i can't speak for the author but i myself see it like lots of people, those smart people you mention do not need to be aware that they are an active participant and or complicit in whatever is going on, without them theirselves knowing that they are actually a part of it, much like the petri dish effect, those inside the dish cannot see outside at all and they never know their entire existence is controlled, very often used as one possible theoretical metaphor about universes/existence in general, could also apply to people that you are referring to, no matter how unlikely it may or may not be.

it's compartmentalization, like in the armed forces, and other corporations.