This is an argument that is trotted out a lot by people who want music to be free, but it just isn't reality. Musicians have *always* been touring and selling merch at shows. People act like this is some amazing new way of making a living. The fact is, the small amount of money made from ticket sales (most venues get the majority of revenue) and merchandise (paltry) goes to pay for the tour itself -- traveling, even by car, is not cheap. It's usually break-even. If you're a bigger artist who is not expected to put on an elaborate show, you might make some money. But that money will probably go towards paying for the recording costs of the album.
The crux of this argument you support is that musicians should just tour 365 days a year, living as roaming troubadours, making enough to continue to slog through endless tours. The recorded music becomes essentially a free giveaway. But that is not "making a living", that's "barely scraping by". But people don't seem to care about the artists. They just want some kind of brutal, deregulated free market of music where music artists are commodities and not people with the ability to contribute amazing art to society. But that just underscores the general devaluation of art by younger generations, especially Americans. I also think that humans just don't have the capacity to see digital products as real products with a monetary value, and this is having profound changes upon society.
Moreover, and most importantly, your suggested way of musician life leaves no room to focus on making great music, great art. Do you really think any of the classic albums of the 60s and 70s could have been made today in the way you propose? Hendrix and Dylan and the Beatles and Brian Wilson constantly on the road? They wouldn't even have had the money to record in the studios they did.
I think most musicians would choose piracy over Spotify. At least the honest and ethical people were still buying records. Now those people are just streaming. The problem is Spotify is like radio, and radio was a net-positive for bands in the past, but radio had limitations that made it more like a teaser and encouraged people to buy the music. You only heard a single or two, and often the whole song wouldn't be played. With Spotify you can basically stream the whole album, listen to what you want when you want. Why buy the cow when the milk is free? It's an unsustainable delivery mechanism, and while listeners of music might think it's awesome, it is definitely not awesome for musicians. And definitely not awesome for music.