Why? Because curiosity withers under repetition and fries under indignation. (https://hn.algolia.com/?dateRange=all&page=0&prefix=true&que...)
When this happens, the community always splits between one subset of users who feel strongly about the MOT, want a lot more of it, and feel like the topic is being censored and suppressed; and a different subset of users who don't want the repetition and don't want the site to be taken over by flamewars. The first subset is typically a minority, but more vocal; the second subset is typically the majority, but less vocal and more inclined to flag the submissions.
(This split has nothing to do with political sides, btw, because the same pattern shows up about any MOT regardless of its political valence. It's true that partisans flag stories that are bad for their side, but that alone isn't sufficient to create the pattern I'm talking about.)
As far as I can tell, the above is what's going on with the current MOT, just as it has with other MOTs over the years. So no, moderation isn't broken—or at least not in any way that wasn't broken 10 years ago. The problem is simply that the bulk of the community doesn't want as many threads about this as you do. A certain amount is ok, but that "certain amount" is just far lower than the amount that you, and others who feel strongly about the topic, want.
This leads to a seeming paradox where a topic which is by far the most discussed on HN over a period of weeks or months, at the same time feels completely suppressed and censored to users who feel like it's starving for oxygen. That is the "nobody goes there anymore it's too crowded" dynamic of MOTs.
Considering how awful, nasty, and repetitive these discussions have been getting, I agree with the bulk of the community. We've still been turning off the flags on some of these stories—that's standard practice for MOTs—but only some, and only when there's significant new information (https://hn.algolia.com/?dateRange=all&page=0&prefix=false&so...) that has at least some chance of a substantive conversation.
Politically passionate users tend to want to go after each other. It's fine to want that, but it's not fine here, because name-calling, snark, and rage are not what this particular site is for. There are other places on the internet to do battle. I know that the strong feelings are justified and that these topics are important—far more important than most of what does make HN's front page—but it doesn't follow that we should just switch off HN's rules. The site would burn to a crisp if we did that, and what good would that do? Scorched earth is uninteresting, no matter what one's passions are.