Anthony Sampson specializes in writing readable books about world business, including the oil companies ("The Seven Sisters"), the international trade in weapons ("The Arms Bazaar"), and big banks ("The Money Lenders"). His latest, a fast-paced treatise on international airlines, comes as their long-established patterns of protection are under increasing attack from the consumer movement.
The specialist who wants to know the specifics of how Juan Trippe built Pan American World Airways or how Howard Hughes almost ruined Trans World Airlines will need to look elsewhere because Sampson roars at breakneck speed through almost all the airline histories. His contribution here is to see and understand the bigger picture -- how international airlines have both battled against and schemed with one another to establish themselves as an essential of modern living. The underlying question, of course, is whether the changes deregulation has brought to the airline business and its consumers in the United States can or even should be exported.
So far the benefits of airline deregulation have largely been limited to the U.S. domestic market and to the North Atlantic. It is cheaper to fly from London to New York than from London to Nice as the European carriers and governments continue to have high fares and inefficient operations.
Global flight has become a fixture in many people's lives. The multinational corporation assumes its executives will be able to fly halfway around the world in 24 hours. The immigrant from Europe knows he can make a trip home and back in a week or less and, if he is careful, pay less than he would for an Amtrak ticket from Washington to Los Angeles. At the same time, governments have found airlines to be an essential political extension -- flag carriers to the world -- and have been more than willing to subsidize their own international carriers and protect them from foreign competition.
International airlines -- including those bearing the U.S. flag -- are no more willing to share their markets than any other entrepreneurs and look quickly to their governments to protect them from incursions. While Country X may permit Pan American World Airways to land there en route to somewhere else, it will not permit Pan Am to pick up passengers who could fly on Country X's own airline. Pan Am in turn lobbies the State and Transportation departments to impose the same restraints on Country X's airlines.
Furthermore, if several airlines share an international market -- such as Paris to Boston -- they can (and do) get together through the International Air Transport Association and agree on what the fare will be without having to concern themselves about whether they will be the target of treble damages under the Sherman Antitrust Act. Even with an agreement, however, there is no guarantee one of the airlines won't cheat to meet a sudden need for improved cash flow.
A recurring Sampson theme is that the great promise aviation seemed to offer to world unity and international understanding when Louis Bleriot made his historic first flight across the English Channel in 1909 has never been realized. He writes, "The hopes and promises behind the concept of 'freedom of the air' soon faded as governments enforced their controls over airspace, landing rights and flight paths; the limitations on freedom were signalled on the political side by the Soviet destruction of the Korean airliner, and on the economic side by the national responses to the American deregulators; as they tried to spread their policy abroad the deregulators succeeded only in mobilising nations against them, and showing the power of coordinated mercantilist states."
He makes much of the role of British and other North Atlantic airlines in the death of Sir Freddie Laker's low-fare Skytrain service, an issue that remains alive in U.S. civil courts where Laker is pursuing suits against major British and American carriers serving the North Atlantic.
Competition -- or the absence thereof -- was part of a thorny diplomatic issue between the United States and Great Britain when the U.S. Justice Department convened a grand jury to investigate possible criminal antitrust violations by airlines flying between the United States and Britain. In November President Reagan, responding to State Department entreaties, ordered a halt to the investigation, which the British had seen as an attempt by the United States to extend its antitrust laws beyond its boundaries.
The central question is whether there is a way for a People Express-type operation to succeed in the international arena, with airline-owning nations protecting the fare levels of their own inefficient carriers. Sampson can't answer that because he is burdened with the same constraints as those of us who watch domestic deregulation: we know things are changing, we know there are going to be winners and losers and considerable unpredictability for travelers, but we don't know, and Sampson doesn't know, what the last chapter will say.