I'm not "misinterpreting" anything, aggressively or otherwise.
He is lumping all states together as "the state", giving an example of some unethical states, and arguing from that that no state is ethical, or pays any attention to ethical concerns.
You said He is arguing that the government of Michigan's laws are bad because the Nazis had bad laws.
Which simply isn’t true. He actually said outright:
If you use the state as a metric for ethics you'll end up disappointed.
Now, you may think that’s garbage, but you’re not free to pretend that he said completely different things he didn’t actually say. Remember how you hate inaccuracy? Do you think that what you were doing before was accurate? How about playing semantic games now with the word “state,” is that accurate?
That argument is pure garbage.