From Janet Biehl, The Politics of Social Ecology: Libertarian Municipalism:
Today Switzerland, because it is still a confederation, seems anomalous among the relatively more unitary Nation States of Europe. But in earlier times, in central Europe especially, it was confederations that were the norm and States that were the anomaly. Confederations abounded in the thirteenth and fourteenth centuries, like the Rhenish and Swabian leagues. Switzerland merely preserved much of this older confederal trend, while its neighbours underwent centralization to become more modern States. Its governmental structure is still relatively decentralized, made up of twenty-two cantons, which still have a good deal of autonomy from the federal level; in turn the three thousand communes still have some autonomy from/the cantons in which they are located.
But Switzerland today also has many State features (as well as attitudes, institutions, and social features that are not at all enlightened). Swiss confederalism is far more interesting historically. Most strikingly, in the country’s easternmost territory—which was once called Raetia by the Romans and is now called the canton of Graubunden—the Swiss communes formed confederations for their common welfare and safety.
At the beginning of the sixteenth century in Raetia, three confederal leagues (the Gotteshausbund, the Oberbund or LGrauer Bund, and the Zehngerichtenbund) coexisted. In 1524 these three leagues allied to form the Free State of the Three Leagues, which despite its "Statist" name was a confederation. The Free State confederation lasted for almost three centuries, until Napoleon forced it into the Swiss Confederation in 1803.
All three of its component leagues, in turn, were made up of communes that were remarkably democratic and free. Indeed, the ultimate sovereignty in the Free State together proposed referenda and carried out the will of the communes. The commissioners had the right to handle foreign affairs and to prevent the component leagues from making foreign alliances on their own. But the communes themselves decided upon matters, of war and peace, as well as domestic issues.
The central “government” thus had almost no power, while the communes—that is, the citizens themselves, in assembly—had a great deal. In effect, the commissioners were merely attendants upon the people. Ultimately they lost to the communes even the power to handle diplomacy and make treaties. In general, the history of Raetia for these three centuries is a striking testimony to the ability of direct-democratic communities to govern themselves in confederal union.[6]