Editor:
Tom Allison, at the time chief counsel to the U.S. Senate Commerce Committee that wrote the Airline Deregulation Act law in 1978, says the ADA resulted in cuts to airline salaries, slashed retirement benefits, forced job cuts despite rises in the frequency of airline services, bankrupted many formerly great airlines or forced them into bankruptcy protection, ruined standards of airline service, raised fares on most non-mainline services, and made life miserable for travelers and airline employees.
Exposure to competition led to heavy losses and conflicts with labor unions for a number of carriers. Between 1978 and mid-2001, nine major carriers and more than 100 smaller airlines went bankrupt or were liquidated — including most of the dozens of new airlines founded in deregulation’s aftermath.
The number of major carriers in the United States fell from six pre-Airline Deregulation Act to three by 1991. Since 2000 every major airline has filed for bankruptcy at least once.
The destabilizing effects of privatization were felt immediately and have become worse as time has passed. Along with a 40 percent drop in airfares since deregulation, airline employees have seen up to a 40 percent drop in income, affecting approximately 545,000 American workers.
A further consequence of the Airline Deregulation Act, Allison noted, which most Americans fail to appreciate, is that deregulation resulted in a “massive shift of airline debt to the public,” via a federal corporation established to pay the pensions (or a part of them) of the employees of airlines driven out of business or forced into bankruptcy.
“I had no idea these things would occur,” Allison says, back when he was a believer in deregulating America’s airlines.
Robert Crandall, former CEO of American Airlines, stated in 2008, “The consequences of deregulation have been very adverse.
“Our airlines, once world leaders, are now laggards in every category, including fleet age, service quality and international reputation. Fewer and fewer flights are on time. Airport congestion has become a staple of late-night comedy shows.
“An even higher percentage of bags are lost or misplaced. Last-minute seats are harder and harder to find. Passenger complaints have skyrocketed. Airline service, by any standard, has become unacceptable.”
The purpose behind government regulation is to create a stable industry.
Live and learn, right?
Unfortunately, no.
Diane Daiute
Sweet Home