But why? It's a supply and demand issue. When demand is high and supply is low, the hiring committees will definitely look over one or more bad letters. But when supply is high (as it is most of the time thanks to overproduction), well the hiring committee will choose the best package deal.

I'm sure the university will be happy to claim that they'll discount bad letters just because it will be politically helpful, but as long as the hiring committee sees them all, it won't matter. They'll choose the best package.

Not that it matters, because most of this happens by word of mouth. I've seen professors write glowing letters of recommendation to cover their butt. Then they privately bad mouth the person.