History of Airline Regulation Essay

The development of the airline industry dates back to the early 20th century but the industry boomed in the US in the late 20th century, Some experts (McDermott, 2017) attribute to the success to the deregulation of the airline industry under the Airline Deregulation Act of 1978, while others are skeptical about the overall effectiveness and necessity of the act, while they believe that the effects of the act are overestimated (Morris, 2017). Nevertheless, the Act was introduced under the impact of objective economic factors as well as on the upheaval of political liberalism in the US economic policy.

The early regulations of the US airline industry emerged along with the development of the airline industry. One of the early acts that set regulations on the airline industry was the Air Commerce Act also made the federal government responsible for advancing air commerce, establishing airways, establishing aids to air navigation, and enforcing safety rules and standards (McDermott, 2017). This act granted the government with the right to control the development of airline industry by defining routes, conducting air navigation, and other issues. As a result, the airline industry developed within the framework set by the government.

Furthermore, in 1938, the Civil Aeronautics Board (CAB) was formed to increase regulations on airlines. The CAB regulated most of what the consumer saw in regards to airlines (McDermott, 2017). In such a way, the government has taken control over the airline industry and controlled virtually every aspect of operations of airline companies. The government could influence the further development of the airline industry and companies operating in the industry.

In 1978, the Airline Deregulation Act was introduced and this act contrasted to previous initiatives of the US government because this act deregulated the airline industry. The Act prevented the U.S. government from controlling fares, routes, market entries, and flight schedules (McDermott, 2017). The only aspect that remained under the government control remained under the safety of air flights and operations of airline companies. Therefore, the government liberalized its policies and retained control only over the safety of the airline industry.

There were multiple reasons for the deregulation of the airline industry. Unregulated airlines charged far lower fares (Deregulation: A Watershed Event, 2007). The government was really slow in the decision making process. Between 1965 and 1978 the CAB approved fewer than 10 percent of airline applications for new routes. Continental had to wait eight years for approval to fly from San Diego to Denver (Morris, 2017). In addition, the political environment before the introduction of the Airline Deregulation Act was favorable for the implementation of the act because the Democrats had the majority in the Congress and they held a strong position in the Congress.  At this point, it is worth mentioning the fact that liberals believed that the government regulation in terms of policies that preceded the introduction of the Act slowed down the industry development and raised unsurpassable barriers on the way to the successful development of airlines.  Liberals believed the government bureaucracy was the unbearable burden for the aviation industry.

However, the past regulation was driven by the necessity to set the government control over the industry, where risks were high and safety issues were of the paramount importance. At the same time, the government control over development of airline companies was driven by the attempt of the government to keep skies under the total government control and to prevent the risk of the emergence of uncontrollable expansion of airline companies.

Thus, the government regulated the airline industry to enhance the safety and to make the airline industry development manageable.  However, the government regulation resulted in overregulation and the deregulation has started since 1978.

References:

Deregulation: A Watershed Event. America by Air. Retrieved fro, https://airandspace.si.edu/exhibitions/america-by-air/online/jetage/jetage08.cfm

McDermott, J. (2017). The History of Airline (De)Regulation In The United States, Aeronautics. Retrieved from http://aeronauticsonline.com/the-history-of-airline-deregulation-in-the-united-states/

Morris, D. (2017). irline Deregulation: A Triumph of Ideology Over Evidence, Huffington Post. Retrieved from https://www.huffingtonpost.com/david-morris/airline-deregulation-ideology-over-evidence_b_4399150.html

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"The terms offer and acceptance." freeessays.club, 17 May 2016

[Accessed: July 2, 2020]

"The terms offer and acceptance." freeessays.club, 17 May 2016

[Accessed: July 2, 2020]

"The terms offer and acceptance." freeessays.club, 17 May 2016

[Accessed: July 2, 2020]

"The terms offer and acceptance." freeessays.club, 17 May 2016

[Accessed: July 2, 2020]