Has globalisation destroyed the power of the modern state?
The Treaty of Westphalia in 1648 established the legal basis of modern statehood whereby nations as they were now termed mutually recognised each other’s sovereignty. Globalisation has been defined as ‘the growing depth, extent and diversity of cross-border connections’ (Kesselman, 2010) and has impacted aspects of the modern state’s sovereignty in different ways. Arguably, the economic power of modern states has been hindered to the largest extent through the power of multinational corporations as well as through comparative advantage and interdependency. Political globalisation has had the smallest impact on the power of the modern state as unless a global government is formed, domestic government retains the greatest level of political sovereignty. The cultural power of states has been diluted due to the development in communications technology and the ability to share and discuss globally. Globalisation has undoubtedly limited and altered the overall power of the modern state but it has certainly not destroyed it. Ultimately states are politically autonomous but their domestic actions can impact their position on the global stage.
Theorists such as Strange see economic globalisation as the most significant factor in undermining the state; ‘where states were once the masters of markets, now it’s the markets which, on many cultural issues are the masters over governments of states’ (Strange, 1996) This is because economic globalisation has resulted in the emergence of a single integrated global capital market by fusing national markets ensuring interdependency between countries. Purchasing decisions in one part of the world affect job opportunities, working conditions and poverty levels in other parts of the world; it is impossible to entirely insulate a national economy from actions taken by a separate economy. This was most clearly evidenced by the 2008 financial crisis which affected confidence of consumers and subsequently led to major liquidity problems for many banks and insurance companies worldwide. (Liverpool, n.d.) The emergence of transnational actors has also potentially led to a decline in states sovereignty. The existence of a multinational corporation in a country provides economic sovereignty through vast employment and therefore it is in a government’s best interest to ensure that the corporation remains in their country. This limits their power in terms of tax setting and determining wage rates as high levels of these things will act as a disincentive for
MNCs to base in a country and it will also cause them to relocate. Susan strange supports this idea, calling TNCs ‘a parallel authority alongside government’ arguing that they have a significant influence over where investment and industry is located and as a result of this significant leverage over the state. (Strange, 1996) Ohmae also corroborates this stating that ‘the nation state has been supplanted by business activities’ (Ohmae, 1999)
The existence of both comparative advantages and absolute advantages has also limited modern state’s economic sovereignty. Globalisation has enabled increased allocative efficiency as countries produce to their strengths and then trade goods on the global market. This weakens states independence as they become reliant on other nations to provide certain goods for them. If a country adopts protectionist policies such as tariffs on imports then other nations will retaliate hindering their economic prosperity. Economic activity is also monitored by the World Trade
Organisation which exists to deal with the rules of trade between nations. The impact of the WTO in limiting the power of a nation was evidenced after its intervention in China over export subsidies following a complaint from the US. (Lynch, 2016)

On the contrary, as Quentin Skinner argues, nation states are still principle economic actors within their own territories, states are legally inclined to ‘impose taxes, enforce contracts, imprison citizens’
(Will Hutton, 2012) therefore suggesting that power remains largely in the nation state. However, the power of the nation state is undermined insofar that large multinational corporations aren’t easily held by these legal obligations. This was evidenced by the UK government’s inability to increase the levels of tax that both Starbucks and Google pay on their British sales. In spite of this, as
Holton argues, globalization has affected the power of different nation states differently and to assume otherwise is ‘highly misleading’ (Holton, 1998). G7 nations have a significantly greater capacity to regulate and exert influence over MNCs in comparison to countries such as Bangladesh and Mozambique. Holton also argues that the existence of Multinational Corporations in a nation state relies upon a good relationship with the government. Although governments ‘welcome the investment, financial returns and international prestige’, (Holton, 1998) Multinational Corporations also aim to obtain ‘a favorable regulatory environment’ subsequently transferring some economic power back to the nation states.
From a realist perspective, the modern state is bound by a sense of national identity and belonging; meaning that those within a nation will inevitably share some common ground simply through existing in the same country. Realists see this as increasing the power of the modern state as one cohesive nation is far stronger than one filled with conflict. However, globalisation has reduced the cohesiveness of nations due to it infiltrating identity seen as specific to nations. Through globalisation and the subsequent development of technology, the ‘remoteness’ of people and societies on the other side of the globe has substantially diminished, arguably reducing the strength of national identities. The impact of this is clearly evidenced by the volume of shared global celebrations and traditions such as Halloween. Having said this, identity is a controversial issue within a nation itself with many nations not knowing what it means to be part of their countries identity. Although in the UK the Conservative’s push to spread ‘British values’, British civilians often don’t associate with what is deemed by the party as a ‘British identity’ rather they have differing identities based on the smaller environment in which they exist. (Bechhofer Frank, 2009) In Britain civilians have conflicting ideas about what it means to be British suggesting that there is no definitive answer. (Roberts, 2012) As Kant argued, ‘the existence of different languages and religions virtually guarantees cultural diversity’; citizens have multiple identities and the nation state is not always their overriding identity. (Hirst Paul, 1996)Having said this, some form of association with a national identity is almost unavoidable due to the level of contact you have with your nation; it’s unlikely that a citizen feels no affiliation with their country of domicile.
Arguably, globalisation provided the platform for ‘Americanization’, the spread of Western culture across the globe undermining the original culture of non western nations. The huge impact of
Americanization is clearly evidenced by the 118 countries that have at least one McDonalds. (News,
2013)As a result of Americanization, many non-western countries have seen a dilution of their culture, with western media infiltrating almost every aspect of their civilian’s lives. Hirst and
Thompson see ‘cultural homogeneity’ as ‘problematic’ and ‘exclusiveness’ as ‘less and less possible’
(Hirst Paul, 1996) They go on to argue that it’s ‘virtually impossible to continue to operate in the various world markets and ignore at the same time the internationalized cultures that go along with them’ (Hirst Paul, 1996) A likely result of multiple cultural influences is that civilians have become more aligned with alternative identities rather a national identity. Therefore, globalisation has limited the power of non western states in particular as it becomes virtually impossible for them to

monopolise what media and culture their citizens consume. However, it’s clear that America’s hegemonic power has been enhanced by the ability to spread their culture, and in this respect globalisation has empowered a nation rather than weaken it. This clearly evidences the differing impact of cultural globalisation on modern states.
The formation of social media has reduced the power of the modern states as it allows for global conversations and discussions preventing states from dictating consumption. Social media essentially conforms to Habermas’ public sphere; (Jurgen, 1991) a realm of social life in which something approaching public opinion can be formed independent of private interests and government intervention. In a sense, a global civil society has been formed increasing the transparency and openness of national governments; enabling nation’s democratic accountability to undergo global scrutiny and as well as facilitating global demonstrations as seen by the Occupy movement in 2011. Due to this, it could be argued that globalisation has diminished the power of the modern state as it has made it far easier for civilians to communicate globally as well as increased the ability for civilians to hold its governments or equivalents to account. Giddens cites the
Soviet Union as an example of where this caused the destruction of a nation; ‘the ideological and cultural control upon which communist political authority was based similarly could not survive in an era of global media’ (Anthony, 1999)
Despite the suggestion that the social globalisation has diluted nationalist identity, there has been a recent nationalist resurgence across many parts of the world suggesting a return to the dominance of the modern state. Countries such as the US, France and even the UK have seen a resurgence of the popularity of the far right who often argue against the fundamentals of globalisation and call for the domination of their identity. Borders cause extreme controversy as globalisation advocates free movement of labour in contrast to the far right promoting caps on immigration and far stricter borders. This nationalistic sentiment was evidenced by the UK’s vote for BREXIT. The leave rhetoric focused immensely on tightening immigration and gaining control of Britain’s borders; notions far from the ideals of globalisation. Once more the increase in popularity has been evidenced in France with the success of the Marine Le Pen making the final round of the French election as well as
Trump’s successful presidency campaign. These examples suggest a return to the political power of the modern state as a large proportion of civilians are calling for and supporting nationalist movements.
Many theorists argue that political power of a modern state is being ‘reconstructed’ (Held, 2002)as a result of globalisation rather than being ‘destroyed’. Hirst and Thompson see the state as ‘a pivotal institution, especially in terms of creating the conditions for effective international governance’ and as the state is ‘the possessor of a territory’ and the people within it; it’s the only agency that can speak for its population hence increasing its levels of power. (Hirst Paul, 1996) However, it’s clear that international organisations such as the UN, WTO and NATO somewhat undermine the power of the state as policy making responsibilities have been passed away from national governments.
Globalisation has particularly limited the independency of a state’s economic decisions resulting in the focus on domestic policy issues such as health. Strange called this ‘trivialising government’ arguing that MNC’s are essentially a ‘parallel authority alongside governments in matters of economic management’ and thus the states power has massively diminished (Strange, 1996).
Krasner’s argument combats this as these international bodies operate within a context governed, created and sustained by states. Both the UN and NATO were formed though agreements by states

and the ‘Powerful 5’ within the UN have significant veto powers. He also evidences that NGOs operate within a legal context determined by a state suggesting that although these bodies have large amounts of power, nation states are ultimately superior. (Krasner, 2008) Nevertheless, this argument is only a valid one for the nation states with these veto powers. There are many nations subject to the conditions of these bodies who have no authority against them.
To conclude, globalisation has undeniably reduced the power of the modern state in terms of their cultural monopoly over citizens as well as in terms of their powers to make economic decisions. Now that modern states have opened themselves up to international trade and due to comparative advantage, countries are interdependent on one another and would struggle to thrive isolated from the global market. Ultimately I would argue that the term ‘destruction’ is too extreme and that modern states will exist in decade’s time. Perhaps the power of modern states in terms of economic power will be destroyed in years to come, but their political power to make domestic decisions is something virtually irreplaceable. The notion of global government would cause too much conflict with competing ideologies claiming superiority. As Heywood argues, international organisations have not come close to rivalling the nation state in terms of its ability to attract political affiliation or emotional allegiance (Heywood, 2012) and therefore it’s extremely unlikely a global government would ever work; necessitating the modern state. Globalisation has changed the power of different modern states differently, with the financial powers less reliant on global trade retaining higher levels of power than those less wealthy. The impact of globalisation on modern state’s cultural power is harder to ascertain as although ‘Americanisation’ has in some ways diluted non western culture empowering the hegemonic west, globalisation has also allowed for the sharing of other cultures and subsequently a larger acceptance of multiculturalism. Despite this, the resurgence of the far right shows that although cultures have been shared, the desire for a single identity within a nation still exists. In conclusion, globalisation has altered the role of the modern state and weakened its economic power, but states still retain some levels of economic, cultural and political power.
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