From this Republicanism draws it's power. The powerful want to rule over other people, so devide the nation into many small states, give each a leader and let the people choose where they want to live. This forces leaders to compete with each other for head count. These socal climbers are naturally competitive with one another so they will go to great lengths to gain more population.
You have the benefits of a large country for things like national defence and natural disasters, but without the strong federal government that ends up homogenizing the states.