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Combating Global Poverty

Speakers: Ben Affleck, Actor; Supporter, Ngo-Led Poverty Reduction Initiatives, Madeleine K. Albright, Chairman, National Democratic Institute for International Affairs, Former Secretary Of State, Nancy Birdsall, President, Center for Global Development, John J. Danilovich, Chief Executive Officer, Millennium Challenge Corporation, Thomas A. Daschle, Former Senator (D-SD), Co-Chair, One Vote '08 Health and Poverty Initiative, Hernando de Soto, President, Institute For Liberty and Democracy; Co-Chair, Commission on Legal Empowerment ff the Poor, Donald M. Payne, Representative (D-NJ), Timothy E. Wirth, Chief Executive Officer, United Nations Foundation, and James D. Wolfensohn, Chairman, Wolfensohn & Co.; Former President, World Bank
Presider: Gayle Smith, Senior Fellow, Center For American Progress
Speaker: Obiageli Ezekwesili, Vice President of the Africa Region, World Bank
August 27, 2008
Council on Foreign Relations

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MR. : I'd like to say that it's my privilege to introduce Mark Nathanson, the vice chairman of the National Democratic Institute, to introduce our moderator. Thank you. (Applause.)

MR. NATHANSON: It is a particular honor for me to introduce our moderator, Gail Smith, and to say a few words about our very distinguished roundtable. On a personal note, it is also a pleasure to participate in this event because of my special ties to the unique partnership of the organizations responsible for putting this together. While making this introduction as vice chair of NDI, I'm also a long-time member of the Council on Foreign Relations, and my wife and myself graduated from the University of Denver, where we took courses from my dear friend Madeleine Albright's father, Joseph Korbel.

I also want to recognize my fellow NDI board member, who should be here shortly, Tom Daschle, who also co-chairs ONE Vote '08, and will participate in the panel.

However, the connection that brings us together today goes far beyond the convention. We are here to talk about global poverty and human suffering caused by poverty. We at NDI fervently believe that the issues of poverty are intertwined with the issues of stability and security in foreign relations, as well as the advancement of democracy into the darkest corners of the globe. We need to put meat and bones on democracy, with over 2.6 billion people on the planet who live on less than $2 a day. Climate change, energy, food, poverty, are all linked in such a way that we need to dramatically strengthen our fight against poverty in this country and throughout the world during the next four years, regardless of geographic and political boundaries. It must engage and enrage all of us, Democrat, Republican, independent, or citizens of the world.

In this room with us today there are former heads of government, sitting ministers, senior political leaders, and members of parliament and ambassadors from over 100 countries participating in NDI's international leaders forum. We must all come together and deliver solutions to end the slow starvation of billions of our fellow planet dwellers. NDI is dedicated to this goal.

We are fortunate to have an excellent group of participants to share their diverse experience, thoughts, and priorities with us today. Our moderator is very well suited for this task. She was a fellow Clinton appointee when I was head of the International Broadcasting board of governors. She served as special assistant to President Clinton and was senior director of African affairs at the NSC, and senior advisor to AID. Throughout her career she has been a leader in the fight against poverty. Let me turn the mike over to Gayle Smith. Gayle. (Applause.)

MS. SMITH: Good afternoon, everyone, and thank you all for being here. I want to thank our sponsors, but also reiterate the thanks to everybody in the audience because when it comes to global poverty, in fact we've got a lot of the solutions in this room. To the students I will say that in the 30 years I have been working on this issue I have never seen anything so inspiring as your interest, your commitment, and your intelligence, and we will be getting to some of your questions. So thank you for being here. (Applause.)

And to the 500 guests from the National Democratic Institute, a sincere thanks to you. These are the people who are leading on the ground in their countries to build the foundation, economic, political and social, that will allow their people not only to combat poverty but to prevent it from being the defining feature of their lives. So to all of you, thank you for being here. (Applause.)

And we also have in this room a lot of people attending this convention. Apparently there is an election coming or something, and the people of Denver and Colorado. As someone who's attending the convention along with many panels and on behalf of all of us, I just want to thank all of you for your extraordinary hospitality to all of us in your city. So thank you. (Applause.)

Okay, now you see us sitting up here and there are these empty seats. It is not because some of the people we invited to speak couldn't come. It's because we have a large panel and we're going to do it in two pieces. So we're going to start with this group to my right. A second group will join us after about half an hour. We will go back and forth and try to keep it as lively as we can. And again, come to some of the students' questions.

So let me introduce who we have here for the first part of our session. To my right is Congressman Don Payne. If you live in Washington, D.C. and are a resident, you do not have a voting member of Congress, so you get to choose who you want to be your representative. And I think many of us have chosen Don Payne, for the reason that he has been an unmatched champion of the cause of poverty, of human rights, for the people all around the world, especially in Africa and in his district. So Congressman Donald Payne from New Jersey. (Applause.)

Obiageli Ezekwesili, who is the vice president for Africa at the World Bank, a woman who has dedicated her life to development, to education, to making the world better for her people and for others. Thank you for being here. (Applause.)

Nancy Birdsall, who's been at this issue for a long time. And in Washington we have all these think tanks and we sit around in these think tanks and we think. And we try to translate those thoughts into things that our leaders might grab onto and actually implement. Nancy runs the Center for Global Development, which is frankly one of the most important, newest addition to think tank row in Washington, D.C., and has already made a huge difference. Nancy Birdsall. (Applause.)

And then there's this -- I don't know who this guy is. He walked in when we were walking in. You may know him as Ben Affleck, the accomplished and fine actor, director. (Applause, cheers.) And I'm only mildly offended that you didn't do that for me. But let me tell you what you will see today is that Ben Affleck is also a responsible and passionate advocate and a policy wonk. So Ben, thank you for being here. (Applause.)

And we have Tom Daschle, former majority leader -- (Applause, cheers.) And I think perhaps the kindest politician the United States has ever had, and a real leader for all of us on the issue of poverty with the One Campaign.

This is like only the first half. Then we have a whole bunch more. So let me start with you all, and I think what we'd like to do in this first session, when you talk about global poverty and you hear about the numbers, billions of people living on less than a dollar a day, I think the first reaction of a lot of people is to get depressed, to think it's intractable, and to just have this image of this huge mass of humanity that is stuck.

Now all of you have spent a lot of time out in the world. You know what poverty looks like up close and personal. You know that it looks a bit different than that. And Oby, if I can start with you, to help us understand when we talk about those billions of people, are they people that are just sitting passively waiting for us to respond? What does that mass of humanity look like? Who are the people behind the numbers?

MS. EZEKWESILI: Well, thank you so very much, Gail. I think that the concept of the poor is oftentimes relative, so you have different societies that define poverty differently. But just picture a situation where a family does not have a definite access to the kind of income that enables them to have three square meals a day. They do not have access to health, do not have access to education. They are so in a situation of blight that the basic economic infrastructure that you take for granted, access to electricity, is not something they can boast of.

So in a continent like Africa you've got only about 24 percent of the people with access to electricity. You take that for granted that when you enter your home, you put on the light and they come on. These are issues that define poverty in various environments.

At this particular moment we've come up with a $1.25 comparitor as a way of capturing the number of people that are poor in the world, and it has moved the numbers from the 1 billion we thought earlier to 1.4 billion. Now 50 percent of the people in the continent of Africa, for instance, are in the category of the poor. These are not impassive people. These are people who simply are poor because access to the economic opportunities and the skills to be able to take advantage of the economic opportunities are not available to them. So it means that government, private sector, the civil society, the international community have a very big and important critical role toward those people.

MS. SMITH: Thank you. Nancy, you've worked on this for a long time and tried to urge our policymakers and our public to do more and to fulfill that role that Oby talks about. But why? Why should we fulfill that role? What's in it for us?

MS. BIRDSALL: Well, let me give you two examples of why we ought to do more. Oby made the point that what matters for people in poor countries is better opportunities. And the fact is that we know in this country when you have better opportunities, when more people have more opportunities, that's the key to our prosperity and also to our security. And it's the same overseas. We have to recognize that in the interconnected world what happens in Oby's country about unrest in the oil fields of Nigeria matters for us. Whether in China there's the capability to do adequate food safety standards, that matters for us. What happens in Pakistan to the poor and the growing middle class, that matters for us.

This morning in the panel was the expression, the world is not like Las Vegas. What happens there comes back to us. And I would say we have to recognize the developing world is not Las Vegas. And so it's in our interest to do everything possible to raise opportunities, increase opportunities for the poor, ensure those changes in those countries that will make us more secure, and in fact more prosperous.

I can say just one other factoid, coming from a think tank. The growth in this country in the last year has been much lower than we'd like. Almost all of our growth is associated with our exports, and more than a third of our exports are going to the developing world, and that number will grow and grow as more people in Africa, in Asia, in Latin America, move out of poverty into the middle class. So what happens there matters for us.

MS. SMITH: Thank you, Nancy. Now our other three panelists -- bear in mind, this is a group of panelists who travels a lot, but I think three of you have just recently come back from trips that proved very important. Tom, I wonder if I could ask you, you recently went on a trip to Africa with the One Campaign. For our audience, can you describe and talk about what it is you saw and learned on that trip that gave you a deeper understanding of what global poverty is and what the solutions are. How does it look different -- what was different than what you anticipated before you made that trip?

MR. DASCHLE: Well, Gail, I think, as you said, you've had the good fortune to travel through Africa. I remember once Lyndon Johnson once said that you never forget the lives of children whose faces have been scarred by poverty and hatred. You go through a country like Rwanda, you can't forget those faces, those young children whose scars are evident. And yet as you travel and as you talk and as you hear their stories, you realize that we can really have an impact.

Here's a country that lost over 800,000 people to genocide 15 years ago. They have a mass grave with 28,000 people in front of the main museum in Kigali. And you realize each one of those bodies has a story. And you realize that in 15 years this country has gone through a makeover unlike any we've seen, at least in my lifetime, and we realize that as a result of our opportunities to interact and to understand that each one of those little faces are part of an effort to change the face of Africa with the programs and the commitments that we're making. It is a phenomenal experience to see the growth and the vitality and the optimism and the extraordinary opportunity that these children have today. And so their story is vastly different, in spite of their scars.

I just wish that through the opportunities we have to discuss it like this, everybody, whether it's through a book like "1,000 Hills" that was just written about the success of Rwanda these last 15 years, or whether we have opportunities through media to see those faces, we understand that we are making a difference and we are saving lives, and we ought to be committed to doing more of that in the future. (Applause.)

MS. SMITH: Congressman Payne, one of the things that you have become expert upon, I believe, is not just poverty but what happens when poverty and war collide. I think if you look at some of the parts of the world where poverty is most extreme, where it's the most persistent, what you find is often injustice and violence behind it. How do those fit? And what do we need to do if we want to do more to end poverty in a place like Darfur and Sudan, or in the Congo, or in some of the spots you've traveled to so frequently?

REP. PAYNE: Well, that's a very good question, and let me commend you and your organization for all they're doing, and NDI and the Council on Foreign Relations and the university here for bringing us together. I think it's very significant to be at a Democratic National Convention to have poverty and under-development and issues like that raised in a forum like this. You know, 10 years ago you probably couldn't get 10 people in a place like this. Back when I first became a member of the Africa subcommittee, the entire budget for sub-Saharan Africa, at that time called the Development Fund for Africa, was maybe $400 million for close to 1 billion people, less than 50 cents a person if you round it out.

So the whole question of neglect and the lack of concern and interest in Africa particularly was right there. We've seen a great change. Your question about poverty and conflict when you have limited resources, the battle goes over those resources. That's basically what it is. So the first way to start avoiding poverty conflict is to try to eradicate poverty. That's something that we really have to deal with. That's a difficult issue. As a matter of fact, today one of the MCC projects and you'll hear from its director soon, is much more than the entire budget 10, 15 years ago was for the entire continent.

So we've come a long way. We have a long way to go but we have to -- Africa is the richest continent in the world. People who deal with Africa become rich and Africa remains poor. That formula has to change. (Applause.)

MS. SMITH: Okay, Ben. You've traveled a lot recently and one of the things you've talked about since you've come back is that not only are there things we have to do, but there are things that people are doing on the ground that we have to support. We've talked a lot about the things that you saw that gave you some hope for what people are doing themselves. I wonder if you could talk about that a little bit, because as important as it is that we do everything we can, what we're basically doing is investing and standing in solidarity with people who are leading the charge. So maybe you could talk about your trip, your experiences.

MR. AFFLECK: Sure. Thank you. I want to say thank you for having me. It's really an honor to sit here with these luminaries and folks who will be on the next panel. I feel a little bit like Forrest Gump up here. But you know -- and I can only speak from my empirical experience. But one of the things that really struck me was how much what I experienced traveling to Africa kind of belied the image that I had about it before I went. You know, I think we do a lot of messaging out of a good place about needing to assist in development and so on, by pointing to all the stuff that's wrong. All the problems we're having, and indeed, a lot of people are suffering. But it kind of alienates, I think, people on some level, and it means that people like me go there and expect to see a bunch of people sort of lying on the ground helplessly, or with flies all over them. You go there and it's this extraordinary, vibrant, spectacular continent, with some of the most amazing people.

That kind of, you know, changed everything for me, and one of the things that made me think that we could probably do better to repurpose some of the messaging we do, we're trying to reach out to people to say hey, get involved with this. Because I think it's more effective to talk about the fact that what people are doing successfully and how people are overcoming some of these obstacles because I think that would give others -- at least it gave me -- an added urgency to be involved because I saw, oh look, there are real solutions here. Even in some of the direst places, you know.

I was in south Sudan, for example. Some of my friends from south Sudan are here who were kind enough to host me, to take me around. In fact, at the SPLM political convention, the last convention I went to was theirs -- this was a place that suffered from a terrible civil war for, you know, 20-plus years, 2 million people died. When the war ended, and part of that was the international community and part of that was the south Sudanese obviously, there was a country that had been, you know, was wracked with poverty, largely abandoned, infrastructure destroyed, and folks set about -- and I don't mean to pander to them because this is their panel and they invited me -- but groups like NDI, for example, are doing workshops with citizens in south Sudan, having conversations about things like the comprehensive peace agreement, and the idea of border protocol.

They let me sit in on some of those, and I was amazed by the depth of the political discourse that was going on there and sophistication of it because I certainly never saw it on American television, you know. Nor had I had it much in my personal life. That populace has been kind of informing the political convention there. As those folks are negotiating with the NCP and building their new government of unity, you know, you're seeing spectacular climb out of a terrible place. That's not something people know very much about, and there are a lot of those for them.

MS. BIRDSALL: I was thinking the same thing, that the glass is half full, and what's interesting is if we go back to 1989, there were four democracies in sub-Saharan Africa. Today there are 18 democracies in sub-Saharan Africa. In the last 10 years those democracies have grown two or three times faster in terms of economic growth than the U.S. economy. As Oby knows, and Jim Wolfensohn will be on the next panel, formerly from the World Bank, growth doesn't answer all your problems but it's absolutely necessary.

The other thing that's very interesting is the change in governance beyond democracy itself, and there's a wonderful example of how the U.S. has helped, which is at the Millennium Challenge Corporation, and Ambassador Danilovich will be up next, is the kind of aid that is meant to create incentives for governments to do better, to be with people in their own countries to do better. A wonderful example is that it's because of Lesotho, a tiny country in southern Africa. Lesotho's desire to get access to the U.S. program, the Millennium Challenge, the aid, that it decided to go ahead and meet the requirement to be good on gender issues. And it changed its legislation to ensure that married women who earlier could not own property are now able to own property in Lesotho. This is the kind of change that in the medium term really makes a difference in people's lives. Growth, better governance, more democracy, so people have voice. That's a sense in which the glass is really more than half full now in Africa, and I think the U.S. has played an important role in helping countries move in those good directions.

Oby, do you want to add to that?

MS. EZEKWESILI: Very quickly on what Nancy just said. I think that it is very important to acknowledge that the level of growth that we have seen on the continent of Africa and in fact in some of the other continents where growth has enabled them to move many more people out of the poverty class. If you take a country like China, what it's been able to do in three decades is just phenomenal as a result of growth. So growth is a very important factor for poverty reduction. Africa has seen growth increasing at levels that have hitherto not been the case.

Recently in the last decade we have seen at least good levels of above 5 percent on the continent of Africa. But as Nancy said, that growth is not sufficient. It has to create jobs, and it has to create economic opportunities. So it means that we need to invest in the poor in the kind of way that we expand the scope of opportunities that we have. That is when it becomes shared growth.

So it's not sufficient, for instance, for American businesses or European businesses, or even the domestic businesses in Africa to simply post big profits. It is important that these profits translate to economic benefit for the citizens of the countries in which they operate. It is important that the governments of Africa, which have seen that embracing economic market reforms can be an important way to attract greater creativity and innovation in their societies be encouraged to do even more, policies that are sound are important. Institutions that will regulate the conduct of business and citizens toward accountability, toward transparency, toward greater governance of assets in a way that ensures relative sense of well-being will be the focus.

I think that, Gail, a very important thing that needs to be part of the dialogue when you have a U.S. audience is for the U.S. audience to recognize when a piece of money that means absolutely little to a community within the United States can actually be the lifeline for economic opportunities in a village in Lesotho or in Rwanda. Senator Daschle, you might know that Rwanda today is one of the good cases of having a good government, a government that shows political commitment to reforms, follows through with economic reforms, and then you have good governance be the fundamental pillar, they pursue the right policies. And therefore, they empower the citizens because empowerment of the people is so important. The poor are not powerless. They are very strong. They simply have been given the wrong end of the stick, and we now need to change the dynamics and give them the power that they really, truly have in them. (Applause.)

MS. SMITH: Let me ask each of you, because shortly we're going to be joined by our other panel, and then hopefully the moderator will weave everything together. But based on your experience out in the field, and talking to and working with these people who are not nameless numbers and who are, as you say, powerful in their potential, if not necessarily, to use another word, their access. We're facing an election. It is a time when there is the possibility that U.S. policy will change.

Now looking at where you've been, and those people looking at the United States, what do you think people want to see from America, from the United States when it comes to global poverty, when it comes to dealing with the conflicts, Ben, that you have witnessed? What would people around the world who live in poverty, in poverty but in dignity, what would they see as the right thing coming from the United States over the next few years? And let me just go down this way, if I may.

REP. PAYNE: One of the great interests in Africa is in education. When I went to the first refugee camps in Darfur, in Chad, the people had had all kinds of atrocities. This was early on before the world was noticing it, and we were pleased that the U.S. Congress and president did agree that genocide was occurring. But rather than ask for the things that you would think people would normally want -- they need food, they need medicine and water was scarce, they wanted protection -- they wanted all those things but they just said, is it possible to set up a school so our children can at least continue some education?

So I think that education is extremely key. That's what I think we need to invest in. We need to have policies that, you know, without justice there will be no peace. We really have to be sure that they go hand in hand. (Applause.)

MS. SMITH: Oby?

MS. EZEKWESILI: Well, the U.S. needs to provide indomitable leadership on the issues of eradicating poverty. It can be done. I mean, 200 years ago decided that slavery was going to come to an end. Every effort went toward that, and it happened. I do not see how, with today's opportunities that we all have, information and communication, technology revolution, the way that diffusion of knowledge is happening around the world, the fact that the greatest creation through capitalism of wealth has happened during the last millennium, and we're in a new millennium with such high trajectory of opportunities -- it can be done. Leadership needs to come from a country like the United States, rallying everybody and saying we must do this.

Wherever poverty is found in any part of the world, it would be a shame for our collective dignity to continue to allow it to be so. Leadership must come from the United States. (Applause.)

MS. SMITH: Tom, you're a big fan of leadership.

MR. DASCHLE: I can't tell you how inspired I am by so much of what's been said. I think leadership is so critical. A function of leadership is really setting the example, and sending the right message worldwide. And I don't know that we've always done a very good job of doing that. I think we have to put real emphasis on leadership and setting a better example in the future, and I hope we can.

But I like what Congressman Payne said about justice. I think in addition to everything else we have to ensure that there's a fabric of social justice and we have to be a part of ensuring that through good leadership and setting a good example we can create that fabric. Once we've done that, it seems to me that it is all about individual empowerment. I've always felt that individual empowerment had three legs. It has a health leg, because without good health there isn't anything else. Good education, the opportunity to be empowered and grow through education, and the opportunity to learn. And third, economic opportunity. It you have the economic opportunity, once you've created the real chance that children can learn and be healthy, you've created a system whereby there will be growth, there will be opportunity, there will be optimism, and we will then send the message that the investments we're making are worthwhile and will come back and reward that we've never calculated before. (Applause.)

MS. BIRDSALL: I would sum it up in terms of trade and technology. I think the people of Africa, first of all they want jobs, they want access to economic opportunities, they want roads, they want to have a more productive agriculture. On the trade side, they want access to our markets. If the next president, with the Congress, were simply to say we will take 15 of the poorest countries of the world and guarantee them permanent access to our markets, without import duties, without restrictions, that would generate millions of jobs in those countries without any real cost in terms of jobs here. Because those countries now constitute maybe 1 percent of our imports. So access to our markets, which is a very tough issue. I'm sure we'll return to it later.

On the technology side, in the end the people in the poorest countries in the world honor America for our creativity, for our ability to bring innovations to market. And there are two technologies where we can make a huge contribution simply by investing more at home and making those investments pertinent to poor countries. One, in the area of energy is solar and solar-thermal, and possibly wind. We could see huge increases in access to cheap energy in places like southern Africa if we brought to scale solar technologies so they were really competitive and made sense.

Let me mention two other areas. One is a vaccine against malaria. It is in this country that we can create the incentives for pharmaceutical firms to be investing in finding a malaria vaccine, a vaccine against the kind of pneumococcal virus that affects poor children. Even an AIDS vaccine against AIDS.

And the third is agriculture. There has simply not been enough research in the private sector or by the public sector in this country on how you can have a green revolution in countries relying on rain-fed agriculture, in the Sahelian areas of Africa, Cassava, millet, crops that we don't know more about. Business acumen, also, on how to get these things done, how to get roads built, how to invest in public -- how to have public-private partnerships that could bring a highway system to Africa, a pan-African highway system.

What did Eisenhower do, what did we do in this country about linking states 50 years ago with the federal highway system? The countries of Africa need those kinds of links so their poor farmers can get jobs, then their children can get to school, and so on. I wanted to emphasize those things not to the exclusion of AIDS, but I think if you ask what the people want, they want access to opportunities that can be brought in through the aid process, but fundamentally they don't want charity. They want business opportunities, economic opportunities, new technologies, and access to our markets. (Applause.)

MR. AFFLECK: Just from a first person perspective in going around, one of the things I was struck by was, these people in Africa are our friends. The countries that hold the United States in the highest esteem are in Africa. We have an opportunity for really vital partnerships going forward. I think part of it's because, you know, we're still seen positively in some countries, but I think also we don't carry that colonial baggage either. Those opportunities sort of have presented us with the ability to make a difference there.

When I said, well, what can we do, how can the United States get more involved, a big answer was, pay more attention. No one cares about us. No one's invested in us, whether it's the electorate, or the government. And sometimes we say, well, you know, their aid, what else can happen, what else can people do, often I would hear, it's not really about aid. It's about being invested in the actual issues, thinking about them and understanding them, because often there are much more creative solutions, much more effective solutions that can take place.

In terms of what the United States government has done at a very low cost level, you know, under Jendai Frazier (ph), Tim Shortley (ph) from the State Department has played an integral role in the peace process in eastern Congo, for example, you know, where we have our State Department representatives meeting directly with principal parties in this and bringing them to the table to negotiate and forge peace in concert with (39:05) and a lot of other Africans who are leading the charge. But as an impartial, external force, there's a real diplomatic role for us to play.

I guess secondarily, you know, again just talking to people who give me their unvarnished opinion, one thing I heard over and over and over again was that Western folks come in oftentimes with a sense of this is how it works. We've figured it all out, we're all smart, we know you run an economy, we know how you build a farm, we know how this should all go, and imposing that paradigm on people who have no familiarity with that and don't know necessarily how to make it work and aren't interested in that oftentimes is much less effective than, you know, taking ideas that are African in origin -- in other words, imposing solutions into existing social groups in that country. Again, what I see has been much more effective, and probably a lesser cost.

I guess on a final note, the people that I've met have really, again, belied these expectations that I had. I talked to fishermen in Wanza (ph) who are making 20 cents a day. They said, look, we just want more opportunity. We want to work more, we want a better job, we want people to buy these fish, we want better distribution. It was in Gulu in northern Uganda, or again in Congo and talked to child soldiers, you know, kids who were 14 years old who had been taken into these armed groups and fought and had now come out. I said, this must be so difficult for you and what is this like and what do you want to do and what do you need? Every single one of those kids said, I want to go to school.

A lot of times you hear, when you talk to people about Africa and you show them what the problems are, people say, well, you know, look, we're just giving them fish, and if you teach a man to fish -- you know what? These people know how to fish. They need a pond to fish in. They need these opportunities. (Applause.)

MS. SMITH: Thank you all very much. I just have a couple of take-aways from this that I think are important. I think those of us who have had the opportunity to travel around the world, and particularly in the developing world, I have always felt that that was an enormous privilege, and I think you have all conveyed something that is important for all of us to grasp. You've all talked in some ways about access, that it is not an absence of cash that is the critical thing. It is access.

The second thing you've all talked about is investment, not charity. I think it's very interesting that there was very little discussion of charity here. It's about how do you invest in processes that exist, how do you invest in the power that is there and its potential and how, Ben, as you suggested, do you invest in where people want to go -- not necessarily where you think you should.

The other thing is, there's this phrase used by the military all the time about force multipliers. I'd like to take it over to the soft power side of the room for a while, and I think you've all talked about those. Health, education, access to markets, technology -- those are the kinds of things that if we invest in we will see a tremendous return to the moral foundations from which we lead, I believe, but also in terms of the stability and security and dignity of the planet.

So I want to thank you all for that and turn to our next one with one word that Ben used, and that is "inspired." When you think about global poverty, my own experience was to get really angry but really inspired at the same time. And as we move forward, I want us to talk a little bit about, for those of us who are committed, passionate and inspired, what are the kinds of things that can be done and are being done, and that all of us can do.

So if I may invite our second panel up to the stage, I think you can come up right here and I will introduce you. (Applause.)

Madeleine Albright, former secretary of state, continued champion for rights and justice. A leader at NDI, and a woman who has an extremely good excuse for the fact that she's going to have to leave a little bit early because she's speaking at the Democratic National Convention this evening and has to get there on time. (Applause.)

John Danilovich, and we are so delighted to have John with us. John leads the Millennium Challenge Corporation, the MCC, which he will tell us about, is something that was built and put together at the initiative of President Bush and with full bipartisan support. He leads what is probably the newest thing that we are doing, Nancy, is as you referred to in the development sphere. So John, thank you for joining us.

Hernando de Soto, who is the president of the Institute for Liberty and Democracy, a man who has championed the cause of the legal rights of the poor, and who with Secretary Albright is working on a commission on the legal empowerment of the poor. So Hernando, thank you for joining us. (Applause.)

Tim Wirth, I think some of you may have heard of him before, is esteemed former senator, and he now leads the U.N. Foundation. I hope that you also all read the Op Ed he had in the Denver Post recently. He's also been a champion on the energy, environmental issues. So Tim, thank you for joining us. (Applause.)

And then we have Jim Wolfensohn, who is the former president of the World Bank and a man who really knows a lot about the economics of how the world works, and someone who I've always admired for his ability to take that knowledge of things like financial markets. I make it up when I talk about financial markets, to be perfectly frank. But also -- I do. I fake some people out pretty well, but it's completely made up.

Jim's ability to relate how our global economy works to the lives and realities of people on the ground and define development between those two poles of high finance and real life has been a great champion and continues to be a champion for development around the world. So thank you, Jim, for being here. (Applause.)

I want to start with something that Congressman Payne said, and I think it's a really important point. Ten years ago if we had done this panel there would not be so many people here. Buying a red iPod would not be something people thought about doing. Poverty, Africa, and justice, Darfur -- these kinds of issues were just simply not as popular 10 years ago as they are today. So we have this momentum on which to build, and Secretary Albright, if I can start with you. You obviously have been secretary of state. We've got this momentum on global poverty. Where do you think we can and should go with it?

MS. ALBRIGHT: Well, first of all, I really also am very grateful for the number of people who are here because I think that it does show a new level of understanding of how we are all linked together. There are lots of reasons that people are interested in poverty. I think some of it has to do with genuine altruism. Also because as a result of the information revolution we actually now know what is going on in a variety of countries.

When I was ambassador to the United Nations I used to say that CNN was the 16th member of the Security Council because when CNN paid attention to something, we actually did something about it. And so as there is more and more information, I think that really does help the issues.

But I think what we have to do to do something about it is to focus on deliverables, or something that is do-able. Hernando, who has been a great friend and informer, I think, of how to deal with poverty has been very helpful to me as we have done this commission together to look at some tools that actually might help.

First of all, we talk here about the fact that the poor are not powerless. I have something to add to that. The poor are not stupid. I think they have -- (applause ) -- and in many ways they are very, very entrepreneurial. What we were trying to do through this commission that Hernando and I co-chaired was to look at what kind of tools could be given to the poor so that they would have access. In some ways we calculated actually that there's more than 2 billion. There are 4 billion people in the world out of about 6.5 billion, that have no access to justice, that don't have an identity, that don't actually belong to anything, that are non-people, that are objects rather than subjects. So through this commission we looked at how they could have access to justice, how they could have property rights, business rights and labor rights.

I just want to tell one story that I think links the various elements of today's meeting. I went to Nairobi as a result of this commission last year, and we went to a place in the Kabera (ph) slum called the toy market. It has nothing to do with toys, but it has about 5,000 stalls. We were there and they put on a show for me and the various visitors that came long with us, including a minister of education. A young man came up and he started explaining what they were doing. He said, I'm so glad to see that Secretary Albright is here and that she brought our minister of education, who also happens to be our MP. This is the first time we've ever seen her.

So he talked about how they, the poor in this slum, had developed their own credit system. They each put in one Kenyan dollar a night, which was about 15 cents, and created their own credit system and lent money to each other. To shorten the story, as a result of a lack of democracy in Kenya, and we saw what happened in the last elections, Kabera -- this toy market was totally destroyed. So when there are not democratic governments that allow people access to the justice, then even the poorest are the ones that are hurt by it. So we need to look at an overall picture of how to help societies in the legal empowerment of the poor and of functioning systems that allow people to use their real powers to help themselves.

Poor people do not want to be victims and they do not want to be treated in a patronizing way. Thank you.

MS. SMITH: So the MCC, and I'll let you explain what it is, but it's a really interesting institution. We were talking a bit before about what I call force multipliers, of how can we do things as a government and as a nation to invest in people and against poverty, if you will. Maybe you can talk about your experience from the NCC, and what does that tell you about what we need to do going forward.

MR. DANILOVICH: Let me tell you very briefly what the MCC is. There's a lot of buzz about the acronym MCC, the Millennium Challenge Corporation, created by an act of Congress in 2004, just over four years old. It's an American program funded by the American people. It's your taxpayer dollars being used for the alleviation of poverty worldwide, and for sustainable economic growth. Our program is sometimes called foreign aid with accountability. Accountability on my part, on the part of our organization to spend your taxpayer money effectively to get results, and accountability on the part of the recipient country to take ownership of their own programs -- to create their own programs for poverty reduction, not our programs. We pay for them but they have to create them and implement them.

They must have good policies. We have a ranking of 17 indicators of what are in fact non-U.S. government indicators from the World Bank, from IMF, from UNESCO, from a number of international organizations that rank a country according to its political, economic, and social performance. These are fairly rudimentary standards. They are not American, Western European developed country standards. They are relative standards for the developing world that's used to encourage countries and incentivize them to improve their governments, to have good governance, to invest in their people, to invest in health and education, to alleviate poverty and sustain growth.

Thirdly, it's about tangible results, actually achieving results from a program. We sometimes call ourselves a business model. We're not a business model because we have no profit. But our profit box is the result box. We make sure that our programs have an economic rate of return, that they have an impact on a sizeable part of a country's population. And in the 18 countries that we have now worldwide -- in Central America, in Mongolia, in Eastern Europe, in the Caucasus, Armenia and Georgia, in Morocco and northern Africa, and the majority of our countries in sub-Saharan Africa -- we are already seeing results from our programs.

The remarkable thing is, if I can say it this way, using the word remarkable, is that the program works. When you start a new program, everybody works very hard to make it work. It's an innovative program, it's demanding, but you don't know if it's going to work until you go through the process of working very hard with the structure, with the administration, with the engagement of the countries. The programs are now beginning to work. They're showing results. The MCC, the Millennium Challenge Corporation, is an effective use of American taxpayers' dollars to alleviate poverty.

I was talking with Ben earlier downstairs, and he has been in Tanzania recently and he was talking about the Tanzanians he had met with and how they were so enthusiastic about the program and went into great detail, explaining to him how this was the project they were doing with regards to water and sanitation, and this was the road project and how they were doing bridge financing with something we called 609G financing. This shows the necessity and the degree of engagement in our partner countries that they were willing to express this type of knowledge, this type of incentivization, and in fact inspiration that you were talking about earlier. Countries being inspired, being incentivized to work on their own programs.

MS. SMITH: I think that's key because it also gets to something that Ben said, that people know how to fish. I think what we're trying to do with the MCC is help create a bigger pond, but not presume again that we have all the answers.

MR. DANILOVICH: If I can just say very briefly, our programs are based on a consultative process within the recipient country. It's not an engagement between the ministry of development, the foreign ministry, where they take off a program that's been on the shelf for 10 years that somebody else wouldn't do and say to the U.S. government, here, you do it. Somebody else wouldn't spend this money on this program that we had in mind.

It's a consultative process amongst the poor, amongst NGOs, amongst the civil society, who come up with these proposals themselves. It's their solutions. This is sort of a unique approach. It's not us telling them what to do. It's them telling us from their experience, from their fishing experience, from their agricultural experience, from every experience that they have what they need for themselves to lift themselves out of poverty.

MS. SMITH: Thank you, John, very much. (Applause.)

Now Hernando, you have spoken and written often about the centrality of fundamental legal rights to ending and eradicating poverty. I wonder if you could talk about that, maybe give us a couple of examples of how and why that really makes a difference, and what you have seen when people either don't have those legal rights or do have those legal rights, and the work you've done around the world.

MR. DE SOTO: Well, I will just take off from where Madeleine left off because really the major effort to look at how important the law or the rule of law is in creating development, or in fighting poverty is a result of a tremendous effort of this commission that Madeleine and I co-chair, have been co-chairing, and also sponsored by the United Nations. The general view is that law has actually made for development and made it a very important issue.

I think it's important to put things into perspective in that sense. First of all, poverty is nothing new. Poverty is the way we have lived for over thousands of years, since we started migrating out of Africa maybe 60,000 years ago. That's the normal stance. When Karl Marx starts writing in the 1850s, he starts saying -- his description of Europe is 90 percent of Europe is one big rural slum. And when even Adam Smith, just seven years before him, writes also, he refers to the widespread poverty, but there is an interesting sign coming out, which is the possibility, through a market economy, of creating enterprises that actually help you get organized. That's where we start off from.

So the first thing that we think is tremendously undocumented, even in Western history, is when it is that you Western countries that have been successful -- here in the West I mean the United States, Canada, North America, Western Europe -- what is it that you have done that led the way to creating wide prosperity among yourselves? And essentially you find that at the end of the 19th century, beginning of the 20th century, in spite of the fact that people have written about this before, you started implementing a series of very fundamental legal reforms.

Mr. Affleck was saying there were fish, there were the fishing rods, but who owns the pond? Now before it was very simple. The king owned the pond. The big reform you did was the destruction of feudalism, which is the rights of very few over the assets. It's as simple as that. And that was in its time not a right-wing revolution. It was the revolution. Property rights meant that all of us could now have rights over different assets, and therefore, we could have a stable pond, or a stable acre.

Now this is still relevant today. We're talking about the lack of food worldwide, and FAO, Food Agriculture Organization, just brought some interesting figures. We are now cultivating roughly most of the food we have in the world from 1.5 billion hectares, and the part that is lying idle, which is mainly between sub-Saharan Africa and Latin America, is 2.7 billion hectares, over which there is no property right. Nobody knows who runs that -- the leopards, Tarzan, or Hugo Chavez. We don't know. So nobody's saying you have to spread private property. We're just saying at the level of the commission, let's create the property rights in such a way that those who have the entrepreneurial capacity to organize assets can link up with the rest of the economy to find those markets.

The interesting thing I find as a Third World-er -- I come from Peru, as you know -- is that the more interesting, the most dramatic changes that you Americans and Westerners made were not your generation, were four generations ago. Your great-granddaddies turned it around. Your great-granddaddies created systems where everybody started being able to own everything. I mean, up until 1850 in the United States you needed an act of Congress to form a corporation or a business. You needed to actually go and have government authority to have a piece of property. The whole gold rush was done at gunpoint, all the way up until the beginning of the 20th century.

But when you put all of that together with the rule of law, and made it accessible to everybody, you basically created the possibility of a market revolution. And if there is any country that's had enormous difficulty of teaching this to other countries, it's been your country. It's really interesting. You've done it but you don't know it. You governed the Philippines for 50 years and you left a developing country. So you obviously know how to do it, but you don't know how to teach it. And the reason you don't know how to teach it is because you're also very much inflamed by everything you've done recently -- your technology, your education. But all of that basically works once you've got the legal system in place.

I mean, the Russians have been so impressed with your technology, Russian universities really create -- compared to us Latin Americans -- enormous amounts of technology that we don't have. Yet an average Peruvian or Bolivian lives about 75, 73 years old, an average Russian male lives only 56 years old. So it's not only technology and it's not only health. What's behind the American system that is very interesting but that your grand-daddies did and that you haven't documented well has been the fact that you created a legal revolution. You've done it once in a while abroad. Japan. The war with Japan at the beginning of the 20th century is essentially the result of a series of peasant revolutions that wanted to basically undo the feudal state. So the military feudal complex enrolls them, puts them into uniform, and says we need more land over the rest of Asia.

What you do, from 1942 in Honolulu until 1945 is actually say, what are we going to do, says MacArthur and a man called Wojtla Djinsky (ph). What are we going to do when we win the war against Japan, and at that time get it organized so it can develop? You really thought about it. Now you had to have an action program. Very little has been written about it, strangely enough, and whatever has been released by the Freedom of Information Act comes with so much black slubs that it's very hard to read.

But anyhow, here's what you can read between the lines. Japan at that time was so poor that over 1 million Japanese between the '30s and the '40s had migrated to countries like Peru and Brazil, the two countries in Latin America that received Asian immigration. And we had at that time a GNP, gross national product per capita between Brazil and Peru, twice as high as that of Japan, three times the size of Taiwan, and four times the size of South Korea.

When you went into Japan, the first thing you did was set up a property rights system and all the things that Madeleine Albright's been talking about, which is the rights of everybody to have access to corporations, to build, to have limited liability, to get property rights, to get the possibility to use your property as collateral to get credit, to issue shares so as to get investment. That's basically what you did in Japan.

Once you finished that job, 1951, you forgot about it. You went into Vietnam and you forgot about it. Next you went into Iraq and you forgot about it. But Japan went out to become a major power, together with Taiwan, together with South Korea, and then Deng Xiao Ping, who had belonged to a communist revolution, all of a sudden stood up in 1978 and adopted the system. It was the biggest American victory I have ever seen in my life. You've even got now China running in the capitalist system.

I'll stop there because I know it becomes too long, but what I'm trying to say is, you Americans know where it's at. But it's mainly your granddaddies you've got to read before you can start spreading it around. It isn't in the 21st century where the key fits the lock. (Applause.)

MS. SMITH: Thank you. Hernando, you make the important point of how much we can learn when we look at our own history and that we can actually do a lot of things well. Hopefully we'll get back to doing that.

Tim, if I can -- that was just a general comment. Tim, if I can turn to you and I can see you taking this one of two directions, and I'll let you have the choice. One, you lead the U.N. Foundation and I think we've been through a period of time where it would be diplomatic to say that we've rather discounted the United Nations as a nation, and perhaps not cooperated globally and internationally as much as might be in our interest to do. So one direction is possibly, how do we revive that? How do we need to think about that in the future going forward in terms of poverty?

But I also want to give you the invitation if you'd like to take a turn as well on the energy side, because I know that you are one of our country's fiercest and most passionate advocates of our doing the right thing on energy and climate change, but that you've also thought about how it works for the world, including in terms of poverty. So your choice.

TIM WIRTH: Can I do both?

MS. SMITH: Of course you can.

MR. WIRTH: Let me go back to what Oby said in the first panel, talking about the importance of U.S. leadership. We are here at a Democratic National Convention. We are here and about to make some very fundamental political decisions about where this country is going to go. In 70 days or so we're going to have an election, which is going to tell us a tremendous amount about what kind of leadership we get. This goes back as well to what Madeleine said when she was at the U.N., that in thinking about the U.N. the U.N. works when the U.S. wants it to work. The U.S. is the indispensable partner to the United Nations.

Let's link all of that. That's all pretty abstract, and let's try to link that back to the issue of poverty and take three specific issues which directly impact poverty, in which the choice that the United States has, the opportunity to lead or not to lead, is very, very clear. They are, and let me just pick three, climate, population, and human rights. In the climate area we know from all the scientific evidence that the climate is changing very rapidly, and increasingly we know, particularly from work done at Nancy's center, we know that the two places in the world that are right smack in the bulls-eye of climate change are the central part of India and southern sub-Saharan Africa. It is projected that in those two areas food production by 2050 is going to decrease by 40 to 60 percent. Food production in those areas decreases by 40 to 60 percent because of drought, desertification, changes in species production. It's a devastating prospect for two areas that are already heavily populated.

Now if you look at the implications of that for poverty, they are very deep indeed. So the question becomes, what are we going to do in the climate and energy area? The U.S. has a choice. We had a choice in the last eight years and our government chose not to join Kyoto, not to recognize the climate issue, and not to recognize the plight that was being created for 2 billion people -- 1 billion in India, 1 billion in sub-Saharan Africa -- who effectively had nothing to do with the garbage that got put up in the atmosphere. They didn't put it there but they were the primary victims.

The choice that we have in November is, are we going to take on this climate issue or are we not going to take on this climate issue, and to what extent are we going to do it. That has a direct relationship to poverty. (Applause.)

The population issue is not a lot different. The populations -- and this is a difficult issue, as climate is -- population is growing very rapidly in Ethiopia, where you just came back from, Gayle. It's going to double in the next 25 years, the same in the Congo, the same in Nigeria. We have 6 billion people on the face of the globe now. We're going to be at 9 billion people by 2050. How do we support that level of individual, and what do we do about it, how do we think about it?


In Rwanda -- Tom, you talked about Rwanda, and talking to President Kagame. I was there in 1994 on behalf of the State Department; talked to Kagame -- the genocide had just ended, I said, what caused all of this? And he said, "Well, very honestly, it was a conflict of too many people scrambling for too few resources." That was at the root of what had happened in Rwanda.

The issue of population is also one of understanding women, the choice of women, and empowering girls and women. (Applause.) It's fundamental to how we think about population. So, the question is a -- the question is a very clear one. Our current government withdrew from the U.N. Family Planning Program -- has withdrawn support on something of a steady basis -- and yet there are 200 million couples in the world who want family planning services and information and cannot get them. This has a direct impact on poverty. And the choice that we make in this country is going to be very clear.

The human rights issue is not dissimilar. And it's been spoken about here very eloquently -- a discussion of human rights, and giving respect for the individual, and the opportunities for individuals. The United States government has not been a party to the U.N. Human Rights Council -- new entity, new opportunity to think through 'what are the rules?;' 'what are the opportunities going to be that the global community comes together and decides upon?' This government again has been absent.

And the opportunity for change, or the opportunity for a choice -- the difference between what's going to happen in November, becomes very, very clear. Poverty comes home to us all here. And the choices that we make, the way in which we deal with our political system, is absolutely critical for what's going to happen elsewhere in the world. And no place is that better illustrated than in the U.N.

And I'll stop with this: The U.N. -- you know, we are the indispensable partner; we are the host; we are the founder. The U.N. does the humanitarian mission around the world like nobody else. And yet, you know, the choice here is very clear.

You know, Senator Obama has made it very clear what his commitment is to the United Nations, and to supporting and financing the United Nations. Senator McCain has talked about, in fact, allowing the United Nations to wither, and creating something called a kind of a "council of democracies," which nobody else in the world wants to do. It would leave out China, it would leave out all kinds of other countries, but, you know, what's that?

Let this current institution that does so well -- as Georgia Shultz said, you know, "If we didn't have the United Nations, we'd have to reinvent it, and we wouldn't do nearly as good a job the second time around." (Applause.)

We are here at a political convention -- (applause) -- we are at a political convention, and these choices impact on this discussion. It impacts all the people, Obi, that you were talking about. You know, and U.S. leadership, and what we choose to do, is going to have a tremendous impact, very tangibly, through the U.N. and its institutions. (Applause.)

MS. SMITH: Thank you, Tim. I think we ought to put you out there for "Rock the Vote," or something, Tim. That was -- that was terrific.

Jim, we're looking at a world where the global economy is changing in ways that are unfathomable, where individual economies are changing. We're seeing the rise of China; we're seeing here the mortgage crisis; the rise in the price of fuel. With all of this turmoil, how should we think about this?

Can we -- in that environment where everything seems to be so up in the air -- can we realistically expect to tackle poverty? Or is it just so vast, now that we've got all these additional challenges, that we ought to do what we can, but not really go as far as Obi went, and say, 'we can solve this?'

MR. WOLFENSOHN: Well, I think you've asked an absolutely critical question, Gayle. And Tim mentioned, first and foremost, the change in global population from 6 (billion) to 9 billion people in the space of 50 years.

We need first to understand that only 100 million of that 3 billion increase go to the so-called "rich" countries; 2.9 billion goes to the developing world, as we now know it. So, it means that in 2050 you'll have 1 billion, 1.1 billion in the rich countries, and you'll have 8 billion, or so, in the developing countries. That's the first thing.

The second thing that we have to understand is that today the United States, and the G-7 and the OECD countries -- the "rich" countries, have taken a view of the world, which we have had since many years, that is based on the fact that we have nearly three-quarters of the world's income, nearly 75 percent of the global GDP.

And our thinking is always from that point of view: "We're the rich world and that's -- what can we do for the poor world?" But the truth of the matter is that there's a massive change about to take place. And it's a swing to Asia. The truth is that today the rich countries have 73 percent. Come 2050, it'll be 32 percent of the global GDP -- 32 percent. The countries in Asia will move from 15 percent to 60 percent of the global GDP. This is not a trivial change (laughs). This is a change in the way in which we contour the world.

By 2040, the chances are China will be the leading economy in the world; India will be looking to be number two; the United States will be number three; Japan, maybe four or five; Vietnam will be number 10. This is a world which is just completely different. And speaking to friends from Latin America -- the former head of Peru is here, the Latin America countries, in terms particularly of Brazil and Mexico, will clearly be demonstrating their potency in terms of moving in.

But the third element of this is that there are people that are going to be left behind. And the best estimates that I can give, you can think of in terms of the GDP per capita today. GDP per capita today in our country is roughly $40,000 per capita. By 2050 we think it'll be $90,000 per capita. The countries like India and China today are roughly $2,500 per capita; 2050, $45,000 per capita, an increase of nearly 20 times.

The giant middle class in the world will be in the East. It will not be in the United States and Europe, it'll be in the East. But the laggards, the people behind -- significantly in Africa and, to some modest extent, in Latin America, those are the people that today in Africa have $620 per capita income -- $620.

And that will grow, on best estimates, to $1,800. But you'll have 2 billion people living on $1,800 per capita per year, and you'll have the affluent world at $90,000 a year. And you'll have an average per capita income of $40,000 per year in China and India.

This is leading us to instability. It has to lead us to instability. These are not people, anymore, that are uninformed. You got to see the phones, and the communications which are emerging in Africa. And as was said by Nancy, we've got 18 countries in Sub-Saharan Africa now that have introduced a democratic form.

But there are 53 countries in Sub-Saharan Africa, and we do not have common rail, we do not have common communications. It is a tremendous need -- which I know Obi and the World Bank are very concerned about, to try and see how we can bring this continent of Africa into a framework where it can take advantage of the opportunities that the world, hopefully, offers it.

And one last thing I'd like to say, given that there are 750 young people here, if you are going -- as many have done up to now in our colleges and universities, 80 percent of our kids that go overseas, go to Europe. They learn Spanish, French, German, and they go to Europe. Less than 9 percent go to Asia. If the world is moving to Asia -- as it clearly is, think about learning Chinese; think about visiting India; think about Asia -- (applause) -- because that's where the future is.

MS. SMITH: (Off mike.) That's really good. Do you want to get a -- you want to -- (inaudible) --

MR. WOLFENSOHN: This is the world that we're going into. It's a world of opportunity, but it's a world that's completely rebalanced from the one that we have today. (Applause.)

MS. SMITH: Wow.

Okay, Madeleine, you wanted to --

MS. ALBRIGHT: Let me just make one more comment before I go -- and it fits very much into what Jim was saying. I think that when I started my comments, and you asked me, I said some people are helping the poor, genuinely, for altruistic reasons. I think one can also talk about this in national security terms, because what Jim is talking about is there, basically, by absolute numbers, are -- according to the U.N., few poor people in the world, but the gap between the rich and the poor is growing. And it's exactly the kind of numbers that Jim is talking about it.

And that gap is something that creates the instability; creates a sense of marginalization. And because the poor, as I said, are not only not stupid, but have information -- and Hernando was talking about revolutionary aspects of this, I think the marginalization of huge numbers of people is what does create the instability. And in the American "always campaign" mode that we're in, I think the more that we make clear which issues are national security issues, the more likely they get attention -- and so the combination of energy, climate, poverty.

And, you can argue that marginalized groups are much readier to be recruited for those who hate us. I think it makes a big practical and national security reason to care about poverty, beyond caring about it only because we want to be good, and nice and help altruistic -- from an altruistic point. I apologize. Thank you. (Applause.)

MS. SMITH: All right, good luck tonight. We'll see you. (Cheers, applause.) Okay --

MS. BIRDSALL: Gayle?

MS. SMITH: Yes.

MS. BIRDSALL: (Off mike.) I'm frustrated.

MS. SMITH: Nancy's frustrated. I've known Nancy for a long time. This is not a good thing. (Laughter.) Nancy, did you want to say something?

MS. BIRDSALL: I'm inspired by the remarks of this last group, and particularly Tim Wirth's point that we're at a political event. And so I feel frustrated because we have all these young people in the room; we have all this interest in this event; but this conversation is not being reflected in our politics -- (applause) -- it is not being reflected.

And so, for both the reasons that Secretary Albright just raised again: National security reasons, and because it's a moral imperative -- and because 80 percent of Americans want development (sic) to accompany development efforts, to accompany our defense efforts and our diplomatic efforts.

The people want something that we're not hearing about in the politics. Most Republicans and most Democrats want to see, of the 3Ds -- development, diplomacy and defense, much more on both diplomacy and defense.

And Secretary Gates -- Robert Gates --

MS. SMITH: No, no, "development."

MS. BIRDSALL: Sorry, did I say it --

MS. SMITH: "Diplomacy and development."

MS. BIRDSALL: -- incorrectly?

You know what I mean. (Laughter.) I would like the students here to take from -- something Tim Wirth said, a simple message on climate change, which has frustrated me in the last few months. We hear over and over that China has become the biggest emitter of carbon emissions. Every time you hear that, I want the students here to educate their fellow students, their parents, and the politicians who represent them, about the reality that for every Chinese -- for every American, there are more than five Chinese, in terms of per capita emissions; there are more than 20 Indians, in terms of per capita emissions; there are more than 100 Bangladeshis, in terms of per capita emissions.

So, if we want to work on an issue like climate change -- which is in our interests, we have to recognize something about what's fair in the world. We have to think about the transfers of technology; the financial help; and the R&D that we can do here and transfer quickly without patents, without trademarks, without complications, to people in the developing world so they can come along with us.

And we have to be careful not to be dictating to -- and bullying developing countries. That's just one point on one issue. But, I just feel frustrated that we're not capturing enough from the students, in particular, about the need for you to get involved in the political process. You can do a lot as individuals: You can visit countries; you can work with NGOs; you can do service -- Senator Obama has proposed a civilian assistance corps; but you must also fight in the political arena to get development and global poverty issues on the agenda in this, for the next president. (Applause.)

MS. SMITH: Yeah, wait, wait. Hold on. Because I think everybody -- the good thing is, Nancy, that that's kind of where I wanted to go, which is this -- and I would differ with you only slightly. And that is to say that, again, 10 years ago this panel wouldn't have happened. It wouldn't have been so well attended. We would not have here with us the head of a new government agency. We probably would have had a vice president for the World Bank. We would not have had the former majority leader of the Senate. We would not have had Ben Affleck. (Laughter.)

He's been at this since he was six, but he just -- anyway, because I think what we're seeing is this big "Queen Mary" on this issue has started to turn around. And if I can take what Nancy said and add to it a bit -- and we can do a bit of a final round on this and take it this way: I think part of our challenge is to get these issues into our political discourse so that our discussion about security is about more than a global game of "gotcha." It is about leadership in a world where there are huge and powerful trends that our leadership will affect positively or negatively.

It's in our economic interests to do so. I think that there is obviously a way we want to get that into the political discourse. I get the security piece. I get the economic piece. I come from the basic "right and wrong" of this. My defining moment was in 1984, in the middle of the Ethiopian famine, when I saw a grandmother on her hands and knees eating dirt because that was all there was to eat. And a day later I flew to London and I said, you just can't have those two things on the same planet. It's wrong. We have to get all three of those into the political debate.

So, one question is, how do we do that? But the second question is, what do we do? Because the fact of the matter is, our politicians -- and even if we get the politicians that we want, and I sincerely believe we deserve, that president is going to have a huge list on his plate. The world has grown more complex and, quite honestly, I'm not sure we've quite caught up to where we need to be.

Politicians in our government can do a piece of it, but what do we do? What do we do to let politicians know that if they take a risk on these issues we will support them? What can we do in our own lives? -- as Jim suggested, as others have, because, at the end of the day, if it's ending poverty in the United States -- where, let's not forget, it is still alive and well -- or around the world, it's not just going to be our government even if we get the best president we could possibly have -- which, please let us get, even with that it's going to take each and every one of us, in a small way, a big way, to do something about it.

So, what I want to do is one last round, and ask people whether it's getting it into the political agenda, or getting it into our lives, and addressing, Jim, this "tremendous shift" you talk about, the "indignity," but the access and the power. What can people here do? And especially our 750 high school students, because I've got white hair, I'm going to step out of this sometime in the near-term, and we're going to look to you all to solve it.

So, what do we need to do? We don't want to let people live here -- leave here and say, this is an important issue, gee, I hope those people on the panel take care of it. We want you all to do something.

Jim? And we'll go around this way, and you can add whatever else you would like to add, that I've left out.

MR. WOLFENSOHN: My experience has been that playing the humanitarian card -- and even the environmental card, which is one that Tim does so well, and I think that's gaining in importance -- that the way in which you can get political attention is through economics and security.

I think you have to sell the government here that it is in our interests to have been development move forward. And you can make an economic argument, in terms of the development of markets; and you can make a security argument, in terms of the security of our country.

I think those two arguments -- while I regard them morally, perhaps, as less significant than the other two, because I think there's a humanitarian consideration which has been at the core of our country -- I think that we should approach this, for the general populace, on the basis of economics and security.

And the numbers that I gave you are very compelling --

MS. SMITH: Yeah.

MR. WOLFENSOHN: -- in terms of saying that our economy is diminishing. And if we want to build alliances to make our economy better, we'd better reach out to some of these developing countries, because if we don't, they will take the markets from us. And that's why I think economics and security are probably the ways in which we should move. (Applause)

MS. SMITH: Thank you.

Tim?

MR. WIRTH: Yeah, let me -- let me pick up on what Jim said, because I agree entirely. I think it's very hard to sell, kind of, the "hair shirt," and guilt, and that sort of thing in a political fashion. I think you -- to put it in economic terms is very important.

Let me come back to the climate issue, as an example in how to do this. To sell the climate issue by itself is very hard to do, as we know. But, to sell American "competitive capability" around the world, which Jim was just talking about; "growth and change in our economy," which we're all, you know, for, in some fashion, we have to do. And to sell the kind of economic change that has to occur, through energy, which can be the basis of a dramatic transformation of our economy, is the way to do it. We can't get from here to there without a very significant technological transformation.

But, where are we today? In terms of research and development, we are today spending 30 percent of what we did in 1980. Thirty percent -- this is in real dollars, it's a lot less in inflated dollars -- spending 30 percent of what we did in 1980, and yet we know where we are in the world, we know we've got this looming crisis coming right at us, and we're not even doing that.

Now, how does that relate to what Nancy was talking about? We find that we had a major session at the U.N. two months ago. Every country in the U.N. was there, represented and spoke about what they want. And what were they talking about?

The greatest, number one request was technology and technology transfer -- just what you were talking about, Nancy. It wasn't "give us more money;" it wasn't "give us more foreign aid;" it wasn't, you know, a request to, you know, have this poverty program or that, it was technology and technology transfer. It was absolutely stunning, Jim.

But, that's where, you know, we have an opportunity -- it's an opportunity for us, and it's an opportunity for the world. It's a perfect case study of how to weave this commitment and thinking about poverty into our own self-interest, and put it in the kind of economic terms that a political constituency can understand.

MS. SMITH: Thank you, Tim. (Applause.)

Hernando?

MR. DE SOTO: Thank you, Gayle.

I think one of the things I most admire as a foreigner, when visiting the United States, or examining or reading about your country, is the amount of information you have. One of the most interesting things about your economic information, for example, is that you don't only, like in our countries, inform of successes, you inform of failures.

Last year I believe you had 1.6 million bankruptcies. It's extremely informative, because it tells you what you can invest in; what you don't invest in -- what you don't want to do; why the guy next door failed; why the guy, maybe, across the way will be able to succeed. And we lack a lot of that information, especially in developing countries.

The last time I met with Jim Wolfensohn was, as a matter of fact, when he had invited me to speak at the World Bank, because you were inaugurating an information center. Jim has been trying for a long time -- like we on the outside, to get the World Bank to release information on all the projects that (he's ?) funded in developing countries, to simply find out what worked and what didn't work.

We think we know what works and what didn't work, and we think it's institutions to a great degree. But, what was done there -- which was already a huge effort, was, of course, opening an information center. And now you can go to the World Bank and get information on any project you want to know, but that can't be less than 20 years old -- versus Americans who know the failures day by day, hour by hour -- Bloomberg, CNN.

Secondly, you can't -- either there, or in the Inter-American Development Bank, or any development agency that's international -- actually get information generally available on any project or any country. You can't. You've got to say what it is you want.

So, it's a little bit like the drunkard who was looking for the keys beneath the lamp post. And the policeman says, "What happened?" He says, "I lost my keys." And he said, "You lost them under the lamp?" He said, "No, but this is the only place where there's light." (Laughter.)

So, one of the biggest problems that we actually have in the developing world -- and regarding your aid programs, is we don't know where we screwed up. And that is one of the wonderful advances of capitalism. And so that has got to be unlocked. When that gets unlocked, also in terms of security, we'll know a little bit more where to aim.

The information we get -- since we, in Peru, fought a guerilla, and a terrorist system, successfully, probably one of the only countries to have liquidated them, in 12 years -- is the following thing: That the reason they advanced so much was because, essentially, what they did was not ideology. Poor people don't understand ideology that well. They don't have minors or majors in philosophy.

What they do is they protect the assets of the poor -- the (pawns ?) of the poor. They protect the rights of the poor. And what we get is from your human terrain teams in Iraq, and the other ones that you have, of professionals. In Afghanistan, that is exactly what al-Qaeda is doing. So, what I'm trying to say is, when you start getting that kind of information, you'll start finding out where the real needs are, as opposed to the speculative -- (inaudible) --.

And last, but not least, even in places like China -- which the figures that Jim gives which are just as absolutely astounding, and with this I finish, the amount of people that are really getting ahead are 250 million of a population of 1 billion, 300 million. In the Eastern part of China -- where there hasn't yet been that much success, just last year there were over 70,000 revolts, with over 15,000 police casualties.

And the same thing happens in India. So, let's remember that part of the problem of development is not just growth. We have grown in the last 60 years the way we have in the previous 2,000 years. It has to do with relative wealth -- whether everybody get in on the action, or not. That's what causes wars and problems. (Applause.)

MS. SMITH: All right, now, don't shoot the messenger, because one of the things you don't know, they've got this big clock looking me right in the face, and it says 0-0-0-0. So, I want to ask folks to be very quick, but I want to make sure to get to everybody.

So, support the MCC. Go for it, and then we'll come this way.

MR. DANILOVICH: One minute only. One minute only. Your participation and attendance in this forum this afternoon is a great expression of your commitment, and your concern and your awareness of the tremendous challenge we have before us to fight global poverty. Global poverty should know no party affiliation. I must be Democratic, it must be Republican, and it must be American. (Applause.)

Poverty anywhere is a threat to prosperity everywhere, and it's a threat to prosperity in this country. Poverty anywhere is a threat to security and it's a threat to our national security. It's a real and present danger. The time is now to deal with it.

It's a lot more than just writing to your congressman. I encourage you and appeal to you to get involved in this effort through NGOs, through organizations, through the Democratic Party, through the Republican Party -- if there are any of you here -- (laughter) -- or any other party, for that matter.

It's something which must be addressed. It's something which the MCC is addressing. With regard to the MCC, it's sustainable, it's measurable, and it's transformative. It's all about change, and so is Barack Obama. Thank you. (Cheers, applause)

MS. SMITH: Thank you very much.

MS. EZEKWESILI: Seeing that I can't follow that act -- (laughter) -- what I would simply say is that you can be the voice of the poor anywhere in the world. (Applause.)

The reality is that, for you as Americans, you have shown the world that individual initiative can take you far. You have shown the world that creativity and innovation represent the path to good quality living. You have shown the world that demanding accountability from your governments are very instrumental to there being productivity, both in government, and in the private sector, and at the community level.

Being the voice of those who still don't have that voice, just because they are economically disempowered, is going to be key and crucial. (Applause.) But, one thing that I would like you to even do, as you shape the sense of governance in your country, is to say to your country, "Go back to important multilateral platforms that you helped to shape." (Applause.)

The World Bank, where I work as vice president for Africa Region, was one institution that the United States of America basically epitomized -- the spirit of reconstruction and development. It happened in the past, it can still happen today. There is no reason why you shouldn't get your country to understanding that those platforms cannot be abandoned by your country.

If your country abandons those platforms, other countries will take the place. Is that what you want? I don't think so. (Applause.)

MR. DASCHLE: Gayle, I guess I would just hope that we'd never minimize the extraordinary impact that idealism and aspiration can have. The fact that we are in something bigger than ourselves, the realization that we could end hunger in our lifetime, is really the goal of something else I'm involved with -- the "ONE '08" -- the "Vote '08" campaign.

And we have 2 million volunteers all over the country who understand that by joining together and recognizing the importance of being one, that we truly can do something. Saint Francis of Assisi said it best once, he said "Preach the gospel every day. If necessary, use words." Let's preach the gospel every day and we can do something about this. (Applause)

MS. BIRDSALL: It's hard to follow Saint Francis of Assisi. (Laughter.)

I think, especially for the students in the room, tell your politicians, tell the next president -- any way you can find to do it, that we live in an interconnected world, where collaboration, through our international institutions, is in our interests.

You know that last year the U.S. spent over $1 billion in Pakistan on military aid and equipment, and $38 million on education. Don't let that happen again.

For the students: Get into the details. Visit the countries. Support the idea of a civilian assistance corps. Join the Peace Corps. Educate yourselves, and fundamentally help us educate our politicians that the world in interconnected.

And, as Jim Wolfensohn said, most of them -- most of the people in the world now live in developing countries. And more and more so, most of the middle class, most of the security issues, most of the prosperity for us and them is going to start there, not here, anymore. It's the 21st century. (Applause.)

MR. AFFLECK: I think, you know, a lot of it's about getting people involved. I don't think any of these things find solutions without a lot of people involved -- this is certainly emblematic of that, but it's going to take, you know, exponentially more folks.

And in order to do that, and I think to get involved in a real way -- not just writing a check, a one-time $50, or a t-shirt, it's about developing an understanding. And that takes real investment. Because I think in order to really make it work, we have to have a citizenry that's -- really has a pretty thorough understanding of what's going on in developing countries, frankly, so that they can take a good look at what we're doing.

You know, often, -- you know, up here saying, you know, "How should it get better there?" And there are inefficiencies in what's happening, you know, in how we're approaching this problem, from the side of the West -- you know, 50 years of aid. And, you know, frankly, in some places it's been a lateral move.

And we need to, you know, examine how we're approaching those problems as well, in these institutions; and cultivate a, you know, citizenry that's ready to reform that. Instead of just saying, "bad governance in Africa," also say, "How can we do this better?" And that's probably a tall order, but it's the only way that that it's going to happen.

And I think these messages that you guys have talked about are really quite effective -- climate change, you know, there's a lot of people gaining an interest. And developing that connection, I think, is really important.

Obviously, the national security issues -- you know, in Dar es Salaam I saw paintings of Osama bin Laden. It's -- it's a real thing. But I think -- you know, in terms of the real, fundamental, galvanizing thing, I really think if we tell the story right, the real story.

I think Americans are great people, and I think once they see that there are victories possible, that there are partnerships possible, that taking these steps doesn't have to come out of guilt or out of fear, but that this work comes out of glory. I think, historically, that we've had our ups and downs. We've been a glorious and great and generous nation, and I think we can continue that. (Applause)

MR. : Can we start these final comments by giving these men and women a thunderous round of applause? (Cheers, applause.)

I'd like to -- I'd like to depart from what we oftentimes do, and thank each one of these individuals separately with a quote:

Obi Ezekwesili, you said "The poor are not weak. They are strong. It's just that they've been given the wrong end of the stick." Would you thank Obi Ezekwesili. (Applause.)

Senator Tom Daschle, you said "A function of leadership is to set the right example." Would you thank Tom Daschle. (Applause.)

Congressman Don Payne has needed to leave previously, but I'd like you to thank him as well, if you would. He said, "Without justice, there will be no peace." (Applause.)

James Wolfensohn, you said "By 2050, the affluent countries of the world are expected to have a $90,000 GDP. In Asia, it will grow from $2,500 today to $45,000 by then."

"However, in Africa, by 2050, the GDP is expected to be as low as $1,800. We must enable the Continent of Africa to take advantage of the world economy." James Wolfensohn. (Applause.)

Secretary Madeleine Albright left as well, but she said, "Poor people do not want to be victims, or to be treated in a patronizing way. Some 4 billion people have no access today to property rights, business rights and labor rights. They need legal empowerment to give them that access." (Applause.)

Ben Affleck, "The countries of the world that hold us in the highest esteem are in Africa. It's not about aid, or imposing our solutions, it's about an opportunity, in the United States, to pay more attention. The people in Africa know how to fish. They need a pond to fish in." (Applause.)

Ben Affleck, you said you felt a little bit like Forrest Gump here, but I think that there is a Congressional seat in California with your name on it. (Laughter, cheers, applause.)

Hernando de Soto, you said "Poverty is nothing new. It has been with us for some 60,000 years. We ask, what has the Western world done to create prosperity? You implemented substantial legal reforms. In the West, the king no longer owns the pond." (Applause.)

Nancy Birdsall, "We would accomplish much if the next president of the United States were to say, 'we will take the 15 poorest countries of the world and give them, without tariffs or other trade barriers, access to our markets.'" (Applause.)

Ambassador John Danilovich, "It's a consultative process, among the poor. It's their solutions. It is they, telling us, what they need for themselves to lift themselves out of poverty." (Applause.)

Senator Tim Wirth, "Are we going to take on this climate issue, or are we not? It has a direct relationship to poverty." (Applause.)

And Gayle Smith, "It's not about cash handouts. It's about investment. It's about investments in health, education, access to markets, and technology. If we invest in these, we will advance both security and dignity on the planet." (Applause.)

I'd like to thank NDI, the Council on Foreign Relations, the Josef Korbel School of International Studies at the University of Denver. I'd like to thank the students. You've been told to learn Chinese and get political. And mostly, once again, I'd like to thank the men and women who shared the afternoon with us.

Thank you, everyone. (Applause.)

.STX


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