The possibility that Congress may enact legislation to reduce federal regulation of the airline industry increased yesterday with the announcement that the House Aviation subcommittee would begin marking up such a bill on March 1.
Although the Senate is set to consider a measure following the debate on the Panama Canal Treaty, proponents of the measure were worried that time would run out on the measure in this Congress unless the House began work on it soon.
In a join statement yesterday, Aviation Subcommittee Chairman Glenn M. Anderson (D-Calif.) and Public Works and Transportation Committee Chairman Harold T. (Bizz) Johnson (D-Calif.) pledged to bring the bill to the House floor as soon as possible after committee action is completed.
"This reform is long overdue, and we are convinced that the public interest demands prompt action," they said.
The outlook for the passage of the legislation is improving at the same time as the Civil Aeronautics Board itself is undertaking to remove many of the restraints placed on the industry during the last 40 years of regulation, and to restore the industry to the rule of the marketplace as much as possible.
But CAB Chairman Alfred E. Kahn and other proponents of legislative action insist the Congress needs to revise the 1938 law which the board currently administers.
In answer to a question at the New York Society of Security Analysts Thursday, Kahn said legislation was necessary for at least three reasons: To move the "protectionist" orientation of the 1938 statute that induced prior CAB members to keep the industry from competition and may keep the curent board from doing all it needs to do, and to protect the future.
"If you can have a board of one kind one year, you can have another kind of board another year," he warned.
Kahn also suggested that there appears to be a general consensus in American society that government has bitten off more that it can chew, and is "not doing some of it very well." He said he perceived a welcoming of the goal of reducing government involvement where it may not be ncssary.
Discussions with security analyst, investment bankers and airline officials in attendance at Kahn's New York presentation revealed an increasing acceptance of the inevitability of some form of deregulation and less fear of it than there had been two years ago.
Alfred H. Norling, who has followed the airlines for years for Kidder, Peabody & Co., contrasted the reception to Kahn's message to the "hostile" reaction he said former CAB Chairman John E. Robson got when he "said many of the same words" two years ago.
Norling said he was impressed with Kahn's appreciation of the economic problems of the industry and his refusal to make promises that no one would believe.
"It's not so much a question of coming to support deregulation," he said. "It's more one of gradual accommodation to the idea."
The chief executives of several airlines who listened to Kahn's speech support the board's current efforts and the proposed legislative changes. "We're not particularly fearful of the environment he's prescribing." William T. Seaweil, chairman and chief executive officer of Pan American World Airways, said, "In many ways it's attractive to us."
In response to an obvious invitation from Kahn to the traditionally "international" airlines to apply for domestic routes, Seawell said Pan Am would respond with some applications this month.
Albert V. Casey, chairman and president of American Airlines, does not support the current direction of the board or the pending legislation. He contends it would not reduce the board's involvement in airline matters. But he complained that the current CAB keeps changing the rules. He noted that American had just spent millions of dollars changing the seating arrangements in planes to adjust to the board's rules on first class and coach fare differentials only to find that now the board is thinking about abandoning them.
"They keep moving the goal posts," he lamented. "We're not afraid of deregualtion though," he said, "if they really took off all the wraps."