On the one hand, yes, but on the other hand WP adminship means so little that it's effectively flypaper for the drama club. Admins are essentially powerless against solid contributions, and the cliques and internal strife function as a fine system of checks and balances against overt abuse.
The worst you can say about it is that the admin culture repulses newcomers. But the WP model doesn't really demand long-term commitment from contributors in order to work. WP will improve steadily based on casual contributions. And so adminship is really more of an inefficiency than a serious problem.
I don't know if it is so harmless drama - for example see this: http://www.theregister.co.uk/2008/10/01/wikipedia_and_naked_... it is certainly overdramatized on itself by the journalist - but even if there is just a trace of truth - then it seems quite serious.
The only serious threat to the encyclopedia would be a force that would prevent strong writing on relevant subjects from being incorporated into it, or a force that persistantly corrupted that strong writing once it was incorporated. This link is just drama.
What lazy or corrupt journalists choose to do with the content in the encyclopedia is a problem outside the purview of the encyclopedia.
The worst you can say about it is that the admin culture repulses newcomers. But the WP model doesn't really demand long-term commitment from contributors in order to work. WP will improve steadily based on casual contributions. And so adminship is really more of an inefficiency than a serious problem.