Because when you're talking about federal/nation level spending it is easier to get people to spend money on a bridge or institution they have some chance of being able to drive to within a day rather than convincing a guy in Montana why he should be paying for native Hawaiian culture in some remote village in the Pacific he can't afford to visit and will probably be kapu'd out of by someone screaming about haoles.

As the nations grow in size you generally end up splitting into states that have more localized incentives and/or you have a more brutal central apparatus like in the large states of China/Russia.