I should begin by mentioning that I am (was) a moderator of three subreddits: one large subreddit, one NSFW subreddit and a medical-related subreddit. After u/spez's calamitous AMA, I joined Lemmy and haven't looked back. I am really enjoying the Lemmy/KBin vibe. It is very much an alpha (almost beta) product and the ad free, corporate free, decentralized nature of the fediverse has a thrill of its own.
Over the past couple of months, Reddit has done everything it can to show its moderators that they are low-value and easily replaceable. They've done this by removing technical tools, killing off third party applications, crippling API changes and jaw-droppingly bad public relations. Heavily used products like /r/toolbox are no longer being actively developed. When Reddit API implements a breaking, non-backwards compatible change, that tool will also die.
Yet the moderators of Reddit continue to moderate. They stay and help Reddit build Reddit. They continue to work for free; to allow Reddit to make money off of their work despite being abused. When I see things like the comment section on this post, I no longer feel sorry for the Reddit moderators still on the site. I see them as a sad, sorry group who cling to the false hope of a corporate turnaround. They could leave Reddit. They should leave Reddit.
These moderators are in an abusive relationship with Reddit, Inc. I might understand the argument, "we built this community, we can't just abandon it". But would you give the same advice to someone else in an abusive relationship? I get that the analogy between the mods and the corp is an imperfect one, yet it is similar enough to be valid, in my opinion.
Moderating is really hard. It is hard and thankless and never-ending. Finding good moderators who can handle the marathon nature of the gig is incredibly difficult. If Reddit moderators were to delete their moderating bots, downgrade their automod "code" and dial back their modding efforts to 5 min/week or less, it would materially hurt Reddit as a product.
The sunk-cost fallacy is a real thing. If the Reddit mods understood this, they'd take their talents elsewhere. But as long as they continue to help Reddit build Reddit, one shouldn't feel sorry for them.
They could leave. I did and I've never been happier.
I was also a mod on Reddit, for about six years.
There are people as you describe. The rest of us hated them, too, because not only did we have the same grievances as normal users but, on top of that, they made all mods look bad by association and started (or perpetuated) a lot of the stereotypes users across the internet still have about internet mods.
Those people weren't all mods, though. Even among those left at Reddit that won't leave, I think a lot of mods just don't care one way or the other and think they can keep moderating as they always have as the place starts to fracture. I think they're wrong, which is why I left. Certainly all the worst powermods and terminally online folk won't leave, for the reasons you do outline, but even now I don't think it's right to paint everyone with that broad a brush.