Léim ar aghaidh chuig an bpríomhábhar

Seanad Éireann díospóireacht -
Wednesday, 8 Nov 2006

Vol. 185 No. 2

Address by the European Union Ambassador to the United States.

No. 1 is an address by Mr. John Bruton, European Union ambassador to the United States. It is my privilege today, on behalf of the Members of Seanad Éireann, to welcome His Excellency, Mr. Bruton. While words of welcome always have a certain formality about them, today in a real sense we know we have among us one of our own.

It was in 1969 at the age of 22 that John Bruton first entered upon the national political stage as a Member of Dáil Éireann. Since entering politics and a life of political service, he has served the people of Ireland in many distinguished roles, as Deputy and legislator, Minister, Leader of the Fine Gael Party and, ultimately, Taoiseach. It is not possible in these brief words of welcome to do justice to the breadth and depth of the contributions John has made to national political and parliamentary life from governance to institutional reform. On this happy occasion and knowing John's innate modesty, I will refrain from any such attempt. However, since Ireland acceded to the European Economic Community in 1973, the truly international nature of politics, economics and finance has unfolded with the benefit of extraordinary advances in communications. During those years, John has employed his own unique energy and talents, in whatever capacity he found himself, to play an active and guiding role in furthering the interests of the Irish State and its people.

Reality being what it is, no doubt he has had his own share of disappointments and encountered many frustrations, but always his vision and focus have remained fresh and vital. He is to be congratulated that nearly 40 years of political life have neither weakened his enthusiasm nor deflected his political vision. Now in his distinguished role as ambassador of the European Union to the United States, John's passion for, and commitment to, the democratic ideal will ensure that his political career continues to remain rich in possibilities and challenges. It gives me great pleasure to invite His Excellency, John Bruton, to address Seanad Éireann.

His Excellency, Mr. John Bruton

A Chathaoirligh, a Leas-Chathaoirligh, Leader of the House, members of all parties, I thank you for this remarkable privilege of being invited to address you. I thank the Cathaoirleach for the lovely words he has just spoken about me which I will always remember and which I deeply appreciate. It is a sign of the way in which the bipartisan nature of Irish politics has evolved in recent years that an invitation like this would be issued to me by a House where parties other than my own hold sway. I am especially grateful for that generous demonstration by the Leader and all in this House.

Coming to the end of my second year as European Union ambassador to the United States, an enduring impression I have from my travels around the US is the overwhelmingly positive image Ireland has all over America. In every state I have visited, Ireland is celebrated not only as the birthplace of parents or grandparents but also as a kind of economic miracle worker that has freed itself of the hardships that drove generations into emigration. Ireland's openness to workers from new EU member states is also much appreciated in cities such as Chicago, Cincinnati and Milwaukee where links to central and eastern Europe, Poland and the Baltic are very strong. Ireland's openness to those people is noted and appreciated. In short, Ireland's economic dynamism is often held up to me as a good example for the larger economies of continental Europe.

Tempting though it may be to lap this up uncritically, these conversations across America are telling. On the one hand, they are a reflection of Americans' unique enthusiasm for success, their openness to new things and ability to ask, without irony or envy, how we did it. Ireland is seen as a trailblazer, whereas other parts of Europe are often, quite unfairly, depicted as slow to change, addicted to subsidies, and not doing a great job of integrating Muslims or other minorities.

This undiluted admiration for Ireland's economic success, while always welcome, does set off some alarm bells. I am concerned our international reputation as feisty go-getters could lead us into an "if it ain't broke, don't fix it" complacency at home while creating impossible expectations abroad, particularly in developing countries, that economic miracles really do happen. Everyone in this Chamber knows well that Ireland's economic model was the result of more than 50 years of trial and error, mostly error at times. This fascination with Ireland's economic turnaround does not always take account of two very important ingredients, namely, European Union membership and United States investment, which were mutually reinforcing aspects of our emergence as a thriving economy.

The Ireland of today and the Ireland of 1973 which joined the European Union are two different countries and almost different worlds. The Ireland of 1973 had a population of only 3 million, an economy heavily dominated by agriculture and little opportunity for young people of school-leaving age. Ireland today is among the fastest growing economies in Europe, a leader in information technology and financial services, and a country to which people emigrate in search of good jobs and quality of life.

Perhaps many in college today do not remember the other Ireland which existed before a visible and tangible improvement was made in Irish living standards relative to the EU average. In 1988, after 15 years of EU membership, Ireland's income per head was still only 70% of the EU average. However, in the second 15 years, Irish income per head greatly increased, reaching 122% of the EU average in 2005. Our delayed progress during the first 15 years of EU membership was due to a mistaken attempt to stimulate the economy by borrowing in the late 1970s, and a high dependency ratio. The dependent children of the 1980s transformed into the young adults who launched the tiger economy of the 1990s.

Ireland continues to gain enormously from EU membership. What is not known widely is that it also continues to gain disproportionately from the EU budget. This is because of the Common Agricultural Policy and the regional funds. Ireland is now one of the richest countries in the EU in gross domestic product, GDP, terms. However, last year Ireland received a net income from the EU budget of €588 for every citizen, while Latvia received only €168 per person. This is more than three and a half times as much on a per capita basis. We might remember that when seeking an explanation why so many Latvians want to live here. Since Ireland joined the EU, net transfers to Ireland have amounted to approximately €10,000 for every person now living in the State.

In other ways, the European Union has been hugely beneficial. It lifted Ireland out of its obsession with an inherently unequal relationship with its neighbouring island. It widened our horizons, gave us access to a huge European market and thus enabled us to attract US investment on an undreamt-of scale. The total value of US investment in Ireland today, attracted here by our EU membership since 1973, is $61 billion, or approximately $15,000 dollars per person living here.

Foreign-owned companies, mainly from the US, produce almost 80% of all manufacturing output and 90% of all manufactured exports in Ireland, although they account for only half of all manufacturing jobs. In other words, the jobs created by foreign investment are very high productivity jobs.

The boost to productivity in Ireland from foreign investment has been major. In 1993, productivity in Ireland grew by only 1%. In 1994, it grew by 2.8%. However, in 1997, it grew by 6.7% in one year, probably the highest rate of productivity growth ever recorded in Ireland. In 2005, productivity still grew, but the rate of growth had reduced to 2.8%, less than half the exceptional 1997 rate. Productivity has also grown this year. The challenge for Ireland is to spread the same rate of increase in productivity achieved in the foreign owned sector to the rest of the economy, including private services, construction, Government services and retail and wholesale distribution. This is more easily said than done. One way to stimulate productivity growth throughout the economy is to ensure we use to the full the disciplines of the Single Market, and use them to tackle restrictive practices and barriers to competition. One key area where this can be done is in financial services.

Commissioner Neelie Kroes, responsible for competition policy, and Commissioner Charlie McCreevy, responsible for the Single Market, have shown great determination in tackling restrictive practices in Europe everywhere they find them. This is the great merit of the European Union, namely, it can act as a liberalising external discipline on member states in the interests of their own citizens and consumers. EU liberalisation has served Ireland well. In the first ten years of the internal market, from 1992 to 2002, freeing up markets added 1.8% to this country's GDP — an additional €877 billion in real terms, and an average of €5,770 for every household — and helped to create 2.5 million jobs throughout Europe.

Precisely because Ireland has benefited so much from American foreign direct investment and from a large European market for its goods and services, Ireland would be vulnerable to any change in the economic situation of the United States or to an energy crisis in Europe. The American economy is renowned for its resilience but, after a long period of expansion, economists are signalling concern on a number of fronts. In a recent edition of Foreign Affairs, former chairman of the US Council of Foreign Advisers, Dr. Martin Feldstein of Harvard, wrote about the dramatic decline in savings by American households in the past ten years — from approximately 7% of income in the 1990s to little or no savings now. The increase in the value of their homes and their stocks and shares made Americans feel wealthier, more willing to spend and less willing to save. Low interest rates encouraged people to take on second mortgages on their homes. Mortgage debt in the US increased by $1 trillion in 2004 alone.

This US savings gap — the gap between savings and income — is being filled by imported money. Through an increasingly globalised financial system, Americans are essentially borrowing money from all over the world. This trend will not continue. Dr. Feldstein believes Americans are already beginning to save again because they know the value of the shares they own will not double yet again in the next ten years, nor will their homes go on increasing in value at three or four times the rate of inflation in the next ten years as they did in the last ten. A resulting rapid rise in the US savings rate would mean Americans would begin importing less and, if associated with a fall in the dollar, exporting more.

The question is whether the slowdown in American imports will lead to a general slowdown in the world economy. I believe this will depend on how sudden is the turnaround and on whether and how it is adapted to politically, not just in America. German, French and Chinese savers will have to start spending a bit more than they spend currently. An increase in the value of the euro and the renminbi relative to the dollar would mean European and Asian consumers have more spending power. Will they have the confidence and optimism to use the spending power that an appreciation in their currencies would give them?

The bottom line is that everybody, not just Americans, will have to change. This is as much a psychological as a financial challenge. One of the great characteristics of America is optimism, a belief that dreams can be realised through personal effort. That optimism needs to spread to other countries, including those in continental Europe. It needs to become America's No. 1 export, so that the coming transition in the world economy can be successfully managed.

I would like to turn to a problem Ireland, Europe and the United States must face together: energy and climate change. Whatever about the short-term trends, I am convinced that oil prices will rise substantially over the next ten to 15 years, perhaps double. Not only that, our dependence on oil from the Middle East will increase, with all that implies for our relationship with all the countries in an arc stretching from Israel to Iran. We have the choice of anticipating these trends and trying to master them or of simply allowing them to overwhelm us.

I believe oil prices will rise in the medium term, although not perhaps in the short term, because China now consumes only two barrels of oil per year per person. Europeans consume 12 barrels each per year, and Americans consume 26 barrels per person per year. Over the next 15 years, the number of cars in China is expected to increase fivefold. Furthermore, 1.5 billion people in the world do not have electricity in their homes. What will happen to world energy demand when they are connected up and can switch on? What will that do to energy prices and global warming?

Climatologists agree that the world's weather is already changing. As the world becomes warmer, the sea level will rise. If, as some predict, global temperatures rise by 5° Fahrenheit in the next 100 years, that could mean an 80 ft. rise in the sea level, which would put low-lying parts of Europe and major cities on the US east coast under water within the lifetimes of our grandchildren. Some 50 million US citizens live within 80 ft. of sea level, as do 250 million Chinese, 120 million Bangladeshis, and probably some Members of this House. I am surprised that property markets do not reflect that risk.

The biggest emitters of greenhouse gases in the world are the United States with 21%, followed by China with 15% and Europe with 14%. Europe is still far from perfect. Some individual European countries have already greatly exceeded their Kyoto emission targets, including one I will not name. Other countries that have congratulated themselves have taken credit for one-off gains, such as the closure of coal mines and heavy industry, which they cannot repeat.

We will manage to cut the rate of increase in greenhouse gases only if public opinion recognises that the problem is both serious and urgent, and is willing to make sacrifices to overcome it. A recently published world opinion survey by Pew Global Attitudes shows wide gaps between countries in how ordinary people view the seriousness of the climate change problem. While 66% of Japanese and 65% of Indians said they worry a great deal about climate change, only 20% of Chinese and 19% of Americans said they do so.

We need to replace the Kyoto Agreement with a regime to which every country in the world is committed. As we know, many countries have no commitments under the existing Kyoto Agreement. The new regime should be ambitious, but should also encourage genuine long-term investments by having a much longer timeframe than Kyoto. I do not buy the idea that we can deal with global warming by some yet-to-be-discovered technological wheeze, without some sacrifices in our short-term economic growth rate.

I will conclude my remarks by looking forward. What sort of world will we have in 2020? Of every 100 people in the world in 2020, about eight will be EU citizens, four will be Americans, 56 will be Asians and 30 will be Africans.

Asia is on the way back, economically speaking. I do not belong to those who find this alarming, unthinkable or surprising. After all, in 1800 — this House was already built at that time — three-fifths of the world's economic activity took place in Asia. By 1900, Asia's share had fallen to just one-fifth, and Europeans with 20% of the world's population, had 40% of its wealth. By 2000, Asians had come back to having two-fifths of the world's wealth. Europeans, meanwhile, had fallen to only 7% of the world's population, but still enjoyed 25% of its wealth. This balance has shifted back and forth over the centuries and will change again during the 21st century.

We must put ourselves in a position to manage these changes proactively. We must manage the perfectly natural re-emergence of Asia, to allow it to enjoy a fairer share of the world's income. We must help Africans to overcome the wars, chronic diseases, and the lack of basic infrastructure such as roads which are now holding them back. We must do all this without destroying the planet with an excess of greenhouse gas emissions. Membership of the EU puts Ireland in a position to have a say in the management of these global changes. It thus enhances our sovereignty.

These massive global tasks can only be tackled if nations are willing to trust one another. The task of diplomats — even newly recruited diplomats — is to build trust and on that basis to negotiate. Negotiations can only start when you empathise, even if you do not sympathise, with the other sides' fears, ambitions and insecurities. Empathy sometimes comes hard for big nations. They know their own story, are proud of their achievements, they know their model works for them, and wonder why they need to understand anyone else's model at all. However, if a region comprises only 7% of the world's population, as in the case of Europe, or 5%, as in the case of America, it is necessary to understand the way other peoples look at things. The European Union, as a construction of 27 nations, making compromises in the world's only multinational democracy, can build a structure of peace for the world in the 21st century.

I am a deep believer in the European Union because just as it has done for Ireland, it has also lifted the sights of other nations from their quarrels with their neighbours, and built a system and a habit for resolution of disputes. The European Union has enabled people to see that each one of us has several identities, of which the national identity may be the most important, but is far from being the only one. The European Union has enabled the people of all 27 nations to be, and to feel, at home everywhere within its boundaries. That feeling of being at home everywhere in the Union gives us all a psychological sense of security that is an antidote to atavism, sectarianism and fear of people who are different from us. I believe that the psychological benefits of the European Union are more important even than the material benefits we have derived from the Single Market, the single currency and the global clout of the Union as an economic player.

The enlargement of the European Union to bring in 12 new countries in four short years is truly remarkable. It is almost as if the 50 states of the United States had merged with the 32 states of Mexico, giving every Mexican the right to work anywhere they wished in the US and vice versa, and adding 64 Mexican senators to the 100-member US Senate on Capitol Hill. That is what we have done in the European Union. We have undertaken an equivalent project, with the conference of equivalent rights. We should not be surprised that such a revolutionary change has created anxiety in some quarters. We should celebrate it for the remarkable achievement it is.

This enlargement is a geostrategic project for the security of every European. Stabilizing central Europe makes every European safer than they would be otherwise. This enlarged Europe must rest on something more than a technocratic base created by 80,000 pages of common legislation and treaties. If it is to exist at the end of the 21st century, as I believe it will, the European Union must become more efficient. That may mean a smaller Commission, more majority votes and fewer vetoes. Beyond that, it must develop the political capacity to seek sacrifices from its citizens and member states whenever that is essential. A Union of rights and responsibilities must be a fully democratic Union. Elites cannot ask others to make sacrifices. Only those who have been directly elected by the people can legitimately ask for sacrifices from the people.

If the European Union is to be strong enough for the challenge of the 21st century it must be able to attract patriotism, loyalty or affection from all EU citizens in the same way each member state will continue to attract patriotism, loyalty and affection from its citizens. Patriotism, loyalty and affection do not arise spontaneously. Rhetoric alone will not create them, nor will constitutions or abstract declarations on their own. People will give loyally and affection only to something they have had a part in creating. People give loyalty to people, not to abstractions.

I have long advocated the idea that the President of the European Commission should no longer be selected in a private negotiation between Heads of Government but should be elected by the people of all member states on the basis of equal suffrage. A large democratic idea of this kind is now needed to energise the European Union.

On behalf of the Seanad I welcome Ambassador Bruton to the House. His sense of curiosity and optimism are hugely engaging characteristics that have always imbued his work in this country, in Europe and now on a wider scale. I invite Senator Ormonde, our representative on the Joint Committee on European Affairs, to pose a question.

I welcome the ambassador and thank him for an informed address. He considered the matters of EU membership, enlargement, and the relationship between the EU and the US. I was interested in his vision for 2020. I intend to read his script again as it provided much to consider in respect of the statistics provided on world population. In 2020, only eight of every 100 people in the world will be European citizens, with 56 being Asian and 30 being African. This will have a major impact on the future of energy and global thinking. Does Mr. Bruton envisage the swing to the Democrats in the US mid-term elections having any implications for the relationship between the European Union and the United States?

Are the European Union and the United States at odds on foreign policy in respect of Iraq and the Lebanon?

Ambassador Bruton

I am not certain what the final tally will be in the US House of Representatives and Senate races. The Senate has more influence on foreign affairs because it must sanction all treaties the United States makes. The House, however, has more influence on finance and taxation, similar to the Lower House in the Oireachtas. There is a concern that the Democrats might be more protectionist because they represent many of the unionised workforces of plants which fear the outsourcing of their work to other parts of the world. That would make it more difficult for the US President to get the trade promotion authority he needs to negotiate treaties without those treaties being subject to detailed amendment. That in turn would make international negotiations impossible.

I do not, however, share that view. I have talked to Republicans and many leading Democrats and while, like any opposition party, the Democrats will use whatever any argument they can to create difficulty for the Government of the day, faced with the choice of moving America towards protectionism or outwards to the world, they would be willing to engage in adequate trade negotiation and give their President authority to do so. The Democrats may lay greater emphasis than the Republicans on respect for International Labour Organisation standards in trade negotiations which may complicate the mandate of the World Trade Organisation. There are other changes a Democrat majority might effect but trade is the most important one with which I can deal.

In regard to Iraq, I may engage in political punditry and speculation, which I am neither paid nor authorised to do, but I have never been unduly worried about.

Mr. Bruton should not let that stop him.

Ambassador Bruton

I doubt the swing to the Democrats will make a great short-term difference. The dilemma facing America and the world is not whether what happened in 2003 was right or wrong. People have their own views on that dilemma but 2003 is history just as 1803 is history and one cannot change what has already happened. Americans face the reality of serious strife in Iraq and a responsibility that, rightly or wrongly, they have taken on and from which they cannot walk away. They also face a concern that Iraq would make the necessary transition to being a pluralist, functioning, rule of law based, and secure democracy.

We share that concern, because it is in the interests of the rest of the world, whatever position one might have taken on the war, and many European countries supported and many others opposed it. People will not walk away from that but a different approach may be necessary. Rather than trying to solve the problems of Iraq in isolation one may have to consider how Iran could be brought in to help stabilise Iraq, while resolving some of the outstanding issues with Iran. Another option is to examine how Syria might be brought in to help resolve the problems in Iraq. This would allow a resolution to some of the problems that exist with Syria such as the Golan Heights, Israel and the Palestinians who are enclosed in the West Bank and Gaza. It is possible to envisage an opportunity of a range of interlinked settlements that could bring about a benign outcome across the region. Rather than looking at it as an arc of insecurity or difficulty, it should be seen as an arc of opportunity to build, through clever diplomacy, a structure of peace based on respect for everyone's concerns. In conflict situations, respect is what people need most. With the Baker report to be published shortly, that is an opportunity that could be seized upon by the Republican Administration and Congress.

On behalf of my colleagues in the Fine Gael Party, I thank the ambassador, Mr. Bruton, for his remarks. I also thank him for subjecting himself to the inquisition that will follow from my colleagues on all sides of the House. It is good to hear him express his views so forcefully. Last Christmas, I read the memoirs of the former British ambassador to America which became an international best-seller. It was a diplomatic kiss-and-tell. I advise Mr. Bruton not to go down that route when he chooses to tell his story.

That would be telling.

He might tell too much.

The EU and America have historical, cultural and trade ties. To have an Irishman representing the 25 member states, and their 450 million people, is a great source of pride to our country and to the Parliament. Mr. Bruton gave all his adult life, 35 years, to politics before he went into the diplomatic sphere. He brings a great clarity to this position that sometimes diplomats do not have.

I welcome Mr. Bruton back to Leinster House and I thank him for his interesting contribution. He spoke of conversations across America which I am sure will be the title of his next diary. Mr. Bruton spoke of the European Union giving us a psychological sense of security. The US has had this sense of security for three generations, largely due to its geographical and political isolation. I recall Mr. Bruton's former government colleague, Mr. Peter Barry, speaking on many occasions of the little travel done outside of the US by American citizens. Many of them do not hold passports and their world is just America.

Yesterday saw an important election in the US. Most EU commentators spoke of how the war in Iraq would impact on how America voted. The early indications from exit polls, if one can take them as a bearing of any real news, was that the war in Iraq was not the main issue so much as domestic concerns such as the strength of American economy. A recent meeting of the Oireachtas Committee on European Affairs was addressed by a delegation of EU trade representatives to the United States. They too provided statistics pointing to the major economic interdependence between Europe and the United States. Does Mr. Bruton believe there is full political recognition on both sides of the Atlantic of how truly dependent we are on each other?

The ambassador, Mr. Bruton, said he is aware of the warmth that still exists in the United States towards Ireland. One presumes and hopes there is similar warmth of feeling towards Europe. The regrettable reality, however, is that in the last decade, not only in Ireland but throughout Europe, there is increasing evidence of anti-United States sentiment. Does the ambassador believe there is a growing recognition in the United States of this new wave of feeling? There are reasons for this sentiment, some of which are justifiable and others not. Is this becoming an issue for the people Mr. Bruton meets? United States citizens are not stupid; they recognise this uncomfortable wave of antipathy. How will this affect the attitude of the United States and its political leadership to Europe?

My final question relates to climate change, global warming and energy policy. I read a report some weeks ago in the Irish Farmers’ Journal, a newspaper with which the ambassador, Mr. Bruton, has a strong association, on a major conference on alternative energy that took place recently in the United States. The significance of this from a political perspective was indicated by the address of President Bush to the conference. It seems genuine progress is being made in the United States towards alternative energy systems, especially those that link strongly with agriculture. Does Mr. Bruton believe this level of progress is making a significant difference? Is there much that we in Europe can learn fromit?

Ambassador Bruton

I will answer Senator Bradford's final question first. There is significant interest in the United States in alternative energy. Of particular interest is ethanol production, which is the production of energy from either corn or sugar cane. The latter is far more efficient as a producer of energy. There is an argument that when one factors in the nitrogenous fertiliser, diesel and so on that must be used for sowing, harvesting and transporting, the net benefit of corn-based ethanol is quite small in terms of the overall energy balance. However, there is major interest in it in the corn belt where farmers are pleased, like farmers everywhere, to discover an alternative market for their product.

If all the United States' energy needs are to be produced from ethanol, however, there is probably a requirement for a doubling of the current scale of agricultural land. This is not an option because land is no longer being turned over to agriculture. There is, therefore, a fundamental problem. I believe ethanol will become a part of the energy scene, an element that will expand or contract depending on markets elsewhere. I do not believe, however, it will become the staple energy source for the United States. Unlike Europe, the United States has huge reserves of coal, but it does not yet have the operational technologies for using that coal in a way that does not generate large amounts of greenhouse gases. There will be difficulties in this regard until it masters techniques of carbon sequestration, which involves putting the carbon back into the earth, or some types of clean coal technologies.

The other issue Deputy Bradford mentioned is one that is profoundly worrying. It is fair to say that people in the United States are much more favourable to Europe and the European Union than are Europeans to the United States. This is what public opinion surveys show and it is regrettable. Europeans often look to the United States as younger brothers look at their older sibling, as an entity which enjoys some advantages and has stolen a march on oneself. Obviously, the United States is an older democracy than most European ones, so we tend to be a bit critical as the young tend to be. We do not give credit to the fact that fundamentally our values and their values are the same. We have different ways of expressing them and different ways of applying them but there is a fundamental congruence in our value systems.

Europeans need to face up to the dilemmas America must face and ask themselves what would they do differently if they were in America's position and how would they guarantee their success in dealing with a problem such as nuclear proliferation which the United States is now taking responsibility for dealing with. Perhaps at the margins we would do some things differently but, fundamentally, we would still have to face the same problems. Just as we criticise Americans for not trying to understand the way other people look at things — perhaps with some justification — we should make a greater effort to understand the way they look at things. If we did so, perhaps some of that difference expressed in the polls would dissipate.

A recent opinion survey done by an outfit called Public Agenda on attitudes to foreign policy in American public opinion showed that Americans are highly self-critical. All the criticisms we might tend to make of American foreign policy are being made by Americans, even by those who strongly support the current administration. Affirmative debate takes place in the United States all the time. We should not see it as a sort of uniform, amorphous mass of opinion. There is terrific debate within the United States as there is here about all these choices.

On behalf of the Independent group, I welcome the ambassador, Mr. Bruton, and thank him for his wide-ranging speech which covered many areas. On a personal level, I thank him for focusing on the issue of global warming and the Kyoto Agreement. I have been struggling for the past two years in this House to get people to respond with some passion to that issue, including a fortnight ago. I thank him, in particular, for giving a very graphic image for which I had been struggling until now.

The ambassador said global warming of five degrees will raise water levels by 80 ft. but he wondered why the property market in Dublin, or generally, does not take any interest in that. What it will mean for this city is that there will be water from Rathmines to Drumcondra at the very least. In fact, the headquarters of the ambassador's former great nemesis, the Taoiseach, at St. Luke's in Drumcondra, will be under water by the time his prospective grandchild is a grandparent. It is a vision to conjure up and it might gain some reaction from the property market and the political leadership in this city.

I thank the ambassador and ask my colleague, Senator Ross, to address him politely with some interesting questions.

He will do his best.

It will be a change not to have hot air coming out of Drumcondra anyway.

I join in the thanks to Ambassador Bruton for coming to the House. He made one of the clearest speeches I have heard from the seat in which he sits. The message was also clear. It was flattering to this House to be read a thesis which was obviously written and understood by its author and I congratulate the ambassador on what he had to say to us.

I wish to ask the ambassador two questions, to the first of which I do not expect him to respond. In light of the eulogies paid to him in the House today, how does he think he escaped the pages of Who’s Who in Ireland in the past few weeks? It is extraordinary for us to be in such distinguished company but not to see him feature in that book. It is an amazing omission but I will forgive the ambassador for ignoring the question.

My second question is more serious. I was struck by the dual interest the ambassador obviously has in Europe and America, as well as the manner in which he attacked the subject from both angles. Specifically, I wish to question him on the first part of his speech, when he spoke rather unapologetically about American investment in Ireland. It is somewhat difficult for Members to listen to the fact that so much is owed to American investment. That was very interesting and the staggering statistics provided by Mr. Bruton tell Members much about the reason the Celtic tiger has taken off.

I do not wish to ask the ambassador about the implications for that investment of the elections as it is to early to tell. Moreover, he touched on the subject when discussing protectionism there. Is a mood developing in America at present that is far more sceptical about investing in Ireland? Are the good days of multinationals coming to invest in Ireland over or at least slowing?

I will quote statistics with which the ambassador may not be familiar. He might comment on an alarming survey that was taken here by the American Chamber of Commerce Ireland in June or July 2006. It found that 43% of those American firms surveyed indicated that Ireland was no longer a preferred location for further investment, while 41% of them indicated that Ireland is no longer as attractive a location for investment as when such companies first set up here. As this sounds the warning bells, what can be done about it? The reasons provided were also fairly clear and singled out specific problems in Ireland that are scaring off and annoying Americans.

This submission is representative of firms such as Intel, Dell and those other organisations that are needed so badly and to which we are grateful. One obvious problem to be singled out concerned infrastructure. The survey stated that Ireland was not within striking distance of airports where it was necessary and the roads were not good enough. It also singled out broadband provision by stating it was appallingly bad, as well as other areas such as labour availability and costs, in which Ireland was falling far behind its competitors. In his discussions with American Members of Congress and Senators — and the newly-elected Members — has the ambassador detected any reluctance, such as that which obviously is conveyed by this survey, to come to Ireland with the same enthusiasm as previously?

Finally, I refer to a political question on a related subject. Obviously, there has been a certain amount of controversy within both parties on the issue of transfer pricing, whereby Ireland takes great advantage of the willingness of American companies to keep their profits or to have their profits taxed here. The issue has been raised recently in The Wall Street Journal. Is there an indication that any United States Administration might wish to put an end to this practice, thereby causing real difficulties for multinationals located here?

Ambassador Bruton

I must appeal to the Cathaoirleach to protect me from being drawn into politics, which I have been avoiding for the past two years. It is important to recognise that Ireland has 1% of the European population. However, in 1997 — to pluck a year from the air — it received 15% of all American investment coming into Europe. It is impossible to maintain such a rate forever because costs are naturally rising. This is inevitable because as demand increases, so do costs. However, the latest figures I have seen show that even in 2004, Ireland received 5% of all American investment coming into Europe, which constitutes a very good performance. Obviously, this share will come under increasing pressure. While some reasons for this were mentioned by the Senator, another reason is that when we began to attract American investment, large areas of the world were closed to it. These areas are now open. China, India and Russia are all open to US investment. Countries which were not competing with us at all 15 years ago are now competing directly with us. This will clearly have an effect. If I were to make a comment about domestic politics, which I will not do, I would say that the crucial factor for us as Irish people is to use the savings we have for productive investment to ensure our savings are used to create employment for our children and grandchildren, directly or indirectly. This will create recurring wealth rather than one-off asset improvement.

How does one structure an incentive system to ensure that instead of putting his or her savings in a house in Spain, a person puts them in a business that will create employment somewhere in Ireland? How does one make such an option more attractive? The idea that we can go on importing capital and ideas from outside the country forever is not viable. We have benefited enormously from it in the past but we are now reaching the point in Ireland where we must find ways of using our resources more productively. This was what I attempted to say in my speech without getting into any problems with the Cathaoirleach.

I join others in welcoming the ambassador, Mr. Bruton, to the House. It is an advantage of this House that it can occasionally take time for these kinds of reflective discussions and I thank Mr. Bruton for taking time out to facilitate us.

I was struck by his comments about the current account deficit in the US and the scenario that might flow from it. He knows as well as I do that the particular scenario set out by him has been predicted by economists for some time but has not happened yet. Is there a real danger to the EU, especially the fledgling recovery in countries like Germany, if the scenario spelled out by him, which would result in an appreciation of the euro against the dollar, came about? In that context, are we not in real difficulty and should we perhaps not give more thought to the policy of increasing interest rates at the current pace within the eurozone? There is a real danger in a combination of the scenario spelled out by Mr. Bruton and the European Central Bank's policy of increasing interest rates at its current pace.

My second question concerns Africa. We sometimes get very mixed signals from the Bush Administration in respect of Africa. On one hand, one gets the impression that because Africa has little strategic interest for the US, the Bush Administration is not engaged. On the other hand, President Bush can attend a G8 summit, as he did in Edinburgh, and sign up to what looks, on the face of it, to be an extraordinary commitment in terms of resources on the part of the US. This is one of those areas where joint action between the EU and the US is vital if there is to be a serious impact locally in Africa. I am interested in hearing the ambassador's thoughts on the reality of the commitment of the US in this regard.

Ambassdador Bruton

There is a danger to the recovery of the economies of continental Europe from a rapid appreciation in the euro relative to the dollar. However, it is important to say that the asset values in Europe are very strong. The average household in terms of asset values in Italy is wealthier in net terms than the average household in the US, which is quite surprising. They have scope to spend if they have the confidence to do so.

I am not privy to the thinking of the European Central Bank but to the extent that it has raised interest rates, it has more scope to reduce them. If there were to be any rapid change in the position as a result of a too rapid increase in US savings, a too rapid decline in the dollar or both, the European Central Bank then has more scope to cut rates from its current level than it would have if it had kept the rates at a very low level. This is the kind of thing that central bankers do. I do not know much more than this but I think they would make this sort of calculation.

In respect of Africa, it is important to state that no US Administration has made larger commitments to aid to Africa than the current Bush Administration. The level of assistance and expenditure by the US Administration on the AIDS issue and aid to Africa in general has been far higher in the last five or six years than it was previously. I am aware that this is quite different from the caricature but it is the reality. This is not to say that enough is being done because US aid in general, as a proportion of US gross domestic product, GDP, is far lower than European aid as a proportion of European countries' GDP. However, one should acknowledge that a very substantial effort has been made as far as Africa is concerned.

I am not as familiar with Africa as I am sure many Members of this House are. One aspect of Africa which stuck in my mind was the fact that it costs more to transport a product from the interior of Tanzania to the port at Dar es Salaam than it does to transport that product from Dar es Salaam to New York. The problem of internal infrastructure in Africa is awful, as are the problems of roads and the disruption caused to transport by war. Africa must be allowed or encouraged to redress these problems.

I join the Cathaoirleach and others in welcoming the ambassador, Mr. Bruton, to the House and in thanking him for honouring us with his presence here today. I also echo the words of the Cathaoirleach with regard to the ambassador and his contribution. We received the kind of intellectual power within an address which we have come to expect from Mr. Bruton. This intellectual power has characterised his entire career.

He made a very important point with regard to the psychological benefits to this country of EU membership, with which I very much agree. In many ways, the psychological effect on the country has been far more profound than the economic effect, even though that has been profound.

I have a number of questions for the ambassador, the first of which concerns the question of enlargement and the appetite for it. I agree with him about how successful the last enlargement was and how it was achieved so rapidly and smoothly, to many people's surprise. I wish to focus in particular on enlargement in respect of Turkey and the Balkan states. The appetite for enlargement seems to be waning. The ambassador probably expected the difficult question about Turkey.

Those of us who are members of the Oireachtas Joint Committee on European Affairs and who visited Turkey were struck by the fact that at administrative or official level, efforts were certainly being made to converge with European from a human rights and legislative perspective but that there was still a long way to go. How can we have a situation where a state wishes to join the EU but refuses to recognise a member state? I do not see how this is possible. Could Ambassador Bruton give us his views on the matter?

The other matter concerns the Balkan states. Countries like Montenegro appear to be very suitable applicants for EU membership. Is the appetite for enlargement waning? I believe it is among populations and the electorate but is it waning at Commission and official level?

In respect of inward investment, we should not underestimate the value of being an English-speaking democracy with all that this entails and the fact that we have been such a stable democracy. The challenge for us now is productivity and competitiveness. Mr. Bruton spoke about the contribution we must make and our rights and responsibilities, which is another matter related to EU enlargement. Does this inevitably mean or should it mean that we must participate in the defence of the EU? Can we derive the benefits, as we have done, and continue to be a member of the club without participating in its defence? Is this a very convenient place to be? Is sitting on the fence an Irish solution to an Irish problem?

I have a further question, which is similar to Senator Ross's question regarding Who’s Who in Ireland and similar in style to the last question raised on the “Questions & Answers” programme. Does Mr. Bruton consider it is desirable for retired politicians to be part of our diplomatic service?

Ambassador Bruton

I think so, yes. I would like to give a slightly serious answer to that question. The training one gets in politics is apt to the diplomatic world. The ability one must acquire to simplify complicated issues and to sit in on long meetings where one may be not entirely enthralled by the proceedings but at which one needs to be attentive and make a useful contribution are skills that are vital in diplomacy. Another skill is the ability to get on with people. Everyone in this House has been selected to be here because they have these skills. Used sparingly, that is a facility of which the Irish State perhaps ought to make use. That suggestion would not be welcomed in certain quarters but it is a valid enough point.

If Senator Dardis does not mind, I do not consider I should deal with the issue of defence. It is an issue on which I know the parties in this House have different opinions. Members probably know my opinion from my previous pronouncements on the subject, therefore, I will leave it at that if I may.

I will, however, deal with the other issue raised regarding enlargement. We should not be neurotic in Europe about the fact that we have some difficulties with the rapid pace of enlargement that has occurred. As I said in my speech, it is as if Mexico and the United States had been merged in terms of what we have done in the past ten years in Europe. It is bound to have resulted in the creation of some internal friction. We should bear in mind that the United States tore itself apart in the period from 1861 to 1865 in part because of arguments about enlargement, about states being brought in, on what terms they might be brought in and which state should be preferred, whether it should be a free-soil state or a state that allowed servitude.

Enlargement is not easy for anybody. It was not easy for the United States in the 19th century and it will not necessarily be easy for the European Union in the 21st century. People should recognise the difficulty of it and the huge achievement that has been made. However, I accept that it is not possible at the end of the negotiation process to be in a position where an acceding country does not recognise an existing member. I believe it is accepted on all sides that this is an issue that will have to be resolved before the negotiation with Turkey is concluded, but I understand it is not an obstacle to the negotiation at this stage. What is an obstacle, however, are issues related to internal human rights in Turkey.

It is important that people should understand that one of the reasons so many countries from Moldova to Georgia to Kazakhstan want to be considered as possibly eligible to join the European Union is because the Union has such exacting standards on human rights and democracy. If we did not have those standards and could not give that seal of approval to a country by accepting it as a candidate, the European Union would not be what it is. It is important that we stand by those standards. We should not have given accession dates to countries separate from adherence to those criteria. Mistakes were made in saying to countries X and Y that they will join by this year or that year regardless. That took the pressure off those countries, but we must keep the pressure on all the time.

That said, it is vital that the Balkans and Turkey have the prospect of joining the European Union. It is vital for the stability of the Balkans, as the states in the region have a very difficult task, particularly in Kosovo, in building a state from nothing and similarly in Montenegro in building a new state. The European Union has shown that it has a capacity as a contributor to state building. We must find a way of continuing to keep those accession processes moving forward, perhaps not all at the same pace or as fast as they may be some of the time but moving forward just the same.

I hope that a solution to the difficulties to which Senator Dardis made reference in regard to Turkey, which are real, will be found by the Turkish leadership and by the leadership of EU member states. Commissioner Olli Rehn who is dealing with this subject is a determined man. He comes from Finland, which has not been a member state of the European Union for long. Finland borders Russia and the Commissioner understands the importance of enlargement. The House ought to have and can have great confidence in the way he will handle this issue, as will the member state Governments.

It is a great privilege to join in the welcome extended to the ambassador, Mr. Bruton. The warmth of the welcome is an expression of appreciation of the work he has done throughout his life in regard to Europe and elsewhere. He should not worry about not being in Who’s Who in Ireland. I regard the omission as another indicator of his great distinction.

I was interested in Mr. Bruton's reply to a point raised, perhaps slightly flippantly, by Senator Norris. It is refreshing that we should hear these matters in language which we understand. It was an inspired appointment of the European Union to send a politician such as Mr. Bruton to Washington. While I have the highest regard for our diplomatic service and for diplomats generally, one of the problems in Europe was that diplomats regarded this as something that they talked about between themselves and did not bring the politicians into it and that is the reason we now have the difficulty of engaging the people of Europe. I was interested in Mr. Bruton's proposal of an elected President, which he has advocated in other places.

I wish to ask two questions, one of which concerns the way Mr. Bruton does his work. He is representing Europe and European countries have their own ambassadors in America. Some of them believe they have a special relationship with America, some believe it is a specially good relationship while others take some pride in having a specially bad relationship. Does that complicate life for Mr. Bruton and how does he manage that transition?

My other question concerns the extent to which, if it is true, that the Americans think of the European Union as NATO at play. Does that create a difficulty? It creates difficulties in Ireland where we do not want Europe to be seen as NATO. It is a question of the interaction between American expectations regarding what one might call the military-security front and the political front.

Ambassador Bruton

I assume the omission from Who’s Who in Ireland was a marketing ploy in order that people would talk about such an egregious omission and thereby talk about the publication in question. I am sure every time that is mentioned it boosts sales.

It is the case that Americans see the European Union and NATO as twins, not identical twins but twins with similar purposes. The United States is a member of NATO, it is not a member of the European Union, but it regards NATO as the European element for defence. It tends to worry if the European Union decides that it wants to develop its own military capacity under EU aegis independent of NATO.

The American insight is that one cannot distinguish and separate power from military power. Military power is part of the reason for the strength of the dollar. There is a certain honesty about the American approach to these matters, which perhaps we Europeans tend to shy away from, with some believing that we never needed the military umbrella that the Americans provided, thereby simply ignoring it because there is no language for describing it. This is an issue which not only Europeans in Ireland but Europeans elsewhere need to consider. There is a salience to military security. It is not as important as it was 15 years ago because the new threats are not conventional but it is important nonetheless.

As far as ambassadors, special relationships and so forth are concerned, one of the things I was partially led to believe I would find when I went to the United States two years ago was that there would be a type of rivalry between member state ambassadors similar to the type of rivalry that may exist between Departments here. I have not once found a trace of it in all of that period. I suppose it is partly because the United States is so big and that there is so much work for all of us to do that we do not tend to cross one another's paths.

Whenever an issue needs a common approach from the member states and the Commission, there is a ready willingness on the part of the member states, large and small, whether it be Ireland's ambassador, Mr. Noel Fahey, Sir David Manning representing the United Kingdom or Mr. Jean-David Levitte representing France, to put on the European Union jersey, so to speak. In the United States, the British Presidency of the European Union was exceptionally good. Its ability to work with the Commission was second to none in terms of promoting Europe in the United States.

I wish to ask the ambassador a question regarding the Kyoto Protocol. He indicated that America is responsible for 21% of emissions. There is a feeling here that Ireland contributes only a thimbleful of emissions in contrast to countries like America. He also stated that a survey revealed 19% of Americans worried a great deal about emission standards. That is a surprise in the context of the graphic images we see on television of the effects of climate change and what is happening in the Arctic and the Antarctic. To what degree does the ambassador think Americans will change their attitude to the Kyoto Protocol? Currently, the view is that they do not take it seriously and that President Bush has never taken it seriously.

Ambassador Bruton

I think a change is taking place in American public opinion. The figures I quoted were probably taken before "An Inconvenient Truth" appeared and the recent spike in oil prices. Those figures may be out of date as American opinion is changing. In his state of the union address, President Bush famously referred to the fact that the United States was addicted to oil. That is the beginning of something that may represent a change in opinion there.

If I were to identify two issues on which the Administration might be able to work with the new Congress, the first would be citizenship and immigration, as President Bush's views are almost identical to those of the Democrats rather than the majority of the Republicans. He may find it easier to get naturalisation arrangements for undocumented immigrants through working with the Democrats than with the old majority. That could be good news for some Irish people. The second issue is possibly climate change and energy security. The Democrats will want to show they can work with the White House on certain issues for the good of their future but, equally, the Administration will want to show, for the purpose of President Bush's legacy, that it can work constructively on certain issues. It is possible the next two years could be a most productive period in terms of climate change, which Senator Finucane mentioned, immigration and possibly even other issues. Some problems will be difficult for them to deal with, for example, health care is a significant issue in the United States. The President attempted to deal with social security reform but had to abandon it due to lack of support. I do not think either of those issues will be resolved in the next two years but progress is possible on the issue to which Senator Finucane referred.

Like everybody else, I welcome the ambassador. As he said, we might have had disputes in the past at home but when people get out on the world stage they are one of our own. It is great we have people like the ambassador and Mr. Peter Sutherland, who is chairman of the Trilateral Commission, who will never forget where they come from.

I was interested in the ambassador's comment on Turkey. He said Europe should not be afraid or neurotic about allowing Turkey to apply for membership of the EU.

Ambassador Bruton

I will clarify that in a moment.

What is the ambassador's view? Many people would say Turkey is geographically not part of Europe. Is there is a limit to the amount of expansion we can undertake? Do we move on from here to Georgia, the Ukraine, Belorussia and Kazakhstan? What will happen if Russia applies? There must be a limit to the level of expansion we undertake. Does the ambassador have a view on that?

Ambassador Bruton

What I said is that we should not be neurotic about the fact that we have difficulty with enlargement. Neither should we be neurotic about the fact that public opinion in some European countries is hostile to further enlargement. It is perfectly understandable that such sentiments would arise. That does not mean they are right but it is understandable and we should not allow other people to criticise us because, having undertaken such an enormous project, we are slightly tired before we make the next step forward. Part of Turkey is geographically in Europe — Eastern Thrace. For years we have said to Turkey that it is potentially a candidate to join the European Union. We may have said it without complete internal acceptance or thinking it would never happen, but we did say it and that is a prospect we must face.

I believe it also will be an issue for Turkey. It is a country with a sense of separate nationality that is much stronger than most European countries, which see themselves as separate nations but also as part of Europe and are prepared to accept being outvoted by a majority of Europeans — not with great grace but they will accept it. I do not know if Turks would be willing to see Turkey outvoted on anything by a majority in Europe. They will have to change some of the ways they view the role of Turkey in Europe for them to be prepared to make the decision.

Significant debates will also have to take place in Europe and, as Members are aware, the French constitution has been altered to the effect that there must be a referendum on every enlargement beyond Croatia. That will apply equally to the Balkans and Turkey. We can look forward to a strong debate in that regard. At this stage I do not believe we should set any geographic limit to the enlargement of the EU, other than that a country must be part of Europe, because it is impossible for one generation to know how a future generation might perceive a problem. If one had asked people to set the boundaries of Europe 30 years ago they would probably have given a different answer to the one people would give now or might give 30 years from now. We should not write into the constitution a limit or anything of that nature.

I indirectly represented this House in the Convention on the Future of Europe which drew up the constitution. If an enlarged Europe is to work there must be more majority voting. The idea that we can have vetoes on all sorts of things is not viable with a Union of 27 or 28 members. Nothing would happen if everybody had a veto. The US Senate could not operate if everybody had a veto. The United Nations is not as effective as it should be because it has too many vetoes. It is so difficult to get world trade deals through because everybody has a veto. If we want to have effective international co-operation we must accept qualified majority votes, such as two-thirds majorities or four-fifths majorities, but not complete unanimity.

One of the criticisms I might make of the constitution is it does not provide enough variable types of majority. It has one type of majority or unanimity. On certain issues, more than 66% of voting strength majority but not unanimity may be appropriate. A little creativity could be applied.

Ireland must consider the size of the Commission. The Irish Government Cabinet comprises 15 members and that is as big a group of people that can be managed cohesively. It is being done so more than adequately at present. A Commission of 27 will prove difficult. However, every State must be treated equally. One cannot treat Malta differently to France in principle.

How can those two concepts be merged? Perhaps we should have one section of ten Commissioners selected in equal rotation among member states along with three or four others selected by the President from countries not represented in the rotation. That might enable bigger and smaller states to blend on a basis acceptable to everybody. Creative thinking is required to ensure the EU continues to be decisive in the face of difficulties.

It is also important to state politics is an inherently messy business. Political decision-making always takes longer than it should. Efficiency is not consistent with pure democracy. It is good to reach a decision. We should not become purists.

I also thank the ambassador for coming before the House today, giving us an excellent overview of his work and the state of the world as he sees it and giving so generously of his time. Will the ambassador tell the House whether the European Union is making any progress in influencing the US to move away from the use of the death penalty?

Ambassador Bruton

One of my tasks is to make démarches on behalf of the European Union in opposition to the death penalty. The European Union is entirely opposed to the death penalty. It believes it is a barbarous way to deal with criminal activity and is ineffective. It is important to state a majority of states in the US do not use the death penalty. Only a small number of states do so. Among those, a smaller number again use it frequently. The démarches are made to individual states.

Greater confidence exists in the efficacy of punishment as a deterrent in the US than it does here. Sentences are far longer there and the level of incarceration is approximately six times that in Ireland as a proportion of population. It comes from a certain Old Testament view about punishment which has little resonance, if any, in this country. I would love to see less emphasis on punishment and retribution in the criminal justice system in the United States. We have nothing to learn on this side of the Atlantic not only in respect of the death penalty but also in respect of retribution as a governing principle. I could elaborate but I will not.

Does the ambassador's mandate extend to the relationship between the European Union, the United States and the Middle East, specifically Israel? A lack of consistency exists in foreign policy attitudes towards Israel because of diverging views. The US has an extremely consistent view. What is the ambassador's role in this?

The ambassador mentioned the United Nations although he did not touch on it too much in his excellent speech. The ambassador can take it as read I echo the welcome extended to him. Supporting the United Nations is a core principle of Ireland's foreign policy. However, as the ambassador pointed out deep flaws exist in the system. Does the ambassador have a role in this regard? Does he see a permanent future for the United Nations or will it go the way of the League of Nations, particularly as the US takes a dismissive view and only uses and manipulates it when it suits its foreign policy?

Does the ambassador have any influence in the context of the results of the recent election in the US whereby the House of Representatives has had a change of leadership? It was a blocking mechanism for immigration reform laws. The ambassador and I met on a number of occasions to discuss this matter and I know he has a personal interest in the undocumented Irish. Does his mandate extend to the possibility of influencing the US towards providing more green cards for the undocumented Irish?

Ambassador Bruton

As I stated in response to a different question from Senator Finucane, an opportunity may have arisen to act on immigration. President Bush is anxious to regularise the situation of many Latin-American and Mexican immigrants, particularly in Texas, who want to become citizens. This may be of help to other undocumented groups, such as the Irish. A great deal of work remains to be done. It is not an issue in which I am directly involved. The Irish ambassador, Noel Fahey, is the "go to man" as they say in the US on this subject. Phrases such as "go to guy" and "heads up" are used.

Like every country, the United States has an ambiguous attitude toward the United Nations. When the United Nations supports what one does, one is all for it but it is different when it takes another view. In general, the United States is a supporter of the UN. It has paid its dues in recent times. I believe the US Administration considers it owes it to the UN to state what it honestly believes, even if some members do not want to hear those views. However, room for improvement exists.

The Middle East peace process is the largest problem facing the world in political terms. Apart from the relationship between the United States and Israel, it causes difficulty to other relationships in that part of the world, such as the relationship between the western world and the former Ottoman empire. In this country in particular, people have an attachment to land and one can state one's grandfather owned a particular piece of land 150 years ago but does not own it now. People here have an understanding of the feelings of many Palestinians about what happened to them or what they did in 1948, depending on one's version of history. It is important this is understood. It is obviously not possible for everybody to return to where they came from but there is a need to have a clear boundary and a recognition of people's sense of having lost something, and to provide some form of recompense. The solution to the conflict is clear to everybody. It was set out at Taba, Camp David and elsewhere. It is simply a question of assembling the political will to achieve it, which is where leadership from outside is probably crucial.

It is important to note that the first US President to recognise that the Palestinians have a right to a state of their own is President George W. Bush. One might say he could have gone further than he has in following up this but he is the first President to have recognised it. I draw some sustenance from that.

It is a very important issue. It is the key to the range of other issues to which I referred in what I called this arc of opportunity stretching right across the Middle East.

I thank Mr. Bruton. I call on the Leas-Chathaoirleach to propose a vote of thanks to the ambassador on behalf of the House.

On behalf of the Members of the House, I thank His Excellency, John Bruton, for his very interesting address and for his comprehensive replies to the many questions raised by Senators. I also thank him for his kindness in accepting the invitation to address the House. I wish him well in the future.

Sitting suspended at 12:40 p.m. and resumed at 2.30 p.m.