Charles Kindleberger maintained that in order for market rules to work in an open world economy a dominant power able to play the role of stabilizer of the system was necessary. Today there is no emerging hegemonic power that could even aspire to replace the US in its role of world banker and gendarme. The decline of US power underscores a phase of transition in which the global balance of power is shifting from the US to the EU, China, India, Brazil and so forth. None of these states alone appears to have sufficient power to impose its decisions in the foreseeable future. None of them is strong enough to aspire to world hegemony. The Cold War was the last old style conflict, i.e. a struggle for world hegemony. At present, a multi-polar distribution of power is replacing the American mono-polarism that governed the world after the fall of the Berlin wall and the collapse of the communist bloc.

The G20 represents a step on the way to a reorganization of world power relations. It marks the beginning of a new epoch in world history. Lacking a dominant power, it is now co-operation between the protagonists of world economy and politics which seems to be the leading tendency of the emerging world order. Global challenges such as nuclear proliferation, climate change, international terrorism, the eradication of poverty, etc. can only be successfully tackled by co-operation within the framework of international organizations.

But this trend, even though desirable, is not inevitably destined to prevail. The disappointing result of the Copenhagen Conference, the tough negotiations between the clashing interests of the new and old giants of world politics, the proud assertion of the Chinese leaders that they will not tolerate any limitation to their national sovereignty all point to the difficulties faced by the birth of a new world order. The EU was believed to be the leader in the attempt to combat global warming, and yet despite the fact that the Lisbon Treaty had entered into force a few days before the Conference started, making it possible for the European Commission to speak on behalf of all member states, the final agreement of the Copenhagen Conference was reached in the EU’s absence. All this demonstrates how outdated the world leaders' patterns of action are, how distant they are from the real needs of our time, and how slow they are to recognize the existence of humankind’s common interests.

While the US still belongs to the epoch of the nation-states and conducts its policies according to the principles enunciated in the Treaty of Westphalia, the EU was created to overcome power politics and to build a pacific international order. The EU, therefore, can be defined as being a post-Westphalian community. The US is reluctant to recognize the overarching authority of a supranational order, and the most striking evidence of this reluctance is its opposition to surrendering the privilege of the dollar as international reserve currency; though it has to be stressed that Brazil, Russia, India and China (the so-called BRIC) are also, to a considerable degree, still in the category of the Westphalian states, since they are keen to assert their power in the world. Yet, in an apparent contradiction, they propose that the dollar should be replaced by a basket of currencies, a move which they see as a step towards a world currency. The EU meanwhile has declined to take part in the struggle for the formation of a new world monetary order.

The Lisbon Treaty entitles Europe to strengthen its voice in the monetary and environmental debates, but it appears to be a senescent society, lacking in political will; and yet at the same time the EU is the laboratory for a new form of statehood whose distinctive feature lies in moving on from the military dimension of nation-states’ power which, in the past, formed the bedrock not only of individual states’ independence and security but also of Europe's predominance and leadership in the world.

Supranational institutions have been established during the half-century of constructing European unity that transcend the largely obsolete concept of sovereignty. While to a considerable degree preserving the independence of national units they also impose permanent limitations on states’ rights. Even though the EU cannot be defined as a federation, an evolution in that direction is clearly visible, as proved by the direct election of the European Parliament and the creation of the euro.

The EU is therefore the world’s most advanced experiment in building a supranational community in which the hegemonic ambitions of even the strongest member states are restrained. Other regional organizations are now following a similar path. The above mentioned BRIC and the US each aim to play a leadership role in their respective regions and regional organizations: MERCOSUR, CIS, SAARC, NAFTA and ASEAN. Even though China does not belong to ASEAN, it has recently signed an agreement with it for the creation of a regional trade and monetary area. The evolution of supranational communities represents the main way to mitigate the nationalism of the leading states and to restrain their hegemonic ambitions. This also offers a model for the institutional evolution of the UN.

Decision-making procedures between states also need examination. The limitations of a procedure based on consensus, i.e. on the unanimity rule, were recently demonstrated by the inability of the Copenhagen Conference to reach a shared conclusion. Moreover, the weakness of international agreements such as the Kyoto Protocol whose application depends solely on the goodwill of the signatory states arises from the lack of a binding mechanism. To be effective, international organizations must therefore be endowed with binding powers. In addition, if their efforts to deal with global challenges such as climate change are to have any chance of success, their decisions must be based on the majority principle.

The Kyoto Protocol is an example of the limitations of what in the political jargon is called global governance. This formula is based on two dogmas:
-    that it is possible to find a solution to the principal international issues exclusively through co-operation between sovereign states, and
-    that states will never willingly and irrevocably delegate a portion of their power to a supranational authority.
If the world wishes to face global challenges effectively, these principles should be revised.

Governments welcomed the idea of global governance because it does not question state sovereignty. But the price paid in terms of effectiveness and democracy is very high: namely, the recognition of individual governments’ right of veto and the rejection of the peoples’ right to have a say in decisions taken at international level and in their name.

We are on the threshold of a new age which requires basic changes in the nature of international institutions. In order to face up to our present global challenges and, primarily, the economic and financial crisis, a new generation of international organizations is needed, replacing the old ones. The WTO and the ICC are messengers of a new epoch of history whose basic need is the extension of the rule of law at international level. But we have to ask ourselves whether opening a constituent phase from which new federal or pre-federal institutions can spring, is possible. Our knowledge of history is no sure guide in the situation which confronts us today, for we are venturing on previously un-trodden territory.

I would venture to suggest that two of the factors characterizing the world’s current predicament appear to favour launching the necessary changes. The first, globalization, promotes the formation of a global market, a global civil society, and an interdependent world system of states governed and regulated at international level. The second is the emergence of a balance of power between the old and new protagonists in world politics which could lead to agreements between them and, ultimately, to the foundation of new federal forms of statehood at world level.

Our own task meanwhile is to keep alive the federalist alternative to the prevailing patterns of action. Sooner or later, a time will come when what today seems politically impossible will be seen as a political necessity.