Air Mail scandal

The Air Mail scandal, also known as the Air Mail fiasco, was a political controversy that erupted in 1934 following a congressional investigation into the awarding of airmail contracts to select airlines. The scandal intensified when the U.S. government revoked these contracts and assigned mail delivery to the U.S. Army Air Corps (USAAC), leading to disastrous consequences.

Under President Herbert Hoover, the Air Mail Act of 1930 allowed Walter Folger Brown, then the Postmaster General, to award contracts at the "Spoils Conference", where major airlines divided routes among themselves, excluding smaller carriers. When details of the conference emerged, it became a scandal. A Senate investigation led to a contempt of Congress citation against William P. MacCracken Jr., the Assistant Secretary of Commerce for Aeronautics, but no further action was taken against Hoover Administration officials.

In response, newly elected President Franklin D. Roosevelt canceled all airmail contracts on February 19, 1934 and assigned the USAAC to carry the mail. However, the military was ill-equipped for the job, and severe winter conditions led to numerous crashes and the death of 13 airmen within days, sparking a public outcry, and would be called a fiasco in the press. Roosevelt ordered the service be returned to the airlines and Postmaster General James Farley issued temporary contracts on May 8, using a process similar to the original Spoils Conference. The airlines resumed operating the flights by June 1, and soon after, Congress passed the Air Mail Act of 1934, repealing the 1930 law, penalizing executives involved in the earlier deal, and leading to the break up of the United Aircraft and Transport Corporation. The scandal also led to significant reforms in the airline industry, that spurred technological advancements, a shift toward passenger transport, and the modernization of the USAAC.