If software engineers are really so easy to replace then why hasn't it happened? They're currently paid more then most professions so clearly businesses would take a cheaper path if available.
It happens all the time, especially outside of anomalies like the Bay Area. Even in the Bay Area it happens frequently enough. Pay is higher in the Bay Area and similar locations because of artificial constraints from the demand-side, not because of a lack of supply. Outside the Bay Area (and similar places) developers aren't paid that much better than any other college educated, skilled worker. I came from outside the Bay Area. This world is...very different from the software world in most other places.
The median pay across the whole US for software engineers is quite a bit higher then the median income for all professions. Or are you referring to a different country?
Doctors have an extra 4 years of very expensive school plus an extra 3-7 years of training. Lawyers have an extra 3 years of very expensive school and only make about 15% more on average than software developers. Accountants make on average about 30% less than software developers.
It is happening in the long term. Software engineers are in the long term often being replaced by other software engineers. The process does not exists in world where people change companies before the companies could realize they need to be changed or where companies lifecycle is short (e.g. startups which die before 2 years and participants move to other positions.)
Software engineers being replaced occurs in a more indirect way. Usually through automation and third party SaaS. Companies replace their own devs with technology and other companies devs rather.