That might be the case but given their biases it's hard to take the WSJ's spin at face value.
They're agenda is to hurt google and with this one I'm guessing they want to further damage google's image with conservative culture warriors.
As for the issue at hand, even if it might not be as drastic as described it's definitely affecting business most evident by some rank and file employees' public objection to their DoD AI work.
Fixing matters will involve more than intranet discussion moderation, it's about hiring. Perhaps they should optimize for a different kind of prospect.