The issue with the hypothetical is if you give a team lead 25 competent people they'd also get bad results. Or at least, the "team lead" isn't really leading their team on technical matters apart from fighting off the odd attempt to migrate to MongoDB and hoping that their people are doing the right thing. The sweet spot for teams is 3-6 people and someone more interested in empire building than technical excellence can handle maybe around 9 people and still do a competent job. It doesn't depend much on the quality of the people.

The way team leads seem to get used is people who are good at code get a little more productive as more people are told to report to them. What is happening now is the senior-level engineers all automatically get the same option: a team of 1-2 mid-level engineers on the cheap thanks to AI which is entirely manageable. And anyone less capable gets a small team, a rubber duck or a mentor depending on where they fall vs LLM use.

Of course, the real question is what will happen as the AIs get into the territory traditionally associated with 130+ IQ ranges and the engineers start to sort out how to give them a bit more object persistence.