From a U.S. perspective, we would be wise to lead the charge to finally end national team competition while we can do it from a position of strength. We are going to look shabby when Americans start grumbling about how China wins four times as many medals as we do. Which they will, in time. And if India ever gets serious about sports -- an open question, I think -- they will win even more. We should have annual world championships in sports whose structures allow for it. In team sports, that should be based on club competition, drawn from normal league play, not national team competition.
I still say instead of marching under their Nations’ flags, they should march under the flag of the US university they attended. You’d be surprised how many of the “foreign” athletes actually attended US universities.
I doubt that will happen. As much as some don't want to admit it, athletic ability is not spread evenly among the races and ethnic groups around the world. And environmental factors will always give groups advantages in various sports such as North European winter sports competitors and Kenyan distance runners. And there are also variations in size among various groups.
Sports competition might be one of the few areas where US "diversity" actually is a strength.