One has to wonder how they'd be doing if they had agreed to competitive wages and not imposed more stupid fees than any other airline.
It seems you know the answer. They would either be less profitable or not profitable.
It seems that the market has spoken regarding the fees, and by that, I mean they are generating revenue because people are willing to pay the fees.
As far as employee wages, its tough. I have an anti-union sentiment that believes employees are intentionally hindering their success by making lateral transitions to other carriers a "re-start" option, and that they allow the airlines exploit that inprisionment and push down their wages. Conversely, it would be hard to argue that a 30 year veteran has developed enough additional skill to justify paying them more than a 5 year veteran (pilots excluded), so the free market may not be the solution either, as that would dictate that employees exceeding a certain level of experience should be capped in pay and benefts.
I DO think that performance based quarterly bonuses should be distributed. Pay out x% of profits to employees per quarter, put y% in the bank for rainy days/years and distribute the rest to shareholders. This will keep fixed costs down, and not lead to substantial furloghs when the economy receeds.