There is a downside to too much power in individual states: the "race to the bottom" where capital can make states compete for resources and jobs by allocating

There is a downside to too much power in individual states: the "race to the bottom" where capital can make states compete for resources and jobs by allocating them to whoever makes the most concessions, whether it's tax breaks, labor laws, environmental protections, etc. (We live with this already on the world scale; our protections on labor are great, but have mostly resulted in exporting poor working conditions overseas rather than eliminating them.) That said, the more local the government is, the more effective and responsible it tends to be: each vote counts more, constituents resemble humans rather than numbers, and it's a more manageable scope to engage in the nitty-gritty of governance. Balancing this reality with the benefits of collective solidarity is what Charlie Stross would call a Wicked Problem [1]. [1] http://www.antipope.org/charlie/blog-static/2011/07/wicked-1.html http://www.antipope.org/charlie/blog-static/2011/07/wicked-1...