That's not actually not an ID card dumb as it seems. It's an IOU that says that a collection of documents that are enough to prove your identity to the government were produced to an agent. It's a cert.
Assuming the "standard path" in the US the pieces of your ID are your birth record, any court ordered name changes (like if you got married), your social security card, and a previous cert that ties the name to a photo.
I know it's pedantic but god damn it's annoying as hell that a passport doesn't actually prove anything or else you could always do $old_valid_passport + $valid_photo = $new_passport but nope. Sometimes you hit special cases that drop you into having to prove your identity from your ID documents all over again.
Not everybody has a passport. A Passport costs more than a hundred dollars. Not everybody is eligible to a passport. For having a passport you need nationality, and you need to be able to have contracts with non national persons.
Your comment about nationality seems interesting - it's a fundamental human right to have nationality (https://www.ohchr.org/EN/Issues/Pages/Nationality.aspx); what do you mean by "non national persons" ? The common mass cases e.g. illegal immigrants are not non-national persons, they're just nationals of some other country. There are certain edge cases that result in stateless people, but the general solution for that is for states to work to assign nationality, it's definitely reasonable in many countries to not be able to have standard contracts with such people until they get their identity documents issued.
