Indeed, the kit lens is good for street and landscape photography. For portrait, sure it is not going to give you the bokeh that you want (the same can be said for many other lenses). The kit lens can produce nice picture - within its technical limitations. The high end few thousands lens have less constraints, due to its wider aperture, faster/accurate focusing, higher tolerance etc.
If you are into action and sports photography, you do need good lenses for such demanding conditions for sure. But most hobbyist are probably not doing much fast action photography here in Singapore.
Some hobbyists maybe a little disillusioned, they strive only for the best sharpness, best contrast etc ... but put less weightage on learning the art of photography.
Spend some time looking at the photo galleries of enthusiasts from other parts of the world. You will marvel at many of the great pictures ... and damn...many of those great pictures were only taken by the humble compact digicams, or just humble SLR lenses.
Now if someone show you his nice collection of pictures from Egypt, are you able to determine if he has used an "L" or a kit lens?