It's a stupid argument, and one used by most unsuccessful chairmen.
Firstly, by setting performance requirements like that you're marking out a manager's sacking criteria, which is normally a self full filing prophecy.
Secondly, most people think Rafa is a very good manager, one of the very best in the world. Are you saying that if we have a bad season he is suddenly a bad manager?
Thirdly, if he suddenly becomes a 'bad manager', who could we get who is better?
Let's be honest, if we'd have had Agger for the season, and if there wasn't all the disruption with the owners, we'd have been very close to the top two last season and maybe challenged. That's a remarkable achievement considering the gulf in spending and the fact that Rafa's only been here 4 years and inherited a poor team.
Liverpool aren't a sacking club. Houlier left after two bad seasons, not one.