Money on the wing: The deregulation of banks and airlines from a contingency perspective

Thirty years of regulatory change in the banking and airline industries illustrated the shifting interconnections between the state, business, and labor, and the mechanisms through which state policy creates and maintains the conditions necessary for the long-term continuation of the US system of private capital accumulation. State theory regarding the state-policy formation process has recently taken an accommodationist turn: rather than reject some theoretical positions in favor of others, current research has sought to specify the conditions under which the policy formation mechanisms identified by the three grand state theories compliment one another. This accommodationist turn has four themes: processes of state policy formation are characterized by sporadic fragmentation and antagonisms within class groupings; the unity and political organization of a class grouping are affected by the perception of a threat to or opportunity for that group\u27s interests; state and societal policy determinants reciprocally modify one another; and, one must specify the historical conditions under which a class grouping will be unified or politically effective, or both. This research organized the contingency inherent in these four themes using the concepts of state projects and the balance of class forces. Commonly understood as an economic phenomena, deregulation has seen little study from the field of political sociology. The deregulation of the banking and airline industries was a dramatic shift in the regulatory state project precipitated by crises in these industries and the larger US economy. As a consequence of these forces and other factors associated with the organization of these industries, those opposed to deregulation were unable to prevent it. In the airline industry, the power of organized airline labor substantively diminished from the time of the 1966 International Association of Machinist\u27s strike, through airline deregulation in 1978, and up to the 1981 Professional Air Traffic Controller\u27s Organization strike. Similarly, banking deregulation in 1982 and the 1989 bailout of the savings and loan industry gave state support to finance capital at the expense of consumer, community, and labor groups. Deregulation was not a class-neutral shift in economic policy--state policy maintained the capitalist structure of relations between the state, business, and labor.