Michael Prest listens to frustrated UN general-secretary Boutros Boutros-Ghali give Oxford's Cyril Foster lecture. Boutros Boutros-Ghali, the Egyptian secretary-general of the United Nations, is a frustrated man. He believes the UN should command the moral authority and practical resources to lead an increasingly integrated world - to give real meaning to the easy phrase "international community". But he knows that his organisation's reputation has never been lower and its money has never been so stretched.

In the Cyril Foster lecture at Oxford University's Sheldonian Theatre last week, Boutros-Ghali tried to set out the causes of his frustration. They stemmed, he argued, from two sets of dialectic: the simultaneous forces of globalisation and fragmentation; and the conflict between members' growing demands on the UN and their reluctance to provide the wherewithal to meet those demands.

The connection between these dialectics lies in the "challenges" thrown down by globalisation and fragmentation. Globalisation, largely driven by technology and economic integration through trade and financial markets, risks leaving many millions of people behind, outcasts in a new world order of footloose capital. Environmental decay and epidemics such as Aids respect no national boundaries. Huge migrations of people fleeing poverty, destruction and disease receive a frosty welcome in host countries.

Fragmentation results from "rising insecurity and unmet needs on a national scale". The positive aspect is the proliferation of citizens' groups and non-governmental organisations whose purpose is promoting the public good. But the negative aspects are fanaticism, separatism and conflict, leading in extreme cases such as Somalia to the international dilemma of the failed state.

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Its 185 member states expect the UN to do something about such problems. But members have become chary about providing the money and owe the UN $2.5 billion. Boutros-Ghali attributes this reluctance to shortsightedness, partly induced by sensation-seeking media: "The new culture likes images. It is more interested in the short term than in the long term." He wryly observed that in addition to the 15 Security Council members there was a 16th - CNN.

So far as it goes, there is much to be said for the secretary-general's analysis. But it goes nowhere near far enough. The UN's difficulties run much deeper. They are partly implicit in the very nature of the organisation and partly of its own making. And the solutions are much more radical than more money and respect.

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From its beginning 52 years ago, two structural weaknesses have haunted the UN. The first is the dependence on the nation state. The second is the inherent tendency of empires to overreach themselves.

That nation states should be the building blocks of the UN is natural. The second world war was fought to establish equilibrium between nation states, not to abolish them. Decolonisation, which has brought as many as 100 new states into being, reinforced the primacy of the nation state as the basic unit of international relations. It was precisely because the world was organised into nation states that the UN was needed as an arbiter, law-maker, peacekeeper and catalyst for development.

Yet the nation state today is in a sorry state. Its legitimacy is being eroded from without and from within. From without, revolutions in finance, commerce and communications have created global networks that reach over and around states. From within, more affluent and better informed citizens demand government that is at once more responsive and less intrusive. This is the great wave of "democratisation" to which Boutros-Ghali referred in his lecture and which he believes the UN should encourage. But it is also the cause of the fragmentation that has produced so much grief from Lebanon to Liberia. Even in the most stable democracies such as Britain or the United States, faith in the state has greatly diminished.

If the nation state is losing legitimacy, how can an organisation built on the nation state not suffer likewise? Moreover, the solution sought by many states and their citizens - the regional grouping - is hardly a consolation for the UN. If carried to fruition, the European Union will be a far more powerful actor in its sphere than the UN ever could be. Trade and political regional bodies are flourishing in Asia, Africa and Latin America. These bodies may well be more successful than the UN in delivering the peace and prosperity people want. Regional groupings may become the principal bargaining parties in international relations, as more or less happened in the Uruguay round of trade negotiations. And these groupings can have a long arm. Despite Boutros-Ghali stressing development as one of the UN's prime functions, the biggest supplier of development assistance to Africa is the EU.

Paradoxically, from the UN's point of view, this is no bad thing. For the UN's second major problem is that it is trying to do too much. To the extent that the UN has added more and more responsibilities to its mandate, the present dialectical contradiction, as the secretary-general prefers to see it, between responsibilities and resources would have been difficult to avoid.

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There is no doubt that the UN has become very ambitious. The UN organisation has swollen to some 40 often overlapping bodies, with a budget of $2.5 billion and 15,000 employees. From early concentration on peace keeping and overseeing international law, the UN has diversified into almost every aspect of human endeavour: economic and social development, human rights, the status of women, to pick at random. Many of these are explicit in the UN charter or can be justified implicitly. Many have been undertaken because members asked for them. Because the UN is meant to be a civil service it must carry out members' wishes as expressed through the general assembly and other bodies.

But the UN often behaves more like a political organisation always searching for new fields to conquer. Take the long-mooted idea of setting up an economic security council. The world is bristling with economic organisations. So why have another except to try to accumulate power? Unfortunately, Boutros-Ghali sees an economic security council as an example of "democratisation", which would give smaller countries a louder voice.

The UN has compounded ambition with incompetence and worse. Unesco, the Food and Agriculture Organisation and latterly the World Health Organisation became personal fiefdoms of dubious probity. It has proved impossible to wind up useless organisations such as Unido (UN Industrial Development Organisation). On the outside, there is an abiding suspicion that internal cases of malpractice such as corruption or sexual harassment have been inadequately prosecuted. But much political meddling bedevils the UN, the organisation cannot avoid all responsibility for its inefficiency and sluggishness.

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Boutros-Ghali was at pains to describe the steps he has taken to remedy the UN's ills. He has tried to streamline the notorious bureaucracy, contain the budget, and improve accountability and professional standards. He summarised the position thus: "During the Middle Ages the lords were stronger than the king. That is my problem." In return for taming the lords, he wants the members to "democratise" the Security Council - code for reducing the power of the permanent members such as Britain and raising more revenue through international taxes.

He is right to maintain that the UN deserves better from its members. We too often forget what has been achieved: successful peacekeeping in Cyprus, nation-building in Cambodia and Haiti, assistance with some 50 elections, mobilising the world's conscience through Unicef and the High Commissioner for Refugees. A string of conferences on the environment, human rights, women, population has accelerated international cooperation on these issues. Although ridiculed for its endless debates, the UN is invaluable because it is a talking shop. Banging shoes on the table is infinitely preferable to launching missiles. Above all, the UN remains the world's central bank of law and decency.

For precisely that reason, however, the UN and its members must think much more rigorously about what they want the organisation to do. The core difficulty with Boutros-Ghali's approach is that he appears to want a leaner and better financed UN so that it can evolve further towards being a surreptious world government. Nothing is less desirable. His priorities of peacekeeping, development, and human rights and democratisation are in combination highly ambitious. They leave little out. We do not want a secretary-general who is "king". We need instead a UN that is more modest, yet more effective, whose reputation derives from publicly focusing on issues it can realistically tackle. That is the synthesis to which the secretary-general's dialectic should lead. The alternative is a UN determined haphazardly by the qualities represented on the Sheldonian ceiling: law, drama and ignorance.

Michael Prest has recently completed five years at the World Bank.

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