Re: Time for a change...
Presumably the indie labels would argue that they are providing a bunch of work for the 50% including advertising, order fulfillment, production assistance, etc. The artists are certainly free to stop using labels, find a label offering a better deal, or set up their own label. (Several large rock bands in the past did set up their own labels after releasing the ~ 3 albums their initial contracts required, once they were famous).
Likewise, artists are free to rely on your "solution" of only live performance revenue if they want. But some musicians clearly want to be paid for recordings as well, either directly or by using a label to handle the details. You're free to boycott such musicians/labels, just like you're free to give your own recordings away for free if you're a musician. But not free to force others to follow the same model if they don't want to.
Now, if 99% of musicians switch to live-performance-only then the few remaining die-hards may find it hard to charge money, much like Open Source means there's no big market for paid web browsers and servers any more. Not sure this would be a good thing though, not least because payment-for-music means that consumers can direct payment only to the good bands.
In terms of: "I don't think the artists personal situation with regards to poverty or not has anything at all to do with the discussion." -- sorry, but I do think it's relevant that if thousands/millions of people are enjoying someone's music, telling that musician "you get nothing, go live in poverty" is wrong.