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Fareed Zakaria GPS
New Phase of Global Geopolitics; Interview with Ehud Barak; Interview with Bruce Bueno de Mesquita; A Look at Europe's Far Right
Aired November 20, 2011 - 10:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
FAREED ZAKARIA, HOST: This is GPS, THE GLOBAL PUBLIC SQUARE. Welcome to all of our viewers in the United States and around the world. I'm Fareed Zakaria.
We have a terrific show for you today. First up, every media organization in the world is reporting that there are signs that Israel is getting ready to attack Iran. We will ask a man who should know - Israel's defense minister, Ehud Barak.
Next, 2011 has proved to be a bad year to be a dictator - think of Mubarak, Ben Ali, Gadhafi. Who's next? I'll introduce you to a man who has proven prescient in predicting political change.
Then, what was Anders Breivik thinking? The Oslo killer was in court this week. We will analyze what he said.
Next, can the euro survive? Can Europe survive? Should the U.S. government slash its budgets the way European governments are? I was in London earlier this week and sat down with a star-studded panel to sort things out.
But first, here's my take. Watching the APEC Summit in Hawaii last week, I had a feeling we were entering a new phase of global geopolitics. For decades now, those summits have been occasions for Asian countries to worry about and wonder about the U.S. commitment to Asia, how strong is it, whom does Washington back, will we stay engaged? The Obama administration has made clear that America is in Asia for good, and that it might actually increase its presence in the region.
But the real concerns are no longer about Washington but rather about Beijing. Countries in Asia and around the world are wondering and worrying about China. Watching China's somewhat aggressive diplomacy last year, many Asian countries are still worried, and as they watch China's military modernization, they worry more.
It's not just in Asia, of course. Take a look at Africa, where China's investments and activities are now becoming part of those countries' domestic politics. The recent elections in Zambia, for example, were won by a candidate who promised to take on the Chinese. The Chinese, by some accounts, have virtual control over that country's economy.
You see, Zambia is a huge copper exporter, and Chinese state- owned companies are deeply involved in that business. And it is a sign of China's power that the candidate who is now president has now had to make nice with the Chinese and recently threw a lunch for Chinese investors. This might explain it - copper exports produced 2/3 of the Zambian government's revenues.
The United States is also witnessing new levels of anxiety about Chinese business practices. The Republican front-runner, Mitt Romney, made a stunningly tough statement about China recently. Listen.
(BEGIN VIDEO CLIP)
MITT ROMNEY (R), PRESIDENTIAL CANDIDATE: China is, on almost every dimension, cheating. We've got to recognize that. They're manipulating their currency, and, by doing so, holding down the price of Chinese goods and making sure their products are artificially low priced.
It's predatory pricing. It's killing jobs in America.
(END VIDEO CLIP)
ZAKARIA: This is stunning, because it comes from a Republican. It breaks with 40 years of Republican foreign policy. Since Nixon and Kissinger opened China to the world, the Republican strategy has been to engage China and not condemn it. That Mitt Romney is changing tells us that popular moods towards China in the United States are now very hostile.
People keep saying that America needs a new China strategy, but I think if you watch all that's going on and see how many countries are wondering about Beijing, the truth is China needs a new China strategy. Beijing needs to recognize that it has become a world power, that its every move is now deeply analyzed, and that it is expected to play by the rules. Indeed, it is expected to help maintain the rules.
Will it? That is one of the big questions of this new century.
For more on this, you can read my column in this week's "Time" or at Time.com. Let's get started.
ZAKARIA: Joining me now, the Defense Minister and former Prime Minister of Israel, Ehud Barak. Thank you for joining us.
EHUD BARAK, ISRAEL DEFENSE MINISTER: Thank you.
ZAKARIA: I have to ask you the question on everyone's mind - is Israel going to attack Iran?
BARAK: I don't think that that is a subject for public discussion. But I can tell you that the IAEA report is - has a sobering impact on many in the world leaders, as well as the publics, and people understand that the time had come. Amano told straightly what he found, unlike Baradei, and it - it became a major issue that I think duly so, becomes a major issue for sanctions, for intensive diplomacy, with urgency. People understand now that Iran is determined to reach nuclear weapons. No other possible or conceivable explanation for what they have been actually doing. And that should be stopped.
And under nuclear Iran, the whole region will turn nuclear - Saudi Arabia; Turkey; Egypt will have to turn nuclear. The countdown toward nuclear materials in the hands of terrorists will start, even if you take out the generation.
But, more than this, they will use the nuclear umbrella to - to kind of intimidate neighbors all around the Gulf, to sponsor terror. Try to think what happens if at a certain moment you wake up after Iran turns nuclear, three years down the stream, and you end up with a Bahrain overwhelmed by Iran - who will come to - to rescue? Who would have come to rescue Kuwait when it was taken by - by Saddam Hussein 20 years ago, if Saddam could have said credibly enough that he has three or four crude nuclear devices?
ZAKARIA: There's a report in Haaretz that says that you and Prime Minister Netanyahu were trying to persuade your cabinet, and that you - you were able to persuade the foreign minister, Avigdor Lieberman. Is that news report accurate?
BARAK: No, I don't - I don't tend to respond on the - you know, that kind of discussions within the cabinet should remain - be kind of closed to the public. There is a freedom of press and the Israeli people speculate a lot.
But I don't think that Israel is the only main issue on the table. It's Iran, its behavior, its intention, the prospect of a - a kind of a nuclear Iran and what - what should and could be done about it on time.
It's true that it wouldn't take three years, probably three quarters, before no one can do anything practically about it because the Iranians are gradually, deliberately entering into what I call a zone of immunity, by widening the - the redundancy of their plan, making it spread over many more sides, with many more -
ZAKARIA: But do you think -
BARAK: -- elements and --
ZAKARIA: In three quarters, in three - in a year, they will reach a point of no return?
BARAK: Not in the sense of - not in the sense of having a nuclear device. People ask, when they will have - when they will (INAUDIBLE) -
ZAKARIA: But you're saying that, at that point, it become impossible to - to block it, because there are so many redundancies in the program?
BARAK: Yes. I cannot tell you for sure, nor can I predict whether it's two quarters or three quarters. But it's not two or three years.
ZAKARIA: It's shorter than that?
ZAKARIA: Do you have the technical capacity to - to strike Iran and destroy or significantly retard its program? I ask you this because you did publicly say that you thought, in the event of an Israeli strike, you - there would be very minimal losses to Israel. So, obviously, you're thinking about this. You believe that Israel has the capacity to take out the Iranian nuclear program?
BARAK: Fareed, allow me to tell you, frankly, it's not a subject to be - to be discussed in front of these equipments -
ZAKARIA: But you said something about it? No?
BARAK: But it's a - no. No, I said something about the - what might happen if a regional war erupts, what can happen or could happen under the toughest scenarios in the Israeli backyard, among the Israeli populations.
But, let me tell you, we recommend for a long time to all players to act sincerely and intensively to block the Iranians (INAUDIBLE) - deprive them or prevent them from turning nuclear. And we have kept recommending to all to leave no option, not to remove any option from the table.
We - we mean it. We take it upon ourselves. We expect it from others the same way.
ZAKARIA: Do you think that President Obama has been - has been serious in his policy to try to prevent Iran from acquiring nuclear weapons? He's toughened the sanctions. He got the U.N. to agree to a further round.
Do you - do you view his administration's diplomacy on this - on this front as - as something you support? Do you think it's enough?
BARAK: I see - first of all, I do not know around those details or what is on the American administration's mind in this regard. But I can see what they are doing, and I think that they are acting quite intensively right now, and I would not underestimate the - the sincerity of - of this administration and this president.
ZAKARIA: You know that there are people in the United States who've - who criticized President Obama for not supporting Israel strongly enough. Do you believe that President Obama is a very strong supporter of Israel?
BARAK: He is extremely strong supporter of Israel in regard to - to its security. I don't - traditionally, the president will support in Israel in keeping its collective military edge and taking care of its security needs. But this administration is excelling in this. And it could not have happened without the immediate direct support of the president. So I don't think that anyone can raise any question mark about the devotion of this president to the security of Israel.
It doesn't mean that we cannot have difference of opinion at this or that point about this or that other aspect of what happens around us, Middle East or the peace process. I would love to see the American president agree to everything that comes from (ph) our government, but I think that's too - kind of idealistic.
ZAKARIA: Tell me about this mysterious explosion in Iran that killed a very senior Iranian general. Every news report that - that talks about it says this was an operation launched or assisted by the Mossad.
BARAK: It means that there is a - a freedom of press in most parts of the world, and there is an eagerness to compete with each other about a - a good headline that will probably attract viewers or readers.
ZAKARIA: You have no comment on it?
BARAK: No. I don't know anything that I can contribute to this conversation.
ZAKARIA: Let's talk about Syria. The Syrian regime appears to be in greater trouble than it has been for months. The money seems to be running out, the level of the insurgency and protests seem to be rising, and they are losing support. The king of Jordan publicly asked President Assad to step down. Where do you think things stand?
BARAK: I think that he is on a slippery slope. He cannot climb back. He's too deep into it. The fact that the Arab League abandoned him, a not extremely strong monarch, a neighbor, found it necessary to say, loud and clear, that that's unacceptable.
I think that what happened with Gadhafi and the less fresh memory of what happened to Saddam Hussein is on his head all the time, and it somehow makes him more brutal, because he understands that, beyond a certain point, there is no way. It's literally a struggle for life or death.
I don't believe that he will run Syria in a year's time from now, in half a year's time, and it's totally independent from the previous issue we discussed. But things are developing very quickly all around us in the Middle East.
ZAKARIA: Ehud Barak, always a pleasure.
BARAK: Thank you.
ZAKARIA: And we will be back.
(BEGIN VIDEO CLIP)
BRUCE BUENO DE MESQUITA, AUTHOR, "THE DICTATOR'S HANDBOOK: We won't be surprised Russia's going to continue to deteriorate and get worse. We might be surprised that over the next couple of years it is pretty likely that Saudi Arabia will liberalize.
(END VIDEO CLIP)
ZAKARIA: 2011 has been a particularly bad year for dictators, but who could have ever predicted it?
Well, my next guest has a pretty good track record of saying when a particular dictator's power will wax or wane, when another might lose his job or his head. He uses game theory for most of it.
He is Bruce Bueno de Mesquita, an NYU professor and the author of "The Dictator's Handbook." Welcome.
BUENO DE MESQUITA: It's a pleasure to be here.
ZAKARIA: So I want to give people - rather than getting into the theory of game theory, I want to give people a sense of how you use it to predict outcomes. And let's start with something very simple. You note that in dictatorships, the roads then to be straight, in democracies they tend to be kind of curvy and windy and complex. Why?
BUENO DE MESQUITA: Well, if you're running a dictatorship, you don't really have to worry about the welfare or the property rights of the ordinary citizen. Only the people who keep you in power, a very small group, matter. So you can afford to invoke eminent domain whenever you feel like it.
In a democracy, you'd be out of your job if you try to do that.
ZAKARIA: So - so in a dictatorship you just go the straightest path possible and connect the two places, and in a democracy you worry about this town here, this village there, this settlement -
BUENO DE MESQUITA: Precisely. In fact, the first time I went to Beijing they were still building the highway and I was shocked to discover, as we were driving into the city from the airport, we literally drove through a farmer's back yard. That was the highway. The fact that his farm was there just didn't matter to anybody other than presumably himself.
ZAKARIA: You predicted last year that Ahmadinejad, the president of Iran's, power would start waning. And, at least on first appearances, that does appear to be what's happening. He's been challenged by the supreme leader in Iran, he's been challenged by the Revolutionary Guard. Why did you make that prediction?
BUENO DE MESQUITA: Well, my modeling indicated that he was trying to carve out an independent base of power. That's, of course, a threat to the people on top, and that meant that inevitably he would be clashing with Khomeini, with Jafari of the Revolutionary Guard. They've got a lot more clout than he has, so that was likely to be a thorn in his side more than he in theirs.
ZAKARIA: He'll lose that power struggle, you think?
BUENO DE MESQUITA: Yes, he'll lose that power struggle. But, interestingly, I think so will Khomeini in the next - he's already on the way down - in the next couple of years. It seems to me, and indeed I - I predicted in February of 2009, that by the beginning of 2011, Jafari would be the dominant, real power in Iran, and that Khomeini would be increasingly more show and less real authority, and that's going to continue.
ZAKARIA: So what you see happening in Iran is effectively a decline of power based on religious authority of the clergy and a rise of power based on military authority?
BUENO DE MESQUITA: That's right. And that makes me mildly optimistic that over the next several years Iran is going to become a much more pragmatic government.
ZAKARIA: And presumably even in nuclear negotiations, these guys are more likely to be rational, deterrable, practical?
BUENO DE MESQUITA: Absolutely. Again, my view on - on the nuclear side is that what is in the interests of the Iranian leadership and what they perceive to be in their interest is to develop a weapons-grade fuel but not to make a weapon. That is, to demonstrate that they would know how, that they have the technology.
That gets them all the political kudos in the - in the region that they're looking for without the big political and military risks associated with actually assembling a bomb. And Jafari surely understands that.
I think Khomeini understands it, as well. Maybe he's been compelled to understand it.
ZAKARIA: What about Libya? Why did Moammar Gadhafi last so long? Forty-two years.
BUENO DE MESQUITA: Well, I'm going to turn that question on its head. Why did he fail to last longer? He obviously had a very good run. He made, from "The Dictator's Handbook" perspective, terrible mistakes in the last few years. He was interested in currying favor with the West, and, in doing that, he started to diminish the amount that he was torturing people, oppressing people, sending the message that, you know, the risk of rebelling against this guy, not so high.
So he had the first, say, 39, 40 years of, from his perspective, great success because he was not Mr. Nice Guy. The last few years, he put himself at great risk by - maybe he was drinking his own whiskey and thought people actually loved him. But he - he loosened up too much.
ZAKARIA: Which would suggest that the Syrian regime will endure because they seem to be oppressing, brutalizing - in other words, what you're saying is it's good to talk of those old line (ph), for a bad regime the biggest mistake is to start opening up a little.
BUENO DE MESQUITA: Yes. Not - that's true, but I'm optimistic that the Syrian regime will fall -
BUENO DE MESQUITA: -- and that there will be a reasonable amount of liberalization, not - not democracy. Because, again, they'll run out of money.
So the question is how much will the Iranians give them, if the reputed $5 billion is the right number. That's probably enough for the very large Assad family to find some place to go into exile and - and live out their lives in luxury. It's probably not enough to buy sustained loyalty from the military, and that loyalty is crumbling.
ZAKARIA: What are the - if you were predicting - looking forward now, what are the things that are going to surprise us?
BUENO DE MESQUITA: Oh, a very good question. Well, we wouldn't be surprised Russia's going to continue to deteriorate and get worse.
We might be surprised that over the next couple of years it is pretty likely that Saudi Arabia will liberalize a bit more, gradually moving towards a constitutional monarchy, but slowly. Morocco is highly likely to liberalize.
Maybe not surprising, when Raul Castro passes from the scene, it is very likely that Cuba will move pretty rapidly to a fairly liberal democracy. We - we just have to hope that he passes from the scene soon enough so that the offshore exploration for oil and natural gas doesn't come on board, because then they will be able to entrench dictatorship.
ZAKARIA: Bruce Bueno de Mesquita, thank you so much.
BUENO DE MESQUITA: Thank you very much.
ZAKARIA: We will be right back with the story from Oslo. The Norwegian mass murderer, Anders Breivik, went on trial this week. "What in the World?" was he thinking when he set out to murder dozens of young men and women?
That's next, followed by a superb panel from my visit in London - David Miliband, Martin Wolf and others. Stay with us. (COMMERCIAL BREAK)
ZAKARIA: It remains one of the most shocking mass murders in recent memory, and last week Anders Behring Breivik appeared in a public court in Oslo and admitted to killing 77 people last July. He wasn't repentant. Instead, Breivik pleaded not guilty to terror charges, claiming he was in a state of war to protect Europe from being taken over by Muslim immigrants.
"What in the World?" was he thinking? How could the culture of Northern Europe, known for social welfare states and generous foreign aid budgets, create a killing machine like Breivik?
An important new survey sheds some light. The think tank Demos conducted the first-ever quantitative investigation of far right groups in Europe online. This is especially important because the Internet following of these parties dwarfs its formal membership. Remember, the likes of Breivik are created and radicalized online.
So Demos reached out it more than 400,000 Facebook followers of 14 far-right groups across Europe. More than a quarter of the respondents said that violence is acceptable if it leads to the right ends. And if you thought the far right's members are aging and disconnected, think again. A third of those surveyed were under 21; two thirds were under 30. Compare that with the average age of Facebook users, only half are under 30.
So it turns out that supporters of Europe's far right groups are increasingly young and connected. They're also mostly male, deeply cynical about the E.U., and deeply worried about immigration and a perceived spread of Islamic influence in Europe.
They are extreme versions of a growing reality in Europe. The E.U. does seem dysfunctional, jobs are scarce, and at least three major European leaders - Germany's Angela Merkel, France's Nicolas Sarkozy, and Britain's David Cameron - have recently admitted that Europe's experiment with multi-culturalism has failed.
Whoever's fault it is - society's for not offering enough opportunities to integrate; the immigrants for clinging to their own practices - the reality is the immigrant experience in Europe has been complicated and has produced a backlash. And now, with youth unemployment skyrocketing in some countries, could rage against immigrants be the escape valve?
Maybe, though please note Norway has not really had an economic downturn which leads to a key point. It's important to understand that Breivik is a complete outlier. He does not represent most of the far right. He represents evil, unrepentant to this day for slaughtering dozens of young Norwegians.
But having said that, it's clear to me that Europe needs to take a serious look at its policies toward immigrants. It needs to offer more integration and opportunities, and it should ask immigrants for much more assimilation. A final thought - since 9/11, the world has focused almost exclusively on Islamic terror in the form of al Qaeda and other groups. But the E.U.'s latest terror report shows that of the 249 terror attacks committed in Europe in 2010, only three were by Islamic terrorists. The rest were by separatist groups, far right, or far left.
For all the attention that has been paid to Islamic terrorism, there are likely more Breiviks out there, and we need to examine that danger, as well. The irony is that Breivik has become a mirror image for the very thing he seems to be against. He's young, disaffected, and a mass murderer, and when taken to court to answer for his crimes, he says he's fighting a kind of holy war. Sounds familiar? We'll be right back.
(BEGIN VIDEO CLIP)
MARTIN WOLF, CHIEF ECONOMICS COMMENTATOR, FINANCIAL TIMES: I mean, basically this government has gone to work. If it doesn't, they're going to have an unmanageable crisis with Italy and will become, I think, probably terminal for the eurozone.
(END VIDEO CLIP)
CANDY CROWLEY, CNN SENIOR POLITICAL CORRESPONDENT: Time for a check of today's top stories.
Clashes have broken out in Egypt's Tahrir Square for a second straight day ahead of the country's elections later this month. The protesters are calling for a faster transition from a military to a civilian government.
Syrian President Bashar al-Assad says his government will not bow down despite international threats of economic sanctions over a crackdown on anti-government protesters. In an interview with "The Sunday Times" of London, the Syrian leader warns any potential military intervention against his country would lead to dire consequences.
The president's former White House Chief of Staff, Chicago Mayor Rahm Emanuel, called the Republican presidential field a bunch of "turkeys." Emanuel spoke about the Republican candidates last night at a Democratic gathering in Des Moines, Iowa. He was hardest on Mitt Romney for what he calls Romney's inconsistencies in his record.
Those are your top stories. Now back to FAREED ZAKARIA GPS.
ZAKARIA: I was in London earlier this week, and I sat down with three great figures on the British landscape. David Miliband was the nation's Foreign Minister until last year. He's still a member of parliament. Martin Wolf is the Chief Economics Commentator for the "Financial Times." And Bronwen Maddox is the Editor and Chief Executive of the U.K.'s "Prospect" Magazine, a current affairs monthly. (BEGIN VIDEOTAPE)
ZAKARIA: Welcome all.
Martin, you wrote in the "Financial Times" this week that you think finally the time is now. People have been saying this about the eurozone crisis for the last year. Do you really think this is a make or break week or couple of weeks for - for Europe?
WOLF: I wasn't thinking in terms of weeks. I was thinking of it in terms of moments. What I mean by this is that the crisis is centrally about the really big peripheral countries. It's now spread actually across most of the eurozone, but it's above all about Italy and Spain. Italy is the most important, by far the biggest. They have a new technocratic government, and it's got to work.
I mean, basically this government has got to work. If it doesn't, they're going to have an unmanageable crisis with Italy and will become I think probably terminal for the eurozone.
And so they've got to provide Monti, who's got an incredibly difficult task, to manage what he's got in front of him, enough help, enough assistance, just quite a complicated thing, to make the Italian effort succeed over the next two to three years. It's not short, but it is now. If this one goes, then I think they are really in serious trouble.
ZAKARIA: David, you have spent time negotiating as foreign minister with the Germans. It seems to me that the German dilemma is this - they don't want to do some kind of sweeping solution, whether it's euro bonds or getting the European Central Bank to act as the lender of last resort, because they feel that's going to take the pressure off countries like Italy and Spain and certainly Greece to do the kind of reforms they need to.
And every time the European Central Bank has intervened and the spreads have lowered, the Italians somehow, you know, decide that actually all these reforms weren't so necessary.
So when you look at the German dilemma as you do, and particularly given the domestic politics of this, these - their support for these peripheral countries is widely unpopular in Germany. Do you think the Germans will ultimately decide that they're willing to pay the price, despite the fact that it might take all the pressure off these countries?
DAVID MILIBAND, FORMER UK FOREIGN MINISTER: Well, I think that this is a key moment, not just for the economic reason that Martin has said, but also for political reasons. Because people like Martin and I have been bemoaning over at least the last year the lack of German leadership.
We now - we now know from Chancellor Merkel's speech to the Christian Democratic Union this week, she said, I'm going to lead and I'm going to lead in the following direction - a more federalized core of Europe. But I think the central political dilemma and the danger is that Germany has said it wants to lead, but it's not clear they're ready to do enough to get ahead of the political and economic curve.
ZAKARIA: Bronwen, how does it look to you?
BRONWEN MADDOX, EDITOR, PROSPECT MAGAZINE: I don't think it's a surprise that this is coming up now. I think the European project of knitting together all these countries came out of really admirable motives. Out of a reaction to the Second World War in saying that we will never have that again.
I myself think the euro - the project of the euro was a disastrous extension of that. But it's not a surprise to me that it's coming now as the Second World War and the passions of that are really fading from living memory, and fading out of if you like the - the political class.
Angela Merkel, the German Chancellor, does feel very strongly about the European project and knitting it together. She grew up in Eastern Europe. But she's never had the whole of her cabinet, the whole of her coalition behind her. And she certainly doesn't have all the German people behind her. Whether it's actually going to amount to enough German public support to keep paying these bills and to make as dramatic a gesture of support for the euro at this point as it would need, I'm very much in doubt of that.
ZAKARIA: Martin, so let me represent the - you know, I'm going to call it the German point of view, but let's call it, you know, Axel Weber's point of view, the head of the - the former head of Bundesbank, which is really, look, the markets, you know, are panicking, but the only way to solve the problem would be some kind of a euro bond issue, some kind of grand gesture. But that will take all the pressure off.
And fundamentally you have a competitiveness problem in countries like Greece and Italy, and they need to reform. And we've got to keep the pressure on. And there is going to be no big check. We're going to dole this money out slowly, and if the markets don't understand, well, we're not going to jump every time the markets tell us to -
WOLF: I understand the point of view. But it's a very, very dangerous game because markets move so much more quickly than economies.
Let us suppose that Mario Monti in Italy did everything we wanted him to do. All the reforms that you could imagine. It's a very large country. It's a very complicated country. It's not like little Ireland with a huge export sector. The best will in the world, anybody who asks how long would that take to work, to restore competitiveness and growth to Italy, if everything went well, I would guess four or five years.
This is a massive undertaking they're trying to introduce a whole wave of reforms, restore competitiveness, lower wages, it's a huge task. In the meantime, the markets are going to lose patience every day. And at some point there's a real risk that Italy doesn't want to be able to fund itself. And then we're going to have the risk of a default, and that will be a contagious event. And Italy will feel abandoned, and the thing will smash.
So the necessary condition I think now, if you've got the government that is committed to reform, and there's no doubt Mario Monti is, then you have to support it as long as it continues with the program, you have to support it so that Italy can finance itself in the meantime.
Now, I don't know whether this will work. I'm really quite skeptical. I think the pressures on the eurozone are spectacularly big, and it could break up.
ZAKARIA: We will come back to discuss all of this and also whether or not cutting budgets in the United States and the United Kingdom is a good idea, when we come back.
ZAKARIA: And we are back with Martin Wolf, David Miliband, and Bronwen Maddox.
ZAKARIA: David, when you look at what is happening in Britain, we in the United States are particularly interested because you preemptively cut your budget, raised taxes, in a way to be - to assure markets that Britain was in good fiscal shape. What do you think the result of that experiment has been?
MILIBAND: Well, it's a pretty clear laboratory experiment if you strangle an economy, it stops growing. And we've grown as an economy 0.6 percent in this calendar year. Our economy is still below the level it was in 2008 with a smaller economy that we have then.
And I think what the government has done is instead of just taking their foot off the fiscal accelerator, they've slammed on the brakes. And at a time when the private sector is deleveraging very fast, there's very little confidence in the consumer sector, probably because it's been frightened by the government about what's going to happen, you see the economy really flatlining.
And that's obviously increasing the strain here, and potentially starting off a vicious circle where benefits bills go up, tax revenues go down, and you're caught in a very difficult vice, really. And so the jury's out to put it - it's most diplomatic in respect of the economy.
Nonetheless, if you look around Europe, you would say this is a relatively stable political situation. I don't see a general election, much as frustrating it is for me to sit on opposition, only being able to talk on, you know, on these shows and not do anything. I see a pretty stable political situation. But you're right, it is a test case to an alternative form of austerity politics.
ZAKARIA: Bronwen, what do you think? Do you think that the United States should look at the British example and say, if you cut the government spending, in their case they raised taxes, very little prospect of that in the United States, but the result will be you will further decrease demand for goods and services in the economy?
MADDOX: No, I don't think it's a self-contained model as David is suggesting. I mean, Britain is enormously affected by what's happening in the eurozone for example. But, yes, the markets have so far given David Cameron credit for being able to reduce the - the deficit in a way that they haven't given the Italian and the - probably Spanish governments credit for that. So the --
ZAKARIA: In the sense that Britain's borrowing costs are low.
MADDOX: Yes. And -
MILIBAND: That reflects our weak economy. I mean, the low yield reflects the fact that our economy is flat than before -
MADDOX: No, but it gives some credit for being able to raise taxes a bit or being able to cut spending a bit. And the markets are not thinking (ph) - the Italian, Greek, and Spanish governments can do that.
ZAKARIA: Martin, I know you've written about this, and you regard the British experiment as essentially a cautionary one that is -
WOLF: What's happened in the U.S.
WOLF: I will be absolutely terrified out of my wits if the Americans follow the British model. On the other hand, right now, I think it would be probably devastating for the world. I'm more concerned that the Americans will never follow the British model. They will never get their fiscal house in order. That would also be very, very serious. Timing is everything in economics.
And I'm - I'm very sympathetic with David's view. Obviously, we had to cut the budget deficit. There's no doubt. But my concern with it is that it's too fast. And above all, it's too rigid. And I think they have locked themselves in - in a position which is could turn out over the next year or two to be very, very unfortunate. Another two, three years of stagnation, bad for the economy, bad for the government, and bad for the public finances.
ZAKARIA: But you say that you'd be scared witless if the United States were to do the same thing. But, of course, at some level that is the conversation in America. We have a budget committee that's, you know, a Senate and House committee that's trying to figure out how to cut somewhere between $104 trillion out of the deficit. We have, you know, potential taxes on the rich. So nobody's talking about spending more money in America.
WOLF: Well, I have every confidence that the Americans will fail to do the cuts that they're promising. I don't think they can do --
ZAKARIA: Which you think is a good thing?
WOLF: In the short run, it's a good thing. I mean, it's clear that America is on a tightening mode. That is clear. But the crucial question is, how fast, how massive that tightening would be. With I think the political opposition to much more action by the Fed, very dramatic tightening beyond what is already on the way, and there is tightening on the way, but I think it would be dangerous.
And so I'd be very keen to see that not happen, but my sense is they're not going to slash spending and they're certainly not going to raise taxes. And so I suspect not much is going to happen.
MADDOX: Martin, this seems a bit disingenuous. I mean, you want to see them fail at the moment because it will stop them tightening too much. But we do want to see evidence that America can actually tighten. That this is a government that still has -
WOLF: When it's actually recovers.
MADDOX: - that it still has a government that is capable of making these decisions. And over the summer with the standoff in Congress, this was exactly what people were questioning. Wouldn't you rather that America chose not to tighten at this point rather than it failed?
ZAKARIA: But, you know, David, let me ask you this as a politician, you see the complexity of what Martin and Bronwen described, which is you're trying to, you know, particularly in the United States, it's a very large country, very diverse, this very complicated message that, you know, you shouldn't tighten now. You should in fact perhaps even have a more stimulus now.
But in the medium term you need to start tightening and you need to tighten quite dramatically given that Medicare -
MILIBAND: It's not that complicated. I mean it just says you've got to have your balance between the accelerator and the break. And I think people can understand that.
Look, there are two parts of our conversation join. There are real dysfunctions in our democratic politics, whether in the U.S. or in the European Union. Secondly, there's a real danger that the move of global integration is going to be halted by protests in the west.
Traditionally, we thought, it's going to be the developing countries that end up tipping over the globalizing bandwagon. Actually, the danger now and the European Union is at the center of this, the danger of deglobalization, if you like, is really serious. And we see the rise of quite dangerous forms of nationalism, localism, parochialism, nativism. And I think that those twin dangers, the dysfunctions of democracy on the one hand, the retreat from global integration - or not global government, but the integration of our global village, those twin dangers are going to define politics for the next decade. And that's what we need politicians to come to terms with.
ZAKARIA: David Miliband, Bronwen Maddox, Martin Wolf, thank you very much. And we will be back.
ZAKARIA: When I was in London this week, I saw the massive undertaking to prepare for this summer's Olympic Games to be held there, which brings me to my "GPS Challenge" question of the week.
How many soldiers, police officers, agents, guards, are expected to be protecting the London Olympics at its peak? For reference, Beijing had 80,000 security personnel for its Olympics. Is it, A) 10,000; B) 40,000; C) 80,000; or D) 200,000?
Stay tuned. We'll tell you the correct answer. Make sure you go to CNN.com/GPS for 10 more questions. While you're there, make sure you check out our website, TheGlobalPublicSquare. And don't forget, you can follow us on Twitter and Facebook.
My "Book of the Week" is the latest from my guest earlier, Bruce Bueno de Mesquita. It's called "The Dictator's Handbook: Why Bad Behavior is Almost Always Good Politics." De Mesquita and his co- author, Allister Smith, have some simple guidelines that predict the behavior of leaders. They say that all political leaders, democratically elected or dictatorial power-grabbers, are really only interested in their own political survival. If you use that as your guide, you can figure out what they will do. A smart book.
And now, for "The Last Look," those of you who watched our recent education special saw the exhausting study habits of South Korean students. The accumulation of that pressure was last week when almost 700,000 South Korean high school students took the test they had spent all those hours working toward.
It was a wild scene outside test centers as younger kids cheered on the heroic test-taker as they arrived. Police motorcycles even whisked the late ones to school. But when it came time for the high schoolers to begin the grueling nine-hour exam, silence was the order. Planes were grounded, honking was banned, and teachers refrained from wearing squeaky shoes for fear of distracting the students. Relatives prayed outside the school gates for good results.
Why all the fuss? Well, it's widely believed in South Korea that this test determines which college a student will go to, which company they will then work at, the size of their eventual paycheck, and even whom they will marry. Pretty intense pressure. The correct answer to our "GPS Challenge Question" was B, the number of people protecting the 2012 London Olympics will max out at 40,000. The Beijing Olympics outdid the rest of the world along most dimensions. Now we know how impressive they were on security, as well. It was twice the size.
Thanks to all of you for being part of my program this week. I will see you next week. Stay tuned for "RELIABLE SOURCES."