No one says that there is nothing left for violins or orchestras to do, and that's a far older tradition.
I think Jazz's "problem" is no different than any other genre. Also, any fan can be elitist or snobbish about their music.
It's also typical for artists to seek inspiration from other sources.
I'm not saying there's nothing left for them to do, necessarily, but at what point does the avenue for making music that appeals to the masses dry up? Eventually you're making sounds that are either stale, or within a small niche.