I think you just coined "context rot", what an excellent term! Quoted you on my blog https://simonwillison.net/2025/Jun/18/context-rot/
imagine instead of predicting just the next token, the LLM predicts a mask over the previous tokens, that is then thresholded and only “relevant” tokens are kept in the next inference
one key distinction between humans and LLMs is that humans are excellent at forgetting irrelevant data. we forget tens of times a second and only keep what's necessary