What do you mean when you say, "Throwing their hands up"? Are you saying the ISPs are refusing to route any traffic after a certain threshold? Does Level3 get cut off entirely if it exceeds its bandwidth limit?
They effectively are refusing to route after a certain threshold. Their connections are saturated and they aren't wanting to play ball the way other peers have (at least per Level 3's side of the story). So once their X Gigabit link is saturated, quality goes down. They don't want to use the same arrangement that Level 3 has made with others (with respect to cost distribution) to upgrade the connection so the situation remains.