You want to choose an example from an industry protected from foreign competion? Foreign airlines are essentially not allowed to fly domestic routes, only international. Choose an industry that has faced foreign competition since that's a large part of what forced domestic companies to reduce costs drastically to survive over the past 3-4 decades - like autos, consumer electronics, shoes & apparel, etc. And just Google to see what domestic airlines think of allowing foreign airlines to handle domestic routes.
Unfortunately much higher labor wages & benefits and (to a lesser extent, only because it's a relatively smaller group) excessive exec compensation indeed played a role. Do you think "leadership/processes/technology/market understanding/quality/innovation" should have been able to overcome US labor costs at 10-20X labor in Mexico, China, etc. That's what we faced, as did many basic industries in the US. While there are legitimate (partial) solutions in your answer, as someone confronted with foreign competition who had to actually face gut wrenching cost reduction decisions throughout the 80s, 90s, 00s - it's hard to believe that no one in autos, consumer electronics, shoes & apparel, etc. was smart enough to find that magic combination that would have kept the US viable.
Bottom line: we/the US needs to do better and we can, but it's way more challenging than many people want to believe. Some of the industries we've lost may never come back...