Of course airfare has risen. Since JetsGo caused the competition to meet their lower fares, and its demise will allow the other airlines to raise fares to more reasonable levels that will ensure profitability...
Case in point: A quick search for a transcon flight, LAX-JFK, brought up tickets as cheap as $129 one-way to $221 round-trip. With fuel prices at all time highs, it's very difficult for a company to stay out of bankruptcy with these fares.
The airline market, in order to once again be successful (where they can then start to raise service above the current snack box and cup of soda for 5+ hour flights, increase seat pitch, etc.) some airlines need to die. JetsGo was the first. US Airways and United are still in bankruptcy protection, as are others. They both seem to slowly be getting a grasp on things, but USAir has a long way to go, especially with the fiasco in Philadelphia over the winter. American has cut pillows from their flights, and is getting rid of their heavily advertised "More room throughout Coach" and putting seats back in. Delta has drastically cut back First Class service and now has essentially non-existent coach service. Things don't look pretty, and our demand for $99 transcon flights isn't helping.