It’s always been politics, albeit to varying degrees. Some orgs lean toward facts and performance, others not so much, but yeah it’s always a factor even if not acknowledged.

It's not a reward for past performance. They're putting who they think will do best in the role in the role and past performance is one very large, but not the only axis on which that is judged.

And, that being said, in larger and richer organizations (infinite monopoly bucks fueled FAANG workplaces perhaps being the penultimate example) the incentives to simply promote the most fit can get more easily polluted by irrelevant criteria than in smaller, leaner organizations that have less runway to continue existing and less opportunity for individuals to dip out without consequence if decisions are not made in a rigorous manner and the results are bad.

That's a bathtub curve. You see it in a lot of industries. The joke for AE at GA Tech circa 2000 was "Aerospace 'Do you want fries with that?' Engineering". Hiring picked up later as Baby Boomers and other older generations started hitting retirement age, but the effect is that a generation gets largely skipped over. Those trained and interested in it will find jobs elsewhere, tangentially related to the field perhaps but not training towards those critical, soon to be vacant positions.

You have a lot of seniors, a lot of juniors (because eventually you realize the coming staffing problem), and few mid-career folks (as a proportion of the whole). A particular downside is that retirement cliff. When the seniors go, you lose decades of experience for each retiree, centuries of experience with every 2-4 retirees.

The whole 2010s bull-run was Millenials monetizing non-gpl-3 open source stacks written by idealistic GenX in the 2000s. Most notably Zuckerberg.