. with a lower cost passive index fund, cost instruction us of 25 to 35 basis points, 1/8 of cost. gerri: a fraction. >> a flak shun. gerri: the assumption in this study was 3%. most think that is really low but it is not in fact. >> look, i think that study was a little bit skewed intentionally skewed but i think when you look at active money management, just classic cliche mutual fund, internal costs of that mutual fund, including all trading could be high as 2% or more. then the advisor put as fee on top of that. if you use financial advisor which we recommend people do, make sure internal costs of funds they're selecting are very low cost. gerri: one final question. so people get bored with index

funds. you know how this is. if we go through period where the stock market does nothing, your index funds do exact same things. >> you want a boring portfolio. i tell people have a boring financial plan. gerri: if they're going down, do you have to be patient? >> you need boring, diversified portfolio, over time when it is going down guess what? you're putting more money in. dollar-cost averaging it is coming back up. you're buying it on sale. when you look at investors in retirement accounts did well since the recession, they never stopped investing. bought cheap cheap, all the way back up. now they're out ahead. >> david bach, got toe sue. >> gerri, thanks for having me back. gerri: i hope you survive the snow. users guide for paying for college, continues with advice every high school senior and their parents need to hear. do you want a big home without the hassle of moving? we answer the question, how to expand the living space while boosting the value of your house.

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gerri: move or improve that is a dilemma many homeowners are facing and more are staying put. we have tom the host of the national syndicated money pit radio show. >> thank you. gerri: welcome back. i love this idea. i know it is super hard. how do you decide whether you should move or stay put and improve? >> there is a lot of value staying in your own neighborhood. you're comfortable there. close to your job. staying put is always the number one choice. there are ways to improve your house to stay there if your needs are changing. addition has high cost to value

ratio. you can get a pretty good roi most of the time. >> i love return on investment when it comes to real estate. is it ever a bad idea. >> it can be a bad idea. it could have lose value if you're not there long enough. tough sit there for a while. you will not get dollar for dollar return on investment. don't overbuild for your neighborhood. that is common mistake. have a three bedroom home and change to six bedroom home and only six bedroom home on the street you won't make any money. gerri: hidden cost. >> some things folks don't think about increased heating and cooling costs. existing system will not work. most additions have three exterior walls. they need their own addition to function properly. more maintenance. higher property taxes. driving value. spend more on property taxes. there is emotional cost. gerri: what do you mean by that? >> emotional cost? gerri: yeah. >> all fun and games when you're starting, right. really excited. but when contractors are there six days a week and dirt and

dust and chaos that wears off pretty quickly. gerri: pretty quickly. i've been there that is stuff. i want to hear horror stories. you worked as a home inspector. you've seen the worst of the worst. >> no easy way to do this if you build addition. one of common things people take patio, a pat crow is a slab, four to six inches thick. they decide screen it in, right. put walls and windows. gerri: that's right. >> maybe they want to put turn tour out there. take screens out, put windows n. pretty soon, sliding door comes out. addition. a piece of concrete on dirt falling away. gerri: what is downside. you can't heat it? >> not built structurally correct. foundation has to be three feet in the soil. taking a garage, converting it to living space is smart thing to do. gerri: not? >> no. if you do it, go all the way. get rid of garage doors. put windows in, make it look like never existed. worst place pull up to house thinking about buying it.

oh, it has two qargha raj. doors don't open because they nailed it shut to convert to living space. gerri: people want garage. >> they do make decisions when they want to buy it. >> one of the things always frustrating looking for houses that addition doesn't match rest of the house. >> that is really good point. >> you have to have architect involved. if the architect is doing job properly. it looks always. you shouldn't tell from addition to original house if designed to bend in like it should. gerri: last thoughts. what should you be absolutely careful of? >> first of all, you want to go as green as possible. that is really important. you can do that now. gerri: why? >> because you will get good return on investment. cut your energy costs -- gerri: by the time you sell that house, everybody will expect those treatments. >> absolutely. other thing to think about might as well factor. if you will have six new windows put in with addition add a few more while contractor force is still there.

less expensive to add those while you're at it. gerri: sounds like you sold a few things. don't do half a job. what does that mean? >> don't go halfway. if you dot project, make sure you do it correctly. you need permits. there is requirements that towns have in terms of how much structure you can have on your property. do it right. comes time to sell, they look at all of those documents. if you didn't do it right didn't get a permit or variance, you will be in big trouble. gerri: absolutely. that could be a nightmare. i have to ask you about a study there is starbucks effect. >> yeah. gerri: if you buy a house or build a house near starbucks you increase value? that is stupid number. 96%? >> actually, i think what it was, they did a survey, they found between 1997, 2013 value of homes in area with starbucks went up 9% compared to 65% in just normal appreciation. about 30% bump right? we always say that the three most important things are location, location, and location. well apparently being near

starbucks also helps. gerri: is a location that matters. >> absolutely. gerri: be careful getting home. >> i will. gerri: coming up next in our user's guide to paying for college we have direct advice to one graduating high school senior. are we getting happier when we come to the financial situation? we results of new survey on investor and retirement optimism. results may surprise you. ♪ at ally bank no branches equals great rates. it's a fact. kind of like mute buttons equal danger. ...that sound good? not being on this phone call sounds good. it's not muted. was that you jason? it was geoffrey! it was jason. it could've been brenda. many people clean their dentures with toothpaste or plain water. and even though their dentures look clean, in reality they're not. if a denture were to be put under a microscope we can see all the bacteria that still exists on the denture and that bacteria multiplies very rapidly. that's why dentists recommend cleaning with polident everyday. polident's unique micro clean formula

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at ally bank no branches equals great rates. it's a fact. kind of like shopping hungry equals overshopping. ♪ gerri: welcome back to the willis report. in a moment, it's day four of our users guide to paying for college. but it's time now for a look at other stories in the news. there were minor injuries after a plane from atlanta skidded off the airport. it was carrying 127 passengers and five crew members. the airport was closed for a few

hours after the accident. meanwhile, there's nearly 2 feet of snow in kentucky and a foot in tennessee. it may be the last big blast of winter. fingers crossed. as temperatures plunge across the south mid-atlantic and northeast regions. turns out the white house didn't know about hillary clinton using her personal email account. clinton was not following rules given to all agencies. official business should be conducted on official email accounts. however, late yesterday clinton did urge the state department to release those emails. and no criminal charges will be filed against nascar driver kurt busch. he was facing charges of domestic violence against his girlfriend saying he choked her inside her home. delaware attorney general's office say there's not evidence to bring criminal charges. those are some of the stories in the news tonight. now, some good news, investor and retirement optimism is up. at least according to

wells fargo's calculations. wells fargo released their quarterly investor optimism today. the sentiments have been the highest since 2007. why are people so optimistic? vice president joe joins us. thank you for coming on the show. why are people upbeat in this survey? >> as you mentioned it's the highest surge since 2007. i think the enhanced optimism is driven on the outlook of their personally finances and improved economy. they're optimistic about the stock market in general. >> they're saving 108 due to low gas prices. this has paid a dividend. economists are wondering where that money went. well it went to savings. right? >> which i think is a good step. $108 in monthly savings. people stepped back and improved their personal balance sheets. a lot of economists thought it would be spent on consumer goods

and products. they paid down their debt and bills. a third said they'll increase their savings rate. those are positive things that investors did with the enhanced savings. gerri: i'm shocked by this. non-retirees say they'll have enough for retirement. every expert i talk to says we won't. >> well, it's interesting. 76% of the people we talked to said they feel confident or somewhat confident about their ability to have enough money during retirement. i think it's driven around the improved economy and their enhanced savings rate and their risk management rate. although they're bullish on the market, they're holding their course and feeling properly allocated. it's about managing risk today than chasing returns. investors are overall optimistic about their personal finances. gerri: let's talk about 401(k)s for a second. a third, a little more than a third say they

need help managing their 401(k) accounts. does that surprise you? >> you know, it doesn't. one of the things that's important you know, the whole industry has been built on consumer directed, self-directed 401(k)s. what we're finding is people move to technology and web. there's a group of people, over one-third that said, i need help. and one-on-one conversation is really important to me. so much so that 70% said they would benefit from a financial professional or one-on-one meetings or a meeting to help them make financial decisions. that was geared toward, help me allocate my assets. i think it's a wake-up call to the industry to say don't lose sight of, people need one-on-one insight. >> i think people are looking for guidance too. thank you for coming on the show tonight. we appreciate your time. and when we come back, why you're not paying any less for plane tickets despite falling oil prices. our users guide for college continues as a student and his dad

joins us to share their story of college acceptance. here's your consumer gauge. we'll be right back. ♪

gerri: i'm so excited. it's day four of our user's guide to paying for college. all this week, we've had the experts break down everything you need to know about cutting your college costs and choosing the best school. to check out their advice, go to gerriwillis.com. but tonight a family going through the college application process right now. here to share their experience and we have some advice for them from princeton review senior vice president rob. he's been here all week. boy i'm going to try this again. james. did i say that right? he's a high school senior at st. francis prep in new york. big school good school. his father is a retired

police sergeant. welcome to everybody. good to have you here. james you go to one of the most competitive high schools in the country. if you're there you're a rock star. do you feel prepared for college? >> i do. i took a lot of ap classes. our guidance department was great. i feel like i'm prepared. going to such a prestigious college, i feel prepared. >> you have applied a bunch of places where have you gotten into? >> i heard back from fairfield. scranton. maryland. then some schools regular decision. some boston college. villanova fordum. and i've ivies like harvard and yale. >> you applied to 12. >> around there. >> how many schools should you apply to? >> most students will apply to seven or nine

schools. there will be some superlative schools. particularly renaissance students like james. >> what do you want to study? >> i'm leaning toward history and political science. i want to go to law school. >> you're going to be president. >> yes. gerri: what do you tell students who are unindicted. maybe you don't know what you want to study. >> most students don't know what they want to study. most will go undecided. they have a love already. and that's terrific. most of them are liberal art schools. the first two years will be lots of general courses. at the end of your sophomore school, you'll know without question. gerri: you've applied to a lot of different places. is there one common theme with them? >> for me, i judge schools on the vibe. i'm walking on the campus. if i can picture myself there. i can picture myself walking across this lawn to go to class. it's important numbers and presteedge but will i be happy at this

school can i see myself here? >> it's what we've been discussing all week. finding your best school. fit financial aid. but getting that wonderful feeling -- gerri: i'm so glad you said i started with a list of party schools and worked my way through it. dad, let's start with you. the process of applying you know i've been looking at this forms. i've been seeing what they send back. i'm mystified by almost all of it. did they give you enough time to go through all of it? >> they don't give you enough time because the forms are difficult to fill out for a layman. i'm a retired police officer. it's difficult for me to fill them out. you need to print them out as a worksheet. prepare them. fill them in. send them in. >> robert, what's your best advice? people are still trying to fill out those forms? >> it's a noble process. gerri: a noble process? >> it is a noble process. you'll be able to get through it.

gerri: you can -- you can beat this. >> you can beat it absolutely. you have to take your time and think about things from an academic perspective and the financial aid perspective as well. it can be a bear because it scares a lot of students and families. gerri: what was the most confusing form you filled out? >> the css profile. gerri: what is that? >> you could probably explain that. >> some schools require you to fill out. gerri: even more so? >> more financial aid. it's very invasive. it's harder -- gerri: but you have to ask deep and personal -- >> oh, yeah. it's amazing. amazing. gerri: did you have to look stuff up? go back to your file drawer. 1986, what was i doing? >> they want to know the year before, the year prior, and the year you're going through it. gerri: okay. so what do you tell people about trying to put it all together? some families are blended families. and it can get really confusing with the details of, where is

mom? is mom paying for this? what do you tell people? >> what i love about this family. they've taken this process together. finding the best fit school academically. thinking about the financial aid process. they worked as a team and left plenty of time to go through the process. you didn't do it at the last minute. still can be overwhelming but you can master the process as well. gerri: we have something from cow cheney. i want to bring him into this conversation. he's not here. let's here from cal. >> colleges try to figure out how much you're trying to pay before you cry uncle and say we can't go. (?) so they're trying to get you to pay the most amount. you're trying to pay the least amount. you want to be prepared and do your homework. you want to be prepared to provide additional documentation to prove your case. gerri: so, robert, are you out there and trying to get a better deal right now? >> i've contacted some schools, and since the contact they've given us more financial aid and some work study program. gerri: i like that.

>> yeah. gerri: are you holding their feet to the fire? you have a fantastic candidate here. >> well, you have to be persistent. you need to call. listen, we need more money if you want us to attend the school. gerri: best thoughts on holding the schools feet to the fire. here's what the way it works. the student aid person is not your friend. they're trying to hold back all the dollars they can. and get you in there with the least amount of money. how do you get them to give more? >> the tide changes once the admission letter gets to the student. let's call it march 15 and may first where that school has to yield you as a student. when they give out money at the beginning, now the tide has turned. you can use that to your advantage to call the schools and be persistent and say this is our first choice. this is one of our top contenders. what can you do for me? gerri: look, i think that's the right advice. what would you say is

the single most best piece of advice you can give to other parents right now? >> i would tell parents to start the process early. get out there and visit schools. gerri: how many did you visit? >> approximately 25 schools. gerri: wow. that's a lot of travel, dad. >> a lot of travel. you have to coordinate all your visits. it's a lot of hard work. >> it's good to see all of them. do you like a suburban campus? do you like a mid-sized school? do you want a private or catholic school? you can narrow it down by seeing more that way. gerri: that helped you make up your mind. >> definitely. gerri: rob, last thoughts as we are prepared to go. it's great to have someone on who is in the middle of this. it has to be harrowing and sort of scary. it's a black box. you don't even come up with your estimated family contribution. they do it for you right? >> by may first you'll make this edition that

everyone will ask you about for the rest of your life. (?) awesome task. if you do it right. it's possible to do it right, it's an enrolling thing when you enroll as a freshman. gerri: now i want to go back to school. i'm excited about this. james, are you ready to go? >> i'm ready for the next chapter of my life. >> do you have an opiniondo you have a feel towhere you'll go? >> hopefully close to home, but i still want to dorm. gerri, all right president. you guys have to come back. come back and tell us how freshman year went. >> i will. gerri: thanks so much for sharing your story. thanks for opening us out. appreciate it. have fun in the snow. tomorrow, we're rapping wrapping our user's guide to paying for college. we have a panel of experts to answer your college questions. send us those questions. go on facebook or twitter or email us at gerriwillis.com. (?) and coming up next airlines flying outside the lines when it comes to rules about fuel

surcharges. why you haven't been getting a break in prices. we'll tell you all about. ♪

gerri: we had to bring you this story. airlines doing something very sneaky. some call it down right dishonest. we called them out on it. when oil prices go up, airfares go up as well. airlines are legally allowed to add on a fuel surcharged. oil prices have plunged and airlines are charging those sky-high fuel surcharges. this is how they're getting away with it. they're calling the fuel surcharge something else. allowing them to skirt

the law and ding your wallet. joe is here with us. george, this is crazy. (?) it seems like outright deception to me. the fees are hidden. would you agree? >> i think the whole fuel surcharge thing is a deception gerri. and i don't understand -- i do understand why the airlines do it. i think it's time for them to stop playing that game. >> it's a game that's for sure. the department of transportation says that airlines will charge a fuel surcharge, it has to be for real. it has to be related to the cost of the fuel. when a cost component is described as a fuel surcharge, that amount must reflect a reasonable aspect of the per passenger fuel cost incurred by the carrier. so the airlines are really weaseling out of this. and the way they do it they give it another name. let me show some of those names. they might call it a domestic surcharge or carrier imposed fee or

airline charge. this is just lying isn't it? >> it is. sometimes, gerri, the base fare is $99 on an international fare. at airfare watchdog we've seen the fare -- the surcharge is $1,000 and the fee $99. there's a couple of reasons why airlines do this. one is when they have a promo code or corporate discount, it only applies to the base fare. the discount is much lower than you might think it is. with frequent flier tickets they're able to add the surcharge to the supposedly free tickets. so you have a free ticket, you know to london and it's $800 sometimes in surcharges. >> wow. >> on that ticket. gerri: let me show you our example. american airlines or british airways. the round trip 1100 bucks roughly new york to london. what's the base fare? $483.

surcharge 458. almost as much as the base fare. i have to tell you george i still don't get this. how can they get away with this? >> well, they shouldn't be able to get away with it. they should roll in everything into the fare. and, you know, sometimes it backfires on the airlines. and, you know, they deserve it. we saw several times last year they forgot to put the fuel surcharge in or they reduced the fuel surcharge. they meant to reduce it by $10. instead, they reduced it by several hundred dollars. there's some really clever people who know how to make the fuel charge go away. we probably don't have time to talk about that. they call at it fuel dump. gerri: that sounds intriguing. maybe sometimes you have to come back and show us how to do that. i can't think of another industry that gets way with that thing. starbucks, well, gerri there's that milk surcharge if you want milk with your coffee. aren't they alone in

pretty much doing this kind of thing? >> they really are. i mean, some industries some delivery services like ups or fedex have added a pernlings percentage, less than 1%. even uber has added a fuel surcharge. but it's never, you know 80% of the fare or in some cases 90%. we literally see $99 to europe. and the rest of the 1,200-dollar fare is a fuel surcharge. the example you gave us is pretty moderate. gerri: it can be worse. >> much worse. gerri: so if you have a ticket in your hot little hand right now. here's what it might be called a domestic surcharge. carrier imposed fees. carrier surcharge or fee. that's what they're calling their fuel surcharge these days. they're hiding it from you so they don't have to follow the department of transportation rules.

sad news. but good to see you. now, we want to hear from you. this administration says it's doing all it can to help the middle school, but ismiddle classis it actually hampering the recovery instead of helping it? george says: hampering in every way possible. thomas: obamacare has thwarted small business full-time jobs are nonexistent thanks to obamacare. only jobs with less than 30 hours are available. the federal government never helps and only fees and restricts. in addition to following me on facebook and twitter, be sure to like fox business on facebook. we'll be right back.

gerri: is this administration helping or hampering the economy? we asked the question on gerriwillis.com. 3% of you said helping. 3%. a measly 3%. hampering was the most popular answer. coming up tomorrow, we wrap up our user's guide of paying for college.

as our panel of experts answer all your college questions. that's it for tonight's willis report. don't forget to dvr the show if you can't catch us live. "making money" with charles payne is coming up next. have a great night. charles: i'm charles payne, and you're watching "making money." the stock of the day easily was kroger. posted its earnings. sending the stocks to an all-time high. the company and the story of survival underscores the greatness of capitalism. back in 1998. kroger. they withdrew a 5 billion-dollar takeover offer. the stock plunged. down 86% in one day. they said, you know what, they spent too much money on this store. they were losing to the hypermarket. big box stores. but mostly walmart. company fought back as you can see. then it started to drift again. by 2005, it lost half of its value. again, people w