Centralism vs Federalism was a conflict that existed in Latin American politics since the very inception of the independent states, in fact they were fighting over it during the wars of independence themselves.

The roots of this conflict in material terms have to do with the socioeconomic realities of Latin America on the eve of independence. While The successor states would broadly have the same borders as the colonial era administrative divisions, this was not a reflection of any sense of unity within those states in several respects. Communications and transportation were very crude if non-existent, and as such economic integration between different regions wasn't possible, and if so only in small scale and not necessarily following national boundaries, for example southern Ecuador and northern Peru had greater economic relations than with the broader national economies of their respective states, same for southern Peru and northern Bolivia. Different regions had different and mostly independent economic systems with differing interests, such as for example the difference between the agricultural exporters and merchant interests of the coast, increasingly integrated into the international market, and the interior landed states with mostly self-sustaining economies. As such there did not exist a national identity following the political project of the new states, but a set of differing and often contradictory regional identities over which the state had little power over, not the least because during the period state revenues were not terribly great.

On top of this inherent conflict arose the fundamental issue of how should the new states be governed. Breaking away from colonial institutions and conceptions of power, that ultimately rested on the supreme authority of the crown, in order to set up a new style of government that rested on popular sovereignty, constitutionalism and division of powers, was no easy task. The formal debate on this issue was embedded in a framework opposed to the perceived illiberal backwardness of Spanish institutions and drew from literature and examples from the French and Anglo worlds instead: the ideas of the enlightenment, the revolution of the North American colonies, the French Revolution and later Napoleonic code, the English parliament, and the liberal constitution of Spain of 1812 all served as models for the new governments.

The move towards republicanism was slow and full of pushback, as of course many remained loyal to the Spanish crown, but even within the republican side many assumed a more conservative view which viewed too much decentralization of power and popular participation as problematic, especially after the disastrous first attempts at self-government. Liberal democracy did not mean for them anything like our modern conception that includes such radical concepts as universal suffrage, rather it was linked with anarchy and rule of the mob, following the examples of the terror of the French Revolution and the slave revolt of the Haitian revolution. It was also believed that such a decentralized system as that of the United States, which gave each constituent state great political autonomy, was too radical for the nascent republics plagued with infighting and external threat from Spain and other Ancien Régime European powers, and that in order to bring order and progress to the nation a more centralized system was necessary, which curtailed the political autonomy of provinces in favor of a powerful executive branch, and limited democratic enfranchisement in favour of an enlightened oligarchy. There was also the added concern of finding a good supply of competent administrators and the funding required for a federal state, which naturally implied a bigger bureaucracy.

But to others the revolutionary ideals of liberty and equality seemed contradictory to this, as a centralized system of government was deemed by the provinces as opposed to their interests while favoring those of the capitals, thus it seemed hypocritical to break the subjugation from Spain only to then be subjugated by the oligarchy of a far away capital they hardly had any affinity for. The over centralization of power was seen as a shameless attempt to establish a monarchy in all but name, institutionalizing the primacy of a person and their network of political clientele at the expense of the wider interests of the nation. Thus federalism was seen as a necessary safeguard of local interests against government oppression, a cornerstone of the republican ideal the new nations were founded upon.

All of these divisions were evident since the beginning of the republican experiments. The first Venezuelan republic established as a confederation soon fell into internal turmoil between the provinces over the organization and funding of the war effort against the loyalist provinces, which was something that Simon Bolivar believed was fundamental in the eventual defeat of the nation. In neighboring New Granada two hostile governments sprang up, the Free and Independent State of Cundinamarca centered in Santa Fe and of centralized leanings, and the opposing federalist United Provinces of New Granada. In Chile the internal struggle between Santiago and Concepción helped in the reconquest of the colony with support from the viceroyalty of Peru. In Rio de la Plata the primacy of Buenos Aires led to friction with the interior provinces and with the rival port of Montevideo, that first remained loyal to the crown and once taken soon established the rival Federal League led by Gervasio Artigas. Mexico went from a homegrown short-lived empire to a federalist republic on US lines in the 1820s to a much more centralized state in the 1830s, amidst rebellions, coups, foreign invasions and secessionist revolts in Yucatán and Texas. Central America was immediately split upon independence whether to join the Mexican empire, join in an independent Republic led by Guatemala, or declare independence for themselves. Peru and Bolivia rejected the centralist Bolivarian foundations of their independence and soon fell into internal turmoil out of which emerged a short-lived project of unification under Santa Cruz' Peru-Bolivian confederation, welcomed by southern Peru with its ties to Bolivia and fought against along with Chile by the north.