here's a game theoretic explanation of why that's no good: okay, fine, let's have an exchange rate where karma gets less valuable as the amount of total karma increases.

then me and my friend will upmod each other 1 karma, because we're each gaining 1 whole karma, but the devaluation we're causing is only losing us a fraction of a karma. With these incentives, everyone will upmod ... and the value of a karma point will tend towards zero.