The Shrinking Skies

The prevailing wisdom among economists is that government regulation is a universal impediment to profits. Never mind that some regulations like safety belts, car seats and auto emission standards, save lives and keep our air cleaner.The most bullish pro business conservatives will argue that if the governments wants a robust economy, it should cut the regulatory red tape and get out of the way.In some industries that may be true; but in others, deregulation has been an unqualified disaster.The most glaring example:

The U-S Airline Industry. Jimmy Carter deregulated the airlines in 1978. Before Carter there were a number of strong airlines out there, aided by a shared fare structure, sensible routes and manageable fuel prices. Yet the airlines chafed at being worker slaves to the powerful F-A-F. So de regulation came…and suddenly airlines went. Familiar names were grounded by money problems and or union problems. National, Eastern, Pan Am, Mohawk, Piedmont, PSA. Some were gobbled up in Mergers, other start up carriers jumped in with big hopes…Like People Express…which flourished for a while with cheap fares and pay as you on board amenities. You were your own baggage handler. Eventually as fuel prices rose and ticket prices rose Peoples couldn’t absorb the cost and folded.

Then consolidation and bankruptcy…today..it appears American and U-S Airways will announce the latest merger…The American name will stay…and non stops will be hard to find….instead plan to go through any of six hubs…Dallas..Phoenix…Chicago…Pittsburgh..Miami, NY and LA.

If approved, the new carrier will be the biggest in the country…and will leave the flying public with a few big options, several smaller airlines and the foreign carriers...in 1977..there were more than 200 airlines large and small flying across the u-s---that gave us options....…today-outside of those triple a affiliates of the big carriers..your choices are United…American..Southwest..Alaska or Frontier Delta….All but southwest have gone belly up or reconstituted through a merger…it means fewer choices for us..smaller planes and probably more hassles...so the industry has been regulated...but while more of us are flying..we have fewer choices, fewer direct flights, less room and more hassles...Progress...