Counter-example

David Friedman has an interesting counter-example to my claim that the state is essential to enforce claims for damages.  He brings up Icelandic law, which is an area of interest to me due to my passion for European history (my leisure reading right now is Trevor Royle's book on the War of the Roses). 

I am not sure that the Icelandic example would scale to the modern United States of America, nor do I think we necessarily want all of the knock on effects.  But it has the virtue of being a viable approach that lasted for multiple centuries (which is about the most we can say of any modern state). 

If you want to try some leisure reading, he has a book on the topic of alternative legal structures that is in development.

P.S. In the annals of small worlds, I used to be a very involved member of the SCA.  The notion of a self organizing society built around ideals is a lot more rational when you've seen the interesting things that the SCA has managed.