Basically they argue that local voluntary law systems would emerge and arbitration would resolve differences across localities. It's basically government with extra steps, time and energy.

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...but it worked for 99.8% of humanity's existence.

Nation States have ruled a majority of humanity for no more than five centuries.

Safe to say they're not delivering on their promises.

Less steps, less time, and less energy.

Why? Because you forgot about guns.

When nobody wants troubles, problems are resolved before they even start.

That, with an accessible arbitration system.

Has worked on every inhabited continent and every climate zone.

this might be true if it were not for the individual's ability to choose to belong to a group or not: that we have forgotten that we have feet to exit a territory is a marker of how effectively we've been mind controlled

That the law will form around groups vs the individial is why that scenario scares the shit out of me. Mob justice rarely affords an outsider a fair trial.