Because like I said, the point was to make things less effort for the writers.
Lothar was a supreme commander, but there was also no question of him having authority over the nations of the Alliance. They were free to withdraw their troops at any time, or to override his orders. Further, efforts were made to keep the member states distinct.
Varian was used as a cheap device to avoid having to write all the Alliance leaders, and they increasingly leaned on the character to become the face of the Alliance. In so doing, they reduced it to Humans and Pals. Less effort, less time writing the faction they don't like.