Imagine The United States of Europe, where everyone has dual citizenship, led by a high profile president.

In Brussels the members of the European Convention charged with creating a new streamlined European machine in time for enlargement in 2004 came up with their first stab at a new model.

The desire is for a simpler legislative process, fewer treaties, clearer voting, and a defined role for Europe in the world, but as if to underline what a fractious place the EU can be and with impeccable timing, two of its largest members have been falling out in a very embarrassing public way.

Just after he had launched his proposals in Brussels, Valery Giscard D'Estaing spoke to Jeremy Vine.

JEREMY VINE:
First, dual citizenship mentioned in here, is that the big idea?

VALERY GISCARD D'ESTAING:
(Chairman, European Convention)
I think it's the big idea, yes. What does it mean? People all over Europe are citizens of their state, British, French and so on. At the same time, we felt we belonged to something which is common, so we can also have open citizenship, and we should be able to use them as we like.

JEREMY VINE:
Two passports?

VALERY GISCARD D'ESTAING:
Well, already we have a single passport, in fact, more or less. If you want to go to study in Europe, you will say, "I'm a citizen of Europe, I go to such and such university." If you travel in the holidays, you already have some euros when you are in the eurozone, but you will have your citizenship also. So it means you will have freedom to use your European citizenship as much as you want.

JEREMY VINE:
Let me ask you about an important issue connected with enlargement. As the EU goes from 15 nations to 25, that can't really happen until agricultural subsidies are settled. Have you taken any view on that?

VALERY GISCARD D'ESTAING:
No. We are working on the post-enlargement period. In the Convention, we have the ten candidate countries, plus two plus one. We are working with them as if they were already members.

JEREMY VINE:
One of the things concerning people is the deal that was struck at the weekend, which seems to have been struck because Germany and France peeled off, apparently to protect their own farmers, came to an arrangement with which Britain agreed, apparently because it was worried that its rebate was threatened. If the EU has a problem, surely it is that deals are done like that. It's not transparent.

VALERY GISCARD D'ESTAING:
Well, no, it's not transparent, but it's rather transparent. It has been debated for years, so people know the facts. The fact is, Germany is the country who pays the most, and France is producing 40% of the total of agricultural produce in Europe. If you have a problem between the two, it's normal to have an exchange of views to see if there could be a common position. The common position is good. It means we will keep the fact that farming is like other activities, urban activities, but at the same time the cost should be put under a ceiling. That was decided. I think it's a fair solution.

JEREMY VINE:
But your convention speaks of somehow enshrining the EU's values. The values at the weekend were self-interest, pettiness, national selfishness, when the deal was made.

VALERY GISCARD D'ESTAING:
Yes, because you read certain pages in the papers. If you read some others, you have generosity, solidarity, the fact that in every country in Europe you have students studying here and there and travelling.

JEREMY VINE:
But where France and Germany get together and make a deal without consulting other countries, that's not solidarity.

VALERY GISCARD D'ESTAING:
If you want to join, you will be welcome. If you want to contribute, you will be even more welcome.

JEREMY VINE:
The document here talks about common defence policy, foreign security policy, to defend and promote the union's values in the wider world. Would that make the EU a more effective counterpoint to the US?

VALERY GISCARD D'ESTAING:
If you say counterpart, it's an expression I don't like, we want to be a superpower. No. No. We want to be imperialistic again? No. We want to exist as the largest group of people of the industrialised world because we are much more numerous than the Americans or the Russians.

JEREMY VINE:
On foreign policy, you just want to be clear, don't you?

VALERY GISCARD D'ESTAING:
In foreign policy, we have a long tradition of conflicting foreign policy, even leading us to war between our countries. We want to have converging foreign policy. Because we think, basically, our interests are the same. I cannot see any difference of interest vis-a-vis China, even vis-a-vis Russia.

JEREMY VINE:
Iraq?

VALERY GISCARD D'ESTAING:
No. It's a special point which is addressed by the EU whilst creating some reactions from a certain part of the international community. But if you take the major groups of countries, Latin America, we have absolutely no reason to have different approaches. So we can have still special fields of competence in foreign affairs. But basically we need to have converging positions and I hope, if we have a President, if we have a Foreign Secretary, which will not be empowered to decide for others but to organise the convergence of policies, then we will move slowly towards a more common approach.

JEREMY VINE:
Will you, though? You appoint this Foreign Secretary you mention. And you have the President you mention. But the fact is, if Mr Chirac takes a different view on Iraq to Mr Blair, there is no foreign policy.

VALERY GISCARD D'ESTAING:
First they could debate between them. When I was President, Helmut Schmidt was Chancellor in Germany. Whenever there was a crisis of the Cold War, we had missile deployment by the Soviets, the Polish crisis and the invasion of Afghanistan, the first reaction was not to speak to the rest of the world but to speak to each other.

JEREMY VINE:
Do you think that is the case now?

VALERY GISCARD D'ESTAING:
No, it's not the case now. If you take what happened in the last three months, everyone expressed his own view or concerns, without adequate consultation with the other.

JEREMY VINE:
How can a Foreign Secretary exist in that environment? The job can't exist, can it?

VALERY GISCARD D'ESTAING:
You don't seem very confident. I am. If this man is good, it will be good. So long as he's a good man, and we will certainly find a good man.

JEREMY VINE:
Or woman?

VALERY GISCARD D'ESTAING:
Or woman, of course. He will be a sort of broker going all the time between the major people concerned in foreign policy. I think this Foreign Secretary should be "secretary" of the group, trying to harmonise positions.

JEREMY VINE:
Would you want the EU to have one seat on the UN Security Council?

VALERY GISCARD D'ESTAING:
No, but I want to have a single posture. To have one seat would weaken the system, because at the moment we have two and, with the rotation, we may have more. So to diminish our presentation would not be constructive. But I think we should work in a way that we use our position as a common position.

JEREMY VINE:
But President Bush would call this person, would ring them up, the new EU President, rather than individual national leaders?

VALERY GISCARD D'ESTAING:
Well, we will see.

JEREMY VINE:
Who would it be?

VALERY GISCARD D'ESTAING:
He complains there are too many Presidents. He says there are too many and he doesn't receive all of them, as you know. He certainly will receive the President of a United Europe.

JEREMY VINE:
People say that might be your next job.

VALERY GISCARD D'ESTAING:
No, no. I'm a different generation. I've already said the President of Europe should be a man or woman, as you say, between 60 and 65.

JEREMY VINE:
Tony Blair?

VALERY GISCARD D'ESTAING:
You must ask him. You have more occasions to ask him than I have.

JEREMY VINE:
Valery Giscard d'Estaing, thank you.

This transcript was produced from the teletext subtitles that are generated live for Newsnight. It has been checked against the programme as broadcast, however Newsnight can accept no responsibility for any factual inaccuracies. We will be happy to correct serious errors.