B) How would you spend the money more usefully?
I'm sincerely curious to hear. Honestly.
On the off chance that you aren't going to bite my head off for trying, here are some of my thoughts on it.
1) What is the attack surface? This is important, it's child's play to kill a plane's worth of passengers because there is attack surface everywhere. One of the things the TSA does wrong is actually create
attack surface. Their long checkpoint lines are more attractive targets than airplanes.
The solution here is to do what Israelis do in their airports, they do not let people pile up anywhere. The TSA screening process should begin from outside the airport instead of just trying to play gatekeeper. They should take a gestalt approach and the screening should start at the curb.
2) It's also important to understand the inherent limitations of preventative security and to understand the risk. The biggest misconception about security is that preventative security keeps you safe, but in reality it plays a much smaller role than punitive security. That is, the reason most attacks are foiled is because the attacker can't survive it and because there are very very few people willing to give their lives (or their freedom) to take down a plane.
So for example, the comments here about how these random samplings aren't likely to catch a terrorist are a bit misguided. That isn't the point, the point is the threat
of getting caught more so than thinking that they are going to actually catch people in the act.
With that in mind, a good tactic is to identify and track these small numbers of people who are far more likely to be a threat. Things like the no-fly list can be useful (but it isn't in the case of the US, where it is poorly run in a way where innocents like the CNN reporter who criticized the process can easily get banned and where a father telling us his son is getting on a plane to attack us didn't).
3) The "rent-a-cop" comments are a bit emotionally loaded but are actually an important point. These folks fundamentally lack the skills needed to do a good job and these should be more highly trained experts. The Israelis use observers who are trained in things like psychology, where they can spot suspicious behavior and suspicious reactions. Which brings me to the main improvement I would like to see:
4) It's a lot easier to spot the suspicious behavior than it is the suspicious object. Humans have a harder time concealing emotions than bombs. Israelis use profiling extensively but most Americans just get hung up on the "racial profiling" factor. The real point is "behavior profiling". They look at you, they ask you questions and look at your eyes and body language to identify people to screen more extensively.
Random sampling has value in the security world, but targeted sampling based on behavioral analysis is a tool that American airports should use. Israelis have people watching the whole process, from the curb, and they also interview you (can be questions like "where are you coming from?" etc, the point is just to get observable behavior).
5) Arm pilots (possibly non-lethally). They can already kill everyone if they want, the missile is in their hands. This won't stop a bomber but would do a lot better with hijackers with box cutters.
This isn't an idea that I like too much for a variety of reasons (one of which is additional training and screening requirements for pilots, but the main one is that it isn't a great security boon and might frighten passengers as much as it helps) but the downside is small and pilots are currently being screened for nail clippers when they can crash the plane anytime they want. This is a silly way to treat pilots though I reject their union's calls for the level of screening they prefer.
There it is in a nutshell, and I'd like to add that poor security measures are not just bad due to their failure to do their job but due to a "crying wolf" effect that makes for security "blindness". It's like the terror threat levels that were recently stopped, all they did was condition the public to ignore them because they were clearly not useful. Bad security is harmful not just due to a false sense of security but due to losing buy-in to the process.