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Connect the World

World Leaders Sound the Alarm Over the Economic Situation; The Financial Crisis Hits Hard in One Spanish Village; Interview with Jan Randolph; Mass Walkout at the U.N.; What's At Stake in the PGA Tour?; U.S. Military Chief Accuses Pakistan of Exporting Terrorism; U.S. and Pakistan's Rocky Relationship; Two Women Fined for Violating France's Burqa Ban; Burqa Bans in Europe; Debate on Burqa Bans; Big Interview: "24" Producer Howard Gordon; Parting Shots of Dash for Exit During Ahmadinejad's UN Speech

Aired September 22, 2011 - 16:00   ET



CHRISTINE LAGARDE, IMF MANAGING DIRECTOR: The current economic situation is entering a dangerous phase.


BECKY ANDERSON, HOST: World leaders sound the alarm as global markets plunge and investors run for cover.

Live from London, I'm Becky Anderson.

Also tonight, relationship on the rocks -- the U.S. says Pakistan helped insurgents plan this attack on its Afghan embassy.

And funding for a fight -- meet the man who's paying up so women in France to cover their faces.

Those are the stories tonight.

But we're kicking off with what seems an almost daily drip stream of gloomy economic news. And what the markets fear is that no one seems to know how to stem the flow.

I want to give you a sense of just what happened across the global markets today, kicking off with the Asian markets.

The Nikkei off some 2 percent, 8,500. Take a look at what happened intraday. This is interesting. Down right at the beginning and then it flipped its way down until the close of play.

Coming to the FTSE, the European markets, of course, opening on the back of the Asian markets. Again, straight down on the open and then a slow close to down some 5 percent.

Let me tell you, some $100 billion was wiped off that market alone today, $100 billion.

And the Dow Jones, which has just closed, better, actually, than it was about half an hour ago. It's about 4.5 percent down. But the Dow closing about 3.5 percent lower. This again. Take a look at that, straight down on the open and then a slow move down, flipping up at the back end, but not good enough to give us a sense of relief in any of these markets.

Well, this is -- time is of the essence -- of the essence, was how Madame Lagarde put it. And in Washington, the pressure is on as financial leaders from the world's biggest economies desperately try to find some common ground.

Maggie Lake is there -- Maggie, is there a sense of urgency amongst these guys who are meeting -- guys and women, of course -- who are meeting?

MAGGIE LAKE, CNN BUSINESSCORRESPONDENT: Absolutely, Becky. The -- the discussions about Europe and the globe, what is now potentially going to turn into a global crisis absolutely dominant -- dominating.

Christine Lagarde, the IMF chief, kicking it off this morning, reiterating that dire warning and saying things are getting worse.

Have a listen.


LAGARDE: Our view is that the current economic situation is entering a dangerous phase. I have said that. We've repeated it. We are clearly -- there is a situation where the growth has slowed down. You will have seen that we have reduced our forecast on a global basis, but regions, as well. And we see down side risks on the horizon.


LAKE: Now, Becky, as you know, they do not choose those words literally. So dangerous zone, you know that they are concerned.

Right after her press briefing, the BRIC countries held a special meeting to discuss possible aid to Europe.

I caught up with the deputy finance minister of Russia directly following that. And he said they felt the best way to help was through the framework of the IMF.


SERGEI STORCHAK, RUSSIAN DEPUTY FINANCE MINISTER: We understand that the situation is really very serious. In our final statement, we are going to say it definitely. And we are going to say it with a clear signal -- to send a clear signal to the market that the BRICS are going to -- is going to work together within the group. Plus, the BRICS rely a lot of G-20 as a cornerstone of our policy toward -- against outcomes of the recent developments on the markets and the economy at large.


LAKE: Now, but he admitted it's not going to be quick. They have to go back to their own countries, get through certain rules there to get any new funds to the IMF. And they want to do deep analysis to find out what the real problem is, especially in places like Greece, before they pour good money after bad.

But, Becky, I asked him, listen, the markets are moving ahead of you, are you concerned about that?

Absolutely, they said, at that meeting, they discussed the fact that this is -- this has the potential to go from a sovereign crisis to a banking crisis. But this is very interesting. He pointed out that Europe doesn't really have the instruments, the mechanism, to deal with this quickly. And that is a major problem.

ANDERSON: It -- it does seem absolutely remarkable that we're thinking about Brazil, Russia, India and China providing aid for the Western world.

When did this all go so horribly wrong?

Action, Maggie, just isn't coming fast enough.

And confidence in the market, as we've just shown on the close on the Dow, the European markets and on the Asian markets, waning fast.

Why can't these leaders get their acts together?

LAKE: Yes, that's interesting, Becky.

I think before this, there was the sense that maybe it was a lack of will, that they just didn't get the problem, they didn't understand how serious it was.

I sat down with the French finance minister today. We'll be having that interview releasing a little later on tonight. And he -- it is clear to me from talking to these ministers, they do understand the gravity of the situation. It is just that they literally -- they keep saying to me over and over and over again, you have to let the political process happen. You've heard that from Christine Lagarde, as well.

They -- there is no way for them to jump ahead of the democratic process of the Eurozone, where all these 17 nations have to individually vote on things.

It's a very different scenario from the U.S., where when that crisis hit and it spiraled, the U.S. Treasury was able to act, in conjunction with the Federal Reserve, extremely quickly, with a lot of force.

You just don't have that situation in Europe. It's very frustrating, but they're just asking that the markets understand that.

The one thing I'll say, Becky, is that the French finance minister, talking to me, said solidarity is important. It's the only way we'll solve this. Although they may be -- their hands may be tied on the political process front, leadership wise, there is certainly more that can be done.

And he's saying we have to take the risk of -- of a sovereign failure out of the minds of the market. They may not be able to race or speed up the political process but certainly one has to think that, from a leadership perspective, more can be done not only from the Europe, but also from the U.S., where Republicans and Democrats are bickering, as well.


LAKE: And the markets, investors are telling you that, as well.

ANDERSON: Maggie, I'm going to go out on a limb. And I've said this before. I just don't think these people leaders are good enough. But anyway, that's my own judgment in all of this.

LAKE: Yes.

ANDERSON: And I think you probably agree, don't you?

LAKE: Becky, you're seeing that in the market.


LAKE: You're seeing that in the market, as well, an absolute vote of no confidence coming from the global stock markets today.

ANDERSON: Maggie Lake is in Washington for you this evening.

Maggie, as ever, thank you for that.

Well, if you think this crisis is just about markets, politicians and bankers, well, think again. People like you and me are suffering across the board across Europe right now.

For those lucky enough to have a job, just getting paid can be a daily struggle.

Al Goodman reports now from one town in Spain where even the police have gone on strike.


AL GOODMAN, CNN INTERNATIONAL CORRESPONDENT (voice-over): At first glance, the village of Valverde del Camino seems idyllic -- lots of sun, life at a leisurely pace. But 130 municipal workers here are seething. They haven't been paid in five months. Now, they're in open revolt and the town's police force is leading the battle.

MANUEL ASUERO, POLICE OFFICER: I feel terrible. You can't sleep at night because you are thinking, how are you going to pay for the family's bills.

GOODMAN: Manuel Asuero has been a local cop for 26 years but now sports a different uniform. The shirt says, "We want to get paid."

(on camera): The police officers here say they're owed, on average, about $14,000 each in back pay. And for their families, that's real money.

(voice-over): They can't go on strike by law, so all 16 officers have called in sick. They've got doctors' notes. That's supposed to be an epidemic of psychological problems among Valverde's police force. And other local workers sympathize.

MIGUEL DIEGUEZ, DELIVERYMAN (through translator): Almost everyone here lives month to month. When you miss a paycheck, it's over. And everyone supports the police and other city workers who are not getting paid.

GOODMAN: Rocio Garcia and her husband are suffering, too. He's a city maintenance worker.

ROCIO GARCIA DOMINGUEZ, WIFE OF CITY WORKER (through translator): It's very, very bad, horrible. There are five of us, three kids. I cannot give them anything to eat. I cannot pay the water or electrical bills.

GOODMAN: For the mortgage, she adds, they eat at local soup kitchens.

So who's to blame?

The local council ran up a $75 million debt in a town of just $13,000 people. That's more than $5,000 per person. So when the conservatives won elections here in May, defeating the Socialists, they started to make cuts.

Even so, credit is tight, says this town councilman.

JUAN CARLOS GUTIERREZ, TOWN COUNCILMAN FOR SECURITY (through translator): Clearly, the financial situation in Spain is a bit more complicated. It makes a solution here more difficult. But there are solutions.

GOODMAN: And one of them, he says, is to beat the ruling socialists in national elections in November.

Many of Spain's regions and municipalities are struggling with high debt and that may derail the national government's efforts to reduce the country's deficit.

In Valverde, the town councilman doesn't think city hall will have to close, but he can't say exactly when the next paycheck is coming.

Al Goodman, CNN, Valverde del Camino, Spain.


ANDERSON: So there is the problem laid bare.

Even in the U.K., which isn't even part of much maligned Eurozone, much talk now of a winter of discontent. This is a crisis taking no prisoners.

So how do we fix it?

Well, let's put that to Jan Randolph.

He's the director of sovereign risk for IHS Global Insight.

Jan, I want to get really specific here in focus.

There are two problems, aren't there, the risk of sovereign debt default and the gaping holes or losses on these bank balance sheets.

Let's start with the sovereign debt crisis.

Give me a solution.

JAN RANDOLPH, DIRECTOR OF SOVEREIGN RISK, IHS: Well, Greece is still in the -- is still the main thing as part of the roadblock here. And we've seen how risk in Greece, even though small, it amplifies to the banking system and to other borrowing countries in Europe, notably, Spain and Italy.

So what needs to happen is we need to think again about Greece, how to make it viable. We can have more and more and more austerity, you know, what kind of an economy have you got left?

It needs to be able to grow. There needs to be hope. And that means probably more debt restructuring for Greece.

But then, of course, we have to look at the banks who hold this debt. Their capital could be compromised. You need to be able to support that.

ANDERSON: And Lagarde, of course, Christine Lagarde, who now runs the IMF, has said some weeks ago now that banks across the Western world need recapitalizing and recapitalizing fast.

Is that going to happen?

RANDOLPH: Well, the regulators can force it. They -- if they can't get it from the private market, then they have to turn to a public fund.


RANDOLPH: Obviously, there may be terms and conditions. Now, we have already the beginnings of this -- a

Solution in Europe with the EFSF. At the end of this year, December, it will have new powers to recapitalize banks.

ANDERSON: Yes, but that's at the end of the year. We've got three months and these markets are in a terrible state. There's no confidence.

RANDOLPH: Yes. I mean there's just no confidence in the ability of Europeans to get it together. What has to happen next is, if I were sort of like (INAUDIBLE) as a solution, Angela Merkel, the most powerful government in Europe, and the other powerful institution, the ECB, representing the monetary side facing the market, they have to sit down together, talk about a short, medium and long-term plan, how to cut, starting off with Greece, but also the consequences.

ECB got rave -- has basically got to show their nuclear buttons here. We will provide liquidity in each and every market. We will -- we will stem any contagion to Italy's banks.

ANDERSON: Well, let me put this to you, though. That Angela Merkel has to or will want to get reelected at some point. She's already, with the coalition, got draft legislation on the books, we believe, which suggests that they'll have to go to parliament to get permission, in the future, to help Europe out, because Germans are basically saying, we don't want to do this anymore.

RANDOLPH: Yes, I mean she...



RANDOLPH: -- she's in a bind. There's no -- no question. I mean there are some in Germany that she's got -- think she's gone too far already and there are others who think that, you know, she's -- she's jeopardizing all the decades of political capital invested in the euro -- euro -- euro project and EU.

You know, the -- it's an existential moment for them. And it, unfortunately, it is up to them. They have the fateful choice to make. And they don't like doing it, but they have to do it.

ANDERSON: What do you want to hear from the leaders of these G-20 countries who are meeting in Washington as we speak?

We're already hearing that the BRIC countries are prepared to help out at this point, which seems to be, I mean, inconceivable that we're having this conversation, you know, given what -- what happened sort of, you know, late 1990s, early 2000s.

They're going to help out.

But what do we want to hear from these leaders?

RANDOLPH: Well, they're all -- they're already helping out, because they -- they hold the biggest bonds on -- on the IMF. The Chinese, you know, invested huge amounts on the bond side of the IMF, beefing up its firepower.

What we'd like to hear is that the Europeans will begin to sit down to think about a medium -- a short, medium and long-term plan how to resolve the Eurozone crisis, looking at all the different angles to it and to recapitalize the banks at the same time.

On the growth front -- and we shouldn't lose sight of the growth front, because if we get growth, these solvency debt problems wouldn't be as big.

And so we need something to stimulate growth. There are governments out there that have very low borrowing costs. They've been chosen as the safe havens. They need to be able to use some of this money that -- you know, they're solvent. They need -- they need to start stimulating the economy, investment banks, this sort of thing, infrastructure investment, job creation.

You know, there's going to be -- there have got to be some -- some -- some hope out there that the growth will -- will come through eventually.

ANDERSON: I just don't want to hear Christie -- Christine Lagarde talk about a dangerous phase for the Western world any longer. That's not -- sadly, that's the position that we are in.

Always a pleasure.

Thank you very much, indeed, for coming in.

You're watching CONNECT THE WORLD here on CNN.

After the break, the speech they just didn't want to hear. Find out what Iran's president said that led to what was a mass walkout at the U.N.

Then, in the next 20 minutes, Pakistan's most powerful spy agency comes under attack from the U.S. military chief.

And facing the fine in France -- two Muslim women take on the burka ban. We're going to have more on that later in the show.


I'm Becky Anderson in London.

It's quarter past nine.

Stay with us.


ANDERSON: I'm Becky Anderson in London.

Welcome back.

You're watching CONNECT THE WORLD.

Seventeen minutes past nine in London.

A brief look at some of the other stories that we are following for you this hour.

And the U.S. flag is flying once again in Tripoli now that the American ambassador has returned. His residence will serve as the temporary embassy now that Libya is no longer run by Moammar Gadhafi. The old U.S. Embassy was destroyed by Gadhafi supporters back in May.

Well, Turkish Prime Minister Recep Tayyip Erdogan, British Prime Minister David Cameron, Ivory Coast President Alassane Ouattara just some of the leaders taking to the world stage at the United Nations earlier today. Not surprisingly, perhaps, the biggest drama so far came when the Iranian president, Mahmoud Ahmadinejad, took to the podium.

By the end of his speech, well, there were an awful lot of empty chairs.

Let's bring in Richard Roth to tell us what triggered the mass walkout -- Richard.

RICHARD ROTH, CNN SENIOR UNITED NATIONS CORRESPONDENT: Yes, another interesting day of drama here at the United Nations when the president of Iran speaks. Sharp fierce rhetoric, very vehement, very angry, worse than other appearances here by the Iranian leader.

And his remarks mostly directed at the United States and Western countries. The Iranian leader, who said his country should be a model for life here, wondered who -- what really caused 9/11. And said that the wars in Iraq and Afghanistan followed forth.

And then there was this comment regarding Europe and Zionism.


MAHMOUD AHMADINEJAD, PRESIDENT OF IRAN (through translator): Some European countries still use the Holocaust, after six decades, as this excuse to pay fine or ransom to the Zionists.

Should it not be an obligation upon the slave masters or colonial powers to pay reparations to the affected nations?


ROTH: You see some European nations and others walking out of the General Assembly en masse -- Ireland, France, Germany, Canada never even attended in the first place. Many of these were low level delegates, but this was all pre-planned. They knew from the past that the remarks could be quite fiery and vindictive and they were ready to -- ready to go.

You've heard of a diplomatic dance, often, at the U.N. Well, this was the diplomatic walk. British Prime Minister Cameron followed Ahmadinejad a couple of speakers later and responded.


DAVID CAMERON, BRITAIN PRIME MINISTER: This assembly heard, not long ago, from President Ahmadinejad. He didn't remind us that he runs a country where they may have elections of a sort, but they also repress freedom of speech. They do everything they can to avoid the accountability of a free media. They violently prevent demonstrations. And, yes, they detain and torture those who argue for a better future.

So we should never pretend that having elections is enough.


ROTH: Well, Iran did not walk out, it appears, from the British prime minister's remarks.

Around the corner from the United Nations, anti-Ahmadinejad demonstrators -- about 300 to 400 -- yelled their displeasure with the Iranian leader, signs based upon what they say is Ahmadinejad and Iran's horrible human rights record.

While you're looking at these pictures, of course, the Human Rights Watch said while Ahmadinejad is lecturing the world from the un podium, dissent is still being crashed relentlessly in Iran. "The world assembly should take with a grain of salt the remarks of a leader who said nothing about the public hanging yesterday of a 17 -year-old in his own country" -- Becky, back to you.

ANDERSON: Richard Roth for you at the United Nations.

Thanks, Richard.

Well, in the U.S. state of Georgia, an execution has been carried out in the face of an international outcry and a last minute petition to nation's highest court. Even down to the last seconds of his life, Troy Davis maintained his innocence. He was given a lethal injection on Wednesday night.

It was the fourth time he had faced death row.

Well, many said the evidence just didn't support his conviction. He had been found guilty of killing police officer Mark MacPhail in 1989.


THOMAS RUFFIN, TROY DAVIS'S ATTORNEY: I witnessed something that was horrible, a tragedy. This night, the state of Georgia legally lynched a brave, a good and, indeed, an innocent man.



UNIDENTIFIED MALE: Has justice been served?

ANNELIESE MACPHAIL, MOTHER OF MURDERED POLICEMAN: In my mind, yes. In my mind, it has. It took a long time to get there, but it really does in my mind. There is no reason to -- to celebrate or do anything, because it is not good for both families from under this. I'm sure his family is suffering like hell to live right now, too.


ANDERSON: Well, Julian Assange is accusing his former publishers of opportunism and duplicity following the unauthorized release of his autobiography. Now, the WikiLeaks' founder tried to cancel his contract after reading the first draft by a ghost writer. But the publishers say they are well within their rights since he failed to return the reportedly hefty advance that they had paid him.

Well, NASA says a satellite the size of a school bus is heading for Earth and will enter the atmosphere on Friday afternoon. The majority of the satellite will burn up on reentry. But about a half a ton of its debris will make it through. Scientists say they don't know where the pieces will land, but claim the chances of a person being hit are actually very low.

And a programming note for you. Join us this weekend for a CNN Freedom Project documentary. Hollywood actor Anil Kapoor shines a light on modern- day slavery in his country, taking us to a remote village in North India, where nearly all the women have been sent into sex slavery. That is "Trapped by Position." It's an excellent film. It's Saturday at -- what is it, the time shown there on your screen.

Well, coming up on this show, winging their way to a $10 million prize. These are the top of the leaderboard of the PGA Tour in Georgia in the U.S.. Find out in 60 seconds time.


ANDERSON: Well, the climax of the U.S. golf season is underway in the U.S. state of Georgia. Just a few hours ago, an elite 30 man field teed off at East Lake in Atlanta for a chance to win the FedEx Cup.

Now, Webb Simpson is the number one seed, given the best shot to take home what is a $10 million bonus. Good luck for them.

But there are plenty of others on the course, of course.

Patrick Snell that's a look at what is at stake for golf's big hitters.


PATRICK SNELL, CNN SPORTS CORRESPONDENT (voice-over): 2010 was a breakout year on the PGA Golf Tour for Justin Rose. The South African born Brit enjoyed back-to-back victories on American soil and he goes into this year's tour championship boosted by his win last weekend in Chicago.

JUSTIN ROSE, RANKS NUMBER 3 IN FEDEX CUP STANDINGS: You don't rely on anybody else out here. And, you know, for me, it's a situation that I didn't foresee being in, really, a week ago. I won an obviously lovely win last week in the BMW Championship and to vault myself into the top five was a huge bonus.

SNELL: Donald and Rose are among five players in the 30 man field who can win the $10 million FedEx Cup title if they secure the win here at East Lake.

LUKE DONALD, RANKED NUMBER FOUR IN FEDEX CUP STANDINGS: I know what I need to do. I know if I win, I win. So obviously, the guys outside the top five don't have that -- that freedom. I mean they -- they -- they have to rely on some of the other guys sort of messing up. So it's nice to have that control.

SNELL: In second place right now, the big hitting American Dustin Johnson, whose recent success at the Barclay's sees him competing at the tour championship for a third straight year.

DUSTIN JOHNSON, RANKED NUMBER TWO IN FEDEX CUP STANDINGS: I say all I need to do is win and I'll win, you know, everything. But, you know, it's tough. It's going to be a long week and it's going to be, you know, nobody is just going to give you anything. You're going to have to earn every bit of it.

SNELL: But the man they're all chasing is Webb Simpson. The 26 -year- old may not be an iconic star on the globe golfing stage just yet, but the American's name is shining brightly going into this year's playoff finale. It is red hot for us, too, after winning twice in a span of just 16 days.

WEBB SIMPSON, RANKED NUMBER ONE IN FEDEX CUP STANDINGS: Well, one thing that we're trying not to do this week is -- is relax. I mean it's a relaxing environment -- no cut, 30 guys, a big purse, a great golf course. And so it's easy the kind of be complacent and settle down. And we're trying to just make sure the intensity and the focus are there and the momentum that I've had lately is definitely still there and helping.


ANDERSON: Patrick Snell with that report for you.

Well, the first round of the tour championship is winding down in Atlanta.

Mark McKay is keeping an eye on the leaderboard from CNN. So he's not very far away, of course, from the course -- Mark, what's going on?

MARK MCKAY, CNN SPORTS CORRESPONDENT: I can tell you right now, Becky, you know, I'm no math major, but I may need to be one between now and Sunday to figure out all the possibilities when it comes to this tournament and who could have a shot at winning that $10 million FedEx Cup bonus prize money.

Let's look at the leaderboard. And we see a familiar name at the top when it comes to Atlanta, Becky, Keegan Bradley. He won the PGA championship in this city just last month. Something about Atlanta and something about big tournaments has Keegan Bradley out in front.

Jason Dutner also made a run at the PGA Championship title here in Atlanta. He finds himself two shots back.

There you see the rest of the golfers, including Luke Donald. You just heard him in Patrick's piece saying that he needs to win this tournament in order to win that big prize.

Becky, a field of 30 golfers, it can -- anything can happen -- and usually does -- between now and Sunday at the tour championship.

ANDERSON: Yes, absolutely.

I'm going to watch for the last six hours on Sunday, I think. That's always the best time to watch.

A familiar face, meanwhile, in the world of football turning up in Italy, I believe.

MCKAY: That's right. Inter Milan confirming what was reported yesterday, that Claudio Ranieri is, in fact, the next manager at the club, of course, replacing the guy that didn't get the job done, Gian Piero Gasperini. No wins in five matches in charge at all competitions there at Inter. Now the hopes turn on a guy that -- to say he's well traveled, Becky, would certainly be an understatement. He spent time there in England, not with the club that you pulled for, but instead, with Chelsea.

And Ranieri has also been around in Spain with Valencia. He spent time in Italy with Juventus and, most recently, Roma.

But his challenge is to pull this club out of third place, currently, on the Serie A table. They hope that a two year contract that Claudio Ranieri signed will get the job done.

So he is in charge. And on tonight's "WORLD SPORT," we throw the focus on the ongoing Rugby World Cup plus the NFL trying to get a handle on players who fake injuries -- Becky, I'll be back for "WORLD SPORT" just after "BACK STORY," about an hour from now.

ANDERSON: Thank you, sir.

"WORLD SPORT" with Mr. Mark McKay, as he says, in about an hour's time.

Well, just ahead on CONNECT THE WORLD, in a scathing and unprecedented attack -- a U.S. military chief accuses Pakistan's intelligence agency of exporting violent extremism to Afghanistan. That story coming up here on CNN.


ANDERSON: You're back with CONNECT THE WORLD here on CNN, the world's news leader. Let's get you a quick check of the headlines this hour.

And growing fears over the global economy as the markets across the globe suffer heavy losses, the Dow closing down around 390 points just about a half hour ago following a bleak assessment from the Federal Reserve.

British prime minister David Cameron says he supports a Palestinian state, but says UN recognition alone cannot solve the broader conflict. Mr. Cameron among the world leaders addressing the UN General Assembly today.

Thousands of transit workers in Greece walked off the job on Thursday to protest austerity measures there. The strike comes a day after the government announced more budget cuts demanded by lenders before they give Greece more bailout money.

And Hewlett-Packard has a new CEO. The board announced Thursday that former eBay head Meg Whitman is taking over, replacing Leo Apotheker, the ousted -- he was ousted after just 11 months on the job.

Those are the headlines this hour.

Going to move you on. Is Pakistan exporting violence to Afghanistan? That is the question we will be investigating in the next few minutes, as America's top military officer says there is no doubt.


MIKE MULLEN, CHAIRMAN, JOINT CHIEFS OF STAFF: The Haqqani network, for one, acts as a veritable arm of Pakistan's Internal Services Intelligence Agency. With ISI support, Haqqani operatives planned and conducted that truck bomb attack, as well as the assault on our embassy.

We also have credible intelligence that they were behind the June 28th attack on the Inter Continental Hotel in Kabul and a host of other smaller but effective operations.


ANDERSON: Well, the U.S. Joint Chiefs of Staff chairman, Admiral Mike Mullen, there, with the strongest criticism yet of the Pakistani government.

Now tonight, we're going to be looking at the complex relationship between these two countries. We know they get along to go along, but is it an alliance that is destined to fail? CNN's Nick Paton Walsh takes a look.


NICK PATON WALSH, CNN INTERNATIONAL CORRESPONDENT (voice-over): Pakistan's problem's obvious. It's become the home to international Islamist militants who train and regroup in its tribal areas, so brazenly so that Washington simply doesn't believe Pakistan really wants to flush them all out.

They're stuck together. America needs Pakistan to let its counter- terrorism operatives in. Pakistan needs American money.

But it's a very bad marriage indeed. First, there are the drone strikes, killing senior al Qaeda and other militants, but also allegedly civilians, sowing fear and fueling anti-U.S. fury.

And then, there was the case of Raymond Davis, a CIA contractor released from double-murder charges in Lahore after blood money was paid.

And then, of course, came the death of Osama bin Laden, America's most-wanted man, found in one of Pakistan's most secure military towns.

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Over the years, I've repeatedly made clear that we would take action within Pakistan if we knew where bin Laden was. That is what we've done.

WALSH: Humiliated, Pakistan lashed out at the affront to its sovereignty.

WALSH (on camera): Now, the relationship's not always negative. A couple of weeks ago, a senior al Qaeda commander was captured in Quetta by the Pakistanis, causing Washington and Islamabad to exchange a flurry of compliments, like and estranged couple at a dinner party trying to pretend that nothing was wrong.

But even this respite for this rocky relationship didn't last.

WALSH (voice-over): Just over the weekend, the recent attack on NATO and the U.S. embassy in Kabul was blamed by senior U.S. officials on the Haqqani militant network. They repeated allegations that the Haqqanis received help from Pakistani intelligence.

Another reason for distrust, but still, this old couple can't quite separate.

Nick Paton Walsh, CNN, Islamabad.


ANDERSON: All right. I want to put this rocky relationship under the spotlight with one of the top thinkers in his field. Akbar Ahmed is the former Pakistani ambassador to the UK. He's advised many of America's military chiefs on Islam and on foreign policy. Professor Ahmed is with us now from Washington this evening.

Let's get through some of what Nick was reporting, there. For example, he says some groups -- Islamist militant groups -- are so brazen that Washington believes Pakistan doesn't even want to flush them out when they are training and regrouping in tribal areas. Is that correct?

AKBAR AHMED, PROFESSOR OF INTERNATIONAL RELATIONS, AMERICAN UNIVERSITY: Well, Admiral Mullen was very blunt. Perhaps more blunt than I've heard any American -- senior American in the last couple of years.

In which he's actually accused the Pakistani ISI and by implication, the Pakistan army and the government of Pakistan, in being actively involved in the activities of someone like Haqqani, Maulvi Haqqani, across the border in Afghanistan, and therefore making things very difficult for the Americans.

So, this, of course, sets the tone, now, for the next couple of weeks in terms of the relationship between the U.S. and Pakistan.

ANDERSON: What do you think's going to happen next?

AHMED: It's very, very difficult to say. I've been writing and speaking about this area for decades, and all the experts will tell you that it is highly unpredictable.

You have the tribes involved, you have tribes on both sides of the border, you've got the government of Pakistan, and that also is very divided on many issues.

And then you have Americans and their policy, which is really starting to draw down, to begin to bring their troops back.

Now, the man that is at the center of this discussion, Haqqani, is a very, very important player in this region, because he's been active since the 1980s. In the 1990s, he was a minister with the Taliban. He has his own force, it's estimated about 10,000 to 15,000.

And above all, he has an heir apparent, his son, Sirajuddin Haqqani. So, in a sense, there's a sort of dynasty forming, which makes him a formidable adversary.

ANDERSON: The received wisdom goes that America needs Pakistan to let its counter-terrorism operatives in. And Pakistan needs American money on the flip side of that. When I talk to politicians in Pakistan today, they say, "We're not sure we need that American money anymore." Do they?

AHMED: The relationship has reached, almost -- I'm not saying it's to the point of no return, but it's almost reached that point. A lot of Pakistanis are actually saying that, that well, "we can live without American aid, but we would prefer to live with our own dignity and our own honor," because they really feel somehow used.

And they say this has happened before in the 1970s and in the 1980s, when America doesn't need us, it walks away.

At the same time, at the same time, America is aware that Pakistan is a critical piece in this drama in that part of the world, a critical ally, and can't just dump Pakistan. And Pakistan exasperates America, it perplexes America, it just can't understand how Pakistanis hope to run with the hare and hunt with the hounds at the same time.

ANDERSON: Professor Ahmed's your expert on the subject out of Washington for you this evening. Sir, thank you for that.

AHMED: Thank you. Thank you.

ANDERSON: Well, still ahead, two women in France dare authorities to fine them for something they consider a fundamental liberty. We're going to take a case that could go all the way to the European Court of Human Rights. That next, here on CONNECT THE WORLD.


ANDERSON: Well, it started with two women delivering a cake to a French town hall looking for legal trouble. They found it, and that was exactly their strategy.

Today, they became the first women fined by a French court for violating a ban on full face veils. Jim Bittermann explains how the case could have implications right across Europe.


JIM BITTERMANN, CNN SENIOR INTERNATIONAL CORRESPONDENT (voice-over): Only on of the two women convicted of violating the law banning face- concealing veils actually came to the city courthouse to hear about their punishment, and even then, she arrived an hour after a judge had already imposed a 120 euro fine for one and an 80 euro fine for the other.

It was exactly the verdict the women were hoping for.

HIND AHMAS, BURQA BAN PROTESTER (through translator): I am very satisfied, because at last, we can take the necessary measures to call upon the European Court of Human Rights and annul this law, a law which is completely illegal.

BITTERMANN: Hind Ahmas who, for the last five years, has worn head- to-toe veils, says she'll remove her face covering if asked by security trying to check her identity, or by school teachers when she goes to pick up her child.

But she says wearing a veil is her choice. She's divorced, she points out, so no man forces her to do so. And a law banning articles of clothing is against her human rights.

The women's fines were paid by an organization called Don't Touch My Constitution, which is working to overturn the law passed late last year that bans face covering veils in public places. Since it went into effect earlier this year, nearly 100 women have been stopped by police, but less than 10 percent of the cases are being prosecuted.

After the verdict, another fully-veiled woman turned up to announce that she intends to run for president in the upcoming 2012 election.

KENZA DRIDER, FRENCH PRESIDENTIAL HOPEFUL (through translator): I want to ask all the women in France to accept my candidacy for the French presidential election. Today, I want to be at the service of every woman who has been stigmatized or discriminated against socially or politically.

BITTERMANN (on camera): Ahmas says she plans to appeal her case first in France before going on to the European Court of Human Rights.

As for the self-proclaimed presidential candidate, she must obtain 500 signatures from elected officials before her name will be put on the ballot, something political observers here think is highly unlikely.

Jim Bittermann, CNN, Paris.


ANDERSON: France is just one of several European countries that have passed laws restricting Islamic dress, and others could follow suit, so this is an important case.

France began enforcing its ban in April. Several groups have threatened to take the government to court to overturn the law.

Belgium introduced a full burqa ban last year, but authorities did not start enforcing the ban until recently.

Now far-right lawmakers in the Netherlands have also proposed the ban. The Dutch government considered a ban on all face coverings in 2006. They dropped the plan.

In Germany, states set their own laws. At least eight have banned school teachers from wearing head scarves.

Italy, some towns have tried to ban burqas, full dress, with local decrees, and the right-wing Northern League is lobbying for a national law.

It's a divisive issue in Turkey, a country with a majority Muslim population. Head scarves are banned from government buildings and universities, but many women still wear them in some form.

I want you to hear some of the arguments for and against these types of bans. I'm joined now by Frank Gaffney, who is director of the Center for Security Policy in Washington.

These women are being denied their choice. And, in fact, they're being discriminated against, aren't they?

FRANK GAFFNEY, DIRECTOR, CENTER FOR SECURITY POLICY: Well, I think they are being discriminated against, but it's actually by their program that adherents call Sharia, not by the laws of France.


GAFFNEY: They're being forced to wear a shroud, I believe, though they may deny that, by a culture, by a society that is telling them that --


ANDERSON: Let's just stop you there for one second. Let me just stop you there for one second --

GAFFNEY: -- they also have to be denied other rights, as well.

ANDERSON: Let me just stop you there for one second, because a woman in the film who was fined today is divorced. She isn't wearing a niqab because she is being forced to. She's divorced, and she chooses to wear that headgear.

So, I put it to you again that it is her liberty, surely, that is at stake here. She -- it's her right to choose, and she is being discriminated against.

GAFFNEY: Well, and I would say to you that, despite the fact that she says she's divorced and she denies this as something that's being imposed upon her, it is certainly being imposed upon her by a Sharia system that France -- and I think, frankly, the other countries in Europe -- have not had the will to confront.

They have been dealing with symptoms of the problem. France has now also banned overflow crowds at mosques were the -- the adherence, again, to the Sharia program are taking over the streets during prayer time.

These are symptoms of a larger problem, but unless and until France asserts itself and, I think, deals with the underlying problem of Sharia, you're going to find not only women subjected to this supremacist doctrine, but men, as well.

ANDERSON: All right, OK. I get your point. Rachid Nekkaz, who I hope will join us shortly from Paris, is backing these -- the case of these women, and he says he'll take it all the way to the European Court of Human Rights.

He's backing -- he's pledged to back them with a million dollars and says -- and I think we've got him here, now. Rachid, why are you -- why are you pledging to pay off a million euros worth of fines for women who wear niqabs, for example?

RACHID NEKKAZ, FRENCH BUSINESSMAN: I have decided to pay all fines about this law who has condemned women's dressing niqab in France because I consider that this law is a violation of individual liberties and a violation of European constitution. That's why I have decided to create --

ANDERSON: Do you think women should be forced to wear veils?

NEKKAZ: Yes, absolutely yes. For example, this morning, I had paid the two first fines near Paris. And then, it would be possible to lodge a complaint to the highest court of justice and after to the European Court of Human Rights.

ANDERSON: Rachid, I think you didn't quite understand me when I interrupted you, there, and I apologize. I believe that you don't believe women should be forced to wear a veil or a niqab or a burqa, but you are still supporting the case of these women, which sounds a little perverse. Why?

NEKKAZ: Personally, I am against niqabs, but as a democrat, we have to respect all religion and all manner to dressing, to dress modest. That's why I think that a real democracy has to respect everybody.

That's why I think it's important for all citizens -- European citizens to defend these women, because they can't defend by themselves.

ANDERSON: Frank, this would never happen in the United States or, indeed, in the United Kingdom, would it?

GAFFNEY: I'm sorry, what is the "this"? You're referring to --

ANDERSON: A ban like this.

GAFFNEY: I suspect that in due course, if we find Sharia insinuating itself into our countries as it has in parts of Europe, you will find pressure of this kind as well.

But here's the larger problem. It's not just that women are being forced to shroud themselves and, indeed, in most cases, they are forced to shroud themselves. They are forced under Sharia to agree to distinctly inferior rights with respect to divorce, with respect to child custody, with respect to property, with respect to how they're treated in the --


GAFFNEY: -- sexual relations. Female genital mutilation. I'm not hearing a gentleman like Rachid coming forward and saying "I'm going to pay money to ensure that those women's rights under the laws of Europe or the laws of their home countries are protected in all of these respects."

In fact, they are being compromised particularly in the, for example, the 750 areas in France today where the laws of France no longer apply.

ANDERSON: All right.

GAFFNEY: They're no-go zones that are under Sharia law. Women are being, among others -- (CROSSTALK)

ANDERSON: Frank, let's -- let's -- let's --

GAFFNEY: -- subjected to this beastly regime.

ANDERSON: -- no, let's Rachid respond to your points. Rachid?

NEKKAZ: I think there is a confusion between the question of law and question of religion. And it's important to make the difference between law and religion, because when we do the confusion, we don't do the real thing that it's important to protect individual liberties in Western civilizations.

And I think, sometimes, it's important to pay a fine --


GAFFNEY: Out a practice that is called Sharia.

NEKKAZ: -- to show to our governments --

ANDERSON: Rachid, finish up, I'm sorry.

NEKKAZ: I think you have -- I think you, Mr. Gaffney, you have problems with Islam. For example, I'm Muslim and my wife is Catholic. She's American and Catholic --


GAFFNEY: No, I have a problem with Sharia, to be very precise.

NEKKAZ: We -- But why --

ANDERSON: All right --

NEKKAZ: -- are you talking to me about Sharia? I live in France. I'm a French citizen. I was born in Paris and I love my civilization, and I want that liberty --


GAFFNEY: Well, it's at risk --

NEKKAZ: -- the individual liberties --

GAFFNEY: -- that's why I'm talking to you about it.

NEKKAZ: -- for women to be real in our country.

ANDERSON: And with that, gentlemen, we're going to have to leave it there. We thank you both very much, indeed, for joining us this evening. Good debate for you, there.

You're watching CONNECT THE WORLD here on CNN. Facing -- the changing face of terrorism. In tonight's Big Interview, the Hollywood producer who is portraying an American hero as the suspected enemy. We explore the controversial new series right after this short break. Stay with us.


ANDERSON: Well, just two months after the September 11th attacks, the world was introduced to Jack Bauer. Now, just weeks after we mark the anniversary of 9/11, the producers of "24" are launching a new counter- terrorism drama that taps into the fear and distrust that remains ten years on.

In tonight's Big Interview, Max Foster speaks to the creator of the series, Howard Gordon.


MARY LYNN RAJSKUB AS CHLOE O'BRIAN, "24": Jack, what are you doing? Let's get out of here!

KIEFER SUTHERLAND AS JACK BAUER, "24": Chloe, take Derek and walk away.

MAX FOSTER, CNN CORRESPONDENT (voice-over): Unorthodox, but unstoppable, the character Jack Bauer was embraced by a public reeling from the realities of terrorism after 9/11.

DENNIS HAYSBERT AS PRESIDENT DAVID PALMER, "24": People are afraid to come outside. They're afraid to leave their homes, Jack. I mean, they're actually starting to turn against each other out there.

FOSTER: "24" was a race against time to prevent terror attacks. Fueled by anxiety, its creators Howard Gordon and Alex Gansa believe is still pervasive ten years after 9/11.

MANDY PATINKIN AS SAUL BERENSON, "HOMELAND": What were his exact words, please?

CLAIRE DANES AS CARRIE ANDERSON, "HOMELAND": An American prisoner of war has been turned.

FOSTER: Their new series, "Homeland," starring Claire Danes also tackles counter-terrorism, but the suspect is an American war hero believed to be an al Qaeda sympathizer.

DANES AS C. ANDERSON: Your picture was on our MIA wall. I saw it every day for five years. Good to meet you in person.


DANES AS C. ANDERSON: I'm sorry we were unable to find you sooner.

LEWIS AS BRODY: I appreciate that.

HOWARD GORDON, PRODUCER, "HOMELAND": We both really started this series by asking ourselves what -- do we have to fear -- should we be fearing the same things that we feared in the aftermath of 9/11?

And that gave rise to a whole bunch of other questions. Who's the terrorist? Who's the villain? Why are we fighting? What do we hope to accomplish by fighting? How are we treating our veterans, those who fight on our behalf.

And all those questions really begat the series and hopefully it's an engaging thriller at the core of it, it's not a polemic, but those are the questions that absolutely inform the story as it's being told.

DANES AS C. ANDERSON: Sergeant Brody stopped being a source of actionable intelligence fairly quickly, and yet, he was kept alive for almost eight more years. I'd like to ask him if he knows why.

LEWIS AS BRODY: I often wondered that myself.

FOSTER (on camera): This sort of storyline wouldn't have come to mind -- it would have been impossible before 9/11, would it?

And it's about ten years since you brought "24" to the screen, so you're perhaps a good judge to work out what's changed in terms of this type of TV and the way Americans look at this type of subject since 9/11. How would you encapsulate it?

GORDON: Well, I would encapsulate it by saying that the world has become a far more complex place and we've become far less naive and, presumably, as television viewers since 9/11. And I think we understand that there has been a price for the so-called war on terror that we've engaged in.

I mean, obviously, we are in two conflicts right now and continue to be in two conflicts even though we're drawing down in Iraq in Afghanistan, but nevertheless, the cost of those conflicts has been profound to this country.

Our rights, our constitutionally guaranteed rights to privacy have been challenged in the name of national security, and sometimes effectively and sometimes necessarily, but again, at a price.

Our conduct in the way we -- we conduct war, in terms of drones and such and mechanized warfare has changed the way we exercise our power abroad. And the price that that has, however effectively as a military strategy, the price it has to our image as Americans has also been challenged.

Obviously, Guantanamo and Abu Ghraib are things that continue to affect our prosecution of the war on terror.

So, as a country, we're very, very -- we have been sobered by the realities of this new complex world that we find ourselves in. Still have things to be afraid of, but our awareness of that fear and our -- the way we're going to challenge that fear, I think, has grown up quite a bit.

DANES AS C. ANDERSON: Ziardi (ph)?

LEWIS AS BRODY: That's what he told me his name was anyway.

DANES AS C. ANDERSON: Was this him?


DANES AS C. ANDERSON: But you know who this man is.

LEWIS AS BRODY: Of course. Every marine in the country was briefed on high-value targets.

FOSTER: You're pushing things, though, aren't you? You're really challenging Americans, because you've got an American hero who could possibly be a sympathizer, and al Qaeda sympathizer. People are unsure about things in America, and you're going to challenge them.

So, you're going to offend a few people, aren't you? Not least in the Pentagon, I'm sure.

GORDON: Well, I think that if we haven't offended some people, we haven't done our job. I think that's really the job of an artist. I like to think that that's our -- not our obligation, but I think that's really what makes something worth watching, which is it makes us think, it makes us ask those questions.

And hopefully, if it provides ready answers to those very complicated questions, then it's propaganda, and it's -- or it's a polemic. I think it's our great privilege as Americans who have the freedom to tell these stories, and I think any -- those of us in the creative community in Hollywood get to ask those questions, and it's a tremendous privilege.

But yes, we are pushing people. We are making them think, hopefully. And it's not something you can fold the laundry -- this is not a show you can fold the laundry and do e-mails with.


ANDERSON: All right. So, it was -- this is our Parting Shots for you this evening. It was actually a remark about 9/11 that kicked off your Parting Shots tonight. The big speech of the day at the United Nations General Assembly, President Ahmadinejad of Iran.

The Americans weren't impressed. Straight out of the door when he claims 9/11 had been a mysterious event.

Well, the other delegations, they stuck it out a little bit longer. Comments about the holocaust sent the French flying. Then, the dash for the exits started. Germany, Ireland, Britain, and others all heading for the exits.

I'm Becky Anderson. That is your world connected. Thank you for watching. The world news headlines and "BackStory" will follow this short break here on CNN. Don't go away.