Because that was how it worked? It was originally thought that the country would actually be a loose union between states. States in other parts of the world are the equivalent to a country, but the term was changed here after the federal government was established. Rather than have a whole bunch of small countries loosely affiliated, they figured why not be one big unified country. The way I see it, we would be better off as a bunch of loosely affiliated countries, because different regions think differently, so why not let each state have it's own set of laws that are not overruled by a federal government?