Cato Unbound » Blog Archive » The Persistent Power of the State in the Global Economy

This is a thoughtful and worthwhile article from political scientist Daniel Drezner about the effects (and non-effects) of globalization on the role and sustained authority of the state. It is a contemporary focus and interpretation of exactly the kind of topic I have been exploring historically between 1890-1945, and will be presenting later this month. I am considering posting the paper on SSRN and if I do I will link to it here. There aren't too many historians on there that I have seen, but I figured it could be an interesting thing to do.

The fact that the state has not, in fact, withered away will not surprise a historian, especially anyone who has studied the early design of the American constitutional system for exactly the kind of imperial govermance it now performs, all accomplished with protection of the core system in mind.

IR types and globalization theorists have certainly worked themselves up into a lather envisioning or even seeing the erosion of state territorial sovereignty ("deterritorialization") but it just ain't so. Nor will it ever be the case, the US system precludes it and forbids it by design, just as it has proven to be remarkably adaptable to dominant in expanding world markets.

I am looking forward to the responses, particulary from Kal Raustiala, an able scholar whose works I have read with interest, such as his essay in this fine book on territoriality and globalization.

Cato Unbound » Blog Archive » The Persistent Power of the State in the Global Economy: "These are not the only arguments put forward about how globalization affects the state. Lawyers and sociologists look at the ever-increasing web of laws, rules, treaties, and international institutions, and see the state cosseted by global norms. Some theorists go so far as to assert that globalization requires a wholesale rejection of existing theoretical paradigms in international relations. Indeed, if there is a recurring theme that runs through the literature on globalization and global governance, it is that economic globalization attenuates state power....

While the distribution of power determines who has a seat at the regulating table, the distribution of interests within and among the great powers determines whether there will be effective global governance. In large-market economies, globalization increases the rewards for policy coordination but has a negligible impact on the attendant adjustment costs that come with altering pre-existing rules and regulations. When the adjustment costs are sufficiently high, not even globalization’s powerful dynamics can push states into cooperation....

The biggest implication of All Politics Is Global is that the global political economy of this century will look only slightly different from that of the 20th century. The state will not intervene in the same crude fashion it did in the past (tariffs, quotas, capital controls) but it will intervene. Governments that regulate large domestic markets will continue to be the primary actors writing the global rules of the game. NGOs and other activists will capture media headlines and occasional moral victories, but have little long-term influence on outcomes. The proliferation of international rules, laws, and organizational forms will not limit state sovereignty — if anything, it will enhance the ability of the great powers to go forum-shopping at will. Even if more issues are negotiated on the global stage, the sources of government power and preferences remain local — giving renewed meaning to Tip O’Neill’s aphorism."