I've only taken a few business courses, so this may sound very naive, but:
every company has fixed costs. Insurance, airport space, terminals, etc.
To generate cash to pay these costs the airlines sell tickets. However, their variable costs far exceed the revenues generated by those activities. So basically every flight they operate digs them deeper into debt.

I'm not advocating the end of majors, but instead of cost cutting and low ball ticket fares, it seems the majors would learn that they need a new approach to the industry. Like stearman driver has mentioned, the capatalistic, ultra competitive approach doesn't seem to be working for us.

Operating flights just to prolong their existence doesn't seem to make much sense for anybody except the exec's and "bean-counters" that get paid to drive the airlines down.

I might be way off on this one, this is just my reaction based on my relatively limited understanding of the business side of it.