In the United States there was no such need, but there was a public aversion to government ownership of airlines. During the 1920s the financial lions of Wall Street were eager to make their fortunes in this new industry. Passengers, however, were not eager to buy air services at the prices of the day, and it seemed sensible to use air transport to upgrade domestic and international mail service while allowing air transportation to prove itself.
Accordingly, the subsidy for initiating air service in the United States came in the guise of generous long-term contracts to airlines to carry mail along both domestic and international long-haul routes after a "competitive" award by the politically appointed postmaster general. The pioneering routes of Pan American to South America and across the Pacific were financed by lucrative U.S. airmail contracts, with revenue from cargo or passengers a welcome by-product to be shared with the U.S. government.
Juan T. Trippe, the founder and president of Pan American, negotiated agreements between Pan American and foreign governments and bought out any foreign airlines that already possessed traffic rights in those countries in order to ensure that Pan American was the only bidder in the U.S. foreign airmail competitions. By 1939 the U.S. government had inserted itself into Pan American's negotiations with Great Britain on transatlantic service.
