Why would you assume that?

I'm a PM who always booked M fares to use on upgrades from DUB to ATL and JFK.

Screwed with the MQM 50% loss and now screwed with no upgrade certs

San Diego also has a cluster of high income people.

You might be correct about the distribution of the FF population in general and high income individuals, but FFers in different locations are more or less likely to fly DL depending on where they live. For instance, DL doesn't have a hub or much nonstop service from the Bay Area, so high income FFers aren't very likely to use DL as their primary or even secondary program. The same is true for the LA area, although less so since DL has more service at LAX than SFO. Similarly, in NYC, DL is increasing its presence, presumably with more (high income) FFers, but many of them focus on AA/US or UA/CO, especially if EWR is more convenient for them (which would include all of the Jersey suburbs as well as at least parts of lower Manhattan).

By contrast, DL FFers are more likely to be concentrated, relative to the population of FFers in general, around DL's hubs and focus cities, such as ATL, SLC, MSP, DTW, CVG, SEA, MEM, IND, BOS, RDU, TPA, PDX, etc.

For discretionary spending on premium cabin air travel, what probably matters is not absolute per capita or family income but some measure of discretionary income after taxes relative to the local cost of living. These adjustments would knock down "income" data for California and New York substantially.

But over the years, overseas elites have benefitted from some very nice relatively low M+ fares that aren't available exUSA. They have been able to upgrade on much cheaper fares as a result.

MSP, converse fallacy in action-
While it is true that frequent fliers in and around the hubs tend to concentrate on flying Delta, that does not conversely mean that most of Delta's frequent fliers are in/around the Hubs.

Certainly O&D hubs work better than non O&D (hence MEM, CVG, etc. are disappearing). I've never heard of the big market in IND (or Tampa) but the rest of those 'focus cities' (you somehow left out NY and LA, btw) are east/west coast, and likely to feed into the transcons in question...

No, you misunderstand my point. Look at the population of "high income" FFers. One of them located in ATL/SLC/MSP/DTW/etc. might use DL as his/her primary program with 90% probability whereas someone from the same "high income" FFer group located in NYC/SFO/LAX might use DL as the primary FF program with only 25% probability. Many of the "high income" FFers taking transcons don't fly DL. If their companies are buying cheap fare tickets or have good corporate contracts, these people aren't spending a lot of money on DL. A monthly transcon at $400 RT is only $4800 in annual spend but about 60,000 MQMs. To expect regular free upgrades to BE might well cost DL more in benefits than these people are contributing to DL's profits.

And people overseas are elite from the MQD policy as well.

People in IND, RDU, TPA, etc. aren't going to route through JFK to get to the west coast when routing through ATL, MSP, and SLC is significantly shorter and the hub airports have their own non-stops.

I did take what you were saying wrong, and I agree up until you got to the whole part about Delta somehow being more competitive by being less competitive in competitive markets. From personal experience, and the people I know who are heavy users of the transcon flights out of JFK, the vast majority of it is booked very last minute which means generally higher fares. Regardless, they could have limited fares to H+ or K+ to "protect" themselves from BE amenities costing more than the fare (which I find ludicrous if it were true)...

They could nerf the entire program out of MSP/DTW/ATL and 90% would still fly Delta damn near as often. Make this one cut out of JFK and you lose all those high-tier fliers who even occasionally fly transcons.

And to sharpen a point, since you seem to be trying to obfuscate it: No FO should expect "regular free upgrades to BE," nor can they go anywhere else* and get regularly excused from coach hell. However PMs & DMs at least expect a chance of not sitting in coach, and this puts Delta behind everyone** else at those levels of flying/spend.

*Even the FO is getting screwed when it comes to Seattle though...

**No, not really everyone, but the other two majors.

1)RDU, not as obvious, really depends on timetable.
2)Since when does anyone care about IND?
3)Nobody cares about the hubs, anyone in a hub is Delta's beotch

I'm one of those who found the lower M fares but i can't comment on those "upgrades" - inventory was as low as it is from the US.

If it were only that, I might agree, but the person who might spend $400/rt is also the person who might spend $1500 - $5000 to go to Europe. If making DM to get TCON upgrades is no longer useful (and there's honestly not that much reason to go be DM out of NYC anymore), then those higher value Europe tickets may go to a competitor. There's no lack of international options out of JFK, LAX, or to a lesser extent SFO.

Of course, this all assumes the typical HVC FF is paying attention. They might not have noticed no longer being able to SDC, or tightened award availability, or the loss of 50% bonus on M fares, but they'll probably notice their name no longer being on the upgrade list.

This is exactly my point. I did the same as you, but ex-HKG. With the loss of MQM bonus on M fares and no UG certs, there is zero benefit to being a PM if you live overseas.

I think you mean "exempt." But who cares if we are exempt if the benefits are gone? I'd rather be subject to the MQD requirement and retain the UG certs benefit. In fact if it were possible to qualify on MQD alone I'd be DM.

SFO I would put as <20% simply due to the large presence of UA.

Except...

1. There's no real cost to DL unless the person would have bought BE to begin with and DL is cannibalizing that revenue.
2. Any seats up front that are given away are minutes from becoming spoiled inventory.

Also, upgrades for GMs on this route may or may not be "regular"... not to mention in this scenario the theoretical passenger only flies one route and always at the same price... not likely to be the case in reality.