Multiple issues there. The first is that nearly all non-american airlines are heavily subsidized by foreign gov. As such, it would not be fair.
Secondly, our real problem is that we have allowed Continental airlines to bankrupt not just multiple times, but in realatively short time frames. Worse, we continue to encourage mergers upon bankruptcy, and instead, should break them apart into multiple companies on the first bankruptcy.

So no, competition from foreign airlines that will be subsidized and not allow us to do domestic in their nation is not smart.