So does this upheaval eventually lead to YTU's version of the Long Night? The Long Night is another one of those things that I have some difficulty accepting as presented in the OTU, but something along those lines is fairly necessary I think to get the variety of different planetary cultures and TLs from worlds that were long out of touch with the larger society. How have you handled the Long Night IYTU?
It does indeed lead to it.
The Ziru Sirka lasted a bit over 1800 years. I've assumed the Vilani system as encountered by the Terran doesn't really get traction in the empire until about 500 years in. Until then, it's slowly falling into place. Even then 1300 years can only be imagined in abstract. It's longer than living memory. It's been "that way" for as many generations as any family history will remember it. The social contracts of the Vilani had been in place for so long that to the people living in the Ziru Sirka they're taken as granted and were as immutable as the laws of physics or gravity.
The Vilani system developed a variety of systems keep their system stable, to maintain their Empire and keep the institutions of Empire regenerating to keep them from suffering from institutional fatigue. One of the methods was to create interdependence between people, worlds, parts of the Empire, and the three massive Bureaux that actually ran the Empire. That is, no world in the Ziru Sirka could be thought of as truly independent. The cornerstone of the Ziru Sirka system, especially to control technological innovation, was the idea of the zero-sum game that was present in almost all things. For someone to gain, someone else had to lose. As the result, the mindset within Vilani society was that everyone was trying so hard, under the veneer of custom and civility to advance their lot at the expense of others, while preventing the same from being done to them. However since those someone was trying to advance over were members of their workgroup and friends on whom they depended, they couldn't really all-out with their ambition, at least not without being totally cut-off and quickly tumbling down.
Using a very simple example: farming worlds depended on industrial societies to buy their food and to supply them with not only luxuries but even basic things necessary to Vilani-style industrial farming such as chemical fertilizers, farm machinery, spare parts, and so on. In this system, a farmer could never move to an industrial world. He could move to another farming world in the right conditions, however. This essentially compartmentalized knowledge and know-how to preserve everyone's place in the Ziru Sirka. However, it also meant that without inputs from industrial worlds, farmers had no idea how to grow food. Similarly, nobody on industrial worlds knew how to grow basic foodstuffs. Indeed, the knowledge of how to do such things didn't exist on industrial worlds so as to preserve the place of farmers and vice versa. The Vilani bureaux were in charge of ensuring the merchant fleets ran on time to ensure the constant movement of goods to where they were needed.
Using a social example: Lateral mobility existed in the Ziru Sirka, as well as upward (and downward) mobility within a caste. Castes were based around skillsets and professions, instead of being broad social levels for the most part (this was to prevent the creation of a "despised" or "untouchable" group), as well as castes of nobles above it all. Each caste had thousands of degrees and distinctions within it. While a single distinction or degree didn't mean much, even twenty or thirty such things meant were rewarded with a small but noticable increase in the quality of life. It was possible to move up in caste, but in reality it was extremely difficult. However people were contented by moving up the degrees within a caste during their lifetimes. Even moving large amounts of degrees within a caste would require lots of cooperation from others in your caste, patronage from those in higher castes, and the ability to fend off attempts by others to bring you down or keep you in place. With such a carrot-and-stick system, climbing up degrees within a caste was the goal of most Vilani. Vilani children might dream of becoming nobles, but by adulthood, most Vilani were set on trying to get to the top of their caste instead of jumping up an entire caste. At the very top of the caste the leaders were responsible for showing how important their caste was to the nobles and making their caste productive so they would be rewarded with a greater share of wealth as well to ensure their caste continued to be allowed to exist.
Given such a complex society, it was basically impossible for any outsider to understand its workings. Indeed, by the time of the Terran contact, even the nobles were so a part of the system they didn't understand it either, only their place in it.
Then the Terans came and kicked the entire thing over. The Ziru Sirka's system worked provided change was so gradual as to be nearer to the movement of tectonic plates or changes were limited to a world or two at most. Rapid shifts destabilized the system which tended to have an avalanche effect. The movement of huge numbers of clients meant that suddenly the Vilani needed workers in certain industries all across the Empire. This alone probably would have made the Ziru Sirka collapse without generations of repair work, but the Ziru Sirka didn't have that luxury. Terran ideas such as democracy or freedom of work took root in many parts of the Ziru Sirka as the system began to spin out of control as they answered the deep-seated fears of the Vilani. Of course, the Vilani were so used to their well-oiled system working that it never occurred to them that Terran societies were not stable; no Terran nation had ever lasted a thousand years with barely any change. Revolutions, invasions, and wars were commonplace on Earth. But the Vilani couldn't truly understand that. So they just saw the idea of "democracy + what we have now = great" or "freedom of work + what we have now = great" without understanding that the ideas were mutually exclusive.
So to use an example of what happened: An agri-world loses a lot of its workers, so can't keep up with food production contracts. Local nobles are aware there's stockpiles to compensate for bad harvests and so on, so use the stockpiles to make up the shortfall while they send a request for more workers to the nobles over them. The planet-level nobles have no idea where to get more workers (you can't take workers from mining or industrial worlds to be farmers after all!), so they send a request to the subsector noble, who gives permission for some local agri-worlds in the area to increase family size to five and that the excess workers will be shipped in twenty years. However, that's not soon enough, but the local nobles have no idea what to do about that, so sends a request to the sector noble, and so on. Each of these steps takes weeks or months. Meanwhile, the world can no longer keep up with its food quotas so there's less and less food going to industrial worlds. The planetary nobility realize what's going on, so at first things are handled by everyone just making do with less. As things continue to get worse the planetary nobles start looking for alternate supply from elsewhere in the Empire, asking the bureaux to send more food, but there was no more food to be had and no way to make more.
Even as the Ziru Sirka fell apart, its institutions continued to operate, but now it was the same as heart continuing to beat despite an artery being cut; the operation of social insitutions was harming the Ziru Sirka more than helping it. Piles of fertilizer a hundred meters high were left on starports on agri-worlds were most of the farmers had left to find jobs elsewhere. The crews of the ships realized this, but as merchants they hated the idea of resources being wasted, but they had set schedules. Starving shipyard worlds continued to turn out patrol cruisers at the set schedules because they didn't have know-how to retool to make merchant ships because the designers of such machinery were on the next system over, they fulfilled their contacts and hoped that'd be enough to get them food. Starving industrial worlds saw huge piles of food accumulating on the docks because too many of their truck drivers had left for jobs elsewhere. The remaining castes and guilds couldn't simply distribute the food themselves as each was too afraid of committing some faux pas that'd result in a degree penalty that their rivals would use to pull them down.
In such a situation, something snapped. And in the Ziru Sirka, the social contract snapped. This disintegration didn't occur overnight. Indeed, the Ziru Sirka continues under the Ramshackle Empire for a few more centuries as the Terran sphere ties up increasing amounts of its capital trying to keep the disaster in the Ziru Sirka from getting worse. By the time it completely falls apart, there's a ripple effect that pulls down the Terran sphere too as nations jockey for power, fighting each other for what's left. Worlds that try and pull back to weather things (possible in the Terran sphere) are attacked by roaming "naval pirates" (entire fleets of the Vilani navy gone rogue) who conduct smash-and-grab raids to try and get what they need then leave, leaving ruins.