The confederacy of planets and moons that formed the Independent Faction was doomed from the start. Each of the outer worlds had its own form of government. They'd never really worked together except to do one thing - deliver the mail. Out on the frontier, folk liked to keep to themselves, dealing with their own trouble in their own way. On the Border planets, it could be dangerous to stick a gun barrel in someone's face because often as not 3 more could be pointing back at you.
While leaders among the scattered outer worlds expressed concern over the formation of the Union of Allied Planets, most folk didn't much care, figuring it wouldn't affect them. They were concerned with far more mundane troubles: food shortages, low medical supplies, and the 'quirks' of recently terraformed planets. It wasn't until the Alliance's proclamation that it intended to extend control over the entire system that the folk on the outer worlds woke up and smelled the tea leaves. They came together to present a unified front of resistance. And resist they did - far more than the Alliance had anticipated. Folk fightin' for their homes, freedom, and way of life fight a hell of a lot harder than those drafted into the army or who carry arms in exchange for credits. What the Independents lacked in training and equipment, they made up for in spirit.
Sad to say, spirit wasn't enough. The Independents couldn't combat the massive Alliance forces. Outgunned, outmanned, and outmaneuvered, they were forced to surrender. The Independent governments of every planet that had resisted Alliance control were removed and replaced with an Alliance Governor. Very little actually changed for the people who lived on these planets, as the new Governors usually kept much of the political infrastructure intact. The people still paid their taxes to the local tax collector. Except now the money went to the Alliance, not to those who needed it at home.
The Alliance promised they would send the manpower, money, and supplies needed to rebuild the bombed and burned-out cities. To give them credit, they did send some. Just not near enough. You see, some folk on the Core think the former Independent supporters should be punished for their rebellion. So when government folk start bringing up measures to help those on the outer worlds, such measures usually find themselves voted down.
Each planet outside the Core is ruled by an Alliance-appointed Governor (or Magistrate, in the case of a moon.) These individuals wield tremendous power, and though some wield it with an iron fist, others take a more hands-off approach and allow the smaller communities to deal with their own problems.
When a Border planet or moon requires the assistance of the Alliance government, the governor has to wade through an immense amount of bureaucratic red tape. Instead of going through the hassle, they'll hand over problems to Alliance-contracted private security firms. While these firms are tightly regulated in theory, in practice they are generally poorly managed, if not downright corrupt. The cure is worse than the ailment.
Tough times for some mean good times for others. The unrest has been a boon to the mercenary trade. Former soldiers from both sides now hire out their guns to communities, security firms, and businesses who pay them to clean up their towns, fight range wars, or put down slave revolts.