Confederation- the power resides in the states. (like the US used to be.)
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Some people argue that all wealth is due to the state and therefore the state is entitled to it.
You only find the state in communities where a state can be sustained by preying on its citizens. You won't find one in hunter gather societies, they don't generate enough of a surplus to sustain a predatory class.
The state is predatory, but its an improvement when the bandits live with you and take bit by bit, than roving bandits who take what they can , burn and murder you and protect you from other bandits.
http://www.bbc.co.uk/news/world-middle-east-25299553 - How the middle east state was created.
http://www.bbc.co.uk/news/magazine-29934867 Uk devolution process