Sometimes great work does not require great tools. But other times it does. Here's where I'm somewhat departing from Seth Godin. He's right to say that creativity can produce even in the absence of tools. What is produced, however, is to some extent dictated by tools.
If what you are doing requires machine production tolerances down to 0.5mm and society hasn't invented that yet, that particular project simply is not going to get done. This doesn't stop you from doing great work that doesn't require the use of tools that haven't been invented yet, nor does it necessarily stop you from inventing the tools. But until the prerequisite technology is invented, by you or someone else, no project that requires them is going forward.
Tool capability level channels your creativity into projects that can be accomplished by what is available. This is why I often get very excited about tools. It is not the tool itself that provokes my enthusiasm so much as the vistas of creativity that become possible.