Annan Sees No Standoff Over Budget at the U.N. 
By Warren Hoge
June 16, 2006
The New York Times
Original Source: http://www.nytimes.com/2006/06/16/world/16nations.html

UNITED NATIONS, June 15 — Secretary General Kofi Annan said Thursday that he thought the United Nations would avoid a threatened budget showdown at the end of this month over management changes, but he warned against threats to pull the plug on the organization if it did not meet some countries' expectations.
The cap on the budget will be lifted, there will be no crisis, as far as I can see, this month, Mr. Annan said at a news conference.
Led by the United States, the major contributors to the United Nations in December obtained agreement on a six-month cap on the current budget that links disbursement of money after June 30 for the two-year, $3.8-billion budget to progress in management improvements.
In addition, John R. Bolton, the United States ambassador, has periodically hinted that if sufficient changes are not made, the United States Congress will move to withhold its United Nations dues.
Mr. Annan predicted that the progress being made now would be sufficient to forestall a crisis, but he added that the tactic pressed by the United States had provoked a strong reaction from many nations.
For someone to say that because you have not reformed to my satisfaction, I am going to pull the plug and stop all the activities is going to be a very hard sell for other member states to swallow — and rightly so, he said.
Mr. Bolton said Thursday that the United States and its allies were in extensive consultations with the so-called Group of 77, which represents 132 developing nations.
We hope we can agree on a consensus decision with respect to the expenditure cap which the United States, the European Union and Japan all said should be based on substantial movement on the reform question by June 30 and a road map through the end of the year, he said.
Mr. Bolton said the group was adopting a flexible, accommodating position but needed to make progress to increase accountability, toughen oversight and start eliminating committees with expired mandates. What we'd like to see is substantial progress in some combination in all three of those areas, but we have not said, 'This is a prerequisite or that is an absolute prerequisite,'  he said.
Relations between Mr. Annan and Mr. Bolton remained strained in the aftermath of a speech last week by Mark Malloch Brown, the deputy secretary general, asserting that the United States had failed to stand up for the United Nations or to acknowledge its value to American policymakers, letting its harshest American detractors dominate debate.
Mr. Bolton unsuccessfully sought a repudiation of the remarks from Mr. Annan, and he said they represented a patronizing attack on American public opinion. He added that they would set back the cause of reform.
Mr. Annan disagreed with that position on Thursday, saying that a poisonous atmosphere that had arisen between wealthy and developing nations was subsiding and that he trusted Americans to understand Mr. Malloch Brown's speech. I do not think they will read the Mark Malloch Brown statement as insulting, condescending or rude, he said.
But Mr. Bolton was unrelenting on Thursday. I can tell you that criticism of the intelligence of the American people is never a smart thing to do politically, he said. 
And I do believe that the comments have had a negative impact politically and that impact continues, he added. I'm not trying to dwell on it, I just think it's a fact of life, and if you don't realize it, you're blinking reality in Washington.