Even if there's a good argument to be made, I think the argument of having a larger body do the regulation still wins out. Local governments simply do not have

Even if there's a good argument to be made, I think the argument of having a larger body do the regulation still wins out. Local governments simply do not have the incentives to make many of the changes required. For example, it's very worth it for Indiana to dump steel mill runoff straight into the great lakes. Their slice of the lake is small and it saves lots of money. But the issue is that Illinois, Wisconsin, and Michigan all have a vested interest, and have to pay those externalities. When push comes to shove, Indiana isn't going to pay a bunch more money just because they were asked nicely by nearby governments. Really, I think the argument is strongly in favor of the opposite direction. As the scale of problems increase, the oversight of the agency that deals with them needs to as well. Hence, why it's so hard to see any meaningful progress in worldwide cooperation on reducing emissions -- when it comes down to it, some countries just don't want to pay more money to pollute less. And who's gonna stop them?