>> Good afternoon, I'm Rebecca Blank
the Joan and Sanford Weill Dean

of the Gerald R. Ford School of Public Policy.

I want to welcome you to our CitiGroup lecture
series which was established by a gifted honor

of Gerald Ford from the CitiGroup
Foundation to bring distinguished leaders,

thought leaders and lecturers here to campus.

I am really pleased today to have Dr. Kemal
Dervis with us and he's going to be speaking

in a few minutes but I just wanted
to welcome him for being here.

[ Applause ]

He will be formally introduced in just a minute.

At the Ford school we are committed to fostering
interaction among those within the community

who have a real interest in
discussion of public affairs.

The CitiGroup lecture provides an
important opportunity to ask questions

and to explore ideas with
distinguished individuals who have worked

at the highest levels of
national and international policy.

We welcome everyone who's joined us today
for this lecture and for the discussions

that are going to ensue after it.

We are particularly grateful to CitiGroup for
making this type of opportunity available.

With us today on behalf of CitiGroup is
Jamie Mistry [phonetic] of Smith-Barney

which is the local representation for CitiGroup
here in town and I'm going to ask Jamie

to say a few words, thank you for coming Jamie.

[ Applause ]

>> Thank you good afternoon and welcome
what a great honor on behalf of CitiGroup

to be joining you this afternoon
and a great honor of course

to be welcoming our distinguished guest Kermal
Dervis to Ann harbor and to the University.

This event marks the first of the CitiGroup
lectures to be held in the new home

of the Ford School of Public Policy.

Most of you are probably already
of the very generous personal give

from CitiGroup's now former Chairman, Sandy
Weill and his wife Joan to the Ford school.

So there is a special sort of significance
to today's event as we now begin

to present the CitiGroup
Lecture Series here in Weill Hall

and what a beautiful facility to have here.

The CitiGroup Foundation in endowing this
remarkable lecture series continues a long

tradition of supporting education,
interaction and open dialogue around the globe.

This type of lecture series is one of many
events that makes life on the Michigan campus

so enriching and unique and thank you for your
participation today we hope you'll be able

to join us for future lectures in
the series, thank you very much.

[ Applause ]

>> Thank you Jamie.

I'd know like to introduce the Director
of the International Policy Center,

Professor John Spanier who will in turn
introduce today's speaker, Dr. Kemal Dervis.

Dr. Dervis as you know is the Director of
the United Nations Development Program.

The International Policy Center was
established here in the Ford School in 2005

to bring together students, faculty and
researchers from across campus with events,

speakers and research activities
focus on a range of issues relating

to international economics, institutions
political economy and global health

and John has just been an excellent initial
Director and leader to this whole effort,

so John I'll turn things over to you.

>> Well, it's a real pleasure to
introduce Kermal Dervis to you,

Kermal and I go back a long, long way.

I'll say first he is a remarkable
person in every respect,

he's a product of the French London
School of Economics as an undergraduate,

PhD from Princeton and that's
why I had the opportunity

to meet him he was actually subsequently
on the faculty, a professor at Princeton

when I was a graduate student there and I've
always thought whatever I don't know it's

because I didn't pay enough attention
in Kermal's class...a great teacher.

But Kermal went on from Princeton, had a very
stellar, rising career in the World Bank,

I had an opportunity to work with him,
he was kind enough to bring me in on some

of the fun stuff that was being
done at the World Bank at that time.

He became Vice President, was in charge of
Europe, Middle East, North Africa as well

as other activities in the bank and
then went back to save his own country.

He was what the economists call
the economic supremo of Turkey,

he helped position the Minister of the economy,
as well as treasury and led Turkey out of one

of the major crises, a real modern
economic fete of applied economic policy.

He then was member of the Turkish Parliament
representing Istanbul and actually was one

of the key negotiators of the European
constitution, the one that failed to be approved

on the first round but many people are
working on it hopefully getting it approved

on the second round and Kermal was there
representing Turkey, a potential incoming member

in the future into the European union.

Subsequent to that he was drafted
to serve now as the Administrator

of the United Nations Development Program,
sounds modest but the administrator is

like the president, it's the equivalent
of the president of the world banks

so you have the head of the
UNDP and that's Kermal and he is

in that capacity actually overseeing
all the activities that the UN has

in terms of economic development.

It is a pleasure to have him here
today to speak about the challenges

of multilateralism I should add that we had
two choices here, one was to have a formal

on the record discussion in which case
he would have to hold himself back.

I said let's go off the record that
way he can be loose and talk to use

as if he had no constraints and then if
you would like to quote him on the record

or something like that you have a chance
afterwards to talk to him and get your quote.

So this is the rules, this is the Chatham House
Rules, you can ask any questions he'll answer

as well as he can given his personal constraints

and it's a real pleasure
to have you here Kermal.

[ Applause ]

>> Well, it is my great pleasure and
privilege to be here really with all of you

and I think you very much for inviting my John,

Jamie it's great that I have other
friends in the audience that I can see.

It is always very good to be in an academic
setting, I did start very early in my career

as an academic both in Turkey and then teaching
at Princeton and then John gave a summary

but it feels very good to be in an
academic setting, I think you're lucky to be

in this beautiful building with all the minds
here, the discussion, it's a very special time

of life and I think one has to enjoy it fully.

I will talk...you know I've learned in politics
there's no such thing as off the record

but I will of course try to be
as free as possible but you know

when something then gets published well,
we'll go over it for some of the details.

Choosing a topic is very difficult of
course for always and one can't fit

into 40 minutes everything
one wants to say and one wants

to share with such a wonderful audience.

I want to talk about multilateralism
really today and really make a plea

for multilateralism both in the political and
economic area and try to share with you some

of the arguments that I've accumulated
throughout my life whether it's in academia,

at the World Bank, in my own country,

at the European convention
and not at the United Nations.

So it will be points rather than
a fully integrated presentation

but I think that's all we really have time
for and I do want to try to put it altogether.

The first point I'd like to make is
that globalization, you know much used

and often abused term is really
an important part of modern times

that we are increasingly living in
a world which is more connected,

more independent than anything
we've seen in the past,

there was always interdependence
even 2000 years ago.

Diseases did spread across borders, the world
was always linked to some degree but the degree

of linkage we have today is by nature...is not
just quantity, there's a qualitative change both

in the economic and in the political sphere.

Take the economy for example it is true at
the end of the 19th century the share of trade

and global GDP was already quite high
and it caught up; and there was a period

after the first world war, the Great
Depression, the second world wart where it fell,

it caught up in the early 70's with the
level it was at the end of the 19th century,

now it is 50 percent higher than that but it's
not just the volume o trade it's the degree

to which global production
systems are integrated,

the degree to which any product we buy today
has components coming from all over the world.

So it's not just the volume it's the way
multinational's organize their production,

plan there production, it's the way
small firms fit into that whole system.

That's one angle if you like
on the economic side.

The financial system, of course there was
direct foreign investment in the past in fact

as compared to British GDP foreign
direct investment from the UK at the time

of the British Empire was even larger than
it is today but what's happening today is

that the gross flows are much, much larger
than net flows, it's not just money moving

from one place to another it's money moving
sometimes within 24 hours thanks to Citibank

and others three or four
times in and out of one place.

So financial integration is much,
much more advanced and indeed

with the modern technology derivatives and
so on we're even having a hard time keeping

up with the degree of financial
integration there.

On the political side of course these are the
biggest of all topics, the danger in terms

of security, human survival that we faced
ever since the nuclear age is much larger

than anything that we ever faced before and
it's continuing so from a security point

of view whether it's the nuclear threat
which we are again rediscovering these days,

we somehow had forgotten about it but now with
nuclear proliferation, the north Korean problem

and all that we say wait a minute we
actually still have nuclear issues to face

and I think they're going
to become bigger as the oil

and gas price will probably remain
quite high, it may go up and down

but fundamentally I think all forces tend to say

that the hydrocarbon will be very
scarce so the price will be very high.

I think nuclear energy technology is again
going to be a priority for many countries

and of course once a country develops nuclear
energy technology then the step from there

to nuclear weapons is not the big a step
given the advances in know how and technology.

So I think the interdependence of the world
on the security side is as great as ever

and greater and of course you know terrorism the
whole threat perceived you know it may not be

of massive destruction but it is true

that when we board a plane today
you know the threat is palpable,

it's present so I think there's a
tremendous degree of interdependence

of human security also on that side.

Climate change, I'm not a specialist
of the issue, I want to find the time

to read more carefully about it but
many of my friends who really do more

about it have really convinced me that this
is a serious issues, it's not just a scare,

it may take a long time but we do have a
major, major environmental challenge here

and again one has to stress the interdependence.

One example I think which is telling is the role
the Brazilian rain forest plays on this issue

of climate change and environment.

I don't know whether the exact numbers
are right or wrong but it doesn't matter,

give or take 20 percent experts...some
experts say

that the Brazilian rain forest has
a carbon retention capacity worth

about 5 trillion dollars so that's what it's
worth as a stock in terms of carbon retention.

Now therefore if Brazil diminished that by 1
percent that's 50 billion dollars worth right

so in a sense it's the Brazilian forest, nobody
should dispute the fact that the forest is owned

by Brazil, on the other hand it's also
a human asset, a humanities asset,

an asset of the international community so
one could argue well if it's a public good

that everybody benefits from why not help the
Brazilian's preserve it, why not make available

from the international community
50 billion dollars to Brazil

to finance the preservation of the rain forest.

When you compare that to the total
number of foreign aid in the world

of 100 billion obviously you see
that's not going to happen tomorrow

but I thinks it's a very vivid example of how
national and international issues interact,

global public goods or global public bad.

I did read two weeks ago the United
States actually did conclude debt

for environment [inaudible] a very small
scale so the whole idea of swapping resources

against environmental assets is not outlandish,
in fact it's happening but at the scale

of the Brazilian rain forest of
course it would be very difficult

so all these are examples I think of
interdependence of why many issues

in the world have to be handles with
a global public policy perspective

by the international community acting
and behaving as a community rather

than just individual nation states.

Comparing all these issues to the role a
nation state plays in the traditional sense,

you know the traditional [inaudible] state I
think one can distinguish three dimensions only,

there's the regular three dimension,
there's need for some kind of regulation

at the global level, there is the
public goods provision I mentioned

and the two things are often related because you
can provide public goods by regulation rather

than necessarily by providing the service
yourself, the private sector can be active

but if you regulate it the right way then you
can fulfil you're public goods requirements

and then finally there's the redistribution
aspect of a nation state nationally,

most nation states...all nation states find

that the market mechanism does not produce the
income distribution of...social [inaudible]

distribution that is considered
politically acceptable by society

so the state does engage more or less but
always engages in some redistributive activity.

I think in all these three dimensions we
increasingly need something at the regional

and global level, this is becoming stronger
and stronger and stronger and I think will

in fact increase dramatically in the next 10
to 20 years particularly because of issues

such as climate change but also security
issues, I think are very, very critical and...

I remember growing up the nuclear danger was
very...you know we felt it, we came very close

to massive human destruction
during the Cuban missile crises.

I remember those days particularly not because
I was back home don't get me wrong you know

in 1960 but as a kid I was living in Turkey
and we found out, we didn't even know about it,

that the equivalent of the Soviet Missiles
were installed in Cuba, the U.S. had installed

in Turkey pointing at the Soviet Union.

So the deal was, it was a deal between
[inaudible] and President Kennedy,

it was an [inaudible] compliance that the U.S.
would quietly dismantle the missiles in Turkey

in exchange for the Soviet's
dismantling the missiles in Cuba.

You know some of you must have read
the book about Cuban missile crises,

how close we came to utter
destruction world wide at that time.

So I think after the cold war the collapse
of the Soviet Union and the disappearance

of the Berlin Wall we became a little bit
complacent that somehow that danger had passed

and I think now we're discovering that the
destructive capacity is still there and that

that whole issue is managed multilaterally or
managed in some form, I'm arguing that it has

to be so multilaterally we're again
facing the same kind of dangers.

Now when we look at the institutions,
the kind of world architecture

of multilateralism we discovered [inaudible]
very complex system, institutions were created

and grew over time somewhat haphazardly of
course there was a grand design at the end

of second World War with the creation of the
United Nations in San Francisco and all of that

but then many things were added, both
in the political and economic field

and we now have almost 100's of institutions

within the United Nations itself we
have 38 United Nations organizations

and then you have to add others.

I think if you ask a citizen of the
world in any country to explain that

or even to tell you a little bit what
they know about it, it's very little.

It's very little, it's not easy to understand,

it's not easy to explain it reminds
me a little bit of a computer program,

now of course you guys all have...the
students have all these packages but when John

and I were students you know I
actually programed my own PhD these

in [inaudible] the solution algorithm
to [inaudible] model and you know I know

with those programs after a year of
adding this and adding that they become

so complicated you have to throw them
away and start from scratch basically

and the international architecture
is a little bit like that,

it's so complex that because it's
been added and added [inaudible]

that it has reached I think this point, I
don't think we can do the same as we can do

with a computer program but really a kind of
a look, a holistic look at what we're trying

to achieve with all this architecture, I think
is needed because otherwise also in terms

of just explaining it and getting
backing for it it's very, very difficult.

So when we look at it what we find
is there's the over arching kind

of United Nations framework and even the World
Bank and the IMF are part of that framework

and then there [inaudible] many
specialized organizations and each sector,

each global issue in a way
has created an organization

and that's not necessarily a bad
thing, in a very empiricist approach

to life you could even say that's the best
way to do, you have an issue don't try

to create some grand design, just
focus on that particular issue,

see who can deal with that issue, get the
people together and try to deal with it

and that's an approach to global public
goods which I think is quite reasonable

in many ways and works to some degree.

You know you don't need an overall
grand design to solve everything.

So that's what we have, we have the World Health
Organization that deals with health problems,

we have the international labor office
that tries to elaborate on labor standards

and labor policies, you have of course
some things which we don't even think

about like international postal
union, when you think about it letters

and now of course e-mail don't basically abolish
letters but for decades we used to write letters

and they came and they had stamps and
everybody knew how much they had to pay and so

but this is an example of an international
organization that could provide the service

for the whole international community.

Not a very controversial service in this case
but that works, I certainly don't want to argue

against kind of pragmatic issues or
into the approach but I do want to argue

that we do need something more than that.

Here what we have is block,
this kind of doesn't advance.

Within the United Nations we have the
security counsel which is a product

of the second World War, the way it was created,
the victors gave themselves the permanent veto

and permanent membership and then their electric
members the size was increased at some point,

essentially it reflected what was the case
after the second World War and when you think

of the security counsel it has it's legitimacy,
it is part of the United Nations machinery,

I think the recent years have shown that
despite its failings and despite the fact

that it represents the world of 50 years ago
it still has a certain amount of legitimacy

but it is very contested and easily blocked.

One permanent members veto can stop any action
and we see it today in parts of conflicts

like in Sudan elsewhere you know there is
always this questions can the U.N. act.

For people like myself who actually work
as a U.N. Staff member on the staff side

of the U.N. is this big confusion of course in
public opinion between U.N. as an organization

and the U.N. as a family of nations
and it is always very disturbing to us

and not a nice event when somebody says
the U.N. is inactive, can't do anything,

isn't moving you know well we can't move
unless...on these issues unless the security

counsel actually makes a decision and
without that decision we are totally lost,

so there is that side of the U.N.

and then there's the general assembly it is a
fantastic institution, the whole world is there,

all the countries are there I think it
has a tremendous degree of legitimacy

because of the universality, because
of the fact that everybody's there

but it does have the feature if you
like that's a very, very tiny country.

Vote counts the same as the vote of China
and India or the U.S. or France or Brazil

and of course the debate is that
functional, I mean is that really workable,

is that a reasonable way of making decisions.

Now the general assembly does have power of the
purse in the U.N. it does have some influence

on how the organizations is run, it [inaudible]
which then elects boards of the funds

and programs and so on but in terms of real
decision making power it is very limited

of course so you have this duality within
the United Nations of a security counsel

which has decisions making power but
the counsel can be easily blocked

by a single permanent member, then
you have the large general assembly

where nobody can block any decision per se
alone but where you kind of have a culture

of consensus which reflects that an actual
vote of the general assembly is something

that many would perceive as a strange thing
so the best thing is to have consensus

because if you have consensus
you don't face the vote thing.

You have the same problem at the
WTO, the World Trade Organization,

here it think there are 150 members there,
strictly speaking all members are equal

and you have to move by consensus which
makes it sometimes extremely hard to move

as we saw in the recent [inaudible] talks.

When you go to the economic sphere
of the international system,

the financial sphere you have
the IMF at the World Bank

with a very different governing structure
which is based on weight of voting

where actually their constituencies,
groups of countries that form group blocks

or constituencies and the vote at the board
reflect certain measurements such as the weight

in the international economy of this countries.

You can debate the weight...there's
a lot of debate on the weight

but the systems does function in a
somewhat more flexible way although

of course there is the facto veto because for
some decisions you need 85 percent of the vote

and for example the U.S. that has 17 percent
of the vote can block certain decisions

but it is true that in the
[inaudible] system because of the weight

of voting you do get...you know
you get somewhat more flexibility

in the whole governance mechanism.

However the [inaudible] systems is very much
dominated of course by the richest countries,

it is very much perceived as being a G7
dominated system, G7 being the major industrial,

rich countries which have
now become the G8 with Russia

and in that sense it really
does lack the legitimacy in kind

of a political psychological sense,
particularly in the developing countries

that the U.N. does have despite all the
limitations of the U.N. there is this legitimacy

where we can debate exactly where it comes from
but it really does exist and the same degree

of legitimacy is not really an asset
for the [inaudible] institution,

they're considered a much more antagonistic way
by public opinion in most developing countries.

We also have regional organizations of course, I
don't want to go too much into that just to say

that we have to think not only globally but
also in terms of regionally, my basic feeling is

that the regional and global should
interact and reinforce each other,

I don't think it's an either or you know
build regional institutions or global,

I think we need both and we need both
in a way that they help each other.

So in this overall picture what has been
proposed for change, what are the avenues

of change that are being
explored and debated well one

as you know was the Secretary
General's proposal last year for reform

of the actual secretariat part of the United
Nations including the Security Counsel.

I must say that when I came to the
U.N. a year ago and I was all excited

about the Security Counsel I had written a book

for Brooking's before I joined
the U.N. thank God

because what I wrote there therefore was not due
to the fact that I had joined, friends told me,

friends who had been in the U.N. for a
while that Kermal don't get too excited

because you know we've been working on
Security Counsel reform for 30 years

so you know it will take some time.

But anyway it is interesting to look at the
proposals for change of Security Counsel

at the Secretary General table and many
of you I'm sure are somewhat familiar

but let me just remind you there were
two plans, plan A and plan B. Plan A was

to bring selected countries into the Security
Counsel as permanent members without veto rights

but still as permanent members, okay.

The Secretary General did not particularly
pick on this country or that country

but the leading candidates were Japan, Germany,
India and Brazil and then there obvious need

for one or two African countries,
specific countries joining,

then there would be some other countries
that would be nonpermanent members elected.

The veto remains the veto so
the P5 still maintain their veto

but you do have others joining
in, in a permeant way,

so once Brazil joins it's a permanent member
and then there was Plan B, I don't go into all

of it here but plan B was different because in
Plan B what you had was something a little more

like the [inaudible] system but no
weighted voting but constituencies,

group of countries electing representatives for
very long terms, two times four years so instead

of Brazil joining you...Brazil might be elected
by a Latin American group and might be a member

for four years or eight years but Mexico or
any other Latin country, Ecuador or whatever,

Uruguay was not forever excluded from the
permanent status so it was more flexible.

The one which gathered a lot
of steam was actually plan A,

plan B was a little bit shelved not
by the U.N. itself but by the members,

there was a lot of support by some countries
for example making Japan a permanent member

but it never happened, the whole year passed,
no final decision was made and I think a lot

of the opposition to this plan came from
the fact that some countries said look

in a sense you're making things worse
the whole idea of having some countries

that are permanent members and others that
are not introduces a fundamental inequality

and all you're doing is adding another four,
five, six countries to that group forever.

Instead let's have it more constituency based

but then the constituency based plan didn't
gather much steam either so that's where we are

at this point, I don't know what
will happen in the next year or two,

I do believe some change is necessary, I mean
I once asked the advisor to a permanent member

with a veto right do you think that 20 years

from now your country will
still be a permanent member

with a veto right and the advisor said no.

Then I said well what about
discussing some changes, he said no.

So we have this funny situation
that everybody kind of agrees

that the present system doesn't make much
sense and probably will not be around 20,

30 years from now but when you then
say okay well let's do something

about it you know then no we can't
because it's just too ingrained

so we have very tough situation here.

On the economic side I also believe it
may not be as dramatic because at the end

of day the economic crisis even very bad
economic crisis doesn't have the same urgency...

[inaudible] but the same devastating effect
as for example nuclear war could have

but there are some major problems with it,
whether it's trade, whether it's environment,

whether it's in financial systems,
global stability and so on,

many issues on the economic side need also a
multilateral frame work and here we are stuck

with this situation where the IMF and the World
Bank kind of do their thing, the U.N. system is

on the other side and done their
thing, they don't really meet very much

and there's a general feeling of the
system is dominated by the rich countries

and it generates a lot of resentment
on the part of the developing countries

and also among the emerging developing
countries, both the very poor ones in Africa

and elsewhere who feel powerless within that
whole system but also the new...the bigger guy

who feel they need a place at the table now.

The table of course outside that
whole system where people meet

and try to make decisions is the G8, that's
where leaders meet regularly...I have

to keep thinking that everything is kind of
on the record even if it's off the record

but you know that's where somehow
seven countries plus one now,

plus Russia have given themselves the right to
meet and kind of decide the future of the world,

okay and when you think about it
China isn't there, India isn't there,

Latin America isn't there, it's
not...you know it's not a framework

that one can qualify is very legitimate,
it may be useful to get some things going

and I think the G8 has made some very
good decisions in the past on [inaudible]

for example the decision to really increase
development later at least the commitment

to promise and other things but when you
think of the G8 as the only kind of framework

for actually making decisions on the economic

and social side...well it really lacks
representatively and lacks legitimacy.

So what is now being put forward
increasingly in various ways is based on two

or three principles I would say, one is that
you need a framework, a forum which is less

than 191 countries meeting around the
table which you know is too unwieldy

and doesn't generate decision, you need
something where you have representatives

of various regional groupings and some
individual countries, the largest countries

that come together to actually look
at these global [inaudible] issues

and actually make multilateralism work.

The second...and I think most people kind of
agree with that, the second principle I think is

that it should be...it should reflect
the contributions, the weight,

the real weight of countries
in the international system

but should not totally exclude
the smaller companies either.

One proposal that the former Prime Minister of
Canada, Paul Martin has put forward was the L20,

the G20 is the group of large countries
in the world on the finance side

and he said why don't we make that
group evolve into a group of leaders,

Prime Minister's level and call it the L20.

I think the problem with taking
only the large countries is

that there are very numerous small countries
that absolutely have to have a place

in that whole debate, you cannot exclude
the small countries from this kind

of higher level international
architecture so I think we need the mix.

And the third principle I'd like to propose
is that it has to be at the leaders level,

I mean that is the value for all it's
limitations of the G8 that people meet the heads

of state or head of government level, I
think the problem we have when we meet only

at the sectoral level that some
of the inter sectoral issues

and priorities don't get even
discussed or let alone solved.

So we have to have some form, some mechanism

where we don't have just the finance
ministers meeting, finance ministers

and central bank governors as we
do for the World Bank IMF meetings.

Or the labor ministers meet at the
[inaudible] meeting, these meetings will go on

but I do believe and over arching
framework which pulls this all together,

it doesn't deal with all the details
but gives some basic direction

to the international system
and to multilateralism.

There are two actual proposals out now, one came
out about a month ago by the global task force

for public good, global public goods
presided by the former President of Mexico,

Ernesto Zedillo which proposes what is called
a G25 which is the G20 and for those of you

who don't remember the G20 is the G7 augmented
with the major emerging market countries

such as India, Brazil, Mexico and so on,
Turkey is also a member but augment that G20

with five regional representatives
from a group of smaller countries

and formally call this the instead of the
G8, the G25 and give it certain powers,

certain attributes to try to give
impulses to the international system

of course nobody is saying that if this group
becomes a pure decision maker they couldn't

but do what the G8 does but in a
much more inclusive and global way.

The other proposal is going
to come out in a few days

and therefore I mean I don't...the Secretary
General did create a second panel to deal more

with economic than social side, panel
of coherence in development environment

and humanitarian affairs and that group of
people which included three Prime Ministers,

Gordon Brown from the UK and others
comes up with a proposal for an L27,

very similar to Ernesto Zedillo's G25
but where it doesn't start from the G20

but actually starts from Eco-soft, Eco-soft
being the 54 members of the General Assembly

or of the UN family elected by the
general assembly to deal with economic

and social matters but these are 54
countries coming by regional grouping from all

over the world and the L27 proposal
would be to ask the Eco-soft group

to come together once a year as leader's level
but half of them only, 27 and they would rotate,

maybe two years would be one group and then
two other years would be another group of 27

which reflects a I think the reasonable
concern that once you get the group like that,

that's too large in terms of decision making
even having a good discussion it becomes very

difficult, 25, 20...at most 30 is what you can
deal with in a decision in a forum like that

if you want to have real decision making or
at least real proposals for decision making.

So a lot of that is floating around,
these proposals are being made.

Now I think the reaction you know can be...there
probably is going to be a range of reaction

but to take extremes, some people
would say or this is irrelevant,

you know these are people making gymnastics
of ideas in the international community

and in the U.N. and elsewhere but the fact

of the matter is nation state is what counts
power politics, real politics is what counts,

you create whatever group you like but at
the end of the day it won't really matter

and you know it's the old game
of nation states that continues

and all this is not really very relevant, okay.

The other extreme of course is to be
very optimistic and say that in the face

of these huge challenges we can actually create
an international decision making architecture

that can deal with the global bad's and goods
in a much more forceful way than in the past.

No body's talking of going above
the nation states mind you here,

it's not like in the European
constitution or in Europe

where some European federalists really viewed
you know really going completely beyond the

nation state, all these proposals
are still taking the nation state

as the fundamental element of the international
system but trying to create you know a structure

and an architecture of cooperation
that will allow nation states

to share some sovereignty to
solve particular problems.

We really need to think very hard about these
things I really do believe that the threats

that are facing us are so big,
are so huge that just business

as usual you know is not...is just not
acceptable and in that sense I do want

to share this conviction with you today,

it reminds me a little big
Paul Krugman's [phonetic] book,

I think it was the rise of...I forgot the name
of it...the Age of Diminishing Expectations.

In that book in one chapter he says
the falling about human nature,

he says look all of us...I mean the big
problems in our life you know are our health,

our marriage...love life if you
like...and our job our career, you know.

Once in a while we think about these things
but in many of my friends he says beside

that these are two big issues
to deal with you know my health,

I mean I can't change my habits dramatically
and my genes and all that you know I may have

to change my life style dramatically
but I really can't

and my health is more of
less set in the way it is.

In terms of career long ago we studied
something, we set ourselves on a certain path,

maybe it was a mistake, maybe
it wasn't the right thing,

maybe we'd love to be a doctor
rather than an architect or whatever

but it's just...we can't now all of a sudden
go back to school and learn a new trade

and we can't shift that around you know.

Love that was a complicated topic, but many of
my friends are in ...some of them let's say are

in relationships which maybe don't have
enough passion but you know there's habit,

there's changing everything
now is just too complicated,

too nerve racking so they say okay this Sunday
I'm going to go ahead and fix my basement

and I think the message is that
it is true that in life when some

of the really big questions are very difficult
to face and it's very natural human reaction

that you look for something that you can
actually deal with and you try to deal with it

and it's very...and there's nothing wrong
with that and in deed we should do that

and that's often the way you make progress but
I do believe that given the threats we face now,

you know given the fact that we're
so interdependent and yet we live

with the nation state machinery
that reflects the world of 50

or maybe 150 years ago I think really
carefully thinking through on how we're going

to manage the global system, whether
it's the ecosystem, whether it's ecology,

whether it's human security,
terrorism, nuclear threats,

disease you know these things really
need global approaches in management,

not to supplant the local, in many ways the
local has to deal with many, many things

but we need that global level and
if we don't make that real effort

to get there we will face increasing problems.

Net works civil society, private sector,
you know NGO's can contribute a lot to that

but they can't really solve the big problem you
still need state machinery and public policy

to deal with the really big problems.

The Middle East disaster situation is not
going to be solved by NGO's, I mean you know

and [inaudible] can do a lot of good
there but somehow you state craft

and you need the international community to see
the extent of the mess and try to do something

about it and I think the same
goes true for environmental issues

and so on so we need the political...the
public policy side as I mentioned

to complete the very positive action that civil
society can do and indeed civil society can push

for these decision, without civil society
pushing for them I don't think much will happen.

So let me end this plea or this presentation on
the role of the U.S. in all that because I think

when we look at the world you know half
the world's armament budget is U.S.,

one trillion is spent on
armaments, half of it is U.S.,

the U.S. is tremendously powerful
economically and certainly in terms of defense,

in terms of ideas, in terms of science, in
terms of wonderful universities like this one,

it's a huge power in the world and
of a kind perhaps that didn't exist

for a very long time maybe
since the Roman times and so on.

At the same time I would submit that the
last few years if anything have shown

that the tremendous limits to what the
country like the U.S. can achieve on its own

and it's becoming increasingly clear.

So in a way it's a huge challenge now because
we are in a...for the U.S. because we are

in a multilateral system or an international
architecture where certainly it's not possible

to advance without the U.S., okay it's too
big, too large, too powerful, too influential,

too rich, the international
community will not get organized

without positive U.S. contribution,
U.S. support,

the U.S. can certainly change...stop any
possible change in any direction, okay.

Its powerful enough and large
enough to play that role.

On the other hand the U.S. is also feeling that
many initiatives are running into dead allies,

many, many things are blocked, many things are
not moving ahead and there are clear limits

so I do believe that we now in the
next years, maybe five years decade

or so we face this situation where either
in the U.S. there's going to be a change

and there will be a much more
active support for multilateralism

and international policy solutions to
global problems or we will face huge,

huge international problems and I'm optimistic
actually because when you look at the history

of the United States and when you
look at the U.S. and I'm Turkish,

I'm not an American citizen, I say it
as a...somebody who lives in the U.S.,

who likes the U.S., who is very found
of America but I think when you look

at it actually it has...there's three
interesting things, one it's very global,

it's a society where you know John here from
the Czech Republic and there's compatriots

from Turkey teaching it's one of the most global
societies so in a sense for the U.S. to kind

of relate to the global world in a sense
take leadership in a government system

that would be appropriate to a
global world I think from a cultural,

psychological perspective
shouldn't be that difficult.

It's more difficult in societies that are
much more homogenous, which are less open,

it's not open to the world in a sense perhaps
travel as much as a Czech citizen does

but in terms of the basic relationships whether
it's to east Asia, whether it's to Africa

as African-Americans, whether it's to the Middle
East, whether it's the through the connection

with the Jewish community and Israel or
to the connection to the Arab community,

it's all there in the U.S. so in a sense
all the ingredients are there for the U.S.

to actually become very committed
to a global solution

or global approach to the
world's key challenges.

The second things is when one looks back
at history of course as I said early

on during the presentation I mean it was
actually the U.S. leadership that led

to the United Nations in the first place.

I mean the San Francisco declaration all
the very strong commitment of the U.S.

to multilateralism and multilateral
institutions.

A beautiful speech as President
Kennedy's address at the commencement

of American university I think
in 1962 or something like that

where you have a beautiful statement about
multilateralism, the rule of law in the world,

the need for nation states to submit to the
rule of law internationally, President Kennedy,

you know a U.S. President and the need to
organize this world in a multilateral way

and I can...you know whether you go back to
Jefferson or even President Reagan coming

from a different side of the political spectrum
a lot of multilateralism and commitment

to the world actually in the
U.S. leadership in the past

and finally third point the resource side.

I mean this is a whole different topic much
more technically economic, the twin deficits

and global imbalances and the 700 billion dollar
deficit, the current account deficit in the U.S.

but I think if you look at it from a resource
point of view it would seem quite clear

that U.S. even though it
has this huge GDP and wealth

and all that doesn't have the financial means
to deal alone with many of these problems,

it has to share, it has to
share the cost of human security

of environmental management and of other issues.

So there's also strong economic pressure I
think that will militate in the direction

of a more multilateral approach
in U.S. policy and I think

when that happens it will...many things
that seem impossible now will all

of a sudden move ahead much more quickly.

So that's why I do believe that it is
important and that I am fairly optimistic

because I think the dynamics within
the U.S. society actually exists.

Of course others have to cooperate too, Europe
and every country has to move in that direction

but I think the role of the U.S. is critical

and one comparison I sometimes make
I don't know how justified it is

but it struck me the other day thinking about
it because when I first came to the U.S.

when a student at Princeton it was in
1970, at the end of the 1960's and I think

in the 1960's American society did something
very, very important in terms of race relations

and race integration, I think it really faced
the issue in the 60's and did a lot of things

and of course there are huge
problems that remain

and some African-American communities remain
disadvantaged economically and income wise

and so on but I think when you compare the U.S.
today to the 50's, early 60's there was a very,

very kind of deep shift in what kind of
society you know the U.S. was going to be

and a deep commitment by leaders to integration
and now you have a country where the Secretary

of State is an African-American, the Chief
of Staff was also African origin American

and now the latest to throw their
hat into the ring, Barack Obama,

you know is talking about becoming President.

I think in my views, I'm not saying I don't it
would have been feasible in the 60's at all.

So there has been a deep transformation in the
psychology, very positive, extremely positive

of course to a multiethnic, multiracial
society in the real sense where anybody

from any ethnicity, from any
minority can go to the very top.

I compare and that needed to be a deep
transformation of people's attitudes,

of people's way of thinking and so I
compare this challenge that existed

in the 60's a little bit to the
challenge of multilateralism now

in the U.S. I think what's
needed is kind of realization

that multilateralism is absolutely necessary
for human security and that the U.S. has

to lead the process, has to look at it very
positively not as something to be afraid of

and something that somehow will make things
more difficult and the country as one

of the only ways that we can manage the
challenges of the coming century in a decent way

and I think once that conversion happens you
know which I think it will happen actually,

then we will have the strongest nation

in the world playing this leadership
role which we so much need.

I don't think it's the only solution again there
are many other things that are necessary for it

to happen but I do believe that there is
this psychological conversion that's needed.

I do feel a deep resistance to it of course
also you know but I think that it's a resistance

that in the end is superficial and that if there
is some leadership that is actually arguing

for it without being afraid that
it's a bad word then I think all

of a sudden the progress maybe
much, much fast than we think.

So this is something I want to share with you,
it is linked to the role of the United Nations

because we need that support and effective
United Nations cannot be there unless major

countries of the world are supportive, we
cannot deal with the huge developmental issues

and human security issues without that
support so that step that needs to be taken

where the United Nations meets it's largest
member so to speak in a positive way and wants

to move forward I think is one of
the big, big challenges ahead of us.

Again we need others, we need
support from everywhere of course

but this particular support
given that I'm talking

in an American University is
particularly important, many thanks.

[ Applause ]

Yeah I think we do have some
time for a few questions.

Why don't we start there.

>> [Inaudible section] very long process
of European nations coming together

in what's now a very [inaudible] the
kind of multilateralism [inaudible].

>> Well, I think it's an excellent question
because Europe in a sense led the way

from being the origin of nation
states in the good and the bad

because the European nation state was
able to create a much more human society,

greater social welfare, more democracy and
all that, it also created two world wars

and terrible destruction, you know that
nation state so the attempt of Europe to kind

of overcome that and create
the multilateral...kind

of super national system I think is very,

very important although I would be a
little bit careful because when I talk

of multilateralism I don't yet...maybe
our grand, grand children will talk

of the super nationality that Europe involves
you know so there's some differences.

I still believe that it's way too
early and that it would be unrealistic

to define a global project ala Europe
where Europe kind of tends to see itself

to some degree as almost one country
you know the flag, a blue flag

and the blue flag is very interesting, I mean
you go to all kinds of places which is are no

where near Europe yet, like Georgia or whatever
you have the blue flag there so lots of people.

But none the less there are many elements
that are very, very similar for example how

to balance still the state versus the federal
level, I mean of course the U.S. has that too,

it's a federal country, how to use
population weights in the voting system

versus having one country, one
vote type of [inaudible] so many,

many things that the Europeans are
exploring I think are very relevant

to the global experience.

I think Europe of course now
is suffering a major set back

and in the sense it's true
their constitution was rejected.

I remain fairly optimistic, I think
these things don't work linearly,

Europe does have to absorb the new
entrance does have to really have to work

on the institutions before it can
actually have new vigor in its project

and there is one sentence which I
really love by Jean Monet [phonetic] one

of the founders of...founding fathers
of Europe you know when they asked him

to define...it's actually the last
sentence of his memoirs where he says,

ladies and gentlemen don't make a mistake
our European project is not an end in itself

but just the first step to a better
organized world, so in a sense the founder

of Europe already...it wasn't just about
Europe it was about the world in a sense too,

so there are many, many relevant aspects
but I do believe that in a way it all feeds

on one another, you know when one side blocks
the other one becomes less cooperative,

so there's an interaction between
what's happening in the U.S.,

what's happening in Europe, what's happening
in other countries which can either be positive

or negative, right now it's more in the
negative mood than in the positive mood.

Then there's this thing about
efficiency which is another given

that you asked the Europe question
which I think is an interesting point.

When you walk in the European parliament
I don't know how many of you have walked

in the European parliaments, some of you
I'm sure, you have all the interpreters,

all the languages, I think 23 or something
now given that there are 25 members

and it costs...a significant portion of
the European budget is actually spent

on interpretation so one thought I had working
around the European parliament is what a waste

of resources, all the interpreters...but then
immediately I stopped my self and I said look

if that's what it takes to avoid
wars between these countries you know

to lower military budgets, to create a
zone of peace I mean let's spend the money,

there's no problem so there is a little bit of
a trade off between trying to be super efficient

versus creating the mechanism where by you
may have to talk a lot and waste some time

but it's a little bit the same as the
General Assembly in the United Nations,

you come in there and one reaction could be well
let's get something done you know and of course

that is the correct request but on the other
hand having all these people interacting

in all the languages, all the translations,

nobody feeling as an outsider,
has tremendous benefits also.

Yes.

>> I would like to ask how we get the voices
of three groups of people in the world really

to that table and one is women's voices
since the Beijing conference in 1995

and their platform for action,
there's been enormous resistance

to moving forward even though [inaudible]
and then there are farming communities

who really do not want to leave the farm and go
to the city even though agricultural policies

in many places and internationally policies
are forcing farm families off their farms

because of the low prices for commodities,
internationally traded and because

of government policies which see a
diminution of a number of farms as a result.

And the third group are indigenous community who
live for instance in the Brazilian rain forest

and who feel that their former
way of life is tied

up with a particular [inaudible] particular
habitat and see very little regard

on the international stage
for preserving those habitats

and letting them preserve their
own community [inaudible].

>> All right, thank you maybe we'll take one

or two questions more then I can make my last
[inaudible] you had a question or comment?

>> [Inaudible] too strong or very strong
[inaudible] but not strong enough to succeed

without limits and therefore it
is in its interest to [inaudible].

I was going to push you a
little bit so we can think

in recent memory the Clinton administration
was [inaudible] much more multilateral

than the current administration, if
you were to take them [inaudible]

to achieve becoming more multilateral.

>> Okay then...if there is anybody else
then...yeah why don't we take one there.

>> You mention that [inaudible] between the
U.S. and [inaudible] we all know about issue

between [inaudible] and what happened

and [inaudible] do you see then this
lateral agreement that's [inaudible].

>> All right well I mean
[inaudible] say a few words,

maybe on the last one you
know I think some amount

of regional cooperation is clearly can be a
building block but it depends a lot what type

of agreement they are and
I definitely don't think

that what's called the spaghetti
bowl you know all kinds of vague,

complicated regional agreements can replace good
multilateral, legally binding trading system

so I'm concerned about the bilateral deals
and the other thing, the developing countries

of course should always realize that when
they are in bilateral negotiation with the EU

or the U.S. you know the power
balance is totally against them

where in a multilateral framework, when all the
developing countries participate in they can

of course bring much more weight to
the table and the deal they will reach

over all will probably be more in their
favor than if Bangladesh negotiates directly

with let's say the European union.

So in that sense it's to the
developing countries advantage I think

to have a multilateral frame work.

In terms of the voices of many
groups, I think the UN, they're voices

but whether these voices translate into action

which is the real question
that's much more difficult.

I must say that the UN is trying a lot

within the United Nations you know there
was a decade for indigenous people.

On gender issues we really hope to push
much harder there will be a new organization

that is now being a proposed, it's UNIFEM
but UNIFEM strengthen [inaudible] women's

and gender organization so but
you know for decisions to be made

on all these things again you need the political
level, advocacy can only take you so far.

Now on the 90's versus afterwards you
know President Clinton is an advisor

to the [inaudible] Tsunami, post
Tsunami and so therefor once

in a while he comes...we have the privilege
of hosting him and he comes by and we chat

and all that and I think the 90's
and he very much realizes that

and it's his [inaudible] so you know.

The 90's I mean so much could
have been done during the 90's

because the Berlin wall collapsed,
the Soviet...the cold war ended,

the history [inaudible] and there was tremendous
opportunity in a way to build the new world

with new institutions overcoming
the cold war blockages,

security council reform all
the things I mentioned.

The ideal time was actually the 90's to do
that and you know the whole thing on terrorism,

911 hadn't happened it was kind of positive
outlook on the world and it wasn't taken,

I mean it was not...there was no action against
it but it wasn't considered a major priority

and you know let's face it...it's
always in our personal lives to you know

if there's no major challenge ahead of you, if
you have a heart attack you really start a diet,

if you don't have a heart attack you don't so
I think the 90's were a little bit of a decade

where you know there wasn't that much of a
challenge in a sense so while the administration

in the U.S., even the first bush
administration and then Clinton was

in a sense much more multilateralism
and much more inclined to work

within a multilateral framework than what came
afterwards is I think the challenge wasn't

so immediate and actually President Clinton
has shared with me once that he really felt

that so much more could have
been done at that time

and of course he's doing a lot
now in his more private capacity.

Then came this period, the terrible crime of
911 and all that and then the reaction coupled

with this...well I should go back
one more step, and of course also

in the 90's I think there was an
unrealistic view of U.S. power,

okay I mean the Soviet Union was
gone, no more competition, that's it.

Well I think what we're seeing
now is that it's not that easy,

there are lots of...there are different threads,

it's no longer like the Soviet Union
another super power but there are many,

many socioeconomic and security threats
and I think we're now getting to the point

where many are realizing that in
fact...I mean that's my thesis,

one should move toward that multilateral.

I don't think...some of the proposals you
know like enlarging the security council

or creating an L27 and really working
with it are practical proposals

but I think what's more important than any
one particular action is really the outlook,

the approach.

You know we have these problems how
are we going to solve them and here

and last point I think it needs to be a
combination of people who share certain goals

and values, you can't always
get the whole world to agree

with anybody I mean whether it's France,
the U.S., Turkey, the Czech republic

so there will always be certain
alliances, certain coalitions,

certain like minded...in the UN on the
economic side we have like minded donor

which are mostly the most generous [inaudible]
who have their little coalition so all

that is fine but the basic approach is you know
we have to have international system that works,

how can we actually make it work and
how can we slowly have rules of the game

which people submit to, like in the W2,
the W2 is actually a fairly good progress

because W2 everybody actually
submits to arbitration there.

So enlarging that kind of approach
and having building political support

for multilateralism I think is the essence,

once that political support is there once people
are no longer afraid in an election campaign

or on TV to say yes I am for
multilateralism you know once

that [inaudible] is broken then I think one
can sit down and say okay how do we do it,

you know what's the better choice, empirically
what works better, then there are lots of things

that can be debated but first one has
to you know go beyond that barrier

which unfortunately still exists that
even saying that you might want to work

with the United Nations is not such
a great politically things these days

so and that has to be changed.

Thanks a lot...oh sorry I think...I have
to run right now because there's a plane.

[ Applause ]

>> We want to very much thank you for
coming and have framed a copy of the...

>> Wow.

>> The poster that's been out front
that you all saw with thanks for all

of your work and your contributions.

>> Thank you very much, thank you very much.

[ Applause ]