>And without the production of the individuals and businesses that exist in a society, the state would have no ability to skim off the top and spend that money.
Yes, because organizations are just collections of individuals. So of course an organization can't do anything without the action of individuals. Is anyone arguing otherwise?
> Believing in a higher entity with more rights than any individual is verging on something akin to feudalism.
There are many examples where groups of individuals have rights that are greater than the rights of individuals without bringing up feudalism.
No individual has the right to imprison another (for long periods at least). No individual has the right to use violence to enforce a contract. Do you imagine a society where individuals have those rights, or one where the state does not?
>which isn't "society", it is the governing body of a region of land)
No the state isn't society. In a democratically controlled system, the state is the proxy designated to act on behalf of society (the extent to which states actually fulfill this duty is highly variable).