There's plenty of competition for domestic flights in NA imo, there has to be a reason they all charge as much as they do

There is a lot more budget carrier competition, often flying in and out of secondary airports, in Europe. The US does have a few like Spirit but nothing like Europe. In Europe, there are probably more subsidies, generally it's denser, probably a higher percentage of leisure travelers, more competition from trains, fewer people likely drive, etc.

It just adds up to a lot of competition among no-frills airlines because there's a sizable group of price-sensitive travelers who are fine with talking a budget flight for an hour or two.