What disturbs me is that you're arguing from the opposite extreme. Airport security
does stop security threats - it raises the bar considerably. There's definitely an argument that current security is way over the top in the US, but the opposite extreme is even more silly. The moderate path is the way forward - it does not follow that all security measures are security theater.
All the arguments about 'what about blowing up trains/buses/whatever' also miss vital points - namely, that the passengers on a plane cannot escape, and small damage to a plane can doom it. This is not true of trains or buses. Combine this with the point that the public, rightly or wrongly, are more significantly affected by a plane crash, and it becomes clearer why planes are better targets for terrorism. Similarly, the demographic that uses planes are largely middle-class. Those who use public transport have a much larger proportion of working-class people on them, who have less political power, and the media also cares less about them.
You also still have to face the issue of running your own terminals, because any international airport has its sterile zone, which is connected to every other international airport in the world. Until you get them all accepting your citizenry carrying weaponry, your local international airport is going to keep its sterile zones. And running your own terminals is going to cost you more than $5 extra/ticket...
Because I trust that on average, by and large, my fellow passengers are competent and well-meaning people.
'On average' is the problem here. The general public includes all sorts of idiots, terrorist or otherwise. Anyone who's had a job facing the general public will be aware that there are plenty of people who fuck with you just because they can. Particularly in an enclosed environment where people sometimes get heavily inebriated.
And regarding the skydiving, light aircraft have only rarely been used for terrorism. The same is very much not true of heavy aircraft, which have a long track record of terrorism.
The specific threat that modern "airport security" is designed to stop is essentially nonexistent.
Ultimately, this is a chicken-and-egg problem. Hijacking has been made extremely difficult by the current measures, but even before 9/11, hijacking was much more difficult in the 90s than in the 70s due to increasing the bar for security. The threat is there, but higher security means you have to be better-resourced in order to defeat it.
Perhaps put another way: if there is actually no threat, then why do you say you'd feel safer if your fellow passengers were armed? Shouldn't you be saying it'd make no difference?