It does. Ultimately someONE has to be the ultimate arbiter of an RPG game.
There are essentially three possibilities:
1. The GM is the ultimate Arbiter. He is allowed to break the rules. This is really the healthiest choice. Someone chosen by his peers to run the game who is then given extreme authority; he knows the group in question and its needs.
2. The Players are the ultimate arbiters. This is an invitation to chaos. There are two ways this can go: either the Players are allowed to break the rules, but the GM isn't, or the Players and the GM are both allowed to break the rules. In either case, the end result is basically a pushing match where the biggest primma donna ends up dominating the game and eventually ruining the fun for everyone else.
If the GM is the ultimate arbiter, yes, if he's a Dick he could ruin everyone's fun. But there's a certain inoculation against that in that the GM doesn't have a PC. Yes, a bad GM will make an NPC his pet, he'll lord over the players, etc... but in all those cases the problem is NOT that the GM has power, the problem is that the GM in question is a dick.
Whereas trying to present some kind of dictatorship of the playertariat as the alternative is stupid. It only takes one dick with power to ruin the game; and the odds of there being a single dick in a group of 5 people is going to be considerably higher than the odds of a single GM being a dick.
3. The "rules" are the ultimate arbiter... which is really a lie. The Rules didn't spring out of nothing. They were written. So in this scenario, what you're really doing is saying that its the Game Designer who has the ultimate power, he's the only one who can "break" the rules because he's the one who got to set them in the first place.
This is quite possibly the MOST idiotic of all options. Here, you aren't trusting Bob the GM who you've known for years, you aren't even trusting power to all six gamers and hoping to god no one ruins it, you are instead giving absolute power to some asshole who might live thousands of miles away, who's never met you nor will ever meet you, but has decided that he knows better than you do what's best for you and your group.
This is utter bullshit. This is the reason rules do not survive first contact with a group. It doesn't matter how perfect and all-inclusive and self-contained a set of rules are; the point is they are not rules that have been specifically written FOR your group (unless you happen to play with the game designer, then its a different story, but that's beside the point). The rules MUST be broken to suit the gaming group, or you will end up with a bunch of idiots running around playing in a sub-par way all for satisfying the whim of someone who's never met them and won't even know they exist.
Of course players will think it'd be cool if they have the power. Usually, what they really want is for "they, personally" to have the power and not the other players. The whole idea becomes a lot less appealing once you realize you'll also have to trust the whims of 3-5 other people.
And of course, there are some game designers, would be "geniuses" who are basically megalomaniacs, who would like everyone on earth to have to play THEIR game exactly how THEY designed it, no changes allowed. They will often talk about the evils of the GM and how the GM must be neutered for the players' sakes, but they are in fact the worst of hypocrites, all they want is for everyone to be forced to admire their own "artistic" vision. They don't give a shit about the other players, they want to be sure they, the "bolshevik" if you would, get to control how a game gets played, and not the "bourgeoisie" GMs or the "proletariat" players; though like any good group of autocrats they'll claim that its the proles who come out winning somehow.
The only real solution is what works, and has worked for well over 30 years now; the GM is the ultimate authority. The Buck stops with him. Period.
(Originally posted March 23, 2009)