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Supply exceeds demand for free moderators. They have no incentive to change this.

Well, the current situation seems like enough incentive to at least discuss this as a possible solution...

What does paying them solve? They’d just become even bigger entitled control freaks.

Why not pay the users instead of the mods?

If there's a market for paying users directly for content, and also as a way to not need mods, someday this market will bubble up.