Game theory is exactly it. A bunch of simulations have shown that in a repeated prisoner's dilemma, the optimal strategy is tit-for-tat, sometimes adding forgiveness. The fact that you will play again incentivizes players to cooperate. But as soon as the game becomes finite (i.e. you can see the end in sight), the optimal strategy becomes "defect", because your opponent also has the same incentives and whoever defects first gets the payoff.
Incidentally this also points to the path from a bad to good equilibrium. You have to throw away the big system and start with a system small enough that the participants will interact repeatedly. This rebuilds trust. Then you have to defend that system from outside influences, or at least carefully control them so they play by the same rules as existing participants. The act of defending your local community also builds trust - arguably [1] post-WW2 U.S. social cohesion was actually generated by the experience of defeating the Axis powers and then getting enmeshed in the Cold War. Finally you can gradually expand the system through carefully controlled immigration and naturalization.
Unfortunately, this probably means that the Internet, globalization, and likely large states like the US/China/Russia are all toast. And as Terence Tao's post here points out, large organizations are usually more efficient than small organizations. That means that as large organizations have outcompeted small organizations, the transition as those large organizations themselves become dysfunctional and disintegrate is going to be wrenching. We're going to lose access to several material conveniences that we take for granted.
[1] https://www.paulgraham.com/re.html