1. The Israelites were in exile in Babylon after the destruction of Jerusalem in 586 b.c. when this story was written. The Tower of Babel story was a commentary on Babylonian society. The Israelites looked around at the ziggurats and the Babylonian religious establishment and wrote a story critiquing the pride, the arrogance, of the Babylonians.
2. One prof I had years ago translated Genesis 11:4-5 slightly differently -- instead of a city and a tower, he claimed the Hebrew should be translated "a towering city." In his view, the story of the tower of Babel was written during the reign of Solomon, when Israelite culture was moving from an agrarian, rural culture to an urban, trading culture. The glories of Jerusalem led the people of Israel to a sense of pride and their security was based on their towering cities. The story was written to critique the Israelites' own arrogance.
3. Others claim that this story was written at a time when the Israelites were starting to interact more with other nations and cultures and the function of the story is purely mythological -- that is, the story is designed to explain the existence of different languages and cultures.
It is dangerous to get too hung up on the origin of biblical stories. First of all, there's a temptation in this to make the story something that is dependent on its human origins and limited by their perspectives and insights. Second, this line of thought pushes us to focus on the details of the cultures in which the Bible was written without ever calling us back to hear God's word for ourselves and our own culture. Whatever the origin of this story, there are important messages in it for us.
First of all, see how sin has expanded its sway. Rather than just individuals behaving badly, we now have willful, corporate sin. "Let us build ourselves a city, and a tower with its top in the heavens, and let us make a name for ourselves." Here we see humans at our insecure worst. There's no sense of trust in God or dependence on God in this strategy. Instead, it all depends on us and what we do. Let US build ... It is easy to see ourselves in this scheming. It's fine to trust God, but when it comes to my bank account, my retirement planning, my insurance, I'm on my own. I've had church council members at previous congregations tell me, "It's fine for you to talk about faith on Sunday mornings, Pastor, but you have to recognize that the church is a business!"
Second, the tower is a direct assault on God. The goal of the tower is to reach heaven. We are constantly tempted to try to bring ourselves to God. Sunday School children in a previous generation were taught to sing, "We are climbing Jacob's ladder, soldiers of the cross" -- neglecting the fact that Jacob never climbed the ladder; rather, angels were coming down the ladder to earth. The God we meet in Jesus is a God who comes to us. We do not -- cannot -- get ourselves to God. When we hold on to our moral standing, our pretty-goodness, our sense of our own ethics and integrity, we are simply trying to bring ourselves to God. (NOTE: I'm not against integrity, of course; but when we think we have accomplished something for God by behaving ourselves well, we're sadly mistaken.)
Third, we see in this story the awesome wisdom of God. He didn't need to destroy the tower, and that wouldn't have accomplished much anyway. Instead, he changed their languages. He cut off their communication, which is really one of the side effects of sin -- it divides us. God simply let their sin have free reign so they could live with the alienation that was brought on by their arrogance. This took the form of different languages that divided them from one another.
This Old Testament story has its counterpoint in Acts chapter 2. On Pentecost, God gave Peter and the other disciples the gift of different languages not to alienate them from each other, but to communicate the good news of Jesus Christ to people in their heart language. The burden of languages, the result of the sin of the tower of Babel, is transformed and becomes the means by which God proclaims good news.
This is the God we serve -- he takes what we experienced as evil, as punishment, and he transforms it into good. When my arrogance is broken and I am humbled, I feel awful. But if I let God work in my humility, it becomes a tremendous gift.
That's really what this story is about. The curse of varied languages and cultures that alienate people from each other will someday be transformed as we come together around the throne of God, where people "of every race and nation, every tribe and tongue" will join in praising the Lamb of God (see Revelation 4-5). This is God's power to transform.
What looks like evil in your life? What looks like the negative consequence of sin, yours or someone else's? Can you imagine God transforming it and making it into a gift?