Who claimed it was tho? We were talking about throughput. If all your intersection knows is time, it can't decide based on traffic. Which is why inductive loops, camera based systems and so on exist, but (1) they are not deployed everywhere and (2) if they are deployed there may still be a time based limit for the case of defective sensors.

Our traffic systems are already pretty well optimized where we are willing to spend money on them. Note however that if you 100% optimize any system for perfect throughput, it has zero slack to deal with unexpected fluctuations in traffic patterns. That is as true for traffic as it is for networks. Throughput is important, but so is comfort, resilience, predictability and cost. All different metrics you have to keep in mind¹ and all of them can suffer when you over-optimize for one.

The view from inside the traffic that we are part of may make that seem inefficient, but seen system wide the main problems usually are not traffic lights, but harder to change structural issues.

¹: or rather you don't have to keep them in mind, since there are people who specialize on just that and are pretty good at it