Airline Deregulation

Essay by Clift567University, Master'sA+, June 2004

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Could you imagine being controlled at all times from your parents? Them able to tell you when and where you could go, what time, what time you can return, and of course how much you can spend? Well when we were all kids we were regulated like this, but as we became older we were less and less regulated. At age 18 we were deregulated, where we can go and come as we please, technically not having to listen to the governing authority. This is how the airlines were treated until 1978.

Before 1978 airlines were treated like kids. They could only fly where (the parent) the government would let them. Air travel started back after World War I, when only the rich or very well off people got the opportunity to fly. It was an expensive way to get from point A to point B. How it came to be was airlines or companies as they were called back then, bid for air mail routes, which was granted through the government.

Carrying passengers became an extra venture as the airlines got bigger aircraft. The passenger though carried paid a big price to fly. One: because it was a luxury to fly back then, and because the government was the one saying how much the airline could charge between two cities. There was no revenue per seat mile back then. Soon there were only four companies flying the mail across the country. These were called the "Big Four" Eastern, United, American, and Trans World airlines. These carriers dominated air transport back then, but only domestically. Pan American (Pan Am) held the rights to international routes only. "In 1938 the Civil Aeronautics Board (CAB) was established to form new licenses for airlines, grant new routes, approve mergers, and investigate accidents." (West...