I take the view that the European balance of power probably broke out into open conflict often because of hidden alliances that made it hard for states to correctly gauge the costs of engaging in such conflict.
In the field International Relations, there's lots of discussion around the stability (or instability) of a bipolar distribution of power. Your stance is closer to neorealists, mine is maybe closer to classical realists. Have fun reading https://en.wikipedia.org/wiki/Polarity_(international_relati... and related links
But from a game theory perspective, having only two powers turns everything into a zero-sum game. I argue that leads to less cooperation and increased divisiveness. Not agreeing with Republicans means you must be a Democrat in their eyes. This "us versus them" mentality is somewhat tribal and leaves little room for nuance.
If I had a magic want, the US would have a 4 party system. Like a cartesian plane with civil liberalism <-> conservatism on one axis and economic liberalism <-> conservatism on the other axis