It doesn't matter whether our theories are right or not.

The facts are

1) Google search results are full of spam.

2) Many of the spam sites have been reported (I reported a few myself) and blogged/written about for years.

What can one conclude from that? I think there are 2 possible explanations

1) It's not in Google's financial interests

2) Google is failing at filtering spam

I doubt it's true, because simply banning the top 1000 spammy domains would cut more than 99% of the search spam. It's something that an intern can do.

If Google wants a pure algorithmic solution instead, well, good luck to them. I think until AI is smarter than humans, such solution doesn't exist. Spammers can always find loopholes in algorithms.