Foolish in what sense? It's not foolish when it works. It can certainly shield you against individual problems, such as losing a job.
In many cases, there are benefits to scale, but the optimal scale varies from one setting to another. Sometimes, the optimal "unit" is your block. Sometimes, your village. Sometimes, your family. And sometimes, yeah, just you.
At a massive scale, things start falling apart again, because the government - or any other organization notionally responsible for the well-being of millions - is not going to be particularly invested in your individual outcome. You're just a small part of a statistic that might be tracked somewhere. You don't quite qualify for a particular benefit because of your unique circumstances? Tough luck.
In many cases, there are benefits to scale, but the optimal scale varies from one setting to another. Sometimes, the optimal "unit" is your block. Sometimes, your village. Sometimes, your family. And sometimes, yeah, just you.
At a massive scale, things start falling apart again, because the government - or any other organization notionally responsible for the well-being of millions - is not going to be particularly invested in your individual outcome. You're just a small part of a statistic that might be tracked somewhere. You don't quite qualify for a particular benefit because of your unique circumstances? Tough luck.