Earlier quoted context omitted.
PhD programs exist to create new faculty members at other institutions. Other people hiring PhDs is a side benefit that has nothing to do with the purpose of the programs.
I disagree. I'm curious what you base this conclusion on? I've heard professors say similar, but it always seemed that it was because they were in an academic bubble. If this is true, then you almost have to concede the model is broken. There will be a glut of PhDs compared to faculty positions. One of the reasons so many PhDs are disgruntled is because of the false expectation that every PhD is on track for a profes…
PhD training prepares people for the academic career and faculty positions. Less than half of PhD graduates actually end up in the academic career. So yes, you could say the system is ...not perfect.