Note about eliminating govt, it's often a choice of evils. Shall we surrender civil society to blood-thirsty thugs, as is happening right now in parts of Mexico and Latin America? Is that our future?
You seem to lack a basic understanding of the cause of the cartels' rise to power. Let me give you a hint: they
love the war on drugs. Governments around the world (urged/coerced by the U.S.) have made drugs illegal, essentially handing a monopoly of drug production and distribution to violent individuals.
Somebody is going to control (and profit) from drugs no matter what.
If the production, distribution, and use of all drugs is legal, legitimate businesses will form to fill these roles. They will be protected by police and/or private security. Look at alcohol prohibition and the end of the same in order to see how a market run by thugs is transitioned to a peaceful one once it is no longer forced underground.
Perhaps SR is something of a stepping-stone out of this quagmire. I'd be interested on what, if any, role they envision for govt. if there were to be significant changes to current laws. Or, does Silk Road consider itself above the law?
It is a stepping stone. The government will either end the prohibition of drugs or go bankrupt trying to fight against sites like Silk Road.