I have noticed, that at -3 level, when you e.g. deny trade, there is the message, that stability has dropped. And maybe there are some revolts, but there is no effect on stabilty. I mean you need 100 points to get to -2 and are currently on 8o points. When in this situation stability drops nothing happens to the 80 points, you already have developed. I would make sense, that they go back to 0 as a punishment. Otherwise, you can not get punished anymore at level -3.
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