It doesn't really matter what their argument is, they simply need to have one. It's their sandbox, and they have chosen an advertiser-friendly ratchet as the driver of policy. YouTube will get more and more bland and samey as people fear the banhammer, which will get used on less and less extreme content and producers, as the "cancelling machinery" has been built and will always find the next-most-evil^tm on which to focus.
Until YouTube becomes boring and enough interesting people end up together somewhere else, and then all the users will leave at once (in internet time).
Doctorow huffs his own farts at a James Cameron level, but he's right about this.