Because if that's the case then all Tai Chi students would just stand still and there would be no fight, there would be no competition.
Take note of the offense attack (hip throw.@ 1:32). You can actually see him set up the throw long before he throws the guy. That is an offensive action, not a wait for my opponent to react concept.
The quote that you listed is the same training quote that I had when I was taking Tai Chi Classes. The context of that quote was based on training push hands and building sensitivity to movement. It was not a quote in which fighting should be based on.