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Companies in the 90's charged a hell more for flights than now, and they had more clients. Now even the surge of low-cost companies doesn't impede people to fly less and take other alternative ways.
Ladies and gentlemen, noone cares enough about terrorists for not flying. Flights were hijacked with big mediatic repercussions in the 70's and that didn't impede the industry from growing a lot in the following decades. In those times before 9/11 they didn't treat you as a criminal at worst or as cargo at best, but as a customer. Now that you're all but humbled down by "security" personnel and bombarded by mutagenous radiation for fear that you have drugs, primarily, or bombs in one of a bazillion cases, people choose not to fly.
The war on drugs seems more a plausible excuse. The reason for which dogs aren't used is simple: dog breeders are no group of special interest with lobby power. If they were, we'd hear unsettling stories about cynophillia much more often, instead of reports of how a Halliburton offspring has gained a contract for installing one full body scanner in all airports in the US' soil.
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