I’m confused about the 4% (or any %) withdrawal strategy. Do I have it wrong?

I realize we touched this topic before, but I just watched a YouTube video where the “expert” debunked the 4% rule. His criticism was simply that is not how people spend money. He said nobody lives on the percent they withdraw giving the example that if a person had $1,000,000 and took $40,000 they may need more money for unexpected spending. Thus they will take extra from the $1,000,000 

That’s like saying nobody can live on a pension or salary for that matter because they may need more money. 

I thought that using a percent withdrawal meant your income from that was the income (plus SS) on which you decided to live. And perhaps aside from a separate emergency fund, all spending was to come from the withdrawal amount. 

In other words, the $40,000 in the example is analogous to pension income. Do I have this wrong?

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