This is a general principle: making things bigger and/or more centralized tends to increase efficiency and decrease the frequency of failures but greatly increase the cost and severity of failures.
In computing think about, for example, centralizing identity management in the hands of a few large companies. These companies have large security teams and mature well built infrastructures, but a huge failure or a huge security compromise of, say, Google’s OIDC system, could be utterly catastrophic, paralyzing and destroying vast swaths of our digital infrastructure. Entire companies, services, or even sectors would be paralyzed or worse.
Small, decentralized, and diverse is overall more costly and experiences many smaller failures but is more robust for the long haul.
This is probably why life, having evolved over a billion years, is mostly this way. Giant super organisms and super-optimized monocultures are possible but fragile.
Our economies, having only existed for hundreds of years and being incentivized to only care about next quarter, tend to go all in on anything that makes numbers superficially better.