Regulation and Deregulation

From the mid-1920s through the early 1980s, the U.S. government regulated the U.S. airline industry. In 1925, the passage of the Air Mail Act required the Post Office Department, now called the U.S. Postal Service, to contract out the air mail routes it had pioneered beginning in 1918 using private contractors. Congress intended the legislation to help foster the growth of passenger airlines in the United States. Postmaster General Walter Folger Brown had that in mind when he pushed for a revision of the Air Mail Act in 1930. He believed that only the largest and best capitalized of the airline companies should carry the mail. Eventually, he believed that these carriers would earn their profits from passengers rather than relying on airmail payments.

His efforts, ...