I believe it'll lead to much higher costs, CO2 emissions, and other issues, simply because this architecture will require more message passing, wasted bandwidth, will be less reliable, and have higher operational complexity. I get that those in decision-making power aren't usually technologically adept at figuring out solutions for these issues, but they should invest in solutions first.
What part of your question is the concern of a bureaucrat? We can drop a couple 9s of uptime in the name of local data primacy right? (I specifically didn't say "data privacy") :)