Over here node10 noted that the "colony dies, everyone loses" condition is unsatisfying, not just for its suddenness but because of the gameplay that it incentivizes - someone who is losing can try to force the game into a loss for everyone. I noted that it's really a catch-up mechanism, because the leader has to spend effort trying to prevent that.
But I've thought about it a bit more, and I think we can do better than that. How about we turn it into an actual catch-up mechanism?
Suggestion: add a new black market item called "Civic Unrest". It's priced like the other black market items, but with a catch: there is a discount off the normal price which is based on how expensive life support is! As prices for food, water, etc rise, the discount gets bigger, so the less happy the colonists are, the less it costs on the black market to rile them up.
When someone buys and uses Civic Unrest, the colonists rise up against the greedy corporate b*****ds profiting off of their misery and levy a one-time progressive tax on all corporations based on their stock price. Everyone pays a fine of X percentage of their stock times some number of thousands, and the higher the stock price, the larger the percentage (so that leaders are hurt worse than laggards). The fine comes out of debt, not cash, so that operating capital isn't affected but the stock and buyout price is.
This kind of catch-up mechanism has two advantages over a straight "penalize the leader" mechanic like simple taxation or overhead costs. First, the cost is based on the colony's welfare, which the players themselves can have some influence over. Leaders will have an incentive to keep colony costs down, laggards will have a reason to try to push those costs up. Second, the penalty is not automatic - it has to be bought by the laggards, who will have to make a strategic decision as to whether it's worth it to pay the black market price of Civic Unrest in order to throw some additional debt onto the leaders.
An alternate mechanism (a better one, I think) would be for the black market price to be figured as normal, with no discount, but instead have the penalty be based on the current price of life support when it gets used. So someone might decide to buy it once or twice early on when it's cheap, and then use it later when life support has spiked. You could even allow someone who has an unused Civic Unrest to "spend" it immediately when someone else uses one in order to counteract the penalty for themselves only. That way someone might want to buy one or two cheap early on, and then later use them either offensively if they're behind or defensively if they're ahead.
If we did something like this, then we could remove the "everyone loses" condition entirely, since it isn't really that interesting. Instead, as the colony gets more and more upset at rising prices, the payoff for buying and using Civic Unrest becomes more and more attractive. If life support prices get insanely high and dominate the end-game market (as they sometimes do), then the net effect will be people using Civic Unrest to pile on debt to other people, keeping stock prices low and making buyouts happen even faster. So not only is it a catch-up mechanism, but in certain circumstances it can be a game-ender as well, and it would be good to have more game-enders than just Offworld Markets.