On the one hand, if a subreddit is supposed to be a community it doesn't make sense for there to be a class of user, a "mod", of a multi-thousand user community that can't be dislodged even if literally every other member of that community wants them to be. That is clearly a highly artificial structure imposed on a community by rigid computer code.
Let me acknowledge the obviously self-serving nature of this declaration, wrapped up in Truth, Justice and the American Way at a highly convenient time for Reddit, and dismiss it for the remainder of my post here, because I find social network game theory interesting as a hobby and want to discuss the mechanics and implications of having dislodgeable moderators.
The problem I see is that there is no way to build this structure that isn't gameable in a world where everyone uses free emails and has ever-increasing access to an army of LLM and other sorts of bots. You can't build a system where a single person with a bee in their bonnet about some mod can simply marshal an army of bots to get them dislodged. The entire thing about moderation is that it produces a stream of people with bees in their bonnet, and the people who tend to get moderated are disproportionally those people. The bigger the sub, the larger the stream of such people. The nice guy who can't be bothered to start a vendetta probably wasn't a problem poster in the first place.
You can't just "vote" them out by handing everyone in the world a vote. You can't hand a vote to everyone subscribed in the community. You could set a cutoff date but that is weird too. You could give participation points (voting, commenting) but those are easy to game too.
There really isn't a way to define a "community" in a way that code can get a hold of it. Which means that in the end this is just going to be Reddit imposing its central views by fiat. That is not intrinsically morally wrong. The problem is that it's not Reddit today. I expect Reddit is calculating the result of its moves with a simple multiplication of how much money they expect to make on the same community, but if they manage to contract it significantly in the process the calculations won't hold. Moreover, even if they do lever open every single community tomorrow, the damage won't be visible tomorrow. It'll be slowly over the course of the next year or two. There won't be a day where anyone external will be able to point at and say "Look, this proves we were right!". There won't be a day when I'd be able to counter a "Citation?" with objective proof. Reddit will just... fade. One interaction at a time.