But then things could be manipulated so as to specifically damage you. A company could literally just pay your suppliers not to give you parts. I dunno. You sound like a very smart person, but I'm highly skeptical on how this would possibly work. And phone contracts are made to offset the cost of the phones you're provided at a huge discount. What would you do? Just give back the phone? Give them back a NEW phone? You're now in possession of their property by cancelling the contract.

Not to mention that we'd be up to our ears in convicts. We are already the top convict capital of the world.

Why would they do that? If somebody ends a contract with you it is most likely because they just don't want to do business or can't do business with you anymore. I don't see why there has to be personal animosity. And if there is a huge chance of that, then people will adjust by only forming business relationships with those whom they trust, which de-incentives breaking promises because their business will start to fail if they play dirty without a state or some other organization to back them up. This already happens today, it's just that with the political influence in the economy some players have special priveleges. Anyway, why can't a company pay your suppliers not to give you parts now? 

Termination fees are a de-incentive so that you don't go to the competitiors. If I had a cheap $20 phone that I paid for myself, I still have to pay a termination fee if I'm bound by a contract.  It has very little to do with the free phones other than possibly contributing to their cost. It is also why you see competitors buying contracts these days. They understand the primary reason why these termination fees exist. 

[edit:  Oops, didn't notice the age of the previous post.] 

Mightn't the "promises aren't enforceable" idea come into problems with goods-for-services arrangements? If I say I'll mow your lawn for $20 and you give it to me before I mow, oops I don't want to, thanks for the dough. You say you'll pay me after, but then say "I hope you liked the exercise". Sure, a person who did this all the time would end up with a bad reputation, but that is a less effective deterrent in a large, mobile society.

Another thing: in your initial example, you say Rothbard would hold that the person has the right to accept the dog in trade, but then (when the other person demands the chicken) decide he doesn't want it, and return the dog, having canceled the "promise", without repercussion. What if the dog died in the meantime? If it was just a promise that was canceled, then wouldn't it just revert ownership, giving the guy back a dead dog? If not, does the guy with the chicken have to hand it over? Why?

I guess one problem I have is the question of when the ownership of property actually transfers. If it hasn't transferred by the time one party has accepted the other party's payment, then why does it EVER fully transfer? Does it ever?  Could I unilaterally "undo" a transaction that occurred an indefinite length of time in the past?

It doesn't matter if the creation of the state is justified or not, if those with the power to achieve such a thing want it they will do it regardless. It's like that with any political act. Most countries are founded on some war alot of the time. Thats why it bothers me when some claim to be democratic as they couldn't careless what anyone else thought.

Also, alot of the time these things are only here to divide us up I think so that we are easier to control