That sounds like it could be done in a way that isnt terrible. As a user, you sign up with an identity provider by submitting personal documents and/or an interview to prove that you’re a real person.
Then, when you sign up to an app/service, you login with the ID provider and come up with a username for that service.
The ID provider does not give the website provider any of your personal information; they just verify that you exist (and you login their their secure portal)
The identity providers could further protect privacy by automatically deleting all of your personal documents from their databases as soon as the verification process is complete. They could also have a policy to not store any logs, such as the list of services you’ve signed up for.
This could still be gamed (ex: a phone scammer tricking someone into getting verified with a provider to get a valid ID), but itd make things much harder and costlier.
Am I missing anything obvious that would make this a terrible idea?