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The Time Has Come to Consider Re-Regulation of the Airline Industry


In a modern democracy, "regulation" is no longer a dirty word. Unregulated medications can hurt or kill you, unregulated monopolists can destroy competition, and unregulated home construction can lead to disastrous fires.

Although a small number of extreme libertarians will disagree with regulation of the above activities or products, the majority of Americans fervently approve them. None of us wants to eat diseased meats or llive in unsafe houses and most of us agree with regulation of industries that play an inescapable role in our lives and affect the vital interest of all of us.

The airline industry has grown to be a "public utility" vital to both our commercial and non-commercial lives. Few of us can avoid relying on airlines for our transportation needs. And today's airlines are operating as monopolists, charging what they alone determine without the need to confront competitive pressures. Unlike other products, we cannot go down the street to purchase an alternative.

For all intents and purposes, the airline industry has been reduced to four carriers controlling 86% of all U.S. aviation, each dominating a particular geographical area or popular itinerary: United, American, Delta and Southwest. The others---companies like Frontier, Spirit and JetBlue---are puny players accounting for a very small percentage of airline traffic.

The four behemoths each determine the prices to be charged in their particular areas. Their sole governing motive is to enjoy the largest profit imaginable, even if the prices resulting from that urge are fatal to the economic needs of a large part of the country.

Each such airline can fix fares, and choose penalties and extra fees, without fear that a competitor may undercut them. They can cut off services to small cities, charge ruinous rates to people in other areas, impose ridiculous change fees that amount to as much as $750 per passenger and they can impair the ability of families to sit together (a safety issue).

Every week, it seems, the four giants are thinking up additional fees and penalties with which to increase their profits. And we, the public, have no means of escaping those fees or the need to use airlines.

They have become, in sum, monopolists. They fulfill every definition of monopoly power. They are so important to our lives that we cannot avoid their machinations. 

As public utilities acting as monopolies, they need to be re-regulated. A public agency should be created that will prevent them from abusing their powers to affect our lives.


Photo credit: jikatu/Flickr