As long as sub forums can be created easily, users may pick their sub forum and thus indirectly moderator.
In this setup having users elect the moderator leads to cases where small groups create their special interest group and then some trolls challenge the moderator.
Their may be some oversight on the large sub forum, but not all.
Necessary for this is that subforums can't have unique names. If a bad mod can squat all the words like "computers", "programming", "coding", newcomers aren't going to know the best subforum is called "RealProgNoBadMod"
Yes, the "important" ones need some special attention. If "democracy" where anybody can create arbitrary amount of accounts is however questionable.
The vast majority of sub forums however are more targeted and smaller to begin with.
Squatting is bad no matter how niche the topic
Squatting also invites corruption and selling rights to control what is posted to a sub.
You see this in city-focused subreddits. But the reality is the name is power. New users type in their city and join the original one. The hostile mods suppress mention of the new one. It never manages to get critical mass.