summative one- globalisation and the nation state

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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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