The Context Tax: Why Step 12 Costs 42x Step 1 (Measure It in 40 Lines) (opens in new tab)

In short: the context tax is what you pay when every agent step re-sends the whole session transcript as input again, so step N re-bills turns 1..N and total cost grows with n(n+1)/2. Cheaper tokens lower the unit, not the shape. context_tax.py meters the re-bill multiplier offline; one debugging session measured 42.8x. AI disclosure: I drafted this with an AI writing assistant. The tool, the fixtures, and every number below come from a real local run of the script in this post on tiktoken o2...