The American Agenda for United Nations Reform

CELINA REALUYO: Good afternoon, and welcome to the council meeting.

I'm Celina Realuyo, from the National Defense University, from the Center for Hemispheric Defense Studies. And it gives me great pleasure to preside over this meeting over American Reform and the U.N. Agenda.

But first, as a reminder, we are on the record today. And most importantly, to avoid another relapse of the Lincoln Center episode, we ask that everyone actually turn off their cell phone, PDA, or anything else, including runners' timers, people who run during lunchtime -- that's been another issue that we had in another meeting similar to this -- just to avoid any interference with the AV.

Today, it gives me great pleasure to introduce Ambassador Joseph Torsella. You have his bio in the program today. I just want to point out that he's one of four ambassadors to our mission to the U.N., and he is the representative for management and reform at the U.S. Mission to the United Nations. And it's today, on this auspicious occasion, that he'll be unveiling the American agenda for U.N. reform. And I think that we'll be having a very interesting speech -- first, and more importantly, some engaging conversation and questions about the -- basically, the new strategy and policy and agenda of the Obama administration.

So with that, can I welcome you to the podium.

JOSEPH TORSELLA: Thank you, Celina, for that very nice introduction, and for moderating today. And thank you, all of you, for coming, especially those of you who may have RSVPed twice, because this event was originally scheduled in December.

And I don't know about the rest of you, but the whole cell phone lecture really made me nervous, so I'm going to do my best, here. (Laughter.)

And a warm thanks, of course, to the council for hosting me here today.

I'm very grateful for the hospitality and the opportunity.

It is dangerous in an audience this distinguished to do any shoutouts, but there's one that I must do, and that is to former senator, and always citizen, Harris Wofford, who has been one of the great sons of Pennsylvania, but also one of the great inspirations for how to lead a good civic life in a spirit the founders would appreciate. So I have to say hello and thank you to the senator.

Ladies and gentlemen, as the United Nations enters the 21st century, the United States is leading the charge to make it more efficient, more accountable, more respected and more effective. This administration believes in U.N. reform just as it believes in multilateral diplomacy and just as it believes in paying our U.N. bills on time and in full, and for the very same reason: because a strong, effective U.N. is critical to American national security and, at its best, the U.N. can help prevent conflict, keep the peace, isolate terrorists and criminals, go where no one else will to care for the neediest of the world, smooth the channels of global commerce, and promote universal values that Americans hold dear. That's why the United States led at the creation of the U.N. in 1945, and why we continue to lead in renewing the U.N. today.

With our engagement comes the obligation and the opportunity to raise our voice for reform, because the U.N. is not always at its best. As President Obama has said, the U.N. is both indispensable and imperfect. My job, by definition, is to address the imperfections. And to do that, to give the U.N. a better future, we have to first understand its past.

What began as a diplomatic meeting place for 53 countries, with a small budget for typists and interpreters, is now a vast and diverse public organization with 193 members, most of whom were not even states in 1945. The U.N. system is involved in everything from feeding malnourished children to ensuring sustainable political transitions to preserving World Heritage sites. According to U.N. figures, the entire U.N. system is now a $36 billion enterprise, larger than the individual GDPs of more than half of its member states.

Now, any large organization has built-in frustrations. On days at the U.N. when I'm tempted to forget that, I remind myself of the one-page memo it is taking me seven weeks and counting to get approved in the U.S. government. (Laughter.) And if you're in the audience, you know who you are. (Laughter.) But something bigger than just bigness is at work at the U.N. As the size and scope of what the U.N. does has changed so dramatically, the way the U.N. does it, the nuts and bolts of running the place, are still in too many ways stuck around 1950.

When I say "U.N." of course, we should remember that there are really at least two U.N.s: One is the U.N. as a global institution, delivering much needed services from peacekeeping to humanitarian assistance. Another is the U.N. as a stage, where diplomats represent 193 sovereign nations and sometimes 193 different viewpoints. And one thing that hasn't changed since 1945 is that when it comes to almost any problem at, quote, "the U.N.," the member states often blame the institution and the institution often blames the member states.

Truth is, there is enough blame to go around. So the responsibility for solutions needs to be shared between the two U.N.s as well. Neither U.N. has changed as fast as the world around us has.

As the ink was drying on the U.N. Charter, President Harry Truman said in his closing address at the founding conference in San Francisco, quote, "Changing world conditions will require adjustments." But the chill of the Cold War meant that world conditions soon became quite rigid and so did much of the U.N.

When I first arrived there in April of last year, I thought the 1950s feeling of the place was merely architectural. But after nine months on the job, I found that for diplomats and U.N. officials alike, the retro look too often fits.

At the most visible political level, the way member states too often align themselves in the General Assembly, with the nonaligned movement and the Group of 77 on the one hand and the Western countries on the other, reflects an era that no longer exists. In today's real world, countries from both North and South, East and West, bridge regional and traditional divides, build strong bilateral ties and forge flexible coalitions to promote common interests, especially around economic issues. Interregional and issue-based groups are the wave of the future, if a political divide among member states at the U.N. is a reflection of the past.

In the U.N. political bodies, regional rotational schemes that were designed to give smaller countries an opportunity for leadership in the postwar system are now, ironically, one of the biggest blocks to dynamic change. Moreover, when a rotation results, as it did a few months ago, in North Korea assuming the chairmanship of the Disarmament Conference, bringing the inevitable and appropriate public reaction of "you've got to be kidding," we know we have some serious work to do.

At the management level, as one nonaligned movement ambassador privately observed to me a few weeks ago, the U.N. does not yet have a culture of management.

It has, as he said, a culture of administration, a relic of an age when the work of the international civil servant was largely behind a desk in New York or Geneva.

A few months ago I asked, how much does the U.N. spend annually on health care benefits for all of its employees? It took far too long to get an answer to a straightforward question that a well-run, technologically supplied business or NGO would be able to supply in a day.

A final example -- the institution needs greater transparency. The U.N. Secretariat's lead auditing body, OIOS, the Office of Internal Oversight Services, recently announced, to the great credit of the U.N., that come 2012, it would post all audits and reports on the Internet for universal public access. The U.S. government has itself been posting these reports on our website for four years and the sky has not fallen. But, as recently as last month, a small group of member states in New York was still trying to prevent OIOS from carrying out this promise.

Their view is that the right to see audits belongs only to member states, not to the public: foreign ministers, ambassadors, heads of state, yes; journalists, students, NGOs, all of you, no. For those member states, it's a concept of institutional accountability that dates from, again, the mid-20th century. But meanwhile, back outside the U.N., world conditions resumed their predictable path of very unpredictable change as Harry Newman (sp) -- Harry Truman surely knew they would.

In 1947, most threats to peace had capitals and armies. But many of the greatest dangers of our time -- proliferation, terrorism, degradation, disease -- cross borders as easily as the wind. These trends have made the U.N. an institution that would hardly be recognizable to its founders.

Instead of fielding a few dozen military observers to monitor a ceasefire between states, the U.N. now has 122,000 peacekeepers deployed in 16 missions. Instead of hosting debates on poverty, U.N. agencies like the UNDP and FAO now work in the field to combat it. Instead of sending delegates to Paris to sign a declaration about human rights, some member states are now visited by human rights -- U.N. human rights investigators.

So we have a mismatch between all the essential complex work that we increasingly expect the U.N. to do and how it sometimes goes about doing it, between the demands of the 21st century and the tools and the member state positions of the 20th, between what is now a global public institution and those who would have it still behave as an isolated preserve for diplomats in New York.

Past secretaries-general, from Dag Hammarskjold to Kofi Annan and even Boutros Boutros-Ghali, recognized the need for reform and have tried to act. Unfortunately, the way the U.N. system has grown means that many posts, programs and mandates have their own advocates among member states, making it easier to add without subtracting and very, very difficult to actually rationalize.

So our task is to build on the work done by President Obama and Ambassador Rice since their first days in office and to push forward reform and renewal across the U.N. system.

Here today we're outlining a broad-based reform agenda for the U.N. with four pillars: economy, accountability, integrity and excellence. You'll find the link to our detailed plan at my Twitter account, which is USJoe_UN, and that line is a bid to make my 15-year- old think that I'm cooler than I am. (Laughter.) In the months ahead, we will continue to push hard for a United Nations that is leaner, cleaner, respected and effective.

Our first priority is thrift: getting the U.N. to adjust to these tough times exactly as families and governments in America and around the world have had to do, by learning to do more with less. Until very recently, the U.N. budget has been disconnected from global financial realities. The U.N.'s regular budget, although a small piece of the overall puzzle, is the system's epicenter and it illustrates some important trends.

In 2000-2001, the regular two-year budget -- not counting special political missions such as those in Iraq or Afghanistan -- was 2.4 billion (dollars). In 2010-'11, it was 4.2 billion (dollars). That's a 75-percent increase over a period that included a major post-9/11 economic contraction and a global recession.

Some of that increase comes from U.N. initiatives the U.S. strongly supported, like new counterterrorism efforts. And as the GAO and others have shown, smart investments in the U.N. can actually save us money. But the good spending doesn't excuse the bad. Too much of the growth in spending has happened on a kind of autopilot. Controlling that spending, especially in this time of fiscal challenges, is our obligation. Every dollar sent to the U.N. represents the hard work of a taxpayer somewhere, and every dollar wasted at the U.N. is a wasted opportunity to build a better, freer and more prosperous world.

So we're going to focus on the larger dynamics that determine whether the U.N. can live within its means, and ours. The first is personnel costs, where there's been too little attempt to comprehensively manage, instead of administer, those costs. The results have been predictable: In the past decade, for example, the number of regular budget positions has grown modestly, while the average total compensation per employee has increased dramatically.

Let me be clear: U.N. employees deserve to be properly compensated. Many of them do heroic work, especially those living in places few of us would even dare to visit, and we need to be able to hire and retain competent, qualified people for the critical work that benefits all of us. But, with U.N. -- the average U.N. professional pay now at nearly 130 percent of average U.S. federal civil service pay in Washington, the system is becoming seriously distorted.

So we are calling for a comprehensive study comparing U.N. salaries and benefits to U.S. civil service scales. We're pressing for a pay freeze for U.N. employees to fix the anachronisms in the international civil service system, and we're calling for the U.N. to take a new look at how it provides everything from employee health care to annual leave to pensions, to give U.N. employees the benefits they deserve at a price we can afford.

Another issue here is to open wider the U.N.'s doors to outside expertise. I recently visited a U.N. facility in Africa, and I met a young, U.N. warehouse manager who showed me both the best in U.N. employees and the worst in U.N. culture. He'd been thrust into his job, despite having no experience in inventory management, and when I questioned him about the truly retro control system -- handwritten tags to record when new supplies moved in or out of the warehouse and several different and disconnected software systems -- he excitedly showed me the Excel program he was writing himself to tie it altogether.

Now, there was something incredibly inspiring about that young man rising to this occasion, trying on his own time to build the tools he needed. But there was also something worrisome about a system that consigned him to that fate in a world with abundant expertise and technology to solve his problem.

When the U.S. Department of Defense has an integrated supply chain that runs from factory to foxhole, and when I can order a package online that has the same laser-readable barcode from the time it's manufactured until the time it shows up in my mailbox, the U.N. cannot continue to operate in this outmoded way.

It doesn't have to. There are literally thousands of executives in the world, north and south, who already solved the management problems burdening the U.N. The U.N. should invite them in. We're calling on the U.N. to make a systematic, intense effort to adopt the best practices of the best-run firms, NGOs and entrepreneurial governments.

We're also promoting comprehensive reform of the U.N.'s broken budget process, a process that emphasizes micromanagement over accountability and gives us mountains of information but very little useful data.

This is partly a function of the secretariat's current procedures, but U.N. members make it worse by regularly missing the forest for the trees. If you'd wandered into a meeting of the U.N.'s budget committee last month, you would have heard a strange but entirely typical discussion of whether one specific position should be classified as a P5 or a D1. That's one slot in a system of 43,747 employees.

Now, somebody should be discussing individual job classifications, but it is not a committee of the whole composed of a 193 ambassador-level representatives, some of whom, candidly, have learned to work the system to serve their interests rather than the interests of their citizens or the U.N.

Instead, let's have this budget committee for the first time hold a serious oversight hearing on the trends in hundreds of millions of dollars in employee benefit costs, and leave the middle management to real managers -- real managers.

Finally, we're urging rationalization of redundancies that have resulted from the topsy-turvy growth of a fragmented system over the last 60 years. One telling example: I've seen one internal study that says the U.N. system could save $40 million annually just by consolidating its auto purchasing power, which is now spread among 40 different purchasing entities. Eliminating that kind of redundancy adds up to big savings and better service.

The second task in our reform agenda is to promote greater public accountability at the U.N., as befits what is now a global public institution. First, the U.N. needs more watchdogs. There are too many -- there are many NGOs and journalists who monitor the policy side of the U.N.'s work, but there are too few who monitor the mechanics. They need -- we need reinforcements, from all political perspectives and from many capitals. We need to create a kind of global accountability community, the equivalent of a national civil society, to monitor the U.N. and its delegations.

Within the U.N., we've made important progress on accountability. But we need still to nail down those gains by getting OIOS, the U.N.'s oversight office, fully staffed, fully resourced and fully protected from interference. We also need to fend off efforts to prevent OIOS from exercising its authority to audit and evaluate most U.N. bodies outside the Secretariat unless it's invited and funded to do so by the very entity to be investigated.

Beyond OIOS, we are opening doors and windows across the U.N. system. I've already pitched my tent on this issue in New York. After my strong urging, Budget Committee meetings are now beginning to be televised.

I've begun tweeting from meetings, and not always diplomatically. We need to get some air into those meeting rooms. And when Cuba fulminates about your Twitter account, you know you must be doing something right.

In the months ahead, we're going further. We're going to urge U.N. funds and programs to post audits on the Web, as UNICEF and UNDP recently pledged to do. Websites like the U.S. government's recovery.gov, the U.K.'s diffen.gov and Kentucky's opendoor.gov make unprecedented amounts of information about salaries, contracts and budgets easily available to the public. We're going to ask the U.N. to do the same system-wide. And we will lead by example, making it much simpler for Americans who visit the U.S. U.N. website to see what their money is being spent on at the U.N.

Our third reform priority is the U.N.'s reputation and integrity, preventing, where we can, misguided efforts by member states and the self-inflicted wounds that too often make headlines and damage public support for the U.N. When I tell people my job is U.N. reform, they almost never ask what we're doing about, say, logistics management, but they do ask about the relentless and unfair targeting of Israel by many member states and U.N. bodies; or the number one question: How on Earth can the General Assembly elect a country like Cuba to the U.N.'s Human Rights Council?

For three years now the Obama administration has been working overtime to keep the worst offenders on the sidelines. We've led successful efforts to keep Iran off the board of U.N. women and Syria off the Human Rights Council. We'll continue those efforts, but the time has come to go further and to chip away at the outmoded idea that uncontested slates and strict regional rotation are more important than the U.N.'s credibility and effectiveness.

Full disclosure: The United States hasn't always practiced what we're preaching here today, but our reform leadership at the U.N., like our leadership throughout history, is stronger when we hold ourselves to the same standards we urge on others.

In the case of membership on the Human Rights Council, the U.S. will work to forge a new coalition at the U.N. in New York, the kind of credibility caucus to promote truly competitive elections, rigorous application of membership criteria, and other reforms aimed at keeping the worst offenders on the sidelines.

It is time for all U.N. member states committed to human rights to come together to do themselves what the General Assembly as a whole failed to do in its review, hold Human Rights Council members to the same standard of truly free and fair elections the U.N. promotes around the world and insist on the highest standards of integrity for the council and all of its members.

More broadly, we're going to assert a common-sense principle across the U.N. If a member state is under Security Council sanction for weapons proliferation or massive human rights abuses, it should be barred, plain and simple, from leadership roles like chairmanships of U.N. bodies. Abusers of international law or norms should not be the public face of the U.N. With these and other reforms, we're fighting, quite simply, to ensure that member states' actions at the U.N. match up to the U.N.'s founding principles and values.

Finally, it's not enough to ask the U.N. to spend wisely, disclose publicly and lead with integrity. The U.N. should be a pace setter, so the fourth and final pillar of our reform plan is an agenda for excellence. That means, above all, shifting the U.N.'s focus from outputs to outcomes. That means moving much more aggressively to unified service delivery at the country level.

It means an overhaul of the human resource system to give the U.N. flexibility to get rid of underperformers while better rewarding high achievers. It means deploying the right staff sooner to humanitarian and security crises, and reforming and diversifying the dated resident coordinator system. And it means a more rigorous evaluation of program effectiveness and a focus on real-world results.

Now this is an ambitious agenda. Over the last 20 years -- excuse me -- I should stop at "ambitious." This is an ambitious agenda. And given that the first recorded call for U.N. reform was by the United States Senate Finance Committee in October -- of 1947 -- (laughter) -- it's fair to ask whether we can achieve it all. And I'll give you the shortest answer you'll ever hear from a diplomat: No. But there's one way to be certain that we'll accomplish none of it, and that's not to try.

The right question is: Can we make real headway? Let me answer that by telling you what happened in New York last month. Over the last 20 years, the U.N.'s two-year regular budget has increased, on average, about 5 percent each biennium. But last month, the United States led efforts at the U.N. that resulted in the first U.N. regular budget since 1998 -- and only the second in the last 50 years -- that's gone down in comparison to the previous year's actual expense. In 2010-'11, the U.N.'s regular budget ended at 5.41 billion (dollars). We passed a budget of 5.15 billion (dollars) -- a 5- percent decrease. That's a $260 million savings, even in nominal dollars -- several hundred million more in real dollars, when inflation and exchange rate changes are factored in. And when you consider the likely increase we avoided, based on historical patterns, we estimate that we saved as much as $100 million -- not for U.N. contributors as a whole, but for the American taxpayers alone.

In those budget negotiations, I said that while some of my U.N. colleagues might consider $100,000 to be a rounding error in a $5 billion budget, I saw it as the average federal taxes paid by 16 hardworking American families in one year. By that metric, 100 million (dollars) represents the average federal taxes paid by 16,000 American families.

So can we make change at the U.N.? You bet. As ambitious as our agenda is, it's also timely. The reform stars are aligned at the U.N. now in a way they haven't been for some time. The financial crisis means that what has often in the past been an American solo has now become an international chorus. Times are tight everywhere. Norms that were once the exception are now becoming the rule around the globe. Countries like Brazil, the Philippines, Indonesia and South Africa have led in establishing the Open Government Partnership. And and I doubt people whose lives are being transformed by the Arab Spring will have much patience for their representatives resisting in New York the same transparency and openness their peoples are demanding at home.

We'll need those diverse voices in New York. I want to say to my colleagues representing other countries at the U.N., the U.S. has lots of ideas, but we don't have all the answers. We can't do it without you, nor do we want to. And the United States has surely played its part in creating the problems that we all need to fix. So we're calling on you to join us in a true partnership, and we're offering our hand in that same spirit. And we're optimistic that many of you will.

In New York, it's striking to me just how many ambassadors and senior U.N. officials will tell me what I just told you. Over a meal or in the corner of a negotiating room, G-77 ambassadors acknowledge the absurdity of letting spoiler member states bully regional groups into positions that don't reflect the views of their broader membership.

And U.N. reform has now a strong ally in U.N. Secretary-General Ban Ki-moon, who'd been pushing -- whose cuts in -- the first U.N. budget cuts in more than a decade were made with real courage and real leadership. As he begins his second term, he's uniquely positioned to bring lasting transformational reform to the U.N.

Finally, we have evidence and experience on our side. We know reform can succeed at the U.N. because we can see where it already has. We see the unsung heroes in the U.N.'s Department of General Assembly and Conference Services Management (sic), who've been pushing toward a paper-smart U.N. So far, they've reduced U.N. printing by 65 percent in two years, saving each year a pile of paper 49 times as tall as the Secretariat Building and a pile of money too. We see dynamic approaches like the U.N.'s Global Field Support Strategy. By managing peacekeeping operations in a more business-like way, the Department of Field Support has already saved over $62 million.

We see countless U.N. men and women who manage to write a continuing story of energy and ingenuity in the face of enormous challenges. My colleagues and I meet them every single day: the World Food Program official who found a way to help impoverished farmers insure against severe drought; the New Zealand civil affairs officer in Bosnia who dreamed up the idea of ethnically neutral license plates to enable Bosnia's fractured communities to move safely throughout the country without fear of being attacked; the UNICEF team in New York now devising new ways to measure which of their programs really work and at what cost.

We need to take what are scattered flowers and plant a whole garden of them across the U.N. landscape to make these examples the rule and to make the U.N. work as its founders imagined it would. Because when it does, we all know the headline accomplishments that can result: toughest sanctions ever against North Korea and Iran, a tyrannical Libyan government prevented from massacring its citizens, pressure brought to bear on repressive governments from Syria to Sudan.

Some of us even know the stories that rarely make the paper: the U.N. peacekeepers who help stabilize conflicts, at a fraction of the cost and risk of sending American troops, or the WHO doctors whose work to stop a deadly epidemic halfway around the world helps keep us healthy here at home.

By pursuing our broad-based reform agenda, we can multiply those stories dramatically. We can equip the U.N. to work for our century, as our predecessors did for theirs. We owe that kind of leadership to the Americans of both parties who helped found the U.N. in 1945. We owe it to the billions of people who depend, many for their lives, on crucial U.N. services. And most of all, we owe it to the American people of today, who deserve a U.N. that is, as another group of founders especially close to my Philadelphia might have said, more perfect.

Thank you all, and I look forward to your questions. (Applause.)

REALUYO: Thank you very much, Ambassador, for a really bold agenda that you set forth.

So actually (I think ?) national security and globalization where -- actually a big debate is whether this multilateral organizations that were established in a post-Cold War -- a post-World War II era and now we're even in a post-Cold War era -- are still actually relevant. And we take a look and think about how these groups and institutions -- if you're thinking about effecting change, whether it's in the private sector or the public sector, we think about, first, political will. And I think that's what you alluded to in terms of how can we get this reform agenda and, more importantly, get others to buy into it.

I actually have a question about how do we get our own constituents here within Washington to buy into this. As you know, we're under tremendous fiscal downward pressures, and particularly a lot of questions, when we travel outside of the Beltway, as to this perception that we're giving so much more foreign aid, that's actually -- that it is factually correct.

I'm just wondering, in terms of your roll-out strategy, how you try to -- are planning on engaging those of us who are not at the CFR and not necessarily junkies in international relations, who used to do model United United Nations -- which I used to run at Georgetown as an undergrad -- how do we get the conversation going that it's still a relevant institution, and more importantly, that these (types of ?) -- making your tax dollar are much more efficient, really get it to the public who are the supporters and have much more influence in terms of the budget debate that's going on here in Washington.

TORSELLA: A great question. The short answer is, I hope we started doing that today. The longer answer, though, is that we're -- two points I want to make. One is, we're pursuing a strategy of public diplomacy around these issues that, for those of you who follow these issues -- and I think most of you who have are in this room today -- you will notice something different. We have started tweeting from meetings. We have started speaking much more directly not just at the U.N. but to the -- to interested followers outside of the U.N., about all these issues, because our belief is that if this becomes much less of an inside game at the U.N., if all of us jointly demand some of these reforms, our prospects for success are much greater.

I think that's a theme the way Ambassador Rice has held her -- has served her tenure as the U.S. permanent representative. It's a theme the way we're approaching the management and reform issues. I think more broadly, it's something characteristic of how the State Department under Secretary Clinton has approached diplomacy.

Around -- there's a second -- there's -- and I want to underscore that a lot of what I was talking about and a lot what we're going to continue to talk about really is about inviting people into the U.N. and not having it be what it once might have been that once might have worked well, which is very closed off. The more we can do that, the more effective the institution will become, because it will start to become more and more accountable.

There's a second question, though, that I think was in the middle of your question about in these -- in these difficult financial times. And I -- we have made repeatedly in New York, and will continue to do it, the point that these times are difficult broadly, and that what might once in the U.N. have been seen as an American focus on doing more with less is now a global focus on doing more with less.

When I first came to the Fifth Committee, which is the administrative and budget committee, someone told me that saying "doing more with less" is really kind of a dirty word, and a lot of the delegates feel it's not something appropriate to -- you know, they think that's the American refrain. So I asked our research department to go and look through speeches by current leaders from the capitals of the countries who thought it was off-limits, and turned up, you know, dozens of examples of other leaders talking in these terms that we've been accused of being -- we -- so the opportunity in what's a broad financial crisis is to build some new coalitions around change, around these issues.

Now, and the third thing is, in terms of the financial constraints on our government right now, to us that is -- that is an argument both for the engagement we have at the U.N. and the imperative of reforming the U.N., because when it is at its best, when it is in a -- in a peacekeeping operation that we might otherwise be looked to to support, when it's doing work in Afghanistan and Iraq that enables us to bring our men and women home safely -- when the U.N. is performing as it should, it in fact is a good investment for us.

Now, it is -- when it is not on that track that it generates the kind of headlines I talked about. But, in these times of fiscal constraint, because the U.N. is fundamentally about burden-sharing, it is more important, not less, that we engage there and that we use what comes with that engagement, which is the tools to ask for reform and the duty to pursue it.

REALUYO: Great.

Well, we're so privileged to have such experts who follow the U.N., who I think are very -- quite involved in the international relations and the role of the U.N. here today.

I'm going to invite the audience now. If you would actually wait for the microphone after you're recognized, state your name and your affiliation. And please actually ask a question, as opposed to disguising a speech in a question format. That would be great because I know many of you would like to get in on the conversation, and we can start that engagement today.

Way in the back, in the maroon.

QUESTIONER: Hi, Claudia Rosett (ph) with -- reports online.

TORSELLA: Hi. Well, nice to meet you.

QUESTIONER: Hi, we would be only too delighted to provide you with questions about -- (inaudible) -- (insights ?) on the technical end of things.

On the $100 million that has been cut from the budget, it sounds remarkably close to the repurposed money that went from U.S. funds for salaries that simply went for U.N. security, something that surely ought to be burden-shared among member states who benefit from that. Could you tell us a little bit about what happened there? And also, on the $36 billion figure, where did you get that? Could you share with this audience what that actually comes from? Thank you.

TORSELLA: OK, so the easiest -- the simplest answer to that question is the $36 billion figure is a systemwide figure in a U.N. report that you can find not with ease, but you can find on the U.N.'s website.

We will get you the particular citation of the report. And note that there are different ways of counting what is and isn't the U.N. system. For the purposes of my remarks here today, I'm accepting the U.N.'s -- it might not be the way we would count it, you would count it, but it is a number that's public.

On the question of the hundred million that we -- that is our rough estimate of what we may have saved the American taxpayer's budget, there is no connection to the issue that -- the past issue of the secure -- of the security upgrades, which, I would note -- and I'll refer you to what the State Department's had to say on this, which has been fairly substantial -- but which, I would note, were urgently requested by the New York police and security services and which have implications for the hundreds of thousands of Americans who visit the U.N.

But that what I do want to say about the budget savings -- what we were able to do this year -- and this is always going to be a question of can the U.N. -- can any organization manage a budget as it proceeds through it with the same discipline that it set out, and that is a fair question, but when you look at where the budget was relative to actual expenses -- because one of the points that we tried to make going into the budget negotiations was to talk about -- budgets being cut from previous budgets that were only budgets isn't really anything like a belt-tightening, it's a little bit of an intellectual exercise.

We made the point that the standard is let's look at where actual expenses were and let's pull back from there. The budget we approved is a 5-percent cut from the last biennium's budget.

You then -- you can factor in an adjustment for inflation and exchange rates, because it's in U.S. dollars. You can then, if you want to, look at additional expenses that were being proposed that we avoided.

You can then look at sort of historically where we've been, and the pattern historically for the last 20 years is that the budget has risen 5 percent each two-year period over that 20-year period. It's actually risen by more than that if you look at just the budget numbers, not the actuals. And this is not an exact science, but we think it represents a real savings to American taxpayers of a very nontrivial amount, although, again, I really do make the point every day at the U.N. there is no such thing as a trivial amount. This does represent taxpayer money, and it does represent opportunity.

So I hope that -- hope that answers your -- I'd be delighted to talk more about budget things as --

QUESTIONER: I have one follow-up.

REALUYO: We have just -- you can probably catch him afterwards, right, on the details of this, right?

TORSELLA: Yes. Yeah.

REALUYO: That's fine.

In the second row, behind -- (inaudible).

QUESTIONER: I'm Will Imbrie, DynCorp International, formerly from the State Department. I'm pleased to see the commitment by the administration to pay our bills and pay them on time. As a sort of inside-the-Beltway crowd here, could you talk a little bit about the strategy to try to pay down our arrears, make sure we don't get additional ones? For example, is -- in the president's budget that's going to roll out next month, is there a request to pay down all the current bills?

TORSELLA: I am probably wisely not going to talk about the president's budget next month. But broadly, I want to answer your question. The ultimate consequences of not paying our assessment at the U.N. are, after a certain point and a certain amount, we lose our vote.

The immediate consequences of not paying our assessments at the U.N. are that we lose our voice and we lose our ability to be effective. So this administration has from day one been committed to paying our assessments at the U.N. on time and in full. Now, there are some timing differences that go to the U.S. budget. So you are hearing a strong commitment to that. It's been from the president and -- the president, the secretary, Ambassador Rice, broadly shared.

You're also hearing today a strong commitment to the other side of that coin, which is that engagement gives us the ability to deliver results for the American people -- and we think we've done that through our engagement at the U.N. -- but it also gives us the ability -- and in a real sense, the obligation -- to demand more of -- more of the U.N. So -- and we can talk sort of historically about what's been the experience, but the consequence of not filling our obligations is that you all make my job that much harder. That's the very narrow, selfish perspective on it.

The broader consequences: We'll lose our ability to deliver tangible, meaningful results for the American people and for the American security interests.

REALUYO: Great. Toby Gati.

QUESTIONER: Thank you. Toby Gati, Akin Gump. I have a question about the way you phrased some of what you're talking about: costs, cost- cutting. I know that's the -- all the rage in Washington and our budget and the U.N. budget, but there has to be some way of presenting the fact that U.N. programs, if they are the -- have the same goals as our programs, are much more cost-effective.

Have you ever put together something that would publicly be able to say, "We gave 20 percent, but the -- if we had to do the program on our own, it would cost the following"? So that it seems -- so it's not only about cutting, which I think is how we are presenting ourselves globally, and certainly the debate in the U.S. So that, you know, when you talk to some of your people in the United States, they would understand that if we really had some of these social economic goals, whatever, it would cost us 10 times as much, 20 times as much, and put that in your -- in your information so people will have a sense that the money that we're spending is really an effective use of money.

My second question is, the U.S. debates which, when you talk about the U.N.'s ability to cut any program because somebody wants to support it, all you have to do is take the word "U.N." out and put in "U.S. Congress." And I just wondered how much the debates here influence your effectiveness or the ability of the United States to really make the case that somebody else should cut a program they care about when they look around and they see that we really have the same difficulty and actually have not been able to do that.

TORSELLA: So a couple of answers to a couple of questions.

On the -- I hope I -- I hope I didn't leave you with the impression that our agenda is only cost-cutting and, if I did, I want to clarify that.

The -- economy and thrift and controlling spending so that it is well and wisely done and reversing some historical trends where there's been and we can -- I can -- I can -- you know, we can disentangle things that have been where we've -- have been fully behind it and things we're more troubled by -- is that's the first plank in our agenda, but it is far from the last. We are not only about controlling costs, but in this time, that's frankly our obligation and frankly a direction we think the U.N. needs to head more into.

Your point about the U.N. as, when it is working well, an investment is one that we and the administration broadly has made.

But you asked in particular about a -- you know, have we done a calculation? And the good news is, there actually is one. There's a very clear example. The GAO did several years back of looking at the U.N. peacekeeping operation in Haiti, and then computing whether -- what the costs would have been if it was -- if that -- it was left up to us of sending American servicemen and -women. And my recollection of that is that it was 14 cents on the dollar.

Another way of looking at this is if there's a -- there are substantial U.N. operations now in Afghanistan and Iraq, they are enabling and will enable us to bring men and women home safely, and the ongoing stabilization of those countries. And you can find, you know, what the amounts for those are, and you can compute, you know, on that budget we pay 22 cents of that instead of all of it.

Now there are also other programs that we're troubled by. There are other programs that you'll be troubled by or you'll be troubled by. But the issue is, as we've said, that it can't be sort of an a la carte U.N. What we ought to do is focus our efforts on having all the U.N. perform. And there's a wide U.N. universe, and there are parts of it that -- you know, that ought to be teaching classes on how to be dynamic and entrepreneurial, and there are parts of it that ought to be attending them. But the -- but our job is to seek that sort of uniform standard, doing it in the context of an agenda that's about not just controlling costs, but that is -- but that is important.

Your second question, about how -- about making an analogy to Congress, is one that I probably shouldn't touch at all, but I just want to note two things from recent news articles.

One, the president's initiative on cutting waste in government has been coming up with and putting out regular examples of things -- and one -- you know, the -- we pay, I believe, $60 million to store commemorative coins now that no one's buying -- things that are being done away with. To go back -- go back to the very first point that we started with, we spent a lot of time tweeting, doing press releases about that trying to link -- you know, link that and point those parallels out. The president last week asked for the ability to reorganize to do away with some of the redundancies that we have.

And as I said, we haven't always practiced what we're preaching here today, but that doesn't -- that should -- that's an easy excuse if you let it be. Our job as public servants, your job -- most of you have been one at one time or another -- our job should never be to find the reasons why -- you know, why we can't, because they are -- they exist in abundance. And believe me, there are 192 other people in New York who tell me about them -- (chuckles) -- every day. Our job should always be to look for the -- look for a more ambitious outcome and push, push, push until we get there.

REALUYO: OK. Right here in the front row.

QUESTIONER: Evin Schweibold (ph). You couldn't be more right in pointing to the pernicious results of the regional system of choice of states for organs and persons for election, the ghastly presidents of the General Assembly and incompetent members of the International Court of Justice, et cetera. But how do you change that system? What concretely can be done about it?

TORSELLA: Well, as I -- as I tried to allude and lay out in my remarks, if the U.N. -- if we can start to push this idea, which is not unique to us but is becoming more broadly shared, that the U.N. has some broad public obligations and that the kinds of credibility -- the kinds of credibility issues that some member states routinely create for the U.N. are clearly not in the institution's interest in having a real base of support, we can begin to -- you know, we think we can begin to turn that ship.

One example I want to go into some detail on is that if you look at the difference between the results we get when U.N. elections are competitive, when you see states like Iran and Syria kept off the Human Rights Council, as a prominent example, versus where there's a, you know, clean slate election which -- and then that becomes sort of just a nod to the regional rotation, you can actually see a big difference.

You can look -- I mean, there are a number of examples from the last two years where problem -- member states that -- whose records did not entitle them to serve on the U.N. body to which they were aspiring were in fact kept off. Is it enough now? No. Will it -- you know, will it become a complete meritocracy (sp) when I get back to New York next week? No. But -- but we absolutely can make a difference by building the kind of caucus that I talked about that is around these values and that enforces some existing membership qualifications and promotes competitive elections and tries to sort of raise the standard. I -- they're in a universal body which is both the strength and the weakness of the U.N., there will always be -- there will always be this tension.

But as the -- as the conception of member states and the institution shifts to understanding more what the impact of these -- you know, these deplorable headlines when a member state, you know, does that, we believe we can make change. And we think that the record that we have of engagement around these issues has started to show that.

REALUYO: On the far right side, yes.

QUESTIONER: Hello. Walker Roberts from BGR Group. Given the 5-percent decrease in the U.N. regular budget that you note for 2012-2013, how do you foresee finding and securing funding for -- some of the reforms that you call for in your speech, at least on the face of it, appear to require additional resources, whether that be your study for the -- call for the study for the U.N. civil service (comparative ?) study, whether it be for best business practices, or whether it be for a fully effective OIOS -- which I assume you mean to be fully funded or fully resourced. Thank you.

TORSELLA: Now would be a good time for those people from philanthropic foundations to identify themselves. (Laughter.)

We're -- yes, there are cases where you can say that -- because of lack of resources, that, you know, the U.N. doesn't have the tools that it needs. And I think back to my -- you know, the young man I met at the -- at the U.N. warehouse in Africa. That's part of the problem there.

But there are many more cases where it's not a question of does the U.N. have the resources; it's do all these -- you know, some of the dysfunctions that I've talked about let the U.N. use them in a proper way? And when you have a budget -- you know, a U.N. regular budget, of 5.15 billion (dollars), and you have a committee of member states, committee of the whole of member states -- and I -- as I suggested, some of them have learned to work the system -- haggling over a salary level for one individual, that gives you a hint to some of what's wrong; that we have -- and going back to my member states blame the institution, the institution blames the member states: Member states have tied the hands in some very fundamental ways of U.N. managers by literally getting to where we spell out individual -- you know, the individual employee rosters.

So we don't -- we think that there are -- the resources exist; it's a question of using some of the tools better and removing some of the impediments. I mean, in the case of -- in the case of the U.N.'s technological overhaul, there's been a significant amount of money appropriated for a broad overhaul of the U.N. business practices. We believe it's a -- it's a sufficient amount of money as well as significant. And it goes back to our moderator's observant point at the beginning about some of these things, you know, become about political will among states who'd rather hold on tightly and among some bureaucrats at the U.N., because they are very -- you know, there are uneven performances from department to department.

I don't want to -- I don't want to suggest that there aren't cases where -- you know, of course all of us know that having more resources to do any job, you know, makes the job easier. But again, that's not -- that's not who we should be or who international servants ought to be in how we think about resources.

We have a -- and at the risk of using all my time here, I made a point -- we made a point in the U.N. budget negotiations that for a variety of procedural and political reasons, U.N. budgeting has often been an exercise in stating what was and what will be tomorrow, as opposed to an exercise in saying, OK, I have limited resources, and they are here, and I have an agenda that's here, and how do I creatively bridge that gap?

That's something every one of us has to do on it, as a household, in our public capacity, in our civic capacity.

So I don't want to -- I don't want to dismiss your point. And we believe that when the investments are appropriate that they should be made. But we also believe that the tools are there to do -- to -- you know, to shoot higher than we have been and to do better than we're doing.

REALUYO: OK. We have time for just one more question. Way in the back.

MR. : Well, that was quick.

REALUYO: Steve Brock (ph), I see you from very far away there.

QUESTIONER: Back in 2000 Ambassador Holbrooke led a successful effort to get other countries with newfound means to pay more so we could pay less of a percentage of the budget. In the current economic downturn that's gone on the past couple years, some countries have fared a lot better than others. Some GDPs continue to grow at an amazing rate. What is the current mechanism to balance and adjust what countries pay based on how well they're doing versus others? Is there an effort to get like countries China to pay more of the budget so others that are -- have any more problems could pay less?

TORSELLA: There's two answers to your question about the mechanism. One is the mechanism that happens by virtue of economic change that you discussed, which to some degree happens somewhat automatically, that when this very complicated system of assessments is revisited, that the -- when the size of national income has changed, the amount paid by country will change. So if you look -- for example, if you look at, you know, Japan's experience or China's experience, you'll see that there have been changes that haven't been driven by the formula.

Second, though, there is the -- there is the formula, which in U.N.-ese is called scales.

And that is the subject of negotiations every three years. And for better or for worse for me, it is the subject or will be the subject of negotiations at the U.N. in 2012 in the -- in the fall session.

Now, we have been -- we were successful three years ago in holding -- there are a couple of principles that are embedded in that system. One is that no country -- the U.N. should not be overly reliant on any single country. And that's always been a core principle. Another core principle has been there should be some kind of floor; we could argue about where it should be. And another one is that there's some adjusting mechanism once just the size of national income gets adjusted by some other things, which produces some of the anomalous results.

We were successful in retaining the ceiling on United States contributions in 2009. In 2009 we supported an effort that would have resulted in some countries paying more to reflect their economic realities. And broadly, we think, you know, there are -- that member states ought to pay their fair share, and having stakes in the expenses has something to do with how much you care about how effective they are.

But the real answer to all you're saying is stay tuned. Watch my Twitter feed, particularly around October and November, when we should have more on this.

REALUYO: Please join me in thanking Ambassador Torsella. (Applause.) And just as a reminder, this meeting was on the record.

TORSELLA: Thank you. That went way too quickly.