I think you are right that this has the ::potential:: for severe abuse, but I think extrapolating the flagging of one post out into infinity can be a dangerous thing to do. Some whales flagged Jeff's post for reasons that they think are in the best interest of the Steemit platform. That is what investors should be doing.

If over a prolonged period of time, these powerful people continue to flag those they disagree with or simply dislike, I will ignore them here or even move on to another platform if I feel the environment is hostile to open discussion.

This is a market and we are all free to make choices however we see fit, but I tend to think that the whales value their investment and the platform itself, and will flag only for the net benefit of the site in the long run.

Also, I decided to take the initiative to tie my voting declaration to the blockchain, so that way there is an established, public record of how I will vote:

https://steemit.com/myvotingdeclaration/@derekareith/my-voting-declaration