I understand what you're saying, but part of the issue here is that that line of reasoning only works well in the context of looking at existing membership - people who have these histories. The problem comes up when you start talking about membership growth - attracting new members or poaching from competitors. Then this becomes a barrier and deterrent.

If you're a young professional starting out or a loyalist of another chain thinking about jumping over, do you really want to hear that even after you do all of your stays and earn what they say you're going to get, you'll still be pushed down the ladder by folks of the same status who have been spending for years? Why even start then, you'd rather just go with a program who treats all its elites somewhat equally. I doubt anyone has the patience to build up, what, 10 years of "lifetime spend" so they can be treated like a diamond. Does Hilton really want overt barriers to entry in its program that are that high?