The rationale for the Airline Deregulation Act, like that of deregulation generally, was to mobilize the infallible wisdom of the marketplace. By eliminating the Civil Aeronautics Board, congress could unleash the lean, innovative “nature” of unrestricted free enterprise. Free market competition would lower fares and increase efficiency. Indeed, from the tumultuous period following the ADA emerged at least two significant consumer-friendly innovations: “hub” airports, and frequent flyer rewards programs. It also, of course, initiated a period of union-busting which, over time, created the pervasive overwork and underpay notoriously enjoyed by contemporary pilots, flight attendants, and other airline personnel. The ADA also provides the legal foundation upon which airlines have argued that they cannot be required to compensate ticketholders for canceled flights or provide water, food, or bathroom facilities during 12-hour tarmac confinements.
A month after the ADA took effect, Foucault began his Birth of Biopolitics lectures at the College de France. Prophetic and incisive in their critique of the various veins of neoliberalism which would flourish in the decades which followed, these lectures have, since their publication in 2004, become as much a part of heterodox economic discourse as Marx’s Capital or Keynes’s General Theory. In his fifth lecture, Foucault argued that “what is important and decisive in current neo-liberalism” emerges from a formula first postulated by the Freiburg ordoliberals as an antidote to Nazism. Whereas Enlightenment liberalism promoted free markets supervised by a disinterested state, the ordoliberals imagined a state under the supervision of the disinterested market. Ensuing generations of neoliberals, diffuse and contradictory though they may be, align around the proposition that “a market economy can in fact serve as the principle, form, and model for a state which, because of its defects, is mistrusted by everyone on both the right and the left, for one reason or another.”
The Airline Deregulation Act of 1978 dismantled the Civil Aeronautics Board, which had used state authority to regulate fares, wages, working conditions, routes, and schedules. The business of airlines, outside of the certification of personnel and the inspection of aircraft, became self-regulating. Insofar as the Department of Transportation has any jurisdiction, it reports to the airlines. Presumed to be the source of an apocryphal “passengers bill of rights,” DOT acknowledges on their Fly Rights webpage that they cannot promise anything legally-binding, but merely distribute a set of guidelines from consultation with the airlines which are subject to constant amendment and voluntary observance.