Im gonna attempt to explain mining difficulty with a metaphor


You and a lot of other people are standing at a bar, the queue is exactly one person deep. The bar tender goes around the queue take drinks orders and fulfilling them let’s say clockwise. When you get your drink you stay in the queue and drink it. Difficulty represents the time you have to wait to order your drinks. If a new person joins the queue you will have to wait longer and ultimately drink less in an evening. If a person leaves the queue you will wait less time and be able to drink more in the evening. This scales up(adding to the queue) and down(dropping from the queue). There will also be the few alcoholics who will never leave the queue, and they want more booze than they can imagine wanting.

Is my understanding correct?

I think the joke(miners death spiral) is that those alcoholics will always be there, drinking from the firehouse or waiting patiently for the bartender to serve them.