This just seems like a (lazy) way to make the game harder as you progress. Instead of bosses you have to do more with less. I don't think it necessarily reflects any sort of deep political/economic reasoning.
Remember that simcity is a socialist fantasy world: all development is directly purchased by central government. In the real world, zoning doesn't cost money, and stadiums are sometimes owner financed.
Even in the US, neither the state or federal government has so little impact at the municipal level.