> From the late 1930s through the ’70s, the federal government regulated airlines as a public utility. The Civil Aeronautics Board decided which airlines could fly what routes and how much they could charge. It aimed to set prices that were fair for travelers and that would provide airlines with a modest profit. Then, in 1978, Congress passed a sweeping law deregulating the airline industry and ultimately abolishing the CAB. Unleashed from regulation, airlines devised new tactics to capture the market.
That makes it sound like air travel was great before free markets stepped in. The real cost of air travel fell by about half since then. Before deregulation, there weren't as many competitive incentives, and airlines couldn't experiment with routes. Air travel became much more popular and got much safer (this might be a coincidence). Granted, service got worse, but you can still buy service at 2x the price in first class. People just don't.
There are probably a bit too few customer and worker protections, but on the whole, airline deregulation shows just how bad command economies are at planning and allocating resources.
That makes it sound like air travel was great before free markets stepped in. The real cost of air travel fell by about half since then. Before deregulation, there weren't as many competitive incentives, and airlines couldn't experiment with routes. Air travel became much more popular and got much safer (this might be a coincidence). Granted, service got worse, but you can still buy service at 2x the price in first class. People just don't.
There are probably a bit too few customer and worker protections, but on the whole, airline deregulation shows just how bad command economies are at planning and allocating resources.