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The latest on airline deregulation

Nick Gillespie from the July 1996 issue

A new study from the General Accounting Office demonstrates that the Airline Deregulation Act of 1978 has, in the main, brought prices down to earth while giving consumers more and safer flying options. The report, which looked at data from 112 airports, supports the conclusion that by virtually every measure, deregulation has been a huge success.

Sifting through records from the past 25 years, the GAO found that the average inflation-adjusted fare per passenger mile was about 9 percent lower at small-community airports, 11 percent lower at medium-sized facilities, and 8 percent lower at large- community ones. The largest savings were found in the West and Southwest, reflecting those regions' greater competition; some airports, especially smaller ones in the Southeast and Appalachian regions, experienced increases in fares.

Overall safety and service have improved dramatically as well. "The long-term decline in the rate of accidents has continued since deregulation," says the GAO. And while some small and mid-size airports in the upper Midwest have seen a decline in the number of scheduled departures, the overall trends are staggeringly positive: For airports serving small communities, departures rose by 50 percent; for medium-sized communities, 57 percent; and for large ones, 68 percent. Nonstop destinations from large airports have risen over 20 percent since 1978. Small decreases in nonstop destinations from small and medium-size airports were more than offset by increases in one-stop service. So despite the cutback in nonstop flights, says the GAO, people flying out of small and medium facilities are "better connected to the entire domestic aviation system in 1995 than in 1978."