I think that the FAA would need to make training more difficult as well. The reason why we have so many pilots on the street is that Flight Schools will train anyone with enough money. The FAA has allowed much of the "high standard" training to diminish. I worked for a European flight school a few years back and most of the pilots who get hired on with British Airways as FO's on a 737 only had about 300 hrs. The reason why it is not a problem there is because the flight schools often weed out the potential "bad pilots" even before they begin their flight training. My best students came from that school because they had better potential of becoming a "good pilot".

I think it would be wise to raise the standards in Flight Schools. This would not only reduce the amount of pilots, which would make it more competitive for the airlines to fulfill their needs, but also it would increase the percentage of "good pilots", who hopefully would only want to work at the airlines that provide good competitive pay and QOL.