One of the sure signs of getting older is when you hear yourself sounding like your parents. Suddenly, faced with a child who doesn't want to co-operate and says 'Why should I?', you're aware of the immortal words, 'Because I say so' coming out of your mouth. Traumatic moments these; our doom has caught up with us.

But I wonder a bit whether we shouldn't be encouraging the question. Blind obedience is a virtue only in a very few circumstances; it's perfectly arguable that being an adult at all means having the capacity to ask awkward questions about the right of others to tell us what to do, so that the child's challenge is itself a mark of growing up. But one of the most sensitive areas for awkward questions is our relation with law and government.

Why should we do what the government tells us? And I don't mean this government in particular, but any modern government. It's a question that takes us into some unexpectedly complicated areas; it raises issues about the unspoken contracts people feel exist between themselves and their rulers. You need to be reasonably confident that your system of government is worth supporting overall if you are prepared to go along with what it tells you in some particular areas where you may not feel completely convinced or are frankly not convinced at all. It's the problem that political thinkers describe as the legitimacy of a system - its 'right' to order you around.

A lot of the time this doesn't seem to be much of an issue, perhaps; but there are periods when the overall worthwhileness of a system begins to look a lot less persuasive, sometimes quite rapidly, and things start to change. Sometimes the change is planned, sometimes not; and sometimes the planned changes set in motion a whole range of unplanned ones. In the middle of the seventeenth century in Britain, the idea that royal authority came straight from above was shaken to its foundations: the kind of monarchy that survived was radically different, with state sovereignty residing now in Parliament. During the nineteenth century it began to be taken for granted in Europe that national communities had a right to decide their own business and that this right was more fundamental than the historic rights of a dynasty whose lands might include several national groups. The great multi-national empires of Austria and Turkey began to dissolve.

And what I want to explore in this lecture is the suggestion, now to be heard in many quarters, that we're in fact living in just such a period where the basic assumptions about how states work are shifting. If this is true, there are some quite far-reaching consequences, and I want to suggest ways of understanding these. But I also have an agenda as a religious teacher here; and you won't be surprised to hear that I have some thoughts about the risks and opportunities associated with religious faith in a volatile and uncharted context like this.

The idea that's being increasingly canvassed is that we are witnessing the end of the nation state, and that the nation state is being replaced in the economically developed world by what some call the 'market state'. This new form of political administration has in some ways crept up on us, and we need to do some hard thinking about how it has happened and what changes are involved for the whole idea of being a citizen - not to mention the whole idea of being a politician too. And if the analysis I want to offer is right, and these changes are indeed irreversible, we need to look at what kind of vacuum is left in our social imagination as a result.

First, though, we need to step back a bit. What do we mean by the nation state, anyway? Very broadly, it's the vision that came to dominate Europe and North America in the nineteenth and twentieth centuries: government is trustworthy or legitimate because it promises to this particular coherent nation - both a piece of territory and a fairly homogeneous community - effective defence against outside attack and a high degree of internal stability. The internal stability was based on a firm directive hand in the economy and a safety net of public welfare provision. The job of those who ran the state was seen as guaranteeing the general good of the community; and its success in managing this was the obvious foundation of its claim to be obeyed.

What happens, though, when the state no longer seems to have the power to keep its side of the bargain? In the later twentieth century, the cracks in the structure get more and more visible. Intercontinental missile technology designed to carry weapons of mass destruction makes nonsense of traditional ideas of defending your territory; you have to rely on strategic means, above all deterrent counter threats, when things look menacing. Then there is the way in which capital is now able to move where it pleases in the world, ignoring frontier controls. No national economy can protect itself completely, and so no nation state government can guarantee employment levels in the old way. Government has to negotiate favourable deals with fickle and mobile investors who can always afford to look for new and more profitable locations and outlets at will.

I've spent the last ten years in South East Wales in an environment where immense political energy has often gone into persuading international companies to invest on favourable terms - but where the average length of stay for such concerns has been no more than a few years. The local economy can't be the deciding factor. A few years ago in Newport there was great delight when the Korean electronics giant LG agreed a deal promising several thousand jobs in the region; hardly a year later, this had been scaled down dramatically so that LG could cope with the pressures of the financial collapse in South East Asia. And I remember also a union official in Cwmbran spelling out, with some bitterness the tensions between the real, but unstable employment prospects offered by the new global economy and his traditional commitment to the rights of employees - which was going, he knew, to prove too costly and complicated in a setting where employers could so easily find a cheaper alternative location.

But unstable employment patterns generate more and more unmanageable welfare levels. And at the same time people's expectations about the level and quality of public service and support are higher than ever and are kept high by the prevailing culture of consumer power. And this relates to a third area. Aspirations towards more consumer power are fed by mass communication. And new communications technology means that the same aspirations and assumptions will be found practically everywhere. You can't easily control the flow of electronic information and image, even in the most heavily policed societies. Increasingly the images of an alternative world will be there. You can watch satellite TV in a little timber -built bar in Kampala – I have. So the incentives to push for equality of access both to consumer goods and to certain kinds of civil liberties are powerful as never before. The fall of state socialism in Eastern Europe has a good deal to do with increasing awareness of the attractions of the alternative world of the West. But the revolution in electronic communication also carries a more sinister implication, something we have learned with horrible clarity in this last year or so: international conspiracy is harder than ever to detect and frustrate, given the labyrinths of global electronic communication we have created. Al Qaeda and similar networks inhabit a virtual world, not an identifiable headquarters in a single place.

This reading of our present situation is spelled out in great detail by the American strategist and historian Philip Bobbitt. He sees our present context as one where the nation state's inability to deliver in the terms we have become used to, its inability to meet the expectations we now bring, has led to a shift into a new political mode, the market state, in which the function of government - and the thing that makes government worth obeying - is to clear a space for individuals or groups to do their own negotiating, to secure the best deal or the best value for money in pursuing what they want. It involves deregulation; the 'franchising' of various sorts of provision - from private prisons to private pensions - and the withdrawal of the state from many of those areas where it used to bring some kind of moral pressure to bear. It means that government is free to encourage enterprise but not to protect against risk; to try and increase the literal and metaphorical purchasing power of citizens, but not to take for granted anything much in the way of agreement about common goals or social good. Successive governments have, for example, dealt with education in a way that shows worrying signs of this underlying philosophy - stressing parental choice and publication of results. Not that these are social evils in themselves; they represent a proper concern about accountability. But they also fit all too neatly into the consumer model and allow the actual philosophy of education itself to be obscured behind a cloud of sometimes mechanical criteria of attainment.

What this brings with it is in fact something that ought to worry government more than it often does. Government is now heard asking to be judged on its delivery of purchasing power and maximal choice. And this encourages an approach to politics itself that could be described as consumerist. Philip Bobbitt talks of how politics becomes 'a matter of insurance' in this climate: voters look for what will guarantee the maximum possible freedom to buy their way out of insecurity. There will be increasing pressure to have policy determined by plebiscites and market research - and this carries in its wake a trend towards streamlining the political executive for rapid response. There will be high expectations of prompt reactions to the needs of the market.

In the autumn of 2000, protests about fuel prices swept across the UK, accompanied by vocal demands that government should act immediately in response to concerns expressed wholly outside the usual electoral process. What was wanted was prompt action to satisfy what could be presented as popular consumer demand. And the pressure for instant action inevitably tended to block wider considerations about environmental policy, transport policy, fiscal priorities or whatever. Real and longer-term issues about - for example - the problems of transport costs in the countryside were irretrievably and damagingly mixed up with a raft of populist worries about fuel prices in general. The point is that a significant number of people did not trust the government to deal adequately with their 'insurance' issues; their language and actions implied that they felt the electoral process worked in ways which still kept appropriate power out of the hands of the mass of citizens. They - and a surprising number of journalistic commentators - were happy to justify at least low-level civil disobedience because of what was seen as the alienation of the people from the decision makers.

The government on the whole kept its nerve. But the nature of the crisis, the kind of concern voiced and the obvious level of anxiety in government was significant. Moments like this reveal something of what people are taking for granted as the essence of politics; and what emerged was a reluctance to delegate decision making powers on any very long-term basis. It isn't entirely surprising: in the United States and the UK during the eighties and nineties, government tended to strengthen a culture of prompt accountability, enforceable rights to see value for money in institutions, even those where we'd once have recognised that calculations of profit were not easily applicable. Government encouraged people to accept the radical new mobility of capital, the purchase of private means of social insurance and so on. So socially and culturally, the last couple of decades have been a period in which physical mobility and the homogenising of the entertainment media have weakened some kinds of local solidarity in speech and habit; and the social bonds that once existed in the territory between individual and state have been seriously eroded - voluntary associations of different kinds, churches, the family itself. There may be more for them to do, but the volunteer base is seriously eroded. It isn't surprising, then, if the unspoken model of political expectation now is increasingly the consumerist one: the individual confronts the state, asking for what is promised - maximal choice, purchasing power to determine a lifestyle. It isn't surprising if the attitude of many to national and local elections is apathy, with a disturbingly high percentage of younger people failing to vote.

Now this may sound like the cue for a lament for lost community or a denunciation of neo-liberal economics, Thatcherism, Reaganism and so on. That isn't the point I'm concerned with here. The issue is that, like it or not, there are irreversible changes in our international environment that have eroded our confidence in the nation state's possibilities. Those pressures that made the UK and US governments of the last few decades 'roll back the frontiers of the state' were perfectly real, in a world where neither military nor economic security lies with strong national government in the way it might once have done. The market state it seems is here to stay. But - here is the difficult point - if we ask about its legitimacy, its claim on us as citizens, we need to come up with a better answer than we've had so far if we are to avoid the reduction of politics to instantaneous button-pressing responses to surface needs.

This matters, I think, for two reasons. First is the simple fact that there are some fairly fundamental issues that are unlikely ever to be sorted out by the consumerist or insurance model. One of the most obvious is the cluster of long-term problems around the environment. The summit at Johannesburg earlier this year gave small cause for complacency. National delegations could not commit governments bound by popular vote to policies that were not endorsed by popular vote; but - notoriously - policies that restrict lifestyle choices are electoral suicide, and the hard truth is that some restriction on certain kinds of consumption is unavoidable if the major environmental challenges are to be met. High energy-consumers will resist a reduction of their purchasing power; and the threats are just sufficiently over the horizon of our lifetimes to allow us to feel rational in refusing to change. The recent commendably honest announcement of government's failure to restructure transport policy in the UK as was hoped, the continuing pressure to expand the road system and underinvest in rail holds up a mirror to our assumptions. Members of all parties have noted the mixed messages being given.

It's not the only issue of this kind, of course. You might try to think of all the things that would never rise beyond the smallest of small print in an electoral manifesto. What about prison reform, for instance? 'Insurance' concerns dictate the priority of deterring and reducing crime, certainly; but long-term issues about the effectiveness of large prison populations begin to push us towards some tough questions to do with the proper funding of prison education services, the probation system, the proper supervision of community penalties and so on. This looks more complicated than prison; it certainly has cost implications; and so it is a pretty unlikely candidate for popular campaigning. Yet what we end up with is so often not even good insurance - a vastly expensive prison population and a high level of reoffending.

Which leads to the second worry here, the bigger one, which will lead us to some questions bearing more directly on religious belief. In the marketised world, so we're led to believe, we're left to make the best decisions for ourselves; but what does a reasonable decision look like in this context? As we've just seen, it isn't easy to justify choices at the present moment that don't have an impact in an immediate future that I am going to experience personally, choices that will secure something beyond maximising my freedom to go on freely choosing. When people make choices about the more distant future, about things that won't directly affect them as individuals, they do so presumably because they see their own choices here and now as part of a larger story that makes sense of their lives and gives them a context. This is the sort of thing you do if this is how you want to see the overall pattern of the human world turning out, never mind whether it's the most profitable course of action here and now for you as an individual. So if you see your choices here and now in the context of a larger story, this is a way of giving some sort of shape or sense to your own life, some sort of continuity to it. People learn how to tell the story of their own lives in a coherent way when they have some broader picture to which to relate it. You can only tell the story of your own life, it seems, when it isn't just your story, or even the story of those immediately close to you.

Now, this is both a very simple and a very elusive idea. Think for a moment of how you talk about learning or growing: certain experiences are seen as pushing you forward or pushing you into a larger landscape. You interpret what's happened to you, you don't just record a series of disconnected moments. You change your job: where did the decision come from, what does it contribute to your picture, your story of how your life develops? (And yes that is a question I have been asking quite a bit lately!) You haven't seen that particular friend for a while; is that significant? You decide it's time you made or remade your will - what's prompted that? And all this is possible because we all at some level work with a usually unspoken sense of what a fuller or more mature human life looks like. We all know the frustration of trying to relate to someone who doesn't seem to learn, who doesn't notice when their experience appears to lead them round in circles. We need ways of getting a story straight so that we don't have to go on repeating it, repeating patterns of behaviour that never move us on. Groundhog Day is a comic horror, but a real enough one: we know how easily we can get stuck in repeating patterns. And the vague and unspoken sense of what maturity might look like at least begins to open us up to the idea that others may be moving in similar rhythms to us, and so to the sense of a shared story that doesn't just fade away when I'm no longer around. All good therapy and counselling have something to do with this business of getting the story straight; but what is different about religious belief is its bold claim that there is a story of the whole universe without which your own story won't make sense. And I'll have more to say about that in a moment.

The worry in a marketised environment is what happens to the sense of cumulative experience, growth or learning, the self aware of its history and the society aware of its history. Do we know where we come from? If the goal of the market state is maximal opportunity for citizens, and if it seeks to achieve this by rapid executive response to expressed needs within an overall strategy of swift and none-too-accountable negotiation with various national and international agencies outside government as traditionally understood, there is a high risk of reducing freedom in the name of increasing choice. Political freedom has usually been understood as including some skills in questioning the options that are put in front of you by the system - the ability to imagine different futures. Such skills have everything to do with a lively sense of accumulated narrative, perspectives from elsewhere, both in individual and in social life. 'Why is that the all-important question?' is the characteristic expression of political liberty. And if political life is dominated by the insurance model, it is very hard to see where there is room for such awkward questions. A person with no skills of understanding the past and no framework for telling their own story will be at the mercy of whoever it is who is deciding what the options are going to be from which you must select. And the apparently simple and attractive picture of a more direct relation between individuals and government, the button pushing model, a contract that can be honoured by the prompt delivery of what the consumer orders, is not the ideal of democratic life but a parody of it.

In such a world, political conflict is likely to be about shifting patterns of advantage rather than major ideological concerns (as it has largely become already in the USA). You'll remember that television drama in mid-November, The Project, tracing the crises of conscience, the hard choices of a group of political enthusiasts in the years that saw the shaping of New Labour? One of the defining moments in that was when the unscrupulous political adviser says to the idealistic young MP with the words, 'It's just a game'. If that is really what politics comes to be, arguments about what is due to human beings as such, arguments about the nature of the story, mine and ours, become a waste of time - whatever the political party.

So the problem of the market state looks rather like this. By pushing politics towards a consumerist model, with the state as the guarantor of 'purchasing power', it raises short-term expectations. By raising short-term expectations, it invites instability, reactive administration, rule by opinion poll and pressure. To facilitate some of its goals and to avoid chaos, government inevitably relies more on centralised managerial authority. So there will be a dangerous tension between excessive government and the paralysis that can result from trying to respond adequately to consumer demand. To put it in another way, government and culture drift apart: government abandons the attempt to give shape to society.

Is this such a bad thing? A good many, here and in the USA, would say that it's relatively positive. But those who do say that are often those who can afford to feel confident about the strength of non-governmental communities that support and nourish the sense of continuity, the sense of a story, which I have been suggesting is vital for reasonable moral action that looks beyond the immediate scene. Take a wider look, though, and the picture is not encouraging in this respect. We are still, in this country, very much at sea over what concrete moral content we want to see in our children's education. In those environments where there is acute deprivation, including deprivation of everyday habits of mutuality and respect, a school bears an impossible burden of trying to create a 'culture' practically on its own, because the institutions that help you shape a story for your life are not around. Family continuity is rare; conventional religious practice is minimal; shared public activity is unusual. These are communities in which a school curriculum about 'values', however passionately believed, can yield heartbreakingly disappointing results. Those who are taught come from and go to a social environment in which common life, in the simplest sense, has often become problematic. Work and relationships tend to be equally transient. What teachers do achieve in such settings is little short of miraculous - I have seen enough of this in the South Wales valleys to make me very impatient of the tendency to scapegoat teachers for our ills. But it is often our attempt to make bricks without straw.

Let me put it provocatively. We are no longer confident of educating children in a tradition. Schools can't do the job of a whole society, sustaining a 'tradition' on behalf of the whole community, an accepted set of perspectives on human priorities and relationships, a feel for the conventions of common life; they can do a certain amount of damage limitation in the context of a rootless social environment, but cannot of themselves sustain a culture that can command loyalty outside the school gates. What they can manage by way of civic and moral education is for the most part - inevitably - at the formal level, the procedural level - encouraging general respect and tolerance. Which is excellent, but doesn't help define a positive core of vision. It can easily degenerate into vague uplift. You may have sat through - as I have, many times - school choirs performing Joseph and the Amazing Technicolour Dreamcoat. I have a very soft spot for it - but as I listen to 'Any dream will do' my conscience bothers me: it's as though although the ideal personal goal recommended were simply activating your potential in any direction you happen to set your heart on. And that it echoes rather cruelly in some of the social settings I've described.

And it is in any case a vision that has nothing to say about shared humanity and the hard labour of creating and keeping going a shared world of values. Being provocative again, I'd want to say that a proper use of tradition makes us more not less critical and independent in society. The great revolt against traditional authority in the seventeenth and eighteenth centuries was a necessary moment, because tradition was understood as the way in which the past dominated the present - or at least how some people's version of the past seeks to limit what's possible now. But what about the person who is now able to inhabit a tradition with confidence, fully aware that it isn't the only possible perspective on persons and things, but equally aware that they are part of a network of relations and conventions far wider than what is instantly visible or even instantly profitable, and this network is inseparable from who they concretely are? I suspect that many of us would recognise in this more of freedom than of slavery, because it makes possible a real questioning of the immediate agenda of a society, the choices that are defined and managed for you by the market.

Further: if specifically religious tradition has a place here, it is because of those elements that only religious conviction seems to secure in our sense of what is human. For the religious believer - very particularly in the Jewish, Christian and Muslim worlds - each of us, and each item in our environment, exists first in relation to something other than me, my needs, my instincts. They are related to a life or agency quite independent of any aspect of how things happen to be or happen to turn out in the universe; to the eternal, to God. To see or know anything adequately is to be aware of its relation to the eternal. So that we care - say - about the environment not simply because of concern for the human future of our descendants (since we see them in potential relation to God and therefore as people having a claim to live in an environment that is not ruined), but also because of the prior relation that the material world to itself, has to its maker. And if the stuff of the world around us is related to, grounded in God, our current human desires, our immediate agenda, cannot exhaust what can be said about that world. Or, to take the other long-term moral and social issue I mentioned, there are things that must be said about penal policy if you want to see both criminal and victim in the light of their prior relation to God, not just in relation to each other or to 'society'. Penal policy should, in a religious perspective, be asking about how everyone involved grows in human maturity. Without that, there is no mending of the relations broken by crime; but it can't happen unless there is some radical awareness of a person's distinctiveness in relation to God. And I'm not talking about a sentimental belief in the innate capacities of the criminal, let alone seeing the criminal as victim; it's simply a recognition that some other presence, some other relationship is at work in the offender, over and above what is involved in dealing with the offence itself.

What I see as typical of religious tradition, then, is the sense of arriving in the wake of relations that are already established, in a way that puts into perspective what my immediate agenda happens to be. And I want to argue that without that relativising moment, our whole politics is likely to be in deep trouble. In the heyday of the welfarist nation state, there was a reasonable case for saying that public morality was taken for granted, and that particular religious loyalties might be something of a problem. The normal language of liberalism still repeats this, assuming that the culture of political rights and liberties and governmental duties is obvious, and that religious communities can be and must be relegated to a sphere of private choice. But here is one of the paradoxes of the transition to a new model of the state. Because of its abandonment of a clear morality for the public sphere, the market state is in danger of linking its legitimacy, its right to be taken seriously by citizens, to its capacity to maximise varieties of personal insurance; but as it does so, it reinforces those elements in popular political culture that undermine the very idea of reasonable politics, the rule of law and the education of active citizens. What if the answer to why we should do what government tells us in the new era had something to do with the willingness of the market state government to engage with traditional religious communities in a new way, so as at least to keep alive the question of what persons and things relate to before they relate to anyone's particular wants and plans?

Now this is going to sound dangerous to many, especially in an audience like this. Institutional religion has a history of violence, of nurturing bitter exclusivism and claiming powers for which it will answer to no-one body. So the challenge for religious communities is how we are to offer our vision, not in a bid for social control but as a way of opening up some of the depth of human choices, offering resources for the construction of growing and critical human identities. And this also means, incidentally but not insignificantly, that religions have work to do intellectually and imaginatively to defend their basic credibility, their truth claims. The nation state could put up a pretty good case for relegating religion to the private sphere: internal differences of spiritual vision or moral loyalty posed a problem, public truth was defined by what seemed the self-evidently truthful vision of liberal modernity. But as national boundaries dissolve and administrations struggle to secure fields of opportunity against a global backcloth, there seems to be a more significant role for versions of human nature that help us avoid a reduction of politics to power struggles and a hectic quest for the purchase of individual or local securities. The sheer presence of the church - or any place of religious activity in the middle of communities of primary deprivation such as I have been speaking about indicates that there is still a space where you can give voice to these accounts of humanity. The historic role of the Church of England has been and still is making such space available. Its history, its constitutional position - however controversial that may have become for some - means that is obliged just to be there speaking a certain language, telling a certain story, witnessing to certain non-negotiable things about humanity and about the context in which humanity lives. A really secular society would be one where there were no more such spaces left.

The market state is much in love with partnership as a model of public action, and the possibilities of partnership with religious communities are many. To point to the importance of religious communities as, for example, partners in statutory education is not to license unbridled superstition and indoctrination but to invite - to challenge – religious communities to find a way of bringing their beliefs into practical contact with public questions, to identify exactly what difference faith commitments make to the educational process.

Similarly, to look at partnership with religious groups in community regeneration isn't about hiving off essential work to private agencies with shaky lines of accountability. What's at issue is a very specific need in many fragmented and deprived communities. They need brokers - people who can help negotiations over resources because they're not just one group competing with other groups. That's the kind of competition that's always the curse of needy communities. They can draw groups together to define some shared priorities. There are now local forums in several regions - the midlands, the North East, South Wales, sponsored by local churches with just these goals in view. And there is another very simple fact worth pondering.

During the last two general election campaigns, the largest numbers of people addressed directly by candidates in the flesh were the audiences at hustings arranged by local churches. What we're talking about is a space where reflective politics is still possible because it belongs to a tradition whose interests are more than political.

If it is true that the nation state has had its day and that we are - whether we like it or not - already caught up in a political system both more centralised and more laissez-faire, we are bound to ask whether there is a future for the reasonable citizen, for public debate about what is due to human beings, for intelligent argument about goals beyond the next election. My conclusion is that this future depends heavily on those perspectives that are offered by religious belief. In the pre-modern period, religion sanctioned the social order; in the modern period it was a potential rival to be pushed to the edges, a natural reaction. But are we at the point where, as the 'public sphere' becomes more value-free, the very survival of the idea of a public sphere, a realm of political argument about vision and education, is going to demand that we take religion a good deal more seriously?

So why should we do what the government tells us? The structures and priorities of the market state alone will simply not deliver an answer to this question that isn't finally destructive of our liberty - because they deprive us of the resources we need to make decisions that are properly human decisions, bound up with past and future. We need to be able to talk about what we're related to that isn't just defined by the specific agenda of the moment. This presents religious traditions with enormous opportunities - and enormous responsibilities. Because we know that religious involvement in public life has not always been benign; but those of us who have religious faith have learned something of how to engage with the social orders of the modern world; and it is up to us to articulate with as much energy and imagination as we can our understanding of that larger story without which the most fundamental and challenging human questions won't even get asked, let alone answered.

© Rowan Williams 2002