Stop to Xbox Live abuse

Had an interesting conversation today in The Console Knights Forum about an article from xbox360.au.com about some roomers that of the possible introduction of censorship on Xbox Live covering Racial, Sexual, Religious and obscenity.
Personally can't see this working. I think it would have been much better if they introduced the "record" option similar to "mute" option we get now. This'll allow users to trigger "record conversation" and upload to some processing unit able to ban or warn users as necessary. Also they could get every day gamers to join some sort of official Xbox Live moderator group, trusted users possibly on a small salary to moderate, educate, warn and ban users if necessary. Similar to Live forums. I really think this would have been easier to implement at present.