Flags must remain as an option because they serve a purpose, especially in the case of copyright images or text being used. But there is no good reason to use them just because you disagree with the opinions or beliefs of the poster - or to censor subjects. Unfortunately it happens, but as flag weighting follows the same as upvoting - the biggest investors (Steem Power Holders) will have the biggest flag impact. It is hoped of course that anyone wielding a big investment is capable of logical and restrained use of the power - unfortunately we have seen that isn't really true either.
One way or another, if anyone can post anything they like on here then we will quickly see the entire blockchain go down under a sea of copyright lawsuits.
Generally I find the majority of people on here are able to act appropriately - and often it is a mistake or from just being new that inappropriate content is posted. And there are of course @steemcleaners working hard to not only ensure copyright and plagiarism issues are dealt with - but also if people have issues ie being inappropriately flagged they have somewhere to go for help.
At the end of the day, the principle holds true: if you just want to post, no one can stop you from doing so. The flags can only take away your rep and potential rewards, but no one can ever silence you.