To explain: where this sort of project management actually works is in a short-term, time-limited crisis that large companies might call a "Code Red" or (in the original meaning of the word) a Scrum. See my Quora post on the topic: http://www.quora.com/Why-do-some-developers-at-strong-compan...
When you're a small web consultancy that has landed a make-or-break project that (say) must be delivered inside of 4 weeks, and when you have absolutely no leverage and must accept any changes in scope as they come, Agile can work. You can reasonably expect people to set aside their long-term goals (career progress, tech debt reduction) and solve the problem at hand. Moreover, when you're a big company fighting a Code Red (meaning, money is being lost right now in large amounts) and have to assemble a cross-cutting do-nothing-else-for-now team with no clear manager, Scrum can actually make sense.
In a true sprint-- a short-term reorganization necessary to solve an immediate problem-- unsustainable effort is OK because, well, no one's going to be expected to sustain it. You're under a short term emergency. You can ignore whether the assigned work helps peoples' careers, because they're not going to be doing it for long. You can mandate that people work on the "official" top priority (of which there's only one) and most people will do so.
The problem is the perma-Scrum that's been sold (dishonestly) by the Agile industry. This stuff works for a few weeks and people don't mind doing it. In fact, even if the work itself is painful and the hours are bad and status updates are (by necessity) frequently demanded, being tapped for the "elite emergency team" is something that people generally like and, over a span of 2 to 6 weeks, it gets results. However, when you have permanent "sprinting" and frequent status meetings or impose these rules over the whole organization, it starts to hurt morale. It starts to feel less like being on an elite emergency team and more like a culture of permanent juniority/micromanagement... which is what Scrum/Agile has become in many organizations.