There will still be mods doing free labor after whatever purges. Less effectively, sure. But I think Reddit clearly believes that they can be replaced with nearly zero negative impact, or even a positive impact if some particularly toxic powermods can be erased.
I don't think you realize how much mods/power users, who act like a funnel for a lot of content, rely on third party apps and api access. The built in mod tools are hot garbage, with critical features going years without development or progress.
I have heard numbers in the realm of 10% of users make content and only 1% ever submit things. What happens when your users aren't getting that constant dopamine drip of new content when a decent portion the people submitting stuff use third party apps stop submitting content. Or even worse, they head to another platform and submit stuff there, which is how Reddit got its big start from digg.
For folks who were around during that time, things like lemmy or the fediverse are in a similar state that Reddit was in when the digg exodus happened.
Reddit needs to realize they aren't just losing users, but adding users to a competing platform, which is arguably a worse sin.
