That's a gross exaggeration of what was claimed. The idea was that if a law is good but it prevents some companies from legally operating, that's ok. For example, if a company can't profit without using child labor then it's ok for that company to go out of business. Lots of folks feel the same about privacy. If you can't protect my data, then it's fine if you go out of business.
And some US state is banning one app rather than trying to find sensible privacy protection that applies to any app.
I'm not sure of your point, TBH. It doesn't follow at all from the above.