100% correct. I often see comments here about Tim Cook's competence from people who clearly have no experience in tech companies. They criticize the wrong thing. In this case, though, yes, this is his fault.
There are legitimate debates to be had around privacy and accuracy of responses. But that's not the issue here.
The article highlights the problem: toxic politics. The leader of the company has one job: to get the right people on the bus, in the right seat, and the wrong people off the bus. If good engineers can't get their work done, then the wrong people are on the bus. This is, as you say, a "spectacular failure of leadership".