It’s not a myth but it’s not presented properly because the more complex answer involves me looking like the GIF but here it is:
Credit card and loyalty cash lets most airlines run larger networks, more marginal flying, and shittier cost discipline than they otherwise could. It props up parts of the network that would be cut or shrunk in a world with no loyalty subsidy.
This is before you get me started on subsidies: EAS, SCASD, State,local, federal, airport, MRG, etc.
I say MOST because one mainline airline cracked the code but it’s getting acquired - Sun Country