"...quoting their lowest fare for flights about which consumers inquire..."
That rule goes away July 1.
"...When they became privately-operated companies after '78..."
All airlines in the US, to my knowledge, have always been private companies. That is, the airlines, even during common carrier route regulation days, were not owned by the government.
Back before "deregulation" in the US, the airlines applied to the US government for rights to fly a route. The US government tried to take the view the US really only had one big giant airline, the common carrier.
This big giant airline was divided into three classes, International Airline, Trunk Airline and Feeder Airline. The individual airlines companies would fall into one of these classes. Routes were divided up and assigned according to what the government felt was best - was the route a trunk route, a feeder route, is there a monoply on the route, etc....
Pam Am was the sole International Airline under the common carrier route regulation, not the sole international airline, however. Under the common carrier regulations, the International Airline was not permitted US domestic routes, but was given first rights of refusal on international routes. If a international route deserved additional service and/or Pan Am decided it didn't want to serve the route, then other US carriers could apply and be granted routes. Thus the term Flag Carrier evolved, still used today. Flag carriers (international airline basically) are separate from the common carrier classes because the term Flag carrier requires additional operating capabilities of airlines/aircraft under certain conditions (long haul, basically).
Understanding how the common carrier route regulation worked is a lot more complicated than this, it was a process that evolved over many years. For example, the International Class was obviously created to accommodate, and approved by, Pam Am.
However, it all ended at the same time.
Today, airlines in the US are pretty much free to choose their routes, subject approval of the airports they want to serve. Routing is now deregulated.
There are, however still common carrier rules. For example, if you inter-line on a routing and your luggage gets lost, common carrier rules dictate which carrier is responsible for getting your luggage to you.
Hope this helps.
[Edited 2004-06-16 08:20:34]
Rex Kramer: Get that finger out of your ear! You don't know where that finger's been!