Not really the model is fine, people will pay to go to a movie... and overpay for snacks and drinks.. but when you are highly leveraged as most businesses are, and you lose most of your revenues for an extended period of time... that debt eats you alive quickly.
What may change is business and investors willingness to carry huge debt loads in exchange for short term profits.. not likely though... eventually greed will prevail.
You mentioned a key factor: companies issuing debt to expand or buy back stock. The economy slows down and cash flow from operations if positive cannot cover the debt payments.
I recently sold my late parents’ home. It is near North Dakota State University in Fargo; the buyers purchased it as a rental property and paid cash-no debt.
Bingo. The cure is reorganization in bankruptcy, resulting in a writedown of debt and a wipeout of equity. A new owner can then try again under bankruptcy court supervision. New business ideas can also help. Much as subscriptions to streaming live opera shows was already a success for some theater owners, there may also be profit in live streaming theater shows, symphony performances, and major sports events.