This is a relatively fair take. That being said, at least it's damaged and dethroned the equally misguided frictionless spheres of homo economicus.
The idea that humans are not perfectly rational self-interested actors has been part of mainstream economics at least since Keynes.
Is it the whole story? Probably not. Like I said, I'm not an economist.
But given the extreme challenges in empirically testing macroeconomic models, it should be no surprise that economists might--as somewhat irrational humans--over-rely on theoretical models.