As they rise through the hierarchy, people go from making decisions based on fact to setting goals and mandating that the facts must alter to fit them. In other words, they go from allowing for reality to defining their own reality.
You see it in every business above a certain size. Management stops listening to their workers, the people who actually have to do the work. They see only their own goals and not what has to happen to meet those goals. Eventually reality catches up, the goals can't possibly be met, and the business fails.
And with an MBA they can bypass the whole fact-based stage and go straight through to magical thinking. They're relying less and less on reality-based considerations, and that's one reason the American economy is going into the toilet.