There is a connection between airline deregulation and Braniff International's financial failure --namely, that the freedom of the market is the freedom to make bad business decisions as well as good. The key decision by Braniff, made after passage of the deregulation act four years ago, was to expand its operations dramatically all over the world. For several reasons--sharp increases in fuel prices, continued high interest rates, a recession and stiff competition-- Braniff's decision backfired. By the time a new chairman of the airline stepped in to engineer the necessary decision to pull back and cut losses, Braniff's cash shortages proved overwhelming.

But the new chairman, Howard D. Putnam, makes no argument for the return of airline regulation. Nor does he cite deregulation as the cause of Braniff's troubles. Dan McKinnon, chairman of the Civil Aeronautics Board, agrees. As he noted last week, there are troubles in many industries--housing, lumber, agriculture, steel and automobiles. Airlines are not exempt from economic pressures.

The Braniff failure is the first by a major domestic airline--though a British carrier, Laker Airways, went bankrupt earlier this year. But if high interest rates and a recession continue, there may be major bankruptcies in other industries. So far, the casualties have not been heavy, and consumer demands-- or lack of them--have been accommodated one way or another.

To say this is not to dismiss the sadness and personal hardships of those affected by Braniff's collapse. A comeback is not impossible. But in the meantime, there is no cause for government alarm, subsidy or reinvolvement in the regulation of airlines.