Like the "Crocodile Club", a truly federalist intergroup inspired by Altiero Spinelli at the outset of the 1980s, the Federalist Intergroup for the European Constitution set up in the European Parliament elected in June 2004 is in the family of intergroups which have had their influence in the European Parliament: on the draft "Spinelli" Treaty of February 1984 and, indirectly, on the Single European Act, as well as on the draft of the European Constitution approved by the Convention in July 2003 and so also on the draft now awaiting ratification by the Member States.
Indeed, under the impulse of the UEF and its President, Jo Leinen, elected to the European Parliament in June 1999, a "European Constitution" Intergroup was formed in September 1999 to bring about the opening of a democratic constitutional process in which the elected representatives of the citizens would be fully involved. In the eyes of Federalists it was obvious that this Intergroup should provide, within the institution representing the sovereign European people, a determining contribution to the transnational campaign for a European Constitution, led in parallel since the years 1997-1998 by the UEF and the JEF.
Even the word "Constitution" has rapidly emerged from obscurity and the domain of taboo-words in the construction of Europe, bringing with it as its corollary the famous F-word; then, following on the traumatising setback of the Nice Treaty, the Heads of State and Government were obliged, with the Laeken Declaration, to concede to the opening of the procedure incorporating the Convention method which had proved itself in the drawing up of the Charter of Fundamental Rights. Instead of limiting itself to dealing with the Nice left-overs, this more political than diplomatic assembly ended up by launching the ambitious project of drawing up a draft European Constitution.
No one can claim that this turning point in the building of Europe, introducing a homeopathic dose of democracy into the intergovernmentalism of the past, would not have taken place without the continuous pressure of the Federalists across Europe and their allies within the Intergroup of the European Parliament. Immodestly, one can even think that the Federalists and the Intergroup were good for something...
And when, at certain critical moments in the adventure of the Convention it was necessary to tip the scales in a positive (federal) direction, the Intergroup of the European Parliament, in complicity with the "brother" Intergroup inspired by Alain Lamassoure within the Convention itself, not only did not miss the opportunity offered but put itself at the head of a campaign being relayed into the civil society by the UEF and its partners in the Federalist Voice network. And the battle was won with a Declaration drawn up on the initiative of the Intergroup, gaining the support of a majority of MEPs calling for the election of the President of the Commission by the European Parliament.
The Challenges of ratification and future revision
The signature of the European Constitution at Rome in October 2004 is an extremely important political act. But the most difficult phase of the constitutional process remains to be accomplished: the ratification of the European Constitution by the 25 Member States of the European Union.
With about 10 national referenda in prospect, all the European institutions, governments, national and regional parliaments as well as civil society should urgently combine their efforts to maximise the chances of obtaining success in the ratification process. As experience has shown on many occasions in the past, an Intergroup can give a crucial contribution in fashioning the coming constitutional developments.
This is why, after the constitutive session of the new European Parliament elected in June 2004 and two days after the federalist demonstration on the arrival of the new MEPs at the entrance of the Parliament at Strasbourg, the Federalist Intergroup for the European Constitution was formed on 21 July 2004. This new Intergroup continues in the spirit of the "European Constitution" Intergroup which has operated successfully throughout the period of the 1999-2004 legislature.
The Federalist Intergroup aims at monitoring the next steps of the constitutional process, first and foremost through supporting the European Constitution, as well as contributing to the communication strategy needed for its ratification; the Intergroup aims likewise to encourage the setting up within national parliaments of intergroups/fora supporting ratification of the European Constitution and giving the political impetus needed for the building of a European Union which is democratic, transparent, effective and responsible to its citizenry.
A truly multinational Intergroup
Today the Federalist Intergroup has just been officially recognised by the European Parliament following a long and very selective procedure within and between the parliamentary groups. It already numbers 86 primary members from 21 of the 25 Members States of the European Union (the exceptions being Denmark, Latvia, Luxembourg and Malta). Its members belong to the five largest political groups in the European Parliament: the Christian Democrats and their allies of the PPE-DE, the Socialists of the PSE, the Liberals and their allies of ALDE, the Greens (Greens/ALE), the United Left (GUE/NGL). It is run by a steering committee of twelve members who ensure that its "intergroup" character is upheld and the equilibrium between the political groups is maintained.
Since its establishment, the Federalist Intergroup has already met four times at Strasbourg during the sessions of July, October and December 2004 and January 2005, each time with more than 25 members participating, that being as many if not more than for an ordinary meeting of a parliamentary committee. The debates have focused on procedures and the appropriate period for the ratification of the European Constitution, on the communication strategy, as well as on the "Mendez de Vigo - Corbett" Report on the Constitution, which has just been voted on in January 2005. The Intergroup has also discussed the Turkish question in the context of the Constitution and the establishment of a European External Action Service. An exchange of views is hoped for with the Luxembourg Presidency of the European Union during the first six months of 2005. Apart from this, the Intergroup will do its utmost to monitor the first ratification referenda, so as to draw useful lessons for the referenda, to come. A first delegation of the Intergroup is foreseen at Madrid on 10 February to give its support for the Constitution in Spain, where the referendum takes place on 20 February. They will have high-level governmental and parliamentary contacts as well as holding a press conference.
Federalist Trojan Horse or nice club of Friends of the Constitution?
The first assessment is encouraging. Only the future will tell if the Intergroup is content with being a mere forum for the exchange of views, certainly more federalist but also more informal than the Constitutional Affairs Committee presided by Jo Leinen and acting as a pressure group with internal influence on the European Parliament. This latter more ambitious scenario would result in its taking autonomous political initiatives and entering into the sort of combats which the preceding intergroups have been best at, namely networking and colluding with national parliaments or at least with the braver deputies or senators of the different countries. In this spirit, the Intergroup should also promote an inter-action with the pro-European civil society, both at the current stage of ratification of the Constitution and at the succeeding stage of its perfection.
Without an overall strategy involving the citizenry and their elected representatives at all levels, the organisations of civil society, the political parties and the European institutions, the constitutional process now under way will not be able to bring about an authentically federal Constitution. That's asking a lot, you will tell me! Certainly, but the opportunities exist in so far as the political actors don't leave their courage behind in the cloakroom and don't take fright at the powers granted them.
In response to the legitimate expectation of the federalists, once the Constitution enters into force (25 countries, or fewer if the European Council agrees) the European Parliament will then have to assume the power conferred on it for absolutely the first time to submit a draft for its revision (article IV-443.1 on the ordinary revision procedure). With this view, the role of the Intergroup becomes evident: that of showing the way and of acting as a catalyst of the political will so that the Parliament does not end this legislative period without having, in all legality, proposed a time-table, a methodology and an agenda for revision.
It is the responsibility of federalists to use their influence to ensure that the Intergroup takes the avant-garde initiatives, thus acting as a motor in the next page of the history of the political construction of Europe.

Federal Union was born in September 1938 at the time of 'Munich'; by anger out of desperation. 'Munich' finally forced everyone to declare themselves. One side saw Chamberlain's journeys and signature as a brave action, vindicating his policy of appeasement. We and our children should be eternally grateful; war had been averted. The other side saw it as a shameful surrender in a long line of surrenders. Antagonisms became passionate: long-time friends stopped speaking to each other, families became divided. And Hitler ranted on regardless.
Chamberlain's policy of 'appeasement' was the product of a government dominated by a generation of men who had been too old to fight in 1914. They had thought to restore their own pre-war Victorian values; the right to separate nationhood, and of each nation to decide its own foreign policy backed by its own armed forces to defend that independence. The individual sovereignty of each nation was held to be sacrosanct; it was the duty of its young male citizens to die for it if necessary. Any difference of interest between nations would be solved reasonably by diplomats from the parties involved.
The sons of that older generation had fought in the trenches. But those who had survived did not take over. They retired into themselves and the nightmares of what their forbears had called on them to do; and what they had seen and done. It was a generation which took little part in government, leaving it to the old men, now joined by the 'profiteers who had done well out of the war', to carry on. Those of them who did take part in government such as Eden and Macmillan, dismissed by Neville Chamberlain as the 'Boys Brigade', had been brought up in their fathers' values. They could differ with their elders but could not find it in themselves to break with them. They could approve the idea of a League of Nations bound by a communal alliance, but not at the expense of diplomacy between individual states and the creation of alliances and counter alliances; these remained the order of the day. The umbilical cord proved too strong and proved lethal. The idea that the League of Nations should be a body, which could override one to one diplomacy between nations, and take action in its own name on behalf of them all, in the way that the Covenant of the newly created League seemed to make possible, was no part of their thinking. The League, in fact, had neither authority nor power to do so. Its constitution laid down that each member remained free to conduct its own diplomacy, backed if necessary by its own forces. It was an escape hatch for those who wanted to renege on collective action.
That generation was followed by one which had been too young to fight in 1914; but was just the right age to be called on now in 1939.
It was a generation which had been brought up with the writings of Norman Angell, H.G. Wells and Bertrand Russell and many others, together with a host of journals, as well as talk in the many branches of the League of Nations Union up and down the country. All identified 'national sovereignty' as the menace and the root from which wars developed. It had been brought up to regard 'collective security' under the Covenant of the League of Nations as a pledge that their fathers had not sacrificed their lives in vain; 'Covenant', with it's biblical connotation, was an appropriate word. Though of age to fight it was a generation which was not experienced enough to take part in government - even Eden and Macmillan from the previous generation, were treated as no more than promising apprentices to be ignored or sidelined by their elders. The old men in control, however, found 'collective security' a useful vote winner; but privately held the idea in contempt. The young were naive enough to believe that they meant what they said.
The moment of truth came in 1935 when Mussolini began threatening to invade Abyssinia. In June eleven million people in Britain voted for sanctions against Italy if Mussolini carried out his threats - nine million of them for military sanctions. "Terribly mischievous" according to 66 year old Neville Chamberlain, already prime minister in waiting.
A paraphrase of Harold Macmillan's account (Wind of Change) of what followed may be cited. On 11 September the British foreign secretary, Samuel Hoare, made what he described as 'a revivalist appeal to the Assembly of The League. At best, he said, it might start a new chapter of League recovery. The speech, however, had been minutely vetted by the Foreign Office and Neville Chamberlain. Nevertheless Hoare boldly proclaimed: "The League stands, and my country stands with it, for the collective maintenance of the Covenant in its entirety... If the burden is to be borne, it must be borne collectively. On behalf of His Majesty's government, I can say that in spite of these difficulties, that Government will be second to none in its intention to fulfil, within the measure of its capacity, the obligations which the Covenant lays upon it". The following day two battle cruisers and a cruiser squadron arrived in Gibraltar, supporting his words.
The effect throughout the world, Macmillan recorded, was sensational. Belgium's representative at the League, for example, reported: "the British have decided to stop Mussolini, even if it means using force". In Britain, Macmillan wrote, the 'response was immediate and impressive; the sense of national unity and pride was aroused'; 'Once more we were going to take our right place in the world. America was neutral, Germany hostile; the democratic nations now looked to us, and we would not fail them. Britain was back in the lead'.
Mussolini called the old men's bluff; went ahead and invaded Abyssinia. There was then a pause while Baldwin called a general election; it had the effect of giving the old men a breathing space to recover from their shock. Baldwin fought the election on a policy which included support for the League and of rearmament as support for collective security. In the meantime the diplomats and Neville Chamberlain among others, quietly got to work to undo the damage which, in their eyes, Hoare's speech had done.
Having won the election on a policy of support for the League, however, the government, as Macmillan wrote, were in 'honour bound, in spite of a sentence here or there of reservation, to stop Mussolini. When the House of Commons met in November, no one - inside or outside Parliament - doubted that this was their firm purpose'. The Foreign Secretary and the Foreign Office thought otherwise. Within a fortnight the British Foreign Secretary, Samuel Hoare, stopped off in Paris on way to a holiday in Switzerland; the head of the Foreign Office just happened to be in Paris too; and the deal with Pierre Laval, leaving Mussolini free to occupy almost all of Abyssinia, was agreed and signed without any consultation with London. Abyssinia was left with what the Times famously described as "a corridor for camels" to reach the sea.
In his biography of Neville Chamberlain, written some quarter of a century later, Iain Macleod judged correctly. "Historically", he wrote, "the Abyssinia crisis has often been presented as a side-show compared with the main drama of Germany's advance to world conquest. In fact it was the turning point of the thirties. Hitler was not slow to act upon this evidence of our weakness". Within a couple of months his troops occupied the Rhineland in violation of Versailles. Like Mussolini in Abyssinia, he was unopposed.
Hoare's squalid betrayal of Abyssinia finally killed off the League of Nations; it had been shown to be terminally impotent without leadership. Britain had had its chance to take the lead and had funked it. Hoare and his elderly associates had successfully put an end to any future action in the name of the League. The deception that 'collective security' could be relied on to work, and the treachery which had ensured that it didn't, had been uncovered. The memorial to the millions who had died in the 1914 war had been demolished without shame. The old men were seriously taken aback by the public reaction and discussed desperately where to lay the blame; finally they had to sacrifice Hoare and let Eden take his place.
But as 1936 went on, all attention became concentrated on the gathering pace of events - the Rhineland occupation, Hitler's and Mussolini's participation in the Spanish Civil War on the side of a fellow dictator, and Britain's non-intervention, then the murder of Dollfuss and the occupation of Austria. Many of the young had already taken sides and had been so outraged that they had gone to Spain to fight against the dictators. But in general public opinion only began to feel the stirrings of fear; while remaining incredulous. Few were ready to think the unthinkable: that the dictators might have ideas beyond putting right what many felt had been wrong with the Peace Treaty of 1919. However useful they might be as a 'bulwark against Communism', the dictators might after all be mad enough to be heading for a repeat of past horrors: a revenge war which would reassert their national pride. A divide in public opinion was beginning to open which would become a chasm at Munich. In the following year Neville Chamberlain, now Prime Minister, effectively took charge of relations with the Dictators, acting behind Eden's back; and the divide inevitably widened.
It was against this background, not surprisingly since it was all their futures which were at stake, that very many of the young were debating among themselves the reasons for the failure of the League of Nations in which they had been encouraged by their elders to invest so much confidence. In 1935 two young men who had attended the same school and left Oxford only two years previously found themselves working for the same boss. One, Derek Rawnsley, soon left in order to start two businesses of his own; both to do with pictures. The other, Charles Kimber, stayed on in the press and political division of oil companies, aiming for a career in politics. They took to lunching together more or less weekly and were often joined by others. Inevitably the same question arose and a general agreement emerged that heads of states, each acting in the name of his state (echoes of l'Žtat c'est moi) could not be trusted to act collectively. The League itself should have had power to act; that to do so it needed forces under its own command; and should have consisted of elected members to authorise their use, rather than party political heads of state, each claiming to represent even those in opposition to him.
Munich was more than Rawnsley could stomach. He rang Kimber and said "Charles, we must do something. If you leave old Mudlitup (our nickname for our boss) you can have a room in my office in Gordon Square and we'll start an organisation". Kimber feeling no less strongly, at once resigned his job and transferred to Rawnsley's offices at 44 Gordon Square. There, he set about writing a pamphlet which was to set out what the organisation should stand for. As he did so, the two were introduced to Patrick Ransome, a freelance journalist with a first class degree in international law. He told them that what they were proposing was a federation; and offered to come in with them.
The pamphlet was agreed between the three and duplicated. All three then sent copies to any of their friends who might be interested and an enthusiastic meeting of some sixty or seventy people endorsed what had been written. What is more they put up money to have it printed and distributed; Kimber then selected some 400 names from Who's Who who had shown interest in international affairs, and posted the pamphlet under the title 'Federal Union' with a covering handwritten letter to each..
The response was astonishing; and he and Ransome (Rawnsley being preoccupied with his businesses) were kept busy interviewing those who had replied. Among them were some who offered personal help; and a meeting with those of them who had, was arranged. A 'Panel of Advisers' was recruited consisting of Lord Lothian, member of Milner's "Kindergarten" in South Africa's reconstruction after the Boer war and Lloyd George's personal secretary at the Versailles Peace Conference; Lionel Curtis, also one of Lord Milner's young men and founder of Chatham House (the Royal institute of International Affairs); Professor Barbara Wootton, Head of Social Studies at London University; Wickham Steed, ex-editor of the Times, and Kingsley Martin, current editor of the New Statesman, then a required weekly read for those politically involved.
They suggested a short 'Statement of Beliefs' which each of them undertook to circulate among the great and the good of their acquaintance for their signature. Any who signed it were expressing support for a supra national rather than an international body; but not as members of Federal Union, though their signatures could be used in propaganda for the organisation. The wording of the statement followed closely the wording of the official objects of the organisation. The list of well known public figures who had signed, when it appeared, was impressive. It was published as a leaflet, copies of which, it is believed, are to be found in the Federal Union archives at the LSE, together with much else.
In the meantime Gordon Square had been planting letters in the press, both national and local, and what started as a trickle soon developed into a flood of letters in response. A large proportion said that 'this was just what they had been thinking'. A very substantial number enclosed money. In reply they were advised to do what the founders had done: arrange a meeting of likeminded friends and form a branch. Federal Union was on its way. First just one secretary, then a small staff supported by many young people who volunteered their help for free. A constitution was then agreed at a meeting of representatives of branches, providing for an elected General Council and an Executive Committee.
It seems uncertain how many joined as paid up members. 14,000 is one figure, 60,000 another. There seems to be general agreement, however, that there were over 200 branches up and down the country. What is certain is that within eighteen months of posting that original pamphlet, Federal Union had become so well-known and had aroused so much interest, that a meeting in the old Queens Hall, home of Sir Henry Wood's Promenade concerts (soon to be bombed out of existence) filled all its two to three thousand seats.
In the year before Hitler finally went to war, and during most of the following year while he was concentrating elsewhere, Britain 'enjoyed' the 'phoney war'. Lord Lothian wrote a pamphlet 'The Ending of Armageddon' and gave it to Federal Union for distribution to its members. More and more branches were formed as membership and money from them increased. Federal Union never had one substantial backer. Other organisations were created, notably Sir Richard Acland's New Commonwealth, backed by Edward Hulton's Picture Post, and supportive of Federal Union. But as the months passed the call up began to bite; more and more members got called up for military service; membership - and contributions - began to fall.
On the outbreak of war, Sir William Beveridge fulfilled an undertaking that he had given Rawnsley, who had been a student at University College while Beveridge was Master. Beveridge created a Federal Union Research Institute, with Ransome as secretary by recruiting a number of leading figures in their fields. He formed them into groups to discuss the effects of a European federation on their various fields and to get one from each group to write up its conclusions. Federal Union published the results in a series of 'Federal Tracts'. Professors Lionel Robbins, Ivor Jennings, Barbara Wootton, Dr C.E.M. Joad and Lord Lugard were among the authors.
The Institute survived the war and became the Federal Trust. The branches and the organisation as it had originated did not. When the bombs began to fall, Federal Union in that form, like all other voluntary organisations made up of local branches, was among the casualties. Rawnsley had been called up and was killed (accidentally); and Kimber resigned. R.W.G. Mackay, later an MP, took over, but died prematurely. The post- war Federal Union which John Pinder joined 51 years ago, inevitably, was a very different animal from the pre-war Federal Union, founded over sixty years ago, though it shares the name.
What, if anything, had Federal Union achieved? The great and the good may have been ready to sign that pre-war Statement of Beliefs without committing themselves to joining the organisation. It was an important contribution. But it would not have been noticed if Federal Union had not been there to initiate and publicise it. Federal Union had made enough noise to be able to claim, with some justification, to have brought the offer of union with France within the 'art of the possible' (at least at that desperate moment). But it also can claim to have put federation at the top of the agenda of such public discussion of 'war aims' as Churchill's insistence on 'unconditional surrender' allowed.
"Europe must federate or perish", said Clem Attlee in 1938. With opinion in Britain now divided across party lines, party loyalties seem too strong to allow those who want a genuine union to get together. Unless they do, Attlee will be proved right and Europe will remain a gaggle of little self-centred states, each exercising its precious 'national sovereignty' by deciding to surrender to the bribery, bullying, or flattery of an overwhelmingly powerful American Empire.

The importance of the rulings by which the Guantanamo detainees have been given back their fundamental rights by the US Supreme Court has been properly emphasized. However, it is appropriate to add that only the minimum conditions for legality have been reasserted, as a different decision would have represented for the Court an outright suicide. In the same days, in an even more difficult and wrecked situation, Israel's Supreme Court has tried to impose limits on the building of "the Wall" wanted by Sharon. These decisions show how the constitutional courts are today an essential instrument in contrasting the governments' ever more widespread desire to go back to the logic of the medieval Princes, free from observing the law, and to consider fundamental rights as an irksome hindrance.
From the human rights front, then, there is good news. To which there is to add an initiative, taken by the European Parliament, which has impugned before the Court of Justice in Luxemburg the treaty between the European Union and the United States administration over the delivering of personal data of airline passengers travelling to the US, arguing that the treaty infringes on the guarantees for privacy. The American and the European events have many points in common. They show the determination to assert that even in situations of particular gravity, such as those concerning the fight against terrorism, it is not allowed to wipe out fundamental rights. They signal a first attempt at re-establishing the law at a time that appears to be marked by the value of brute force only: an emergency, a "state of exception" cannot set legality to zero. They highlight the point that defence of democracy cannot be carried out with means that negate its very founding principles. Those who oppose a civilized behaviour to barbarism must rejoice.
At the heart of these events there is the US and its pretension not only of imposing its rules unilaterally, but also of completely freeing itself from adhering to the law. The Supreme Court's decisions will not fill the long-held lapse of memory which has cancelled any recollection of the hideous cages in Vietnam and let those in Guantanamo be accepted, but mark the re-emergence of reason and, with it, of right. We are not yet at the full reinstatement of one of the formulas that have inspired the best moments of American history- "the ills of democracy are cured with more democracy"- but a step has been made in the right direction.
Now we have to wait for the specific decisions of the American ordinary courts, and for the ruling of the European Court. But this cannot remain a passive wait; as the title of a book recently published in France, "Droit de l'homme, Combat du si�cle", once more reminds us, Parliaments, civil rights organizations, public opinion of the democratic countries on both shores of the Atlantic should draw from these recent events positive motives for reinforcing their actions in favour of fundamental rights; actions that until yesterday seemed, more than impossible, fruitless, the special feature of isolated minorities with no real influence. And as we are always asked what should be the political role of Europe with regard to the United States, this is a good moment for showing the value of Europe's renewed vocation to be the land of rights, which has just been confirmed by the insertion of the Charter of Fundamental Rights in the Constitution.
There is much insistence in these weeks, after the disappointing compromise that allowed the Constitution to be launched, over what could be its "added value" in spurring the attention and the consensus of the citizens of the Union's twenty five countries. Sure enough, it will not be the alchemy on majorities or the brakings on the road towards a real political unity to arouse the passions of public opinion. Today, a real and common "European public sphere" can be constructed, with difficulty, starting just from the Charter of Rights.
Indeed, a confirmation comes from the United States. The American Civil Liberties Union, perhaps the most important civil-rights association in the world, has stressed the positive aspects of the Supreme Court's decisions. Moreover, a short time ago the same association had strongly criticized the attitude of the European Commission, which was about to accept the request by the US administration, thereby renouncing effective guarantees for the airline passengers. The document concluded with telling words, worth today an even more careful reflection: "As to the protection of privacy, it is us that have to reach for Europe, not the opposite". The attention paid to the European model of rights protection may unite the citizens of the Union and of the United States.
It is not on grounds of anti-Americanism, but for the new pressure brought by public and private institutions even in the US, that today the need arises for an analysis of the different rights-protection models that are being confronted on the global dimension. Even if one wants to credit the thesis of those claiming that economic globalization has suffered a (decisive?) standstill, it is not so for what regards human rights, in particular if one considers two questions. One, technological, points out how our personal data, that is to say our "electronic body", circulate more and more frequently in the Internet, hence by definition in a planet-wide space. The other, political, has to do with the pretension by the present US government to give to its norms an utmost "extraterritorial" character, forcing other countries to subject their juridical systems to them.
If the recent positive signals are to be taken seriously, then, we cannot limit ourselves to expressing our satisfaction. Maybe a glimmer of light can be seen now that lets us put the theme of law and individual rights, inseparable from that of democracy, at the center of our discussion. But who can lead this new process, whose political relevance is undeniable?
The European Union would have the qualifications. I say "would have", because not everybody in Europe makes its actions correspond to its statements on this matter. The British Prime Minister signs the Constitution, but then he arrogantly strives to impede social rights from crossing the Channel, and landing in the country that invented labour-protection laws, trade unions and the Welfare State. The Commission and the Council, i.e. the Eu-government bodies, underwrite the Charter of Fundamental Rights, but then they forget about it in the negotiations with the United States, and do not listen to criticism by the Parliament, the only institution which is rightly taking seriously the common commitment to build a Europe of rights and not of markets only.
We must hope that the new Parliament takes up this heritage, because the Charter of Rights is for sure a stronghold to be kept if we really want to proceed towards a new Europe founded on strong and shared principles. Guantanamo is far away, but the match for rights is also played out here in the European Union, on home territory.

1. We have in front of us a Treaty, whose purpose is to establish among the Union's member States a constitutional order, and no longer just an institutional one. Contrary to what they want us to believe, this Treaty is less characterized by a more general application of the qualified-majority rule, than by the preservation of unanimity in key sectors: foreign policy, defence, tax laws and social policy, that affect to a high degree the ever more integrated evolution of European society. In fact, the unanimity rule blocks any major progress, at least for the time being. Unanimity is required, what is more, for the Treaty to come into force, as well as for revising it.
   
   The right to secession is present explicitly in the text. What was not the case for former Community Treaties. This provision, if one knows international right, takes us away from the "federal" to the advantage of the "confederal".
   
   
2. The Treaty replaces the pile of former Treaties, except the Euratom Treaty. One would have expected an easily readable document for bringing "Europe" within the capacity of the citizens. Instead of making it simple, we find ourselves in front of a massive document of 448 Articles and 36 Protocols which form an integral part of the Treaty (plus 89 pages of declarations). By comparison, the Constitution of the French Republic comprises 92 Articles, the Swiss Constitution 198, the Canadian Constitution 147, the American Constitution of 1787 just 7 Articles and 27 Constitutional Amendments, and nobody would dare pretend that it is obsolete.
   Another subject of complexity and hence perplexity: the qualified-majority rule as it is defined: 55% of the member States comprising at least 15 of them representing 65% of the population. The blocking minority must include at least 4 members, otherwise the qualified-majority is considered attained. But, in addition and remarkably, notwithstanding what specified above, when the Council does not decide on a proposal by the Commission or the Foreign Minister of the Union, the majority is defined as at least 72% of the members of the Council, representing at least 65% of the population of the States.
   
   
3. Even if the proposed document "innovates", "organizes", "arranges" according to a more coherent plan many dispositions scattered in former Treaties, it nevertheless falls short of our expectations in answering today's challenges.
   
   A case in point is foreign policy, at a moment when Europe is driven to break away from American leadership, for assuming on its own ever greater responsibilities on the international plane, much more strongly than in the past.
   Of course, we will have a European Foreign Minister and the EU has now a telephone number, which Henry Kissinger had asked for at which it could answer "as such". And yet, Mr Solana will be at the same time the mandatary of the Commission and of the Council, which in reality will continue to decide by unanimous vote. This "Mister double-hat" makes one think of La Fontaine's tale: "I am a bird, look at my wings, I am a mouse, long live the mice!".
   In addition, this foreign policy will be supported, for operations abroad, by a European service placed under the Council.
   
   
4. As to defense, each State will keep its royal attributes. The Treaty lists some objectives (conflict prevention, humanitarian missions, crisis management, etc.) but the Council continues to decide by unanimous vote. The Treaty, although instituting an armament agency, places it under the sole authority of that Council, hence of the States.
   The Treaty provides "structured cooperations" among member States willing to give birth to advanced integrations among them, but the decisions regarding them will be taken by unanimous vote.In such a situation, "the progressive definition of a Union's common defence policy" is puzzling.
   
   
5. In other areas, "enhanced cooperations" are provided for, granted by a European decision of the Council acting on a proposal from the Commission and after obtaining the consent of the Parliament, or else taking a unanimous decision after having sent the request to the Parliament for information and after having sought the advise of the Commission. Moreover, for it to enter into force, one third of the member States must be involved, after the consent of the European Parliament.
   
   
6. Although the text is pretending that now "the rule of qualified majority is the general rule", unanimity remains equally the rule when there is to define the Union's own resources, taxation (including the fight against tax evasion), the allocation of structural and cohesion funds, the trends to be given to social and environmental policy, the negotiations and their conclusion in the areas of services, commercial aspects of intellectual property, foreign direct investments, etc.
   Whereas the Union has "the competence of competence" in the euro-zone countries in currency matters, economic policies, essentially, remain within the competence of the Union members, as it, as such, is allowed to determine only the general trends and coordination of the whole, and its role is limited to "recommend" the Broad Guidelines of Economic Policies to the States, according to Art. III-71. In matters of employment, the Union defines the guiding lines of a coordination policy.
   
   The outcome of such an exercise can be evaluated today in terms of growth and employment. The growth forecast of the euro-zone is 2,2% in 2004; 3,4% in the UK, 4,3% in the US, 4,4% in Japan, and 5% for the world economy, being understood that the oil crisis could level all of those percentages. In matters of employment, the euro-zone is the tail-light of the advanced industrial world, with 9% of job-seekers relative to active population, versus 4,8% in the UK, 4,6% in Japan and 5,8% in the US. As Jacques Delors, who wakes up every now and then, said, "the unbalance between the economic and the currency aspects remains untouched".
   
   
7. I mentioned the above to avoid attributing to it, as too often is done by the thurifers of the constitutional Treaty, virtues and therapeutical powers that it does not have, paving the way to tomorrow's disappointments.
   This said, it is true that the proposed document does not contain any retreat and contains some appreciable, although limited, advances compared with the Nice Treaty.
   
   
   • It confirms the Union's legal status. Paolo Ponzano, Director of the "Institutional Task Force" of the Commission's General Secretariat, notes on this subject that this is not a real novelty with respect to the present treaties. I quote: "The European Community has always had a legal status and hence the ability to sign international agreements", although it is true that the European Union (created by the Maastricht Treaty) only has an implicit legal status. The fact that the EU can avail itself in the future of a "single" legal status is not, therefore, a truly new element, all the more so as Euratom continues to have, formally, a separate legal status.
   • The Treaty, with the inclusion of the Charter of Fundamental Rights, will give a binding legal value to it, making legal claims possible and hence really protecting citizens' rights, when the States apply the laws of the Union.
   • The Treaty gives the European Council a stable, full-time Presidency for two and a half years, renewable once, and at the same time confirms the election of the Commission President by the European Parliament. However, according to Mr Ponzano, "there is the risk that the permanent President of the European Council will cut out for himself an independent role" that could cast the Commission President into the shade, all the more so as the European Council, in the framework of the Constitutional Treaty, becomes an institution, which it was not formally so far.
   • The Treaty, by merging the Treaties in existence (except once again that of Euratom) substantially improves the norms dealing with the realization of the space of liberty, security and justice, by extending the community method. The areas of application of qualified majority will be twenty times as many considering the whole constitutional Treaty.
   • Moreover, the Treaty will allow the Union to make laws in matters of services of general interest and to make some progress towards democratization, for example in associating national Parliaments, in opening the way to participation of civil society in the integration process. The new text explicitly recognizes the development of "participatory democracy" (initiatives by citizens that can lead to legal acts of the Union, that is to say, to laws of citizens' initiative). Such participatory democracy is bound to let civil society play an organized role in the new "constitutional" framework, in addition to that- more traditional but always essential- of "representative democracy", as it takes place in our countries.
   Finally, last but not least, as Romano Prodi was pointing out recently in an interview, "it is true that in some circumstances the better is enemy of the good".
   To reject the constitutional Treaty as it is presented now, because it is unsound, incomplete and, in some aspects, ambiguous, would be felt by public opinion as a failure of the European idea and of the European project itself, especially if this failure is to be ascribed to one of the countries which have been the founders of the community process born from the Monnet-Schuman initiative of the 1950s. If the failure will be due to the attitude of this or that Eastern European country that has recently regained its sovereignty after having lived under the Soviet boot and experienced totalitarian hardships for half a century, or if Great Britain will have to be blamed, the fact to be brought back to the start -that is to say, to the mediocre Nice Treaty- would be felt as a failure as well. But nothing would then prevent the "founders" and somebody else (I think in particular of Spain) from going back to the spirit of Joschka Fischer's speech at the Humboldt University and putting in place, if they have the political will, the "United States of Europe" within the European Union. If, instead, one of the founding countries gives up -France, for example- I am convinced that the refusal will have lasting negative consequences, highly dangerous and maybe even irreparable, for the historic process of the whole European Union. "A 'no' by France will drive Europe into an absolute crisis"- warned Jean-Claude Juncker, Prime Minister of Luxemburg.
   
   That is why a clear 'yes', critical but cautious, looks to me inevitable.

Turkey's candidature poses with a new sharpness the question of Europe's frontiers. The argument which has broken out on this question risks polluting the debate on the Constitution, some electors being tempted to refuse to ratify the Constitutional Treaty out of hostility to Turkey's accession. This problem is stoking up passions and dividing Europeans. The cleavage on the Turkish question coincides neither with the traditional conflict between Europhobes and Europhiles nor with that between supporters of a Europe of the States and defenders of a federal Europe. My point here is to present readers of The Federalist Debate, all or nearly all of whom I suppose to be defenders of this imperfect but unexpected constitution, with arguments to be set against those who would be tempted to seize upon the Turkish question in support of a 'no' vote.
Let us start by recognising that, since the accession of the three neutrals (Austria, Finland and Ireland), it has become customary to give enlargement the priority over deepening. The strongest argument against Turkey's accession is the strange eagerness of many Europhobes to support it. That is why, in addition to the conditions for membership regarding the fundamental issues of democratisation of the country, its legal system and even more its moral codes - I think in particular of the crimes of honour, whose victims are so many Turkish young women, - it would be appropriate to add some conditions making clearer the aims and objectives of the Union.
The arguments for and against Turkish membership are as of now well known
The main arguments in favour are the beneficial effects for Turkish society of the accession process and the potential contribution that this country would give to European influence in the Near and Middle East. The main arguments against are its economic, social and cultural heterogeneity and the resulting impossibility of sharing with the Turkish people the will to participate in a common European political destiny. There, then, is the link between the Turkish accession problem and the political objectives of the Union. The argument about the difficulty of integrating the Turks into a European political union is however very much weakened by the observation that certain present members do not appear to share these objectives and that France, which has made itself the proponent, refuses to accept the ensuing institutional and budgetary consequences.
Starting with these simple ideas, it should be easy for Federalists to define their position: 'yes' to Turkey's accession if, when the time comes, it is accompanied not only by an in-depth transformation of Turkish society, but also by a clarification of the objectives of the Union and the establishment of the mechanisms to achieve them. If this exercise in political clarity shows a persistent cleavage between Member States, a federal avant-garde will be needed, not outside, but at the very heart of the Union. If the proposed Constitution can assure the future of the enlarged Union for a dozen years, it would evidently not be appropriate for the much more enlarged Union lining up on the horizon. Hence the interest in reflecting on the forms which the organisation of a federal core could take at the centre and not on the edge of the Union. The intergovernmental bloc of the most populous countries, which certain French and British leaders are dreaming about, would in reality be a soft centre subject to the paralysis of unanimity, as well as a source of division, for it could not but irritate those countries which will be excluded. A Europe of several tiers will probably be the result of further enlargements. But the core group, pursuing integration most vigorously, will either be federal or it will not be, the criterion for membership being not size but the will to unite. It would be, to say the least, imprudent to draw up today a list of the countries which will desire to take part.
Finally, should we determine now once and for all the frontiers of this "multi-circled Europe"? To do so would be to deprive a number of our neighbours of the powerful incentive to wisdom provided by the ambition to join the Union. For Europe's most noble vocation, the most obvious aim of its policies, should be to be the vehicle for promoting the values of reconciliation and democracy.

A Dialogue between Martin Feldstein, Otmar Issing and Robert Mundell

These are excerpts of a conversation chaired by Dominick Salvatore, on "The Dollar, the Euro, and the International Monetary System" organized in Philadelphia on January the 8th by the American Economic Association, and reported in the Italian economic newspaper Il Sole-24 Ore by Mario Platero, whom we thank for the permission he gave us to reprint his article.
Is there still a problem for the Euro?
FELDSTEIN - The problem is always the same: how to make the existence of a single currency compatible with a decentralized economic policy: there is no market control instrument available to keep in check the public deficits of individual States. The national governments cannot make use of monetary policies or exchange rates. In America there is a much higher mobility of the work-force, there is one language, there is more wage-flexibility. This allows for more rapid adjustments. In Europe there is just the opposite: low work-force mobility, less flexible wages.
But there is the Stability Pact, which imposes limits and homogeneity on fiscal policies. Do you believe the mechanism is too rigid?
Of course in Europe there is a need for anti-cyclical measures, but it is not easy to modify the Stability Pact. It was also difficult to apply it: the deficit has been higher than 3,5% in France and Germany, there were to be fines as high as 0,5%, but the Council of Europe did nothing, it put off the fines. The Commission appealed to the Court and won. But the fines remained a dead letter. This is not a soft start. Now, in proposing adjustments, Germany, the first contributor to the European Union, argues that its contributions to the EU should be excluded from the computation. France, which spends more than the others for defense, argues that military expenditures should be excluded, and so on. The new Commission President took everything into his hands and said he will let his decisions be known. My impression is that something will have to be done, however it shall not be tailored to anybody's interests. When the Stability Pact was drafted, there was the illusion that a 3% deficit will only be reached in anti-cyclical situations, and in all others the budgets will be balanced. Well, things did not go like that. A 3% deficit over the GDP could be reckoned over a mid-term period, allowing greater manoeuvering freedom, but then new parameters would have to be taken into consideration, for example employment levels: if unemployment stays high for many years, we are not in the presence of a cyclical weakness. Another flexibility element may be considered, namely, eliminating non-recurring expenditures that do not have to be financed by tax revenues in the current year.
From a Euro-sceptic to a Euro-protagonist, Otmar Issing of the ECB.
ISSING - My first remark is that six years ago, when people started to talk of euro vs dollar, there was a minimal interest, and scepticism was prevailing. Today, the euro is a protagonist. And it is so in a natural way. Our choice for the euro's international role was clear: we will not be in a position to control it, in particular in the presence of floating markets. Our initial concern was that of asserting the credibility of our institution, in particular in the fight against inflation, but we did not have to do it, because inflation has remained moderate. That is why, looking back - and I would not like to look flattered by it -, considering the problems of exogenous shocks we have had and the problems we still have due to our internal non-flexibilities, mostly on the front of jobs, I believe that the euro has been conducting itself quite remarkably.
Mr Mundell, somebody considers you the father of the euro ...
MUNDELL - Thank you; but I would like to introduce a new element: to look ahead to, more than to just think of, the need to move on towards a global currency. I realize that many people may react to this with a smile. But they are the same that were smiling when we started talking of a European single currency, which would have kept together under the same umbrella Germany, with a growth of 2%, and Ireland, with a growth of 11%. There were still several currencies in circulation when the euro was introduced. But the floatings ceased pretty soon. Today there are 200 different currencies in the world, why not to do the same?
But doing that at the global level ...
MUNDELL - I have a plan: we start with the three great world currencies, the dollar, the euro and the yen; the currency will be given the name DEY; in a second stage, also the pound and the yuan can be added. We will have, then, a basket of five reference currencies for the 200 different currencies. Each area will dampen the floatings within the basket. I also anticipate that there will be a role for gold. Unless we can assume that there will be a century of global peace in our future, gold will play an increasing role. On a technical plane, an agreed platform will be needed, that shall regulate the compensation mechanisms with the help of the International Monetary Fund, or better yet through a Council for world stability in the interest of everybody.
* Professor of Economics at Harvard University and President of the National Bureau of Economic Research
** Member of the Executive Board of the European Central Bank
*** Professor of Economics at Columbia University, 1999 Nobel Prize Laureate

Sebastian Mallaby
The World's Banker: A Story of Failed States, Financial Crises, and the Wealth and Poverty of Nations
New York, Penguin Press, 2004
Sebastian Mallaby, the celebrated journalist, has written a brilliant expose of James Wolfensohn, President of the World Bank. The result combines an "embedded" ride with Wolfensohn along with Financial Times reporting and analysis. This book should be read along with former colleague Financial Times editor Martin Wolf's book Why Globalization Works, who gives his views on the disastrous failures of the World Bank - and the institution's uncertain future and why globalization is good for everyone (except the poor).
The book is part biography, part institutional history of the World Bank. It idolizes Wolfensohn. The World's Banker is a delicious account of the intra-management struggles of Wolfensohn with his inherited inbred staff. It should delight those who believe with the author that the Bank should concentrate on building roads, railroads, dams, water and irrigation systems, power facilities and other types of infrastructure. Mallaby (and Wolf) ridicules Bank critics, anti-globalists and often disgruntled and non-representative NGOs as "activists without an off-switch.''
Wolfensohn's success was built on personal connections, on charm and trust and the ability to bend powerful people to some common purpose, or out in out schmoozing. To him, it was all about relationships, and, as Mallaby portrays, he has "an instinctive grasp of people's needs; he understood the human craving to be heard because he felt it so acutely.''
Though Mallaby at times seems mesmerized by the glamour of Wolfensohn's life, he is not blind to his failings - fits of temper, a lack of managerial skill and a desire to please both the proponents and critics of both the bank and often-big development projects. On the negative side, Wolfensohn is so vain that he prefers to shout at his subordinates rather than share credit with them.
In order to bring reform, Wolfensohn is set on removing corruption, assuring that borrowing governments are committed to development, and insuring that poor nations' governments are setting their own priorities. This last issue is the most important theme of The World's Banker and here Mallaby's sympathies are clear: the best way to lift the poor out of their misery is through well-conceived infrastructure development and perhaps the market will take it from there (my italics). While there is some truth to that analysis, poverty issues cannot be solved with infrastructure development alone.
Instead, the book's strongest aspects, its behind-the-scenes-details, make The World's Banker read like a long gossip column. Mallaby also tries to describe the weaknesses of the World Bank as perceived by Wolfensohn and himself, but fails on that count. He fails because his information was from one basic source - 200 interviews of the present and past top management of the Bank plus 20 hours with Wolfensohn. These top managers came from one basic inbred source - the Bank's infamous 'young professionals' who were promoted to management positions by "keeping their nose clean", not making any mistakes that could be placed in personnel files, and allying with whichever president, managing directors, vice president or directors were in vogue. It appears from footnotes and sources that Mallaby avoided interviews of line managers, and, specifically, professional staff members who were in the field on an average of 100 to 120 days a year.
James Wolfensohn wanted the Bank to solve poverty, the goal that his idol, Robert McNamara, had set as his goal. McNamara was intense in his dedication, but private and who, in addition, attempted to live down the Vietnam fiasco. He had a competent Vice President, Bert Knapp, who had sound judgement to ward off his critics. After a huge expansion of the Bank, Wolfensohn was McNamara's choice to succeed him. Neither the US, who determines who the President is at the World Bank, nor were the Board of Directors ready for the younger Wolfensohn who had not "yet proven himself".
Unfortunately, the Bank had to suffer through three Presidents - none of whom knew anything about development. The last of the Presidents was clearly ill and when Wolfensohn found out, he lobbied shamelessly for the position.
Wolfensohn came from a small investment bank of advisers to rich clients. He had no experience operating a bank of 10,000 professionals who financed large and small projects in developing countries.
After Wolfensohn finessed his way through the Clinton White House to get the presidency, he began to put his stamp on the Bank. Wolfensohn's egocentric twisting and turning attempted to resolve what he perceived as its major problems: the perception that the World Bank represented "an arrogant pin-striped suited bank official" who pushed structural adjustment loans¹ to force standardized change to many countries. His other major criticisms included: (I) little contact on the part of Bank management with the constituents of loans; (II) a lack of emphasis of poverty; (III) an unwillingness to tackle the difficult problems of corruption; (IV) a lack of participatory planning; and (V) the role of NGO participation in project preparation, design and implementation. According to Mallaby, he accomplished most of the five points and included the major task of reduction and removal, in some cases, of structural-adjustment loans (although they are now labeled something else), and a return to project loans.
On the other hand, Mallaby presents shifts in the types of lending favored by the Bank as an example of its learning from experience. He points out that the Bank started with the notion that "infrastructure was the route to human betterment." His analysis as to why this was so is at best weak. In reality the Bank's early staff was filled with dedicated professionals and ex-colonials with experience and expertise in infrastructure, agriculture and some industries. Then it moved from building physical capital into building human capital by funding education projects; then, from human capital into social capital by funding projects to improve the quality of institutions. And, very recently, as Mallaby notes, the Bank has partially reverted to its early emphasis on physical capital.
Mallaby's sympathetic portrayal of the Bank contrasts with some of the harsh characterizations of other observers. In his recent book Why Globalization Works, Martin Wolf calls the Bank a "fatally flawed institution," whose source of failures "was its commitment to lending." Describing the situation when he worked at the Bank in the 1970s, Wolf writes: "Every division also found itself under great pressure to lend money, virtually regardless of the quality of the projects on offer or of the development programs of the countries. This undermined the professional integrity of the staff and encouraged borrowers to pile up debt, no matter what the likely returns." The Meltzer Commission, appointed by the US Congress in 1998, made a similar charge in its report. Mallaby, too, alludes on occasion to this pressure to lend, particularly to middle-income countries, but does not give it the importance ascribed by others.
Others put an even less positive spin on the Bank's intellectual journey. In his book The Elusive Quest for Growth, William Easterly - a former Bank staffer - treats the same evolution as a chase after fads that failed to deliver: "We thought that certain objects associated with prosperity in the industrialized world - dams, roads, schools - could bring success to the developing world." The Bank urged governments to embrace "democracy, constitutions, independent judiciaries, decentralization to local governments and other magic bullets. None of them worked."
Other critics pointed to the hardships of structural adjustment and the blindness of a sudden leap to market-oriented programs. While the growth examples were few, the Bank's economists pushed hard on the measures. Developed countries such as US, Canada, New Zealand, Australia, UK, France, and Germany pushed for the poor countries to drop subsidies in agriculture and industry, cut government expenditures, raise interest rates to farmers and industries, remove tariffs of imported goods and commodities, and similar measures which place tremendous burden on the poor.
Hypocritically, the Bank did not point out that these industrial economies had the same or larger subsidies. A few, as in the case of New Zealand and Australia, had dropped subsidies after giving several years of interest free loans to clear their own indebtedness. Of course, this was a subsidy that both countries failed to report. Moreover, most of the other developed economies continue to have higher subsidies, do not have the same high interest rates for their agriculture or industries, and fail to cut their government expenditures. The successful developing countries that had positive growth records, namely the Asian tigers: S. Korea, Thailand, Singapore, Taiwan, and Malaysia, had restricted imports along with high tariffs, heavily subsidized agriculture and industry, high government expenditures and low interest rates for farmers and industry.
Most of the other critics from the developing countries and a few enlightened economists, e.g. Joseph Stiglitz², point to the "disasters" in the major lending programs starting in the later part of 80s, when structural adjustment and eventually market reform, and capital market reform were "forced fed" onto the poorer countries. The move to market reform in the 90s became a "theatre of the absurd" when the Bank advocated market measures, including futures markets, and market reform far further than those in the developed countries. In fact, futures markets were introduced: potatoes in Poland, orange juice in Morocco, and future input supplies in China. The academics and "high fliers" at the Bank who advocated them took them out of text books, and did not consider the infrastructure needed to maintain futures markets, namely: (I) a banking system to allow credit on inventory; (II) a transportation system that would deliver the product or dump the commodity on the door step of the buyer if he did not sell his product, (III) a healthy processing industry which needed to know the cost of the raw material for processing; and (IV) a properly trained trading community who had access to buyers and sellers. The Bank advocated market reform in some countries that were further advanced than the most market oriented developed countries.
The most questionable position by the Bank was in the cases of China and Vietnam which have been added to the success of East Asia. Each openly challenged the Bank by stating that it would not accept a sudden imposition of structural adjustment loans, or the immediate market reforms that caused hardships to Russia and other countries; nevertheless both countries became large recipients of credit from the Bank³.
While the book may not satisfy critics of the Bank, its accessibility and broad scope make it required reading not just for experts on development but for anyone with curiosity about global development, the Bank, and James Wolfensohn.

1) "Structural Adjustment Policies (SAPs) are economic policies, which countries must follow in order to qualify for World Bank and International Monetary Fund loans and help them make debt repayments on older debts owed to commercial banks, governments and the World Bank. Although SAPs are designed for individual countries, all have common guiding principles and features, which induced export-let growth; privatization and liberalization; and the efficiency of the free market. SAPs generally require countries to devalue their currencies against the dollar; lift import and export restrictions; balance their budgets and not overspend; and remove price controls and state subsidies. The Bank's Poverty Reduction Support Credit (PRSC), a lending instrument designed to support implementation of PRSPs, has been created to complement traditional adjustment loans. In fiscal year 2001/2002, roughly 40% of World Bank lending was adjustment lending - 30% for poorer countries that get loans from the International Development Association (IDA). In addition to the PRSP, countries still need a Letter of Intent (LOI) and a Country Assistance Strategy (CAS) spelling out their targets and actions to request IMF and World Bank loans"
2) Stiglitz, Joseph E, Whither Reform? Ten Years of the Transition, Keynote address at Annual Bank Conference on Development Economics, Washington, DC, April 1999
3) Vietnam has only recently joined the Poverty Reduction Program of the World Bank 2003