Hooray for Nation States

How many times have we heard that the nation state is passé? That borders have disappeared, that distance is dead, that the Earth is flat, that our identities have become global, that politics transcends national boundaries, that the decisions shaping our economic lives are now made by multinational corporations and faceless international bureaucrats? And yet look at the way events have unfolded as the global financial crisis engulfed the world. Who bailed out the global banks to prevent the crisis from becoming even more cataclysmic? Who pumped in the liquidity needed to soothe international credit markets? Who stimulated the global economy through fiscal expansion? The answer to each of these questions is the same: national governments. We may think we live in a world whose governance has been radically transformed by globalization, but the buck still stops with domestic policymakers.