The following research is on the subject of the Airline Deregulation Act of 1978. Airlines in the United Stats are riding the crest of a wave of increased passenger travel the likes of which has not been seen since the introduction of the jet into commercial aviation in 1960. Passenger-miles are up, new orders for aircraft from both domestic and foreign manufacturers are up as the airlines replace their aging fleets and capitalize on new designs and new technology that allow them to fly more people on less fuel than ever before. And airline profits are up as well. To fly the new planes which carry people who have never flown before, the airlines are in a frantic scramble for new pilots, since it is also true that the "first generation" of World War II pilots is now retiring, and the airlines are wooing hundreds of pilots a month away from the armed forces.
Much of the responsibility for this vast influx of new passengers must go to the federal government, particularly the Civil Aeronautics Board, which over the last two years has undertaken a policy of loosening restrictions on the airline rate structure, a policy which has enabled air carriers to cut a variety of prices, attract more passengers, and still maintain healthy profits. These price-cutting policies culminated in the Airline Deregulation Act of 1978, which is the subject of this paper. We shall examine briefly the history of CAB regulation of the airlines, the policy changes made by the Carter Administration and its then-CAB Chairman Alfred Kahn, now the President's chief anti-inflation fighter, the battle surrounding both the gradual de facto deregulation and the Act itself, and, though it is still early, some of the effects of deregulation on the health of the industry. And we shall see how one airline, virtually alone in supporting deregulation at the time, has been the first to be hurt - in a round-about way - by it.
Government first got involved in some...