Airheaded Antitrust Policies Keep Passengers on the Tarmac

The past half-century has seen a breathtaking boom in air travel. A mode of transportation that was once a luxury is now a shared experience that millions of Americans partake in every year. The percentage of Americans who have flown commercially in their lives skyrocketed from 63 percent in 1977 to almost 90 percent in 2022. Yet, regulatory headwinds threaten America’s dizzying ascent airborne.

In recent years, antitrust bureaucrats at the Department of Justice (DOJ) and Federal Trade Commission (FTC) have used far-fetched theories to prevent airline mergers. These deals would have meant lower prices and more options for millions of consumers. Bureaucrats— and their airheaded theories—should take a back seat to free choice and open competition.

Air travel has transformed from a rarity to a common method of transportation for Americans of all income levels. This transformation could not have happened without significant deregulation of the airline industry. A light-touch approach allowed airlines to compete on price and gave them more flexibility in defining their routes. The impact of former President Jimmy Carter’s liberalization of passenger air in 1978 manifested quickly. The sector experienced a nearly 67 percent drop in airfare prices in just five years. The success of these changes for travelers is clear. In 1977, just 25 percent of Americans had flown commercial in the past year. That figure increased to 44 percent by 2022. Meanwhile, employment in the air transportation industry experienced a dramatic jump post-reform, increasing from about 300,000 jobs in the 1970s to about 550,000 jobs in the 1990s.

Such success would have been considered unthinkable in a previous era. The deregulation of the airline industry has proven a resounding success that has sparked a true golden age of travel.

Yet, overzealous antitrust enforcement threatens to keep an ascendant industry stuck on the tarmac. One recent example has been the DOJ blocking the proposed Spirit-JetBlue merger. After a successful challenge to the merger, Spirit has struggled mightily to resolve its financial woes. It has filed for bankruptcy twice since November 2024, and the company’s CEO recently stated that the company is working to reduce capacity by 25 percent. Flight attendants are being put on furlough en masse, a sad and direct consequence of the government’s inability to let successful companies acquire struggling ones through market processes.

Even when the government opts not to block a merger, it often mandates an extremely burdensome “Second Request” process that takes months to complete and costs millions of dollars. This broad-based request for information from merging companies—which encompasses mountains of emails, board documents, and even personal chats—results in costs passed along to consumers, including higher airfares. One recent example is the Alaska-Hawaiian merger, which involved two companies that only competed on about 3 percent of routes. The DOJ nonetheless foisted costly mandates on the merging companies.

Instead of onerous antitrust enforcement, policymakers should embrace pro-market reforms that lower barriers to entry in the airline industry. It’s time for a new approach that puts competition and innovation in the cockpit.