When was the last time a regulator (or government agency) admitted to failing because of incompetence, stupidity, or bad luck? It seems they are eternally underfunded and understaffed, and never make mistakes. I consider myself and my associates to be quite diligent and intelligent, yet every one of us is sometimes at fault when we fail.
The NTSB/FAA does a _great_ job of regulating. Aircraft have the beneficial property of being immune to bullshit. Mistakes, incompetence, and corruption lead very directly to planes falling out of the sky which is a very public and costly failure.
They're great because they have to be _and_ being great leads to success. You can, with solid engineering, completely understand and prevent failing. There aren't any act-of-God accidents. How and when aircraft fail is designed from the start; when they do fail there is always a cause and it's always fixable.
You can read plenty of NTSB reports about accidents (and they take mistakes which don't actually result in harm very seriously too) and they really do point out incompetence and stupidity. The most important part is that it isn't about blame or prosecution, it's about finding, fixing, and preventing problems. Revenge against people who screw up intentionally or not isn't helpful, making it impossible to screw up is.
All of the airplanes that crash were approved for production by the FAA. I am not sure how you would measure the failure rate of the NTSB, other than by looking at the number of repeated failures, which is tough, as many incidents are one-offs, or can be categorized as distinct without being substantially different.
In any case, one could regard the FAA's primary failure being that the airliner market is a duopoly. The FAA and its counterparts have helped make it so expensive to develop and approve new aircraft that only two companies can do it, and even they only design one new airplane every ten-twenty years. Bombardier, which is a large and established aircraft manufacturer could afford to develop an airliner, but not to get it approved; this results in slow progress, high prices, and little competition.
It would be interesting, if impossible to know how safe aircraft would be if Boeing and Airbus were granted an unregulated monopoly. I would guess their aircraft would be very safe and expensive (as they currently are), just like 'Ma Bell's service was in the days of its monopoly.
Every mistake, every crash is a failure and there are remarkably few of them. Mistakes happen and the mistake is always in not predicting the failure correctly.
And there's quite a bit of competition; Boeing and Airbus are integrators, they don't build all of the parts and there are plenty of parties competing for the various parts. Likewise they both make the largest aircraft exclusively, but as you get smaller you add more and more alternatives to the mix.
You're also wrong about no new models. They release updates and changes all the time. Completely new planforms just aren't needed. The basic design is fundamentally unchanged and doesn't need to be changed. There's just nowhere to go. Only small iterations of improvement.
There are plenty of opportunities for new models; Boeing wanted to make 3 new aircraft, and had to settle for 1 new and 2 upgrades. The 737 has been flying for almost 50 years, and Boeing still can't give it long enough landing gear to properly accommodate properly-sized turbofans because of the regulatory burdens. Bombardier thought there was an opportunity for a new single-aisle airliner, but hasn't been able to come up with the money to get a certificate.
The fact that there are no new aircraft manufacturers coming on-line only proves that the regulators have created a duopoly.
Looking around on the internet it sounds like the cost of the aircraft accounts for about 10% of the cost of a ticket. Frankly, airplanes sound downright cheap compared to the cost of staffing and fuel. Doesn't seem like the right place to start looking for cost-cutting measures.
If you want to understand how important new aircraft are, you need to take more factors into account, such as turn times, average numbers of transfers, etc. into account. The airlines have been moving away from the hub-and-spoke model, towards point-to-point for quite some time; aircraft CPM plays a significant part in this shift (as well as in slowing it down).
The larger Embraer E-Jet series (E170/175/190/195) jets do somewhat compete with the Boeing 737 & Airbus A320 for the regional market. The E195 is smaller, and significantly cheaper than the 737. The E-Jet has a respectable safety record, and few major accidents.
The DC-10 is notable for having several major crashes due to design flaws, which significantly reduced sales of that aircraft.
