Healthcare? Defense? Medical and scientific research? SNAP and (albeit small/not enough) education funding? What about banking regulation, regulating privacy and tech?
What happens when those, by your insinuation, 'unwise' states like California and New York are the only states that can afford anything? I would add it's my opinion these liberal local govs are the only ones willing to vote in their own best interest - e.g. education - but i'm sure we won't agree there on the fundamental premise.
Most of the conservative states rely on money from more populous states to even feed their people. The Republican Speaker is insanely hypocritical here in current stimulus negotiations as Kentucky is the second most dependent on Federal funding. e.g. they are 2nd to last in taking more money in from other states than they give back.
Plus State and local governance already has an outsized influence on people's lives (even many conservatives would agree more than Fed Gov)
and local government seems even more affected by unequal political power and wealth. Just look at all the Q anon and other crazy city council and school board zealots elected all over the place (which sadly has now made it's way into Congress)