It seems like a good time to talk about how bad of a thing centralization on LN actually is. Because, the way I see it, it isn't that big of a deal, but I may be missing part of the puzzle.

There is this idea in the economics of free market capitalism that, even if an actor is a defacto monopoly, that even though he isn't constrained by existing competition, he is still constrained by the competition that will come into being if he abuses his position. This doesn't always work in the real world because monopolists employ the state to protect them against competition. However in the abstract world of permissionless adhock networks there is no state to protect a node from competition.

Even if there were only one node that everyone connected through, he would be constrained by the knowledge that if he abused his position than competition would quickly appear. He would have to keep fees so low that no one wanted to bother starting a node to compete with him. He would have to route all transactions because the moment he started censoring nodes would pop up to route those transactions. He would have to route transactions reliably and consistently because the moment he didn't new nodes would pop up to compete with him that could. He would have to find a way to be DDOS resistant because if he did not new nodes would appear to serve those who were unable to route through him due to network disruption.

Anyway, I am sure that you see where I am going with this. So I would like to know what if anything I am missing here. What is the fear of a centralized lightning network?