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I wonder what would happen to costs if airlines didn't have their routes dictated to them. In other words, suppose airlines could drop those airports where daily flights don't make economic sense but they are forced to service even though they are not profitable. True, some cities would lose air service, but what if those cities had better rail service to major hubs? It's like railroads and canals way back in the 1800's. In England, they were complement goods...the rails took commodities from the canal endpoints to market. In other words, canals and rails worked together to get goods to market. In the US, they were substitute goods...they competed for business and the rails put the canals out of business. It's similar for the air-rail markets today. Passenger rail service is almost non-existent for most of us and, probably because it is gov’t run, Amtrak can't compete. Perhaps there is some way to make rails augment, rather than compete with, air travel. Just an idea...

You make some excellent points in that comparison between England and the U.S.

One thing to remember, though, is that England is a very small country compared to the U.S. The railroads and canals were able to complement each other because the distances traveled weren't long enough to put the canals at such a big disadvantage like you saw here in the U.S. during the 19th century. It's one thing to move freight by barge from Buffalo to New York City, but once the industry moved to places like the Midwest the railroads became the dominant form of transport.

I wonder what would happen to costs if airlines didn't have their routes dictated to them.

With the exception of Washington Reagan, and La Guardia where slots are owned and the gummint get't involved, the US airline industry has been deregulated for 32 years. Your premise is wrong. Airlines don't have their routes dictated to them.