From the Atlantic:
Health care for the world’s poorest and human rights for the oppressed as private-sector businesses? Where there’s money to be made, a commercial alternative will emerge. But core state enterprises are subject to increasing non-commercial competition, as well. Many in southern Lebanon willingly receive social services and other incidents of modern government from the terrorist group Hezbollah rather than from the official government. Al-Qaeda presents many Islamic radicals with an even more extreme — and arguably more effective — non-territorial alternative to the nation-state for purposes of waging war.
The whole thing is interesting throughout, though I don’t agree with the author that virtual states are somehow replacing traditional states. I don’t think we’ll see the disappearance of the state anytime soon either. What will happen, I think, is that governments will become more minarchist in nature as markets simply overwhelm the crummy services that governments essentially force on people using their own extracted money.