That is why there are law regulating HOAs, and they talk about that exact mini-government issue you talk about. Ex: https://www.calhomelaw.org/doc.asp?id=460 h

That is why there are law regulating HOAs, and they talk about that exact mini-government issue you talk about. Ex: https://www.calhomelaw.org/doc.asp?id=460 https://www.calhomelaw.org/doc.asp?id=460 You can also say something similar about corporations.