I don't think they work too well in a diverse community, either: I used to moderate such a community, on a codebase that introduced killfile features during my tenure, and its only substantial effect on moderation seemed to be cutting down on complaints from long-term users that had well-developed killfiles. (I've gone into more detail elsewhere in this thread on its cultural effects.) Since all communities are mostly newer/transient people during the active phase of their lifecycle, this wasn't much consolation.

That is a much harder administrative problem, though, and I've never found a solution that works other than "have a good seed culture, create strong norms against empty rhetoric and generally being a dick, and choose your mods very carefully". With the LW experience in mind I'm actually kind of a fan of karma as a self-moderation tool, but it introduces some problems of its own (see: Recent Unpleasantness), isn't anywhere close to a panacea (see: half of Reddit), and doesn't completely eliminate the need for good people with higher perm levels.