To tackle the distributed power optimization problems in wireless sensor networks localization systems, we model the problem as a hierarchical game, i.e. a multi-leader multi-follower Stackelberg game. Existing researches focus on the power allocation of anchor nodes for ranging signals or the power management of agent nodes for cooperative localization, individually. However, the power optimizations for different nodes are indiscerptible due to the common objective of localization accuracy. So it is a new challenging task when the power allocation strategies are considered for anchor and agent nodes simultaneously. To cope with this problem, a hierarchical game is proposed where anchor nodes are modeled as leaders and agent nodes are modeled as followers. Then, we prove that games of leaders and followers are both potential games, which guarantees the Nash equilibrium (NE) of each game. Moreover, the existence of Stackelberg equilibrium (SE) is proved and achieved by the best response dynamics. Simulation results demonstrate that the proposed algorithm can have better localization accuracy compared with the decomposed algorithm and uniform strategy.