That, as Cheswick explains, won't necessarily work either. The server would still have to check where the incoming packet came from. I can still swamp the CPU doing the validation. It becomes an arms race. He then gets a more elegant idea.
Flooding is the final Internet problem.
After we solve everything else, that will still be there. You can mitigate it, but you cannot make it go away. We are now being attacked on our telnet ports. This means that people can't reach panix1, panix2, or panix3 from the internet. Our router is also being attacked.