Charges of fraud, collusion and favoritism erupted in relation to the airline industry and the contract approving government agencies. The collusion allegedly took place at meetings called “Spoil Conferences” which awarded $78 million in airmail contracts to selected carriers. In all, 18 out of 20 contracts went to consortia controlled by United Aircraft, Aviation Corporation and North American General Motors. We did not research as to how and when these charges were levied but the timing indicates the matter may have been a 1932 presidential election campaign issue.

            Shortly after the new administration took office, newly appointed Postmaster General James Farley instituted a departmental investigation. Not be outdone congressional hearings were also scheduled. Northwest’s Col. Brtittin and Croil Hunter were called to testify before the Senate Committee chaired by Alabama Sen. Hugo Black.

            There were apparently some very heated exchanges between Col. Brittin and the Chairman. Enough so that at the conclusion of the hearings Brittin decided, that to prevent further embarrassment and in the best interest of Northwest, to resign. The Board of Directors with “extreme reluctance” accepted his resignation. Interestingly, the only original Detroit director and friend of Brittin, Ford Chief Engineer Mayo, also resigned.

            On February 9, 1934 President Roosevelt signed an Executive Order authorizing the Post Office to cancel all of its airmail contracts. The order, affecting 26 routes and 12 companies (including Northwest Airways), also directed the Secretary of War to provide the Postmaster General with U.S. Army Air Corps (USAAC) airplanes, airfields and pilots to carry the mail. At the signing the USAAC chief declared the Air Corps was ready, able and willing to carry the mail. Well, sort of!

            Ten days later service was started on only 14 of the 26 routes formerly contracted to private carriers. The Air Corps simply did not have enough planes and those available, primarily Curtiss A-12 “Shrike” attack monoplanes, did not have the capacity to carry the mail and lacked the instruments needed for night and bad weather flying. After only three weeks of carrying the mail and nine pilots and passengers having died in accidents, USAAC suspended service to overhaul its airplanes and re-train its pilots. Flights were restarted ten days later but were suspended forever on June 1st after another series of fatal crashes.

            On June 12 “hurry-up” legislation was signed by FDR aimed at giving small private carriers a chance to secure airmail contracts, although they would have to show they could operate safely and efficiently. Those carriers would be awarded one-year contracts with extensions based on performance. To bid, former contract holders were required to change management and/or establish new identities. While the new contracts were expected to reduce taxpayer expense by 50%, ironically many airlines were the same as before. United, TWA, American and Eastern cornered most of the new airmail contracts resulting in the new network closely resembling the old.