I cannot imagine anything less likely to succeed than such a merger. Both airlines are overstaffed, very costly and inefficient by the standards of our times. For each to tackle those problems separately has proved almost impossible with American probably having the better record.
Then you have the problem of fundamentally different aircraft fleets. Very few synergies would be possible there.
Then you have the problem of the competing hubs at Chicago. No regulator would ever allow them to be merged. It would be just the same on their international routes.
The management effort required would be way beyond anything that has ever been contemplated in any business in the whole history of time. Trying to merge two of the largest companieds in the world when both are in a hopeless state is such an unimaginably daunting task the surely no sane person would ever attempt it.
No sadly what has got to happen id for United to cut back its operations to some profitable core. American will have to do the same. It would be nice to think that if US Air failed completely that it would then be easier for AA and UA. I think not, though. US is such a ragbag of an operation that it is hard to see who will benefit exceept Southwest and Jet Blue, and Air Tran. American would probably see some gsains at Raleigh if US closed Charlotte.
Those big American airlineds look as if they need to shed at least 25% of their capacity and about 30% of their unit costs if they are going to survive. It is going to be a tough winter.