What's the opposite of rose tinted glasses? Because I think you're wearing them
We're a level above Arsenal right now on the pitch, have a settled squad and a first XI we couldn't improve even if we had twice the money they have to spend - they have a lot of rebuilding to do squad/first XI wise and a manager their fans will be screaming to leave after their first bad result - money being equal any player would be mad to choose them over us at this point in time.
Edit
It isn't one bad season btw - last season was exactly the same as their last 5/6/7 - only now there are more teams competing at the top end with good managers and money to burn so they have been passed by