[vidyesh]

You are somewhat right and somewhat wrong.

SEO indeed is like what you described, but there is a fine line to start doing blackhat or stay whitehat.

Now the problem is, the line is so thin you end up crossing it at times. And everybody does. The way Google works you need to do both somewhat in a way to get the balance and stay top.

For example, link-building its one of the worst areas where defining white-hat and black-hat is really difficult. One way is doing guest post is allowed and great but paid posts aren't. There is no guarantee a guest post is not a paid post.

There are 'digital marketing agencies' which at times are so ridiculous that the backlink included in the guest post doesn't have any value in to the post as such but anchor text magic does all the work.

SEO isn't broken as such but there are too many backdoors to doing the white-hat SEO methods in the concealed black-hat way that it isn't realistic to blame he search ecosystem.

I agree, website penalties is not a good solution to the problem.