If I remember right Mede was a soldier (can't be bothered to pull him up on UESP at the moment). Screw it I did look it up and it doesn't say anything about that. Anyway, I think he made the understandable mistake of looking at things purely in terms of his own weaknesses, and concluded that the Empire simply couldn't fight any longer. Which was possibly correct but he missed that the Thalmor really couldn't keep fighting either. So he failed to realize that they needed the peace as badly as the Empire did, and was way too willing to accept terms that were purposely crafted to splinter the Empire by alienating two of its most warlike provinces and dismantling its intelligence service.
Skyrim happens 20-some years later and right now the Empire should be arming an entire new generation of young men, larger and more prepared than the last one (cause humans can do that), to teach the Thalmor the lesson that didn't quite sink in when Numidium taught it. Instead they're mired in a totally avoidable civil war in what should be a vital part of their war machine, dealing with frosty at best relations with what should be another vital part, and stewing in despair over in Cyrodiil itself. Meanwhile the Thalmor get to replenish themselves at mer breeding speeds and leisurely undermine the civic trust of the Empire's citizenry.
TLDR Mede choked