This has been a thing since even before the web existed, with Usenet (the original federated forum) in the 1980s.

Would you really want admins controlling what you can and can't say online? What if the admins have different political or societal views than you, and delete you / your content just because they disagree with what you're saying? The world needs fewer power-hungry admins and mods, not more of them.

Also, the the thing with open source software is that you can't control how people use it - a key feature of open-source is that it's accessible to everyone.

IMO anyone should have the power to start their own Lemmy instance, but other instances should have the power to block you. I do agree that there's some instances that 99% of Lemmy would block. For cases like that, an optional global blocklist of awful instances, that any instance could opt-in to blocking, would be useful.