Rather OT, but I have a major problem with this line. The population of the U.S. around the writing of the constitution was ~3 million; if it was a state today, it would be one of the smaller ones. In many cases, states are not in any better a position to decide these issues than the federal government. (And with things like SOPA, per-state regulation would naturally be disastrous.) I think at this point, very few things can be well decided at the state level; thus, either the national gov't is needed to keep states from stepping on each others' toes (tax law and internet taxes), or the national gov't is needed to keep states from stepping on the rights of citizens of that state - which they are just as capable of doing as the national gov't was when the idea of state sovereignty was taken for granted.
tl;dr: states are as capable of screwing things up as the national gov't, and tend to be less transparent about it.