Matthews: Don’t let Washington do to airlines what it did to Amtrak

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A record number of travelers — 2.9 million — took to the skies on the Friday leading up to Memorial Day. And 7.7 million for Friday, Saturday and Sunday combined. Americans want to fly, and in an era of expensive groceries, gas, food and rent, the last thing anyone wants is a massive increase in airfares.  

But that’s precisely what travelers could soon experience if lawmakers push through new restrictions on prices, routes, baggage policies and even seat sizes. 

More airline regulation might sound appealing to frequent fliers. But regulations and red tape always come with a cost, often in higher prices but also in reduced access and less convenience — and unintended consequences.  

We know this because the air travel industry used to be heavily regulated. Until the late 1970s, government officials set fares, routes and schedules for interstate air travel. Prices were sky high, the industry operated inefficiently and relatively few people flew.  

Lawmakers, including those who were normally government-regulation advocates, decided they had to do something. Congress passed, and President Carter signed, the Airline Deregulation Act in 1978. The law ended government micromanagement and allowed airlines to determine their own routes and prices. Even the late big-government, liberal-icon Sen. Edward Kennedy (D-Mass.) was one of the primary leaders of the airline-deregulation effort. 

The change unleashed a wave of industry competition and allowed new low-cost operators to enter the market. Predictably, choices skyrocketed and prices fell — though significantly higher airport fees and taxes today diminish some of those savings.  

Thanks to deregulation, most Americans today can afford to fly, and the Memorial Day travel is proof. On an inflation-adjusted basis, the cost of flying is half of what it was before Congress deregulated the industry. 

Deregulation also led to more options. The number of cities connected via nonstop service, and the number of carriers providing that service, increased markedly.  

More affordable tickets and an explosion of routes made flying accessible to millions of Americans who had never flown. In 1977, just a quarter of Americans reported flying in the past year. Today, it’s close to half. In fact, nearly 90 percent of Americans have flown in their lifetime. 

Considering these positive outcomes, why do some policymakers seem increasingly intent on bringing back onerous airline regulations? Especially considering the government already has a less-than-stellar public-transportation track record — that is, Amtrak. 

Amtrak, created in 1970, is a government-subsidized public train system that receives billions of dollars in taxpayer subsidies. Government created the system because federal regulations, price controls and generous union contracts meant passenger trains were losing money. And yet the Washington Times notes that today, “Even with all that [taxpayer-provided] money, there are still widespread complaints about the train service. Signal problems, mechanical snafus and computer breakdowns are seen across the country.” Amtrak was set to make a profit for the first time in 50 years, until the pandemic hit. 

In Congress, members have proposed legislation that would pave the way for more federal control of airline baggage policies, fees and even seat sizes. And a recent Department of Transportation rule imposes complex new restrictions on airline refund policies that even the most seasoned traveler may be hard-pressed to understand.  

Taken together, the changes amount to an oversized regulatory regime that would be expensive and time consuming to comply with. As a result, some airlines could be forced to raise prices or even cut unprofitable routes. 

Ironically, proposals to re-regulate the airlines have nothing to do with passenger safety. It’s been 15 years since the last fatal U.S. commercial airline crash.  

To be sure, there’s room to improve America’s air travel system. The pandemic hammered the airlines and getting back to normal has been a challenge for both the companies and passengers.  

In addition, staff shortages among air traffic controllers remain a persistent problem and can contribute to frustrating flight delays and cancellations — not to mention barley averted accidents. And outdated facilities and infrastructure continue to pose challenges in many parts of the country. But remember, many of the broken parts of the system are largely under government control already — the same government that wants to control even more. Even if re-regulation advocates claim their proposals are minimal, the fact is small steps are usually just first steps to government taking bigger steps.  

Subjecting airlines to burdensome new regulations similar to those that existed before 1978 wouldn’t make air travel better. Rather, it would lead to higher costs, fewer routes and less-satisfied travelers. And once those problems got worse, we would likely see Washington claiming it needed to take even more control, just as it did when it created Amtrak. Don’t let Washington do the airline industry what it did to train travel. 

Merrill Matthews is a resident scholar with the Institute for Policy Innovation in Dallas, Texas. Follow him on X@MerrillMatthews

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