While a merged US+AA could grow, a lot of pundits keep repeating the obvious: mergers generally result in the removal of redundant capacity, not growth. Since I'm not a mind-reader, I don't know whether Doug Parker intends to grow new AA or whether he'll do what he's done at US since the 2005 merger, which is essentially no-growth. Despite the lowest pilot and FA costs among the legacies since 2005, Parker didn't leverage that cost advantage and grow US Airways.
Whenever someone mentions the Horton stand-alone plan (which calls for 20% growth over five years, or 3.7% growth per year), someone else says that such huge expansion by AA would trigger a ruinous fare war that would send AA and the other legacies back to Ch 11.
One thing is certain: AA has been where US has aimed most of the Advantage Fares over the years, and once merged, new AA isn't going to "compete against itself" - it's impossible for a single company to "compete against itself." So consumers lose the benefit provided by the lower-than-AA Advantage Fares.
This merger would cut the number of big domestic competitors from five (AA, UA, DL, US and WN) to four. That's a more highly concentrated market than resulted from the prior mergers, where there were more competitors after the merger.
Obviously, Texas (and likely the other states' AsG) isn't concerned with that highly complex economic theory of the case, preferring to get written promises to keep serving lots of Texas towns and to keep the HQ in TX and to keep DFW as a big hub (as if those weren't already in the cards).
Maybe this is just about the number of DCA slots and once Parker agrees to give up a bunch of them the federal government will settle. Problem is, the DoJ identified more anti-competitive effects than just the DCA slots, and giving up a few dozen slot pairs at DCA isn't going to fix those other problems. That's why I don't think there will be a settlement.