No. This won't work, and here is why.
Lets say that a mod goes inactive for a few months. They are demodded, and account deleted. Then, someone decides to make an account with the same username as that former mod, everyone will have a ton of trust and believe them to be someone trusted etc.
And, on top of that, there is no activity requirement for the site, so it is not fair to delete a lot of accounts just because they have not posted in a while.