this post was submitted on 10 Aug 2024
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Too much government control of the airlines was definitely detrimental after WWII. They couldn't compete on prices, couldn't adapt to changing routes, and couldn't really cost optimize anything. Deregulating the non-safety aspects improved air travel a lot.
There wasn't government control of the airlines, just regulations. Protectionist regulations.
The airlines were still privately owned and the government gave them sweetheart deals and intentionally limited the entry of new competition into the industry, allowing the formation of monopolies of the legacy airlines. There was no incentive for increasing the number of carriers because that would hurt profits, and the regulations helped by making entry into the market even harder.
That problem goes away if you just seize the airlines and run them as public utilities.
Why would government owned airlines incentive lowering operating costs?
Electoral pressure would incentivize keeping prices and costs lower; voters actually get a say in how public utilities are run.
What's the incentive for raising operating costs? No one is profiting from it.
Raising operating costs by servicing tiny congressionally important airports would definitely be a thing. And once you've added service to somewhere, you couldn't remove a flight without backlash. To pay the maintainers more, you'd make maintenance more convoluted than it needs to be.
And people voting have a lot better stuff to do than look into airline efficiency. Even tickets costing twice as much probably won't be a very important consideration when people are voting.
Why didn't this happen to the postal service?
Ticket prices have caused mass protests all throughout history. They literally toppled the government in Brazil over bus ticket prices. There's electoral pressure that you just aren't considering.