The nation-state may be obsolete in an internetted world. Increasingly, the resources and threats that matter disregard governments and borders. States are sharing powers that defined their sovereignty with corporations, international bodies, and a proliferating universe of citizens groups. The bond markets must be satisfied or capital will go elsewhere. International involvement in domestic crises is a growth industry. Activists fight battles in cyberspace for every imaginable cause-and the nation-state gives in. The ramifications of this power shift will be seismic.
Jessica T. Mathews is a Senior Fellow at the Council on Foreign Relations.
THE RISE OF GLOBAL CIVIL SOCIETY
The end of the Cold War has brought no mere adjustment among states but a novel redistribution of power among states, markets, and civil society. National governments are not simply losing autonomy in a globalizing economy. They are sharing powers -- including political, social, and security roles at the core of sovereignty -- with businesses, with international organizations, and with a multitude of citizens groups, known as nongovernmental organizations (NGOs). The steady concentration of power in the hands of states that began in 1648 with the Peace of Westphalia is over, at least for a while.-1
The absolutes of the Westphalian system -- territorially fixed states where everything of value lies within some state's borders; a single, secular authority governing each territory and representing it outside its borders; and no authority above states -- are all dissolving. Increasingly, resources and threats that matter, including money, information, pollution, and popular culture, circulate and shape lives and economies with little regard for political boundaries. International standards of conduct are gradually beginning to override claims of national or regional singularity. Even the most powerful states find the marketplace and international public opinion compelling them more often to follow a particular course.
The state's central task of assuring security is the least affected, but still not exempt. War will not disappear, but with the shrinkage of U.S. and Russian nuclear arsenals, the transformation of the Nuclear Nonproliferation Treaty into a permanent covenant in 1995, agreement on the long-sought Comprehensive Test Ban treaty in 1996, and the likely entry into force of the Chemical Weapons Convention in 1997, the security threat to states from other states is on a downward course. Nontraditional threats, however, are rising -- terrorism, organized crime, drug trafficking, ethnic conflict, and the combination of rapid population growth, environmental decline, and poverty that breeds economic stagnation, political instability, and, sometimes, state collapse. The nearly 100 armed conflicts since the end of the Cold War have virtually all been intrastate affairs. Many began with governments acting against their own citizens, through extreme corruption, violence, incompetence, or complete breakdown, as in Somalia.
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Doomsayers predict that globalization will weaken national governments. They should bite their tongues. Global governance will of course grow in step with economic integration. But it will actually express and promote, rather than suppress, the interests of nation-states.
Global corporate citizenship means that companies must not only be engaged with stakeholders but be stakeholders themselves alongside governments and civil society. Since companies depend on global development, which in turn relies on stability and increased prosperity, it is in their direct interest to help improve the state of the world.
Author's Note: The major conclusions of this article will be expanded in "Sovereignty at Bay: The Multinational Spread of U.S. Enterprises," to be published in September 1971 by Basic Books, Inc., New York.

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