I basically agree with this solution, but I do not think we will see something like this from WotC. Tying races to a setting really allows you to lean into their differences in mechanics and fluff. And ASI were never an interesting racial differentiator (though I still think they can be useful).Snarf's Superior Solution: Swerve hard into differentiation both in crunch AND lore. Get rid of 'default' races in the PHB. All races should be campaign- or setting-specific. Get rid of ASIs for races completely (as that seems to be the alpha and the omega of complaints) and differentiate all races by abilities and/or gated racial feats. Races should have a rich tapestry of culture and fluff to pull upon (or to play against, as need be, but will still help place them in the world).
However, what do you, playing the role of WotC here, give to people who don't us a published setting? My group never plays in published settings, so where do we get our fantasy races from?