Even if you believe this goal is possible to achieve at some point in the future, I think the argument falls apart when you consider that it will take years, probably decades, for a pure vision approach to catch up to where Waymo is today in terms of safety. (They have cameras too.)
That Tesla can’t afford to fit expensive LiDAR sensors to all of the cars it sells is Tesla’s problem. Regulators won’t give a shit that pure vision is “better” in theory. They will simply compare Tesla’s crash rate in autonomous mode with that of Waymo and other AV operators, and act accordingly.