There are strong incentives to tolerare bad moderation. Given the choice between cutting off their users' friends and letting something slide moderators will often let things slide. This bears out in practice: There's a socially centralized network of sites that all federate with each other, and some loons and Nazis on the periphery.

The effect is similar to if a centralized service randomly chose which of a few tens of moderation policies to apply every time they get a report. That's a big disadvantage. You lose because you see content that pushes past what your chosen moderator would prefer, and you don't see content that your chosen moderator would allow.

If Mastodon provided something nice in return I'd consider it, but they consider that disadvantage as their main advantage.