I also think the stigma is GENERALLY true. The average 10yr software engineer from Phillipines is not going to be anywhere as good as the average software engineer in the Bay with 10yrs experience at these companies that pay good. Sure, there are exceptions, but we are talking about the average. Heck, the average 10yr software engineer in the US outside of the major tech cities can't keep up either. There's a reason most of the innovation and tools you are using are coming out from that side of the world. :-)
That's not the right logic here. Are you saying that if they do those things in the Phillipines, then they should get a similar salary? I don't think it would be very difficult to get someone to raise the price of a house they're selling to $1 million dollars. One can then say they're buying that house and to give them a salary that allows them to do that. That would be extremely silly.
What you pay someone should only depend on what you get in return, and not on what their expenses of living are. Those are totally irrelevant. You can use an estimate on their expenses of living to know how low you can offer to pay them and still keep them happy, but it's not a justification, only an indicator of a low price they would be happy with.
On your second paragraph, that might be true, but GP's comment is made on the assumption of being equally experienced, equally as good. What justifies being paid much less, then? The real justification is that they can't be equal because, at the same price, it's always going to be more beneficial for a company in country A to hire an employee in country A over one in country B. This because it's inconvenient to have to deal with stuff like different timezones, language barriers, cultural barriers, taxes and other legal stuff, difficulty in physically meeting, etc. These things define the upper bound that a company is willing to pay before preferring to instead hire local for someone of the same skill.
As to the real price that these employment contracts should go for, it should be somewhere between this upper bound and the lower bound of the salary that a employee candidate can be reasonably sure to be able to obtain from their local job market. If the real price is too close to this lower bound, it may be because as a group they're not valuing themselves enough to push for higher salaries, or maybe they're being offered something else that they value that the local job market doesn't offer like remote work.
However if you're unique in a vertical, you no longer compete. Let's say you're no longer just an app developer, you're an expert in live streaming videos and CA/DRM for apps. Maybe there are regional/legal difficulties in implementing this.
Now suddenly you are worth a whole lot. A company like Netflix is willing to pay premiums like $100k for a consultant for a week maybe.
If it's a large enough niche, demand exceeds supply, and people are willing to pay closer to what they're valued.
I'm sure you wouldn't start paying a cheap remote developer more if they decided to move to a more expensive country or their personal expenses went up (like if they decided to have a child). For the same reasoning, you shouldn't demand you pay them less because they currently have low expenses.
Developers should charge for the business value they deliver to the client. A developer's personal expenses is of no relevance to the client.
Also frankly speaking, American devs are a lot better. Interviewing candidates in both Malaysia and Indonesia, if the higher paid senior ones can reverse a linked list, it's considered quite good. Western companies have much higher standards.
You must be exaggerating, right? What can a developer do if they can't even reverse a linked list? I'm genuinely curious how a developer like that can work.