The bounty mods that are incentivized to act are kept in-check by the salary mods who have a base pay determined by number of bounty mods(which is determined by user metrics) with volume bonuses. The salary mods primary responsibility is oversight and only have incentive to increase traffic, which can be kept in-check by bot limits per active users so the mods can't botfarm base pay or bonuses via traffic metrics.

Bounty mods would be established community members supplementing income, salary mods would be would be established members of the community who had a solid track record as a bounty mod.

Just having low-level mods paid a living wage creates waste or overwork as they either get paid to do almost nothing or have to have multiple subs they maintain, which means less focus. If they have a certain number of subs that they have to maintain, they may not have the interest or knowledge of their subs to effectively mod them.

Higher-tier mods would have the same issues but at a higher pay scale, workload, and cost. Not having a higher-tier mod would mean no oversight for the actions of mods except outside of the sub community with people who don't have an active involvement and understanding of that sub community.

That leaves the actual company to act as oversight and investigate suspicious activity within a sub's numbers which indicates some malfeasance. If the numbers aren't genuine, then that harms the profitability of the company because they are paying more for a salary mod and bounty mod than they rightfully deserve.

What you don't know is how a sustainable and effective business or people work. You can't expect everybody to be honest and hard working withithout adequate compensation driving that and you need limits to keep bad actors in-check or flagged for removal. You can't pay people to do less than the value their labor creates and you cant pay people more than the value they creates, that is inviable due to turnover and unsustainability respectively. An unsustainable business leaves the company to derrive sustainable income via alternative revenue outside of their core business like selling user data and rampant ads, which is harmful to the users(See: Reddit).