The problem in Canada is that we don't have adequate competition when it comes to the airline industry. That relates to barriers to entry to market as well as limitations on foreign ownership when it comes to air travel services within Canada. What we are seeing is more a race to the bottom, as you have observed, than a meaningful competition in providing better service to passengers.
In order to have the trend change, one would need far more competition. Even then the negotiating power of a single passenger is very limited compared with airlines. That is why one needs to have some state regulatory intervention, in a wise way, to ensure it becomes more profitable for an airline to provide standards of treatment to passengers rather than disobey the law.
The role of good regulation is to set a level playing field for all competitors that they all have to meet as a bare minimum.