The Global Economy and the Nation-State

A TRUE SURVIVOR

Since talk of the globalization of the world's economy began some 35 years ago, the demise of the nation-state has been widely predicted. Actually, the best and the brightest have been predicting the nation-state's demise for 200 years, beginning with Immanuel Kant in his 1795 essay "Perpetual Peace," through Karl Marx in "Withering Away of the State," to Bertrand Russell's speeches in the 1950s and 1960s. The latest such prediction by eminent and serious people appears in a book called The Sovereign Individual by Lord William Rees-Mogg, former editor of the London Times and now vice chairman of the BBC, and James Dale Davidson, chairman of Britain's National Tax Payers' Union. Rees-Mogg and Davidson assert that for all but the lowest earners the Internet will make avoiding taxes so easy and riskless that sovereignty will inevitably shift to the individual, leaving the nation-state to die of fiscal starvation.

Despite all its shortcomings, the nation-state has shown amazing resilience. While Czechoslovakia and Yugoslavia have been casualties of a changing order, Turkey, a nation that never before existed as such, has become a functioning nation-state. India, rarely united except under a foreign conqueror, is holding together as a nation-state. And every country that emerged from the nineteenth-century colonial empires has established itself as a nation-state, as have all the countries emerging from the breakup of the Eurasian empire forged by the czars and tied together even more tightly by the czar's communist successors. So far, at least, there is no other institution capable of political integration and effective membership in the world's political community. In all probability, therefore, the nation-state will survive the globalization of the economy and the information revolution that accompanies it. But it will be a greatly changed nation-state, especially in domestic fiscal and monetary policies, foreign economic policies, control of international business, and, perhaps, in its conduct of war.

THE NATION-STATE AFLOAT