This is a return to old, punitive FAA philosophy. It didn’t work then, and it won’t work this time. What will happen is pilots will stop reporting events entirely. As others have said SMS will fall apart.
The fact that it feels like we’re in a period of many foul-ups in aviation is proof that SMS (ASAP, ASRS, etc.) and other things have been doing some great work for us. Go back to 80s and 90s and look at the regularity of crashes in the airlines. The planes haven’t changed that much (EGPWS and TCAS are huge improvements, so take this sentence with a grain of salt); the philosophies have.