A happy story for consumers isn't necessarily a happy story for the airline industry, which bled an astounding $51 billion between 2001 and 2011 and lost money in every other year since 1981.

So, why have the last three decades been so good for flyers? And why don't we appreciate it?

THE DEMOCRATIZATION OF THE AIR

If you want a two-word answer to why airfares have dropped so much since the 1970s, it's this: Deregulation worked.

Before 1978, the airlines played by Washington's rules. The government determined whether a new airline could fly to a certain city, charge a certain price, or even exist in the first place. With limited competition, airlines were guaranteed a profit, and they lavished flyers with expensive services paid with expensive airfares. The silver and cloth came at a predictable price: The vast majority of Americans couldn't afford to fly, at all.

With prices skyrocketing during the energy crisis of the 1970s, an all-star team of senators and economists decided that Washington should get out of the business of coddling the airlines. Let's hear from a young former aide to Sen. Ted Kennedy named Stephen Breyer (oh, yeah, that Stephen Breyer) reviewing the free market case for letting airlines fly solo:

In California and Texas, where fares were unregulated, they were much lower. The San Francisco-Los Angeles fare was about half that on the comparable, regulated Boston-Washington route. And an intra-Texas airline boasted that the farmers who used to drive across the state could fly for even less money -- and it would carry any chicken coops for free.

Three decades later, the lesson from Texas -- if you deregulate the skies, ticket prices will fall -- has been applied across the country. The democratization of the air is obvious enough from the frenetic bustle of every major U.S. airport. But the stats are mind-blowing, as well.

-- In 1965, no more than 20 percent of Americans had ever flown in an airplane. By 2000, 50 percent of the country took at least one round-trip flight a year. The average was two round-trip tickets.

-- The number of air passengers tripled between the 1970s and 2011.

-- In 1974, it was illegal for an airline to charge less than $1,442 in inflation-adjusted dollars for a flight between New York City and Los Angeles. On Kayak, just now, I found one for $278.

Why did deregulation create such dramatically falling prices? "Flying is neither a life necessity like tuition, milk, or medicine, nor is it addictive, like alcohol or drugs," said John Heimlich, vice president and chief economist at Airlines for America. "When you have intense competition for a product that is price sensitive, you have falling prices."

MACHINE vs. MACHINE: THE PRICE WARS



In the showdown between airlines and flyers, both sides wield a formidable weapon. Airlines use computers to move prices. We use computers to find the lowest price. It's like a multi-billion-dollar game of cat and mouse played out between competing machines -- with William Shatner caught the middle.