"How is flagging superior to downvoting?"

Downvoting has an effect on member reputations, and can actually cause articles to be semi-hidden.

Flagging on the other hand would have no effect on the member's reputation or the status of the article itself, until such time as a neutral body reviewed the article to see if in fact should be removed. If the post was in fact against stated terms and conditions, then removal of it would take place, and with perhaps a warning sent to the offending member. Perhaps after 3 such warnings, the offending account would be terminated.