Of course, the problem is that almost everything it gets applied to can be decomposed neatly into, independently operated geographic regions - whether states, or counties or groups of such - if the scale becomes a challenge.
Arguably scale rather creates great opportunities. Subdivision coupled with looser coordination and knowledge exchange means systemic failure at the top of each system can be contained by leaning on the others. E.g. the UK National Health Service is split into many "trusts" and failing trusts are often either put under the control - temporarily or long term - of successful ones, or given more focused support from surrounding trusts to get back on track. Any number of trusts can be badly mismanaged without creating existential threats to the health service as a whole.
The larger the overall system, the more such trusts can be run at whatever the ideal scale is for optimizing system cost rather than having to scale them down to spread the risk; and the more such trusts, the easier it becomes to absorb individual failures without too big effects on surrounding ones.
I've yet to see a coherent argument for this claim.
> This works great in smaller economies (like you're advocating) like Scandinavian countries where you have a much smaller population and it's easy to support a few million people.
Why would this work better in a smaller economy? Why would it be easier for an economy of 30 million people to support N needy people than for an economy of 300 million people to support 10N?
> When you have over 300 million? As we've seen in recent years, when you institute measures like this it actually creates more dependency and self reliance on the government
How have we seen this? I don't see any evidence that "measures like this" have actually been instituted, much less that they have been instituted and observed to produce the results you suggest.