OK, so reducing 7Billion by a factor of 10,000 results in 700,000. Are you really saying that we cannot manage an earth with greater than 700,000 people in it, without squashing the individuality out of the general human population?
I wish I could give a really good, educated rebuttal to this, but I can't. I think the reduction number is too high, but I know for a fact, for my life experience to be positive in any way, I need a community with fewer people.
Growing up the big city I learned that the government is "other" than me. I can't make a difference. Don't expect too much. Whatever life is today is as good as it gets, maybe with a very small bit of change. When I did try to communicate with State level government my attempts were met with something that felt like an intentional push toward apathy - a laugh in my face. Yeah right.
Here, in my smaller world, I now take part in grass-roots action, make demands of my government, write letters, and frequently get positive results.
OTOH, we here are not immune to this push to make people feel defeatist and apathetic. We are now going through problems because our town was gobbled up by a neighbouring big city. They only wanted our tax money, and proceeded to take it and more, and thumb their noses at anything our community needed. They are city, we are farming - but they are attempting to make us all conform to that generalised mush you speak of. It isn't working. They tell, we are supposed to accept being told.
But again, this would seem to support your statement. More people, more mushing of community into a uniform mass. Still, I have to say that I have observed that people hold a foundational belief, and to the extent that they are able will naturally attempt to re-form everything around them to support that foundational belief. Even without knowing that they are doing it. Even in the face of opposing truth. Then, if you get enough people who hold the belief that people are evil and disruptive, and need to be squashed and be controlled, eventually, over time, societies will be re-formed to mirror that truth.
I'd like to think that all the massive population we currently have can be supported by, instead of making everyone the same, localising responsibility to small enclaves which work together as purpose-defined groups, working to the larger group, but having self determination at the lowest level. I suppose I'm naive, though.