It's obvious that this principal operates in many areas in a healthy society. The state government maintains highways, but it should not discipline our children for not doing their homework. In fact, a sign of an unhealthy society is one where big entities try to meet social needs that could and should be met by smaller social units or individuals. That is one reason why the growth of the welfare state is so abhorrent to most Americans. It offends our sense of balance in a primary way.
Subsidiarity keeps a society in balance.
And when the principles of subsidiarity are respected in economics, the economy is stable. When subsidiarity is respected, solidarity occurs. Solidarity ensures that the widow of a worker who dies is provided for. It watches out for the physically and mentally handicapped, the newly-arrived immigrant, the elderly or retired individual, to make sure that their needs are met. Today the government and corporations regularly promise to meet the needs of everyone, but it is a promise every thinking person can recognize as patently unrealistic.