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FAREED ZAKARIA GPS

Islamic Infighting, Iran versus Saudi Arabia; Inside the Oil Kingdom; Kim Jong-Un's Quest for the H-Bomb; Interview with Niall Ferguson; Interview with Gary Kasparov. Aired 10-11a ET

Aired January 10, 2016 - 10:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.


[10:00:00] Fareed Zakaria, Host: In the United States and around the world. I'm Fareed Zakaria.

(BEGIN VIDEO CLIP)

ZAKARIA: We'll start today's show with what could be the next war in the Middle East. Saudi Arabia versus Iran. Sunni versus Shia. The execution of a cleric. The severing of relations. What will the next step be? Will this Cold War turn hot and what role should America play?

I have a terrific panel to talk about all of that.

Then, the next recession. We're due for another one and some see it coming inevitably from China. What in the world? I will explain.

Also, the most controversial secretary of state of all time, perhaps, Henry Kissinger. War criminal, foreign policy master mind, something in between? I will ask his biographer Niall Ferguson.

And Vladimir Putin. He has just declared NATO as a threat to Russia but how much of a threat is he to the West?

Finally, one of the world's most top fashion houses. They may shoes, handbags, dresses, skirts and now hijabs. Yes, indeed.

(END VIDEO CLIP)

ZAKARIA: But first, here's my take. Over the last two decades, the United States has approached the Middle East through its own conceptual frameworks. Dictatorships versus democracies. Secularism versus religion. Order versus chaos. But the most significant trend shaping the region today is something different. Sunni's versus Shiites.

That sectarian struggle now infects almost every aspect of the region's politics. It has confounded American foreign policy in the past and will continue to limit the ability of America or any outside power to stabilize the region.

In his prescient book, "The Shia Revival," Vali Nasr argues that the American invasion of Iraq in 2003 was the tipping point. The U.S. saw itself as bringing democracy to Iraq.

(BEGIN VIDEO CLIP)

GEORGE W. BUSH, FORMER U.S. PRESIDENT: We will not relent until your country is free.

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ZAKARIA: But people in the region saw something different -- the upending of the balance of power. Sunnis, who make up 85 percent of all Muslims, had long dominated the Arab world, even in Shiite- majority countries like Iraq and Bahrain. But in one stroke, that changed. Iraq, a major Arab state, would now be ruled by Shiites. This rattled other Arab regimes, and their anxieties have only grown since then.

Though there's always a tension, Sunnis and Shiites did live in peace for the most part until recently. In the 1960s and '70s, the only Shiite power, Iran, was ruled by the shah, whose regime was neither religious nor sectarian. In fact, when the shah was overthrown, the country that first gave him safe harbor was Egypt, the region's largest Sunni power, something unimaginable in today's sectarian atmosphere.

The pivotal shift took place in 1979. The Islamic Revolution in Iran brought to power an aggressively religious ruling class, determined to export its ideas and support Shiites in the region. That same year, in Saudi Arabia, militant radicals took over the Grand Mosque in Mecca, proclaiming opposition to the royal family and its lax ways. The event scared the Saudis, pushing the regime substantially to the religious right. And Saudi Arabia's governing ideology of Wahhabi Islam was always anti-Shiite, viewing the sect as heretics.

As Iran has expanded its influence in Lebanon, Iraq and Syria, Saudi Arabia has responded by adopting an even more sectarian edge to its policies. But this may be about more than just geopolitics. Saudi Arabia is facing a series of challenges from ISIS to domestic extremists. The country's large and active social media is dominated by radical Islamists. And as oil price plunge, government revenues have collapsed and the country's generous subsidies to its people will prove hard to sustain.

The regime needs greater legitimacy. And perhaps that is why we see a more assertive, aggressive and yes, sectarian foreign policy that Saudi Arabia has ever pursued. The strategy is not without risks. About 10 percent to 15 percent of Saudi Arabia is Shiite. And they live in the eastern province atop the kingdom's oil fields. Neighboring Bahrain and Yemen are now filled with resentful Shiites who see Saudi Arabia as repressing them.

In general the United States should support its ally Saudi Arabia in resisting Iran's encroachments in the region, but it should not take sides in the broader sectarian struggle.

[10:05:06] This is someone else's civil war. After all, Washington's principal ally in the fight against ISIS is the Shiite-dominated government in Baghdad. And besides, the single greatest threat to America emanating from the Middle East remains radical Sunni jihadists, many of whom have drawn inspiration, funding and doctrines from Saudi Arabia. There are very few good guys in this story.

For more go to CNN.com/fareed and read my "Washington Post" column this week.

Let's get started.

Let's dig deeper into the Middle East cold and hot wars with a really terrific panel. Joining me here in New York, Robin Wright, a contributing writer at the "New Yorker" and a joint fellow at the U.S. Institute of Peace and the Woodrow Wilson Center. And Vali Nasr, the dean of the Johns Hopkins School of Advanced International Studies and a former top adviser at the State Department. He is also an Iranian American.

Martin Indyk joins us from Washington today. He was assistant secretary of state for Near-East affairs during the Clinton administration. He is now an executive vice president at Brookings. And in Geneva, Nawaf Obaid is a visiting fellow at Harvard's Belfer Center for Science and International Affairs and a columnist for "Al- Hayat," an Arab newspaper. He is from Saudi Arabia.

Robin, you say that this schism is perhaps turning into one of the biggest divides in the world of Islam in 14 centuries.

ROBIN WRIGHT, CONTRIBUTING WRITER, THE NEW YORKER: I think so. And in terms of the scope of the impact and the damage that's being done, this is something with a two rival powers that plays out politically, ideology, strategically, ethnically, and virtually every range and it's having an extraordinary impact on the four critical peace initiatives that were supposed to begin playing out this month.

The effort to try to get the government and the opposition together in Syria. The effort to push the various warring factions in Yemen to a second round of peace talks after the collapse recently of the cease- fire. To help the Iraqis move both militarily and politically to solve the crisis with ISIS and then of course the Iranian nuclear deal is supposed to be implemented this month. And this timing really comes at an extraordinary moment in each one so this is having a rippling impact right across the region.

ZAKARIA: Vali, do you think that Saudi Arabia recognizes what it was getting itself into? It would be execution of this Shiite cleric which is the spark, in a way, that set this fire in motion.

VALI NASR, DEAN, JOHNS HOPKINS SCHOOL OF ADVANCED INTERNATIONAL STUDIES: Well, at least they should have known largely because the mood in the region is very tense. There's already heightened sectarianism in Iraq. In Syria, the Arab -- the uprisings in Bahrain became very quickly sectarian. And also because there had been warnings not just from Iran but also from the United States that this could be the start of a wedge issue that then could polarize the already tense situation that existed.

ZAKARIA: You have argued, Nawaf, that what we are seeing in Saudi Arabia is the Saudis taking on a much more assertive and aggressive foreign policy to defend themselves from what they see as Iran's maneuvers and encroachment and what they see as a kind of abandonment of Saudi Arabia, Saudi interests, by the Obama administration. Is that a fair characterizations of your views?

NAWAF OBAID, COLUMNIST, AL-HAYAT: This is correct. I mean, you have a loss of U.S. presence and of U.S. leadership in the region. And hence you have to have the most powerful of the Arab states that's still standing take on the role and take on a role that's going to be able to negate and then start pulling back slowly Iranian presence and influence in the Arab world. So that's ongoing. And that's only going to increase in the next several years.

ZAKARIA: Martin, what do you make of that criticism of the Obama administration? In a sense the Republicans make it as well that if the United States were more assertive, more engaged and, you know, many of them keep saying we should be supporting our allies, Saudi Arabia, more strongly.

MARTIN INDYK: After the Iran nuclear deal was done, I think President Obama tried very hard with the new leadership in Saudi Arabia to get on the same page and the consequence of that was when this headstrong young leaders in Saudi Arabia under King Salman, his son and also the crowned prince, took Saudi Arabia or the rest of the Gulf states into a war in Yemen instead of Obama saying, you know, hold on, guys, this might not be such a good idea. You're going to get stuck in a quagmire here.

[10:10:11] Instead we essentially went along with it. And now they are stuck. And now 50 percent of the Gulf military capability is being eaten up in war that's causing humanitarian crisis in Yemen, and that's to the advantage of Iran. It's not turning Iran. It's really sapping in the Gulf states of their military capabilities when we need them to be active elsewhere in the region particularly against ISIS.

So we have an urgent need, I think, to try to get on the same page. And that requires both sides to be more engaged with each other in confronting both the Iranian hegemonic ambitions and the challenge from ISIS.

ZAKARIA: What do you think?

NASR: I agree with the statement of the problem from both Nawaf and Martin, but I think the problem is -- I will put it differently. I mean, once the United States started talking to Iran it changed the whole geo-strategy of the region. For 40 years there was a very close alliance between Saudi Arabia and Iran -- Saudi Arabia and the United States to contain Iran. Now there's a breach in that alliance. The United States has decided that it's not as committed to containing Iran has Saudi Arabia would have expected.

But the problem is not containing Iran. There are too many Shiites in the region. I think -- what we're really talking about is that Shiites in Iraq, Shiites in Bahrain, Shiites everywhere basically have to accept to live under a political order that existed before 2003 Iraq invasion. We might be able to --

ZAKARIA: Which is a Sunni dominated order. NASR: But it's a Sunni -- or an order in which Iran will have

absolutely no influence and the Shiites will have absolutely no ability to rely on Iran. Well, we're in a situation that any time Shiites asked for anything it seemed as an Iranian power play. And the dilemma the United States has and I think Saudi Arabia has is that you might even be able to contain Iran, but you can't contain half the population of the region, whose sense Iraq has woken up. There's no going back to an order before 2003 where there would be passive acceptance of an American-Sunni Arab architecture that keeps Iran outside and you have the populations where minority and majorities. The Shiites would accept things as they were.

ZAKARIA: Robin, you've reported so extensively and wonderfully from Iran. Do you think the Iranians want to come in from the cold and become more modern? Do you think they're seeking to spread their influence through the Shia populations off the Middle East? What is Iran's goal here?

WRIGHT: Iran, was it January, is a month that after almost two generations that it was going to end or begin to end its pariah status. With the implementation of the nuclear deal, the beginning of the lifting of sanctions, and if so relations being warned around the world. Its place being restored. It is the -- most populous country and it has a huge consumer base. It has enormous resources that it was looking for the restoration of its stature, a proud civilization.

And now this crisis has begun to derail that. The Gulf countries cutting off relations. The -- you know, the questions being asked if we do warm relations, will our embassies, other embassies be ransacked in Tehran, too? That this is the behavior of a very mischievous regime, and yet again attacking another embassy.

The thing that's so interesting and the reason that the ability of the outside world is limited in writing this very difficult showdown is because both countries are really in transition. And Iran is in a transition in the sense that it's going to elections next month that will decide the future course of the revolution. It will decide whether the balance of power will shift more to the kind of centrist line of the current president or remain as it has been in the last decade in the hands of hard liners.

Meanwhile in Saudi Arabia, you have a king that's been in power a year. He's ailing. He's deferred a lot of the power to his young son. And Saudi Arabia feels -- I think both countries feel kind of vulnerable in transition at the moment.

ZAKARIA: Fascinating. Stay with us. Next on GPS, we will tackle some of the other top stories happening in the world. Most notably the North Korean nuclear test.

(COMMERCIAL BREAK)

[10:17:31] ZAKARIA: And we are back with Robin Wright, Vali Nasr, Martin Indyk and Nawaf Obaid.

Nawaf, let me ask you about this new order, this new ruling elite in Saudi Arabia. There are lots of people who tell me, including Saudis, that they're very worried. That the king is ailing, that the person, the defacto ruler of the country now is this 29- or 30-year-old deputy crown prince, Mohammed bin Salman, who is also Defense minister and he's also chairman of the Ruling Council of Iran called the Saudi Oil Company.

And he seems to have done things that people say are rash and impulsive. The war in Yemen. Much more aggressive Saudi foreign policy in general and some of these anti-Shia or anti-Iranian moves, depending on how you see it. What -- how does the new leadership in Saudi Arabia look to you?

OBAID: Well, the new king came into power, he was already faced with several challenges. And one of them was Yemen. So you have a coalition and the strategic coalition with the U.S. where you listen to ideas and policies that don't really work or you actually take things into your own hands. I mean, Iran is in Syria, supporting a dictator that's killed 400,000 people. They're in Iraq funding in Shia militia that have done some of the most atrocious things. So I don't really see how we can sit down at the table and have some sort of an agreement was, you know, blaming, for example, the new deputy crowned prince for irrational decisions.

He was faced with a set of factors and a set of challenges. And through this new committee that's been established, they've had to make decisions and they had to go forward. Now will they plan out? Will they not plan out? Time will tell. But it's not he didn't have the choice or the luxury to stand still and see things happening around itself in the region which it's obviously should dominate in the Arab world and wait for instructions and some guidance from the U.S. which weren't coming in the first place.

ZAKARIA: We have to move on.

Robin Wright, you went to North Korea with Madeline Albright. You look at this recent test. But what is most interesting is, China was not informed. The Chinese seemed upset about it. And yet as in the past they have never wanted to pull the plug. They provide most of the fuel and food that keeps North Korea going. Is there any sign that will change?

[10:20:04] WRIGHT: And not yet. And one of the great challenges, what do you do to try to convince the regime that this is not a wise course of action without the Chinese participating. It's the most critical element. The United States has tried engagement during the Obama administration, during the Clinton administration. It's tried, you know, increasing sanctions. Neither has had enough impact. And while there are calls for more sanctions, without the Chinese squeezing the North Koreans, the prospect of getting any shift, any moderation is unlikely. And this is a young man, again, we're talking again like Saudi Arabia, 33 years old, very insecure. He sees -- he sees villains and devils at home. He sees them in the international community. And this is his kind of macho response, and it's a very dangerous course of action.

ZAKARIA: Vali, when you were in government, you were advising the secretary of state, and Richard Holbrook, on Afghanistan. What do you make of these reports that the Taliban may now actually control more territory in Afghanistan than it did in 2001 that after 14 years, after all this money, every time we draw back from a town, the Taliban seems to be able to encroach.

NASR: Well, I think the idea that there was an Afghan Security Force that could take over from the U.S. military as we drew down was overstated and oversold. So the Afghan Security Forces are not able to withstand the Taliban. And as we shrank our forces, the Taliban began to encroach. And it's actually not just the Taliban. It's ISIS also showing up in Afghanistan that are in pockets in the north and pockets in the east that are controlled by, you know, virulent extremists that are allied to the -- to ISIS, and that's another source of worry.

The other problem is that the Afghan government that we vested so much hope in is not performing the way we thought it should. So in a sense, Afghanistan is going sideways and downwards, somewhat like when the United States left Iraq. And we create a scenario where we market it as good enough. Afghanistan good enough, Iraq good enough, but it's actually not good enough.

ZAKARIA: But what are we supposed to do, Martin? We can't stay in these countries forever. I mean, it's been 14 years and probably a trillion dollars in Afghanistan.

INDYK: That's true. But I think that what happened in Iraq with our complete drawdown and the chaos that emerged from that with another ruler there who in Maliki was a real problem that pulling out all together is not a good idea in Afghanistan. We at least have a leadership there that we can work with. And I think that it's worthwhile to stay the course there.

Of course President Obama is in his final year. And he has to stop to think about handing all of the things to the next president. That's part of his responsibility. And try to find a way to move against ISIS more effectively. I think that they're gearing up for that. And try to ensure that Afghanistan does not fall apart, focusing on the rebalancing situation. Here we have an opportunity picking up on what Robin what was saying. The challenges to get the Chinese to put the pressure on the North Koreans.

That's where the leverage lies, our leverage, interestingly, lies in making clear to the Chinese that if they don't, we will have no choice but to boost our presence in their region so as to protect our allies, South Korea and Japan. And they don't want that and that may give us sufficiently enriched to get them to pressure the North Koreans.

ZAKARIA: This is sounding like a very, very complicated world to start the new year. Thank you all very much. Terrific panel.

Next on GPS, the great recession that almost became a depression might seem like it was yesterday but in reality it began eight years ago and some think the next recession could already be on its way. It's all about China. I will tell you what you need to know when we come back.

(COMMERCIAL BREAK)

[10:27:57] ZAKARIA: Now for our "What in the World" segment. The "Big Short" tells the story of the unlikely characters who predicted the financial crisis of 2008.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: So Mike Burry, who gets his haircut super cut and doesn't wear shows knows more than Alan Greenspan?

CHRISTIAN BALE, actor, "The big short": Dr. Mike Burry. Yes, he does.

(END VIDEO CLIP)

ZAKARIA: based on the book of Michael Lewis, it's a riveting tale likely to receive some Oscar nominations this week.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: The whole world's economy might collapse.

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ZAKARIA: The film also makes you wonder what might cause the next global crisis. This past week the markets may have given us more than a hint. On Monday and then again on Thursday, China's main Shanghai market plummeted 7 percent each day. The drop was so dramatic that trading was halted on both days. Other markets around the world took some big hits as a consequence.

All of the turmoil suggests a frightening possibility, a global recession born in China.

Ruchir Sharma, an expert on emerging markets at Morgan Stanley, has been warning about that scenario for months. He says the world is about due for a recession.

Since the early 1970s, global downturns have struck every seven and a half years on average. And it has been seven years since the last one. These days China is the world's biggest driver of economic growth, Sharma points out, a reversal of years past when the United States power growth.

So the world economy hinges on China like never before. But Beijing is mired in debt and keeps on racking up more. Debt levels have skyrocketed to around 300 percent of the total economy, Morgan Stanley says. No developing country in history has ever taken on debt faster than China in recent years, says Sharma. And when debt levels go up so fast and so furiously, that is the single most reliable predictor of financial crisis, he says.

China is staring into this abyss thanks to the hubris of its once unquestioned technocrat rulers. For years they delivered miraculous double-digit growth. Lifting tens of millions out of poverty. [10:30:06] Now when the financial crisis hit in 2008, they wanted to

keep things going. So they began a massive stimulus program and they have not wanted to pull the plug on it for fear that economic growth would come crashing down. Ironically while the country's technocrats don't have to worry about elections, they are so worried about angering the population with slowing growth and rising unemployment that they have been unwilling to stop goosing the economy.

Now the truth is that Beijing still has some extraordinary tools at its disposals, including strong fundamentals and huge reserves of cash. Unfortunately experts say China's stock market is less reflective of the nation's economy compared to other countries. But however things turn out, every nation on earth will be affected by Beijing's policies in the next year.

(BEGIN VIDEO CLIP)

DONALD TRUMP (R), PRESIDENTIAL CANDIDATE: China is killing us.

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ZAKARIA: You'll likely hear lots of China bashing in the 2016 election, but the truth is Americans should be rooting for China to succeed. If not, Americans will feel the pain right here at home.

Next on GPS, understanding Henry Kissinger. Richard Nixon's secretary of state is one of the most controversial people ever to hold that office. Is that controversy grounded in fact or fiction? I will ask Niall Ferguson, the author of a massive new biography of the 92-year- old elder statesman.

(COMMERCIAL BREAK)

[10:35:18] ZAKARIA: Henry Kissinger is a controversial figure. That's probably an understatement. One the one hand there are those who see his great accomplishments first and foremost the opening up of China to the west and the world but also the 1973 Nobel Prize for attempts to bring peace to Vietnam and his detente with the Soviet Union. But his critics have called him a war criminal?

So which is it? Well, Harvard professor Niall Ferguson has done an extremely deep dive into the life and papers of Henry Kissinger and come out with the first installment of his biography of the former secretary of state. Kissinger Volume I, 1923 to '68, "The Idealist" is 1,000 long and doesn't even get to his service in the White House and State Department.

I talked to Ferguson about Kissinger and his title, "The Idealist."

Niall Ferguson, pleasure to have you on.

NIALL FERGUSON, AUTHOR, "KISSINGER 1923-1968: THE IDEALIST": Great to be back.

ZAKARIA: You spent a lot of time in the book talking about his upbringing. And you point out something might surprise people, which is that he grew up an Orthodox Jew in an Orthodox Jewish family in Germany. This is something he doesn't bring up a lot. This is something others don't spend a lot of time on.

Do you think that black Orthodox Jewish background was very important to understanding Kissinger?

FERGUSON: Yes, in the sense that one has to understand the youth to understand anyone, really. And growing up between 1923 and 1938 when he left Germany at age 15. He grew up in a pretty straight Orthodox community. I mean, it was a part of Germany that was by no means friendly to Jews. You are right next door to Nuremberg if you live in Furth and Franconia and Bavaria. And Nuremberg was one of the hotbeds of national socialism place that produced the odious magazine "Des Durma (PH)." So I think the fact that he grew up an Orthodox Jew in that very hostile environment mattered a lot.

ZAKARIA: One of the things people are sure about Henry Kissinger is that he has personally Machiavellian, that is to say very clever about advancing his own career. Do you see him as the young man, the Harvard assistant professor, plotting and planning his way carefully to get to the -- this very young national security adviser and then secretary of state?

FERGUSON: No. But I thought I would. What starts off a historical project with certain expectations I thought I was going to call this book American Machiavelli. But I realized quite soon into the research that he wasn't that at all. In fact I was struck by how inept his attempt to political to self-advancement were and we think of the later Kissinger as a master manipulator of the press. But the early Kissinger makes horrendous blunders and dropped bricks at the press conferences that he first attend.

So I came to realize that this younger Kissinger and this is right down to the end of the 1960s, is kind of politically slightly naive. And at times almost bungling. Quite professorial. Quite earnest. And rather repelled by the realism that he encounters. For example in the Kennedy administration it's very telling that he's shocked by the deals that Kennedy does, say, over the Berlin wall or over the Cuban missile swap for U.S. missiles in Turkey. Kissinger goes, this is gruby to do these deals with the Soviets. So I think "The Idealist" is a pretty good subtitle for this book about Kissinger's early life and it runs counter to all that one being led to expect about him.

ZAKARIA: You know that you are writing this under the shadow of a huge amount that's been written about Henry Kissinger and in particular some very, very tough, nasty indictments. Christopher Hitchens' book and movie essentially accusing of him war crimes. Now this does again, as you -- this happened in his period in power. But you do talk a little bit about it at the front of the book. Do you think that the indictment of Henry Kissinger as a war criminal is unfair?

FERGUSON: I think it requires a double standard. It requires you to say that things that were done by the Nixon administration were uniquely wicked and were not done by other administrations. And I think if you apply a single standard, it's very striking that there's a continuity in U.S. foreign policy. If you just take specific example, it is by no means only in Chile that a military coup takes place. That the United States is happy about if not actually supports. If you take the case of the bombing of Cambodia, it is not a unique situation that an American administration is responsible for bombing a country that it is not formally at war with.

[10:40:02] In fact these things go on in our own time. Think only of the restoration of aide to al-Sisi's regime in Egypt this year, a regime that's actually likely to kill a lot more people in the end than finish a regime in Chile, or think of the bombing that has gone on in Pakistan under this administration. Today we have drones rather than B-52s. The technology has changed. But this is not it seems to me substantially different from what was going on in Cambodia in the early 1970s. Now --

ZAKARIA: And you point out that Eisenhower and Kennedy probably used covert actions to depose regimes.

FERGUSON: Absolutely.

ZAKARIA: Far more frequently.

FERGUSON: Yes. Yes. And indeed if you carry on thinking about what was done in the 1950s and 1960s where there were much clearer cases of CIA sponsored regime change that happened in Chile, you'd have to conclude that they were all war criminals. Nearly all the secretaries of state ought to be accused of these things and nearly all the presidents, too. So that seems the main problem with Hitchens' approach. This is not to say --

(CROSSTALK)

ZAKARIA: And then why --

FERGUSON: -- that it's all OK. It's just to say that if we're going to assess American foreign policy during and indeed after the Cold War we should have a single standard and that's what I'm going to try and do in volume two.

ZAKARIA: Niall Ferguson, fascinating book. Can't wait for the second volume.

FERGUSON: Thank you.

ZAKARIA: Up next, Gary Kasparov, the former world chess champion from the days of the Soviet Union, has now become one of the biggest thorns in Vladimir Putin's side. Kasparov will take us inside Russia, inside Moscow, even inside Putin's head with some startling revelations when we come back.

(COMMERCIAL BREAK)

[10:45:12] ZAKARIA: As 2015 was turning into 2016, Russian President Vladimir Putin did something rather extraordinary. Something that got lost in the shuffle of New Year's celebrations. Putin signed an executive order on December 31st naming NATO as a threat to Russia's national security due the military alliance's approach to Russian borders and its buildup of military potential.

So just how bad is the state of affairs between Russia and the West? To talk about that and much more, I recently had Gary Kasparov in the studio. Kasparov is still best known for becoming the youngest world chess champion at age 22 when he played for the Soviet Union. Since retiring from chess, he's become a campaigner for human rights and democracy in Russia.

Gary Kasparov, pleasure to have you on.

GARY KASPAROV, AUTHOR, "WINTER IS COMING": Thanks for inviting me.

ZAKARIA: You think that Russia is in a very dangerous stage right now because of the nature of Putin's rule. The book -- you know, the title is haunting. "Winter is Coming." And you really think that it's going to get pretty bad in Russia.

KASPAROV: It will get worse before it gets better.

ZAKARIA: Worse because oil prices are collapsing? The foundation of his regime.

KASPAROV: Absolutely. But it's -- also you should look at Putin's budget. You know. He's now struggling with cash. First time during his 50 years in power, he doesn't have enough cash to pay for everything. And he had to make tough choices. And he's cutting pensions. He's cutting, you know, social spendings. But he keeps increasing military spending, security -- support for security apparatus and propaganda.

This was the war budget. And that's -- I can make only one prediction that, you know, he will continue his aggressive foreign policy because his propaganda machine needs these victories. Even virtual victories. But they have to present Putin as the white knight who is the only one able to defend Mother Russia against endless enemies.

ZAKARIA: A friend of mine said that these actions in -- Russian friends said to me these action in Ukraine, in Crimea, have been very popular. People like watching it on TV but then they go to the fridge and it's empty. And he said in Russia right now it is the battle between the TV and the fridge.

KASPAROV: Absolutely. This is -- it's all sort of a joke. And I'm waiting for the fridge eventually to take over. But it's -- you know, I can rely on my mother. She's 78. She was born and raised under Stalin. And she saw every century of everything, all sorts of propaganda, and she has been -- she's still in Moscow. She has been listening to this, you know, massive 24/7 attacks. You know, the brainwashing attacks. And she told me that the difference between solid propagandas and Putin's propaganda is that, you know, always (INAUDIBLE) about the contents of propaganda. It still contained some element of positive future. Bright future or the communism, the brotherhood.

Putin's propaganda, it's always like cult of death. It's all poison. It's war. I mean, we have no way of -- we have to fight everybody. So Soviet Union had some friends. And here we have enemies. Ukrainians, Georgians, Estonians, of course Americans, Jews. That's -- it's everywhere. So that's why -- first time in my life, you know, I'm fairly pessimistic about the outcome because I see no, you know, positive scenario. It's all just choice for lesser evil.

ZAKARIA: A lot of Western leaders would listen to you probably would not disagree with your analysis but say look, it's a huge country. Ten time zones or whatever it is. 3,000 nuclear weapons. A veto on the Security Council. We have to do business with Russia.

KASPAROV: You know, I'm not telling you that confronting Putin today, you know, could solve all the problems and it will, you know, bring the sufferings in Russia or outside of Russia caused by Putin's regime to an end. Any day Putin stays in power, any delay of confronting him simply will raise the price. And unless we try to, you know, have a real red line. And it will not end nicely.

ZAKARIA: You're very critical of the West from the start. And you talk about President Bush. What do you think Bush was thinking when he said I can look into his soul and I saw a man who I could trust.

KASPAROV: I think it's not just the problem of Bush 43 or Bush 41 or Bill Clinton or Barack Obama. I think it's a fundamental problem of the West. After the collapse of the Soviet Union and the end of the Cold War, you know, it's complacency. It was won. And Francis Fukuyama book, "The End of History," very much reflected our expectation of (INAUDIBLE). So fine, we won. Now let's dream about the future.

So Bush tried to, you know, work with Putin probably because there was a 9/11. And he -- and Putin was very -- let's give him credit. He's a very capable KGB officer who could read the mind of his counterparts and proved to be an excellent negotiator -- I would even call him poker player who knows how to bluff even if it was a very weak hand.

[10:50:22] ZAKARIA: And you think that the Obama administration has continued the Bush administration's sort of attempt to engage the Russians?

KASPAROV: Absolutely. This is -- that's why, you know, I'm critical about this, the U.S. foreign policy almost 25 years because four administrations failed to actually come up with a plan how to integrate Russia into this democratic world and how actually to pave the road for a better future. And naturally, today, we're dealing with problems that we thought were gone 25 years ago.

And my book is an attempt to actually explain why it's happened and what we should do now to make sure it's not going to be repeated.

ZAKARIA: If you listen to the version of history that Vladimir Putin believes and there are many Russians who believe this, the problem is that the West was always trying to keep Russia down. That the West attacked Serbia, Russia's ally. That the West criticized Russia about Chechnya. That the West has expanded NATO to Russia's borders. In other words, that there was an attempt at -- you know, there was a hostility that the West showed to Russia, (INAUDIBLE), and that's why Russia has had to react in this way that it has.

KASPAROV: Yes, but unfortunately all these were heard from Adolf Hitler when he was trying to explain, you know, why Germany behaved as it did. I'm not talking about 1939 and 1940. And by the way, the harsh conditions imposed on post-world war and Germany by (INAUDIBLE) are nothing -- could be compared with very preferential treatment offered to Russia under Boris Yeltsin by the United States and Europe.

There were credits, there were -- the doors were open. Russia was accepted in G-7, turned to be G-8. Not being -- normal democracy and not the greatest industrial power. So there was a good credit line both financial and political. And as for the expansion of NATO, look, these still European neighbors of Russia had some bad memories. And nobody doubts now in Estonia and Latvia that if not for NATO membership, Putin's tanks will be in the (INAUDIBLE) region today.

ZAKARIA: Really? You think so?

KASPAROV: Look. I think the NATO is the only thing that protects them because Putin definitely looks for the weak spot on the map. And if he believes that, you know, if he can grab it, he does it.

ZAKARIA: Very sobering thoughts.

Gary Kasparov, thanks.

KASPAROV: "Winter is Coming."

ZAKARIA: Next on GPS, I will give you some fashion advice for 2016 or at least I'll tell you about one luxury designer with a very new surprising collection. Stay with us.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

[10:56:23] BARACK OBAMA, PRESIDENT OF THE UNITED STATES: We know we can't stop every act of violence, every act of evil in the world. But maybe we could try to stop one act of evil, one act of violence.

(END VIDEO CLIP)

ZAKARIA: That was of course an excerpt of President Obama's emotional speech on guns this week. And it brings me to my question of the week.

Which U.S. state has the highest rate of gun deaths per hundred thousand people? Alaska, Illinois, Mississippi or Texas. Stay tuned and we'll tell you the correct answer.

This week's "Book of the Week" is actually a movie called "Meet the Patels." It is a funny documentary about an Indian man who finds himself still unmarried at the ripe, for India, old age of 29. Despairing of dating, he asks his parents to arrange a marriage for him. So they all tour around the United States searching for the perfect wife. It is a really funny story with lots of humanity mixed in. Definitely

worth watching.

Now for "The Last Look." We have a lot to look forward to in 2016, in the fashion world apparently tie dye is making a comeback and lace will be chic this year. I guess I will need to update my wardrobe. The top Italian design house Dolce & Gabbana made news this week and not for their 2016 line of colorful dresses or handbags. They debuted a line of high end hijabs and abayas on style.com/arabia.

The site describes the religious wear as coming in, quote, "neutral hues," and you can see the lace I mentioned earlier. It is not surprising such a well-known brand wants a piece of this fashion pie. Muslims spent $230 billion on clothing in 2014. According to the most recent State of the Global Islamic Economy -- yes, there is such a thing -- that number is expected to grow to $327 billion by 2020.

If this clothing market were a country, it would rank third after the U.S. and China, the largest two clothing markets in the world, the report said.

It isn't just clothing and footwear, Muslims spent $54 billion on cosmetics in 2014 and that number will grow to $80 billion by 2020. So the Dolce & Gabbana designers are on to something and they certainly aren't the only ones. The report points out that other brands like Tommy Hilfiger, DKNY and Mango have made collections appealing to Muslim women.

Now head scarves, hijabs, abayas, burqas and other types of Islamic clothing for women are of course hotly debated in many parts of the world. Are they symbols of faith, of modesty, of oppression or of all of the above?

The most important thing it seems to me is that women should be free to choose to wear or not to wear any of them.

The correct answer to the GPS challenge question is A. According to new analysis by the Violence Policy Center, Alaska has the highest rate of deaths caused by guns in 2014 with 19.68 deaths per hundred thousand people followed by Louisiana and Mississippi. That state was also number one in 2013 and to put this in perspective, Alaska had a higher rate of gun deaths than Mexico according to gunpolicy.org.

The study found a correlation of higher death rates in states with lax gun laws and high gun ownership. 56 percent of Alaskan households have guns. The lowest gun death rates were found in Hawaii and Rhode Island where between 12 percent to 16 percent of households own guns.

Thanks to all of you for being part of my program this week. I will see you next week.