Federal regulations do not permit Americans to fly on a foreign-flag airliner between two points in the U.S. The ability of an airline from one country to carry passengers freely within another is known as "cabotage" and some economists think its about time we adopted the practice.

• This regulation affecting American passengers has its origins in the 1920 Jones Act, which required that goods shipped between U.S. ports travel on vessels owned and staffed by Americans.

• Critics point out that the rule limits choices, increases prices, stymies free trade and misallocates resources.

• Since 1993, airlines based in European Union countries have enjoyed cabotage within other EU states -- with inter-EU routes growing from 490 to 520 between 1993 and 1995.

• A net total of 20 airlines have been added in these territories and at least 90 percent of passengers are paying cheaper fares, in real terms, than they did in 1993.

The Senate Commerce Committee plans hearings on the Jones Act and anti-cabotage regulations on September 15, 1998.