The Future of Nations

Today for a change I’m not going to recommend a book or review a place, but instead speculate on some issues that I find interesting and important – issues about the future of the nation state.
Of course we have not always had nations. A long time ago we only had tribes and villages. Over time the idea of the nation evolved. In most cases this was an area run by a king or queen who protected his or her citizens and in return the citizens paid taxes, served in the military, and were otherwise loyal to the ruler. There were also slaves in many societies. 
The idea of a nation as a group of people who voluntarily gather, and in fact are in charge of their own country, is a relatively recent idea in human history. Another new idea was a nation based on ideas and ideals, like the United States, rather than based on kinship. 
Many nations even today don’t want any “strangers” to become citizens. I recently heard Madeleine Albright, who was born in Europe but became a US citizen later in life, talking about how every country she lived in said “It is so nice you are here, when are you going home?” Except for the US, where people said, “It is so nice you are here, when are you going to apply for citizenship?” TV talk show host and comedian Craig Ferguson talks at length on air and in his forthcoming autobiography American on Purpose about coming to America from Scotland, and why he opted for citizenship.    
Many trends today indicate that we should see a decline in the inter-national wars that have plagued society for the last few centuries. It has been said that there has never been a major war between two true democracies. As the world becomes more and more democracy-filled, and as world trade and globalization continue to grow, it should be less and less likely to have such wars. People who trade with each other a great deal are less likely to bomb each other. When I say trade, I mean trade in ideas, innovations, religions, education, culture, and people as well as in products and services.
At the same time, I have to wonder about the future of the nation state. In 500 or 1000 years, will the world still consist of about 200 separately-governed nations? 
Sometimes when nations break up – like Yugoslavia or Russia – the temptation is to think there will be even more nations in the future than at present.
I believe there are strong pulls at both ends of possibility – that is, a strong pull to have one nation on earth and another pull to have finely divided governance. First let me talk about the internal structure and pulls within the United States, before returning to the international scene.
Take something as “mundane” as health insurance regulation. Lost in the current debate is the fact that in the US, this industry is still regulated in large part by the states. Policies that can be offered in one state cannot be offered in the next. Similar issues in state-based insurance regulation have contributed to home and auto insurers pulling out of some states while staying in business in neighboring states. It seems that things would be more competitive, efficient, and less expensive if we had standardized national rules.
I recently read a franchise offering document – the legal papers that every franchisor has to show to their potential franchisees – and found several pages referring to the specific rules of the states of Michigan, California, North Dakota, etc. These minute differences are what keep lawyers in the money, but they don’t serve the rest of us very well. 
In some areas of business life, such as the Uniform Commercial Code, and in some areas of securities sales, the states have joined together to agree on common standards across the US. That makes life easier for entrepreneurs and businesspeople.
In the 1920s, all 48 state directors of highways got together and agreed on a national highway numbering system. This meeting gave us the old Route 66, National Road 40, US 1, and all that. Finding your way around the USA without that innovation would have been much more difficult.
These are examples of the appeal of a unified approach to things, especially when a group of states reach agreement voluntarily. It is perhaps odd that we do not have a national driver’s license or ID system.
On the other hand, the idea of states’ rights also has appeal. 
Some years back, if you wanted a strong welfare system and free or cheap junior college, everyone knew you could get it in California – although your taxes would be higher. If you liked the idea of a Scandinavian-style semi-socialist state you could find it in Minnesota. If you wanted the land of the eccentric and independent, you went to Texas. And Nevada allowed all sorts of things not legal in other states. This seemed to me a world which offered you lots of choice and variety. You could, to some degree, pick your own political environment and style of government. 
There is of course a huge tradition in the US of “distributed” (state and local) power, perhaps greater than in any other nation. 
As far as I know, there is no national law against murder or rape in the US – those are all state laws. The only reason the feds get involved in bank robberies is because the banks are federally regulated and insured. On the other hand, if you study the UK or France and look for anything even slightly resembling our states or Canada’s provinces, you will find little or no power anywhere but at the national level. I believe Australia, Brazil, and possibly Germany, all of which are more “federal,” have a bit more regional or local power.
So I can see reasons to standardize things nationally and I can also see reasons to allow a great degree of local leeway. 
The US public education system shows the tension between these forces. The enforcement of immigration laws varies from community to community. 
In the global context, one of the most interesting cases is the United Arab Emirates, which I believe is the only federal monarchy on earth. Each of the 7 Emirates is a separate monarchy, with a great degree of local authority. But the 7 join together for the creation of money, for diplomatic and defense issues, and other things where it is much more efficient to share the task.
I mention the above examples to illustrate this tension between centralized lawmaking and localized lawmaking. My main goal in writing this post is to consider the future of these issues. Because, from here on out, it looks to me like these same tensions now move up a level. Over the coming centuries I believe we will less likely be worried about states’ rights than about nations’ rights.
One hundred years ago there were few things that nations needed to agree upon, and few things that they did agree upon. Over time we added the Geneva Convention to govern the conduct of war; we added the International Court of Justice in The Hague and the United Nations in New York, neither having much real law-making power. International treaties about the oceans, Antarctica, and other issues have facilitated world trade and relationships. In more recent years, NAFTA and similar agreements around the globe have begun to have more impact on individual nations. 
In the boldest attempt of all, the 27-nation European Union is consolidating more and more power, most visibly with open borders and shared money. I am sure this horrifies some, perhaps many. Giving up sovereignty is a big deal.
At the same time, the globalized world is less and less able to be regulated or ruled by diverse national rules. A few years ago General Electric decided to buy Honeywell and the US authorities approved the merger but the European antitrust regulators did not. 30 years ago that would have been a joke. This time, it stopped the merger. Given that we are really just at the beginning of a truly integrated international economy, such matters will go from being rarities to being daily headlines. Crime is already internationalized, the corporate world is internationalized, the nonprofits like the so-called NGO’s (Non-Governmental Organizations) is internationalized, and the lives of individual citizens are increasingly internationalized.
In this context, it’s hard to see how we cannot have more trans-national regulations and laws. There will be a time when more people (and companies) want them, even require them, to make their lives simpler.
Insofar as possible, I would hope such things could be worked out on a voluntary basis, like NAFTA. But I also have to believe that over time more nations need to merge, or at least integrate some functions. 
There have been attempts at voluntary combinations of nations in the past, particularly involving Syria, Libya, and Egypt, but they did not last. Malaysia and Singapore tried to start off as one nation, but that had a very brief life, as centrifugal cultural forces – the Malays vs. the Chinese – took over. Maybe Europe will lead the way, in gradually merging at least more and more functions of government.
In this context, I have always been interested in the cost of sovereignty – a subject no one else seems to consider. Think of it this way: if you are one of the many small nations in the Southwest Pacific, you have a very high cost of being independent. Not only do you have to print money and postage stamps, but you have to establish embassies in nations around the world, you may have your own airline, you have to develop a national banking system, and so on. How much do these things cost? Costs that are tiny relative to the size of the US economy are huge to Vanuatu.
Think about it at the state level – how much does it cost North Dakota to develop, manage, and provide everything that comes with being a state? How much money and resources would be saved if the two Dakotas pooled, for example, their state police system, their state welfare systems, or their state highway construction operations? Even a big and populous state like Texas might benefit from sharing services with neighboring states. The rise of privatization – of everything from toll roads to jails – should facilitate more flexible administrative arrangements. 
Perhaps states and nations could learn from the airlines. When the regulators would not let giant national carries like British Airways and American Airlines merge, the two airlines worked together creatively to form alliances, in which they shared or integrated routings, ticketing, timetables, and frequent flyer programs. Today there are several global airline alliances which give them some economies of scale while at the same time preserving autonomy.
Most of these thoughts at first strike me as “politically impossible.” Selling such ideas to anyone in the government, getting them to agree to reduce their power or staff size, seems nearly impossible.
But it can be done if you have strong leadership.
If one studies the great cities of the US, many of which collapsed in the 1960s and 1970s, one of the great problems was the governmental separation of suburbs and city centers. In a place like St. Louis or Washington, the rich suburbs were under one or more governments while the high-crime, high-fire, high-poverty city centers had no access to those suburban tax funds. But in Indianapolis, a brave and smart young mayor named Richard Lugar convinced voters to merge the city of Indianapolis with surrounding Marion County. That changed everything. Over the last 20 years, the Indianapolis metro area has been one of the faster growing cities in the Northeastern quadrant of the United States. Lugar’s “UniGov” plan has to be given at least part of the credit.
I have long been a critic of most corporate mergers – perhaps 70% of them result in disappointment. But I think there is a natural merger rate – some mergers do make sense – that is lower than the rate we witness today. On the other hand, the fact that the merger rate in governments, hospitals, museums, universities, and other non-profits is near zero also seems to me to be out of line.
Perhaps not in my lifetime, but certainly in that of my younger readers, and their children and grandchildren, I believe the idea of merging nations, or at least a much higher level of legal integration, will become among the most challenging political tasks of the era. Wars may even be fought over such issues.
Perhaps the ideal is a combination of more local authority with more central authority. While it has retained sovereignty, Indonesia has agreed to give the Aceh territory more autonomy in order to avoid secession. Ten years ago Scotland got its own parliament for the first time in almost 300 years. 
So perhaps the issue is not so much whether we go with “states rights” and local autonomy or become a one world nation, as it is that we think clearly about each issue, and determine what should be centralized and what should not be. Such an approach might also make the whole process more palatable politically – for example your nation might give up a couple of powers but your state or city would gain a few.
What do you think?




  1. Simple response: my thoughts (almost) exactly! I tend to lean more towards universalization in general, but with the underlying assumption of individual choice and autonomy.

  2. “The rate of mergers among non-profits with budgets over $50 million (which is one measure of viability and growth potential) has been 1/10 of the rate of for-profit entities.”

    Source: Chronicle of Philanthropy