Under the system known as federalism, the United States grants more authority to state and local governments than do many other Western democracies. Why do it this way?
First, self-government. There are more opportunities for political participation at the state and local levels than at the national level. Your vote counts for more, you have more access to your state and local officials, and you have a better shot at exercising direct, personal influence, such as through service on boards and commissions, and participation in town meetings. None of this would be the case were federal bureaucrats to assume control over zoning, K-12 public education and public safety.
Not that self-government is always good government. States, cities and towns often behave badly. They dole out $80 billion annually in business subsidies, most of which are incomparably more absurd than anything found in the federal tax expenditure budget. They have shamelessly misallocated funds from the mortgage and tobacco settlements. And, oh yeah, they have allowed their pension deficits to swell to epic proportions.
Want to weaken public employee unions? A surefire way would be to nationalize everything. Unlike in many strong union states, there is a viable Republican party at the federal level. Also, voting percentages in federal elections are higher than in state and local elections. Because of widespread public apathy towards state and local politics, federalism now works to the advantage of the public employee unions, which no one could accuse of being apathetic. Republican pushback plus relatively elevated voter turnout levels now severely restrict union influence over national politics. Were school, police and fire departments simply administrative units of the federal government, unions would not wield nearly as much power as they now do.
But federalism's justification does not stand or fall by the success of self-government in America. In Federalist #51, James Madison argues that federalism serves the same purpose as separation of powers: limited government enforced by checks and balances.
In the compound republic of America, the power surrendered by the people is first divided between two distinct governments, and then the portion allotted to each subdivided among distinct and separate departments. Hence a double security arises to the rights of the people. The different governments will control each other, at the same time that each will be controlled by itself.
With federalism, we make it hard on ourselves. Federalism contributes to the American political system's overall inefficiency, but also restricts the ability of any one party to dominate over the nation as a whole. Indeed, the genius of the system may be in how it takes the pressure off of self-government. Even in the absence of great leaders (who "will not always be at the helm") and/or a universally enlightened and engaged citizenry, free government will still be protected.
Over the centuries, the federal government's power has increased at the expense of the states'. There have been many benefits to this, most notably civil rights for black Americans. Nor could the weak Articles of Confederation have provided us with the prosperity and world dominance we now enjoy. But state and local governments still play a vital role in our system, albeit a complicated and contested one. Who's responsible for K-12? Social welfare? Health care? Federalism is a negotiation, always has been and always will be.