As kids, we're told only people who go to college/university for politics/economics/law are qualifiable to make/run a country. As adults, we see no nation these "qualified" adults form actually work as a nation, with all manifesto-driven governments failing. Which to me validates the ambitions of all political theorist amateurs, especially as there are higher hopes now that anything an amateur might throw at the wall can stick. Here's my favorite from a friend.
I originally did, but on further reading I found that dunbar's number isn't strictly proven, though it does feel about right.
Also, you would get super tiny towns and the community wouldn't be diverse enough to support multiple interest groups. For example, assuming a small niche knitting community in a village of 150 would have maybe 3 members who would already know everything about each other, whereas in a town of 5000, there'd be a higher chance of getting at least a mixed bag of people who only know each other through the knitting group.
Very good point, it might lead to more tribalism if kept too small
exactly, though some small degree of tribalism is wanted (e.g. a community of tech-heads, or a community of hippies, or a community of furries, etc.)