It's really a tricky issue @timcliff, but on the whole I agree with what you're saying here.
On the whole "the rewards are mine when I get upvoted" I think we need to change that a bit think of it more like a game... just because you are leading by 20 points at half time doesn't mean you're entitled to win by 20. Probably not the world's best analogy... but this stuff is not cast in stone.
I agree with the changing of "flag" to "downvote." There's something psychological there because historical web terminology calls for "flagging" of illegal/inappropriate content on every site under the sun, while "downvoting" something merely means you don't like it, or disagree with them. People get offended and butthurt by flags because they bring old terminology with them to Steemit.
I keep coming back to a possible solution that's borrowed from a very old site I used to create content on... in which you still have your reputation and vests... BUT there would be an independent "trust rating" for every person here, based on an algorithm that takes into account age of the account, site activity (posts and comments), curation efforts and more-- too complex to fully explain in a comment.
Anyway, the purpose would be to create a "trust based" rewards/voting algorithm that effectively bridges the gap between "n" and "n^2" by adding this "trust score" into the mix.
So for example, let's say we have Tim Cliff on one side with 50,000 SP and thousands of posts and followers and "trusted activity" and then we have "Joe Nobody" who just buys 50,000 SP and does little but upvote himself. But because Tim has a "trust score" of 99 (about as high as you can get) but Joe only has a trust score of 17 (these would probably be figured on a logarithmic scale), Tim's vote with the same amount of SP actually carries 10x(?) 20x(?) more weight because of the trust factor.
The key with the trust factor is that it can't just be BOUGHT, it has to be earned. A system like that might create a little more fairness in the system and make it much harder for someone to just open another account and transfer SP around. Sure, you have all that SP, but until you've "done the work" and earned a high trust score... a relatively minimal effort by those thoroughly invested and involved could negate any shenanigans, without too much trouble.
For example, in the recent Haejin debacle, the "dormant whale upvoter" causing the stink would have had maybe 1/20th of the impact, being largely a previous non-participant.
I'm just throwing this out there as a possibility for the future...
That's a pretty good analogy!
Are you aware of @scipio 's User Authority idea? I think there are flaws to it but there could be some support for something like this.
The main problem with anything that mitigates the raw power of capital is that you are going to have push back from whales and their supporters, who contend that buying in should simply be enough to get access because if it didn't then no one would buy in. So that gap also needs to be bridged. Go solve!
Cool idea. I’d be interested to hear details about how the trust score would be earned in a way that could not be gamed.
"trusted activity"
Hey, we found a usage for reputation!
But seriously, let there be a daily list of rewards and flags as well.
https://steemit.com/downvoting/@thatanimesnob/an-easy-way-to-find-and-eradicate-self-voters-like-checkthisout-and-moses153