I think the accumulation of cabin baggage was never imagined and has built up for a couple of different reasons. No single event allowed it. Without expounding in detail, the expansion of travel, it's purposes and the often short duration of trips - one or two nights for business or a City Break weekend was not imagined.
The competitive advantage of allowing cabin bags at no cost got taken up far more enthusiastically than 'planned' as FR have just admitted. A lengthy series of changes over the last 30 years is now established practise - all aircraft are built to take more cabin bags so it must be OK? Changing back is, effectively, not possible until some other colossal event occurs.