There is no objective standard of "impartial and fair", but is that even necessary for your proposal? Different people want different moderation standards, but that seems fine.
Turning moderators into content creators (content curators) and connecting them more directly to their advertisers is the general idea.
This applies to anything and everything. Subreddits were great because they could set whatever rules they wanted and you could just leave if you did not like it.
Up until this very recent fiasco, those rules were much more lax.
Uh huh...
This will never happen. Reddit already makes rules that are not impartial or fair towards users. If they pay the mods the mods will only work to serve reddit (and therefore reddit's advertisers) not users.
As for the users, we could debate all day what's best for them, but the war between mods and Reddit would be over, and that's incredibly good for users.
Either way, Reddit provides value to users, because user retention is how Reddit makes money. Now, mods are also incentivized to retain users, rather than the current disconnect where a mod is actively disincentivized to retain users, given the additional burden users create for mods.
No, that's absurd. Plenty of people would become moderators for free. Yes, for free. And plenty of them would be better mods than current mods.
Mods provide less value than you think.
Most of the value was essentially being the first to register the name of the subreddit.
Reddit needs to convert their model to financially compensate moderators of subreddits based on the revenue ads on that subreddit generate.
In return, moderators need to re-agree to a set of terms that align their incentives towards being impartial and fair towards the users of those subs.
Mods who agree could stand to make good side-hustle money (maybe even full time job money), and Reddit could obtain a method for showing their future shareholders that they're in control of the revenue channel.
Could run this program out of a spreadsheet until the code gets written to automate, and IMO this is important enough to pay the lawyers and accountants to figure out the details.
YouTube does this, Twitch does this... it's absolutely feasible, and everybody wins.
Hell, if you want to be tricky, you could set up some kind of currency market (probably avoid crypto but if ever there was a legit use for it...) that mods get paid in that they then sell to advertisers for space on their respective subreddits where Reddit gets a cut (I assume this resolves some amount of the labor/employment issues, but IANAL), but that's something you do after you put out the fire.