we need to be even smaller

That’s not the argument, please don’t trust it needlessly like that

The point is that having everything be on one instance results in the centralized abuse of power we saw with reddit

Per example: .world has some famously bad power mods (a certain soaring mollusk comes to mind) same as reddit, growing communities outside of that centralized area gives us a place to run when they finally snap completely, as is inevitable with power mods

This is very easy to do thanks to how Lemmy works

It’s not that we need to be smaller, but we benefit if we all grow similarly, or at least the community distribution does.