Would you have said the same thing to people living in warring tribal societies if they hoped that local tribes would cease existing and coalesce together into a single nation state? That's bad because it reduces competition, right? But overall it was very good because tribal conflict and barriers to movement and trade act as a massive tax on anything we would both call good.

Unprecedented levels of peace in Europe happened not because of competing nation states, but in spite of that competition. It was the unipolar control exerted by the US and the destruction of the Soviet Union and the creation of the EU (a proto pan-European state) that caused the 1990s. There was one and only pole -- the West. Not 2 (or more) different adversaries with opposed interests engaging in an arms race.

As we go back to a world with more fragmented and distributed power, we will get more war and more arms races. An especially toxic setup in the age of AI.

This doesn't have to be a binary, anyways. You could set it up as some kind of federation where there's still economic competition. Just not military competition.

There is a difference between consolidation to a few different powers and consolidation to just one.

Also, AFAIK all of those nations consolidated because of military conquest. Countless European wars and empires.

The EU isn't like that, but they're an alliance and not one country. You can't just leave a country like England did.

America is the only nation that currently has consolidated global power behind an even vaguely free nation.

and yes, America has done that for the "pax Americana" period. unfortunately we were short-sighted and allowed people too much free reign to be stupid and anti-American.