I agree that some people will always be abusing the flag button but the purpose of it was to hide(not censor) content that was abusive/spam or that people believe has a negative impact on the platform(of course this is subjective and different for everybody) The point is that the flag has some useful features and personally I wouldn't want my right to flag abusive content removed because someone misused it in the past, I have faith that the free market will figure it out and that eventually it will balance out. In the case you mentioned I guess the best way would be to promote the content that was hidden(if you believe it is really worth it) by resteeming it to your followers and talk about this author with other people.
You could also start a community/bot to find flagged content and republish the links on your own blog everyday with an explanation of why you thought that was an abusive flag and that people should look at this content. I believe there is always a way to solve those problems using voluntary free market solutions. You could call this initiative "Ron's daily hidden report" :)
Moving on to the follow a whale problem, well we can't tell people what to do with their voting power which is why I didn't reply because I don't have an opinion/solution, I guess if I found that all the content on steemit is not providing anymore value to me as a reader that I would just powerdown and leave and use my time somewhere else. At the moment it isn't the case and I still see value in spending time reading articles on steemit even if those articles I value aren't the one with the biggest payout, at least they are written here and I can still read them.
To address the issue of government take over, well most blockchain are open source anyway and if a government wants to clone Steem and use it, well they can. But if nobody wants to use their national Steem clone then their experiment will be a failure and a waste of taxpayer dollars. Ultimately it will be the population's choice of which blockchain they want to use and we can't go against that, people are free to chose to be slaves. We can only inform other people about why our platform would benefit them better but we can't force people to join.
Thanks Walter @walterjay I enjoy problem solving, the greater challenge is recognizing and addressing problems before they cause a catastrophe - sure, if there are survivors then they, as the market, will become the market solution...
During my career I was amazed at how often wonderful efforts and finished projects would later have the end users reveal unseen and unintentional problems - I have no doubt the steemit programmers did not intend for the flag feature to be abused.
And I doubt many programmers want to focus on how institutional governance will threaten the decentralized and freedom nurturing blockchain efforts.
I have no programming expertise, but I find your community-bot suggestion interesting and I will look into this.
Thanks for sharing, Cheers!