fleeting. only 7% say he is the most electable in november. thank you for watching "state of the union." i'm candy crowley. before we go, two programming notes. tonight, 8:00 p.m. eastern, wolf blitzer hosts "countdown to iowa: the final 48 hours." later today, i'll be anchoring the "the contenders 2012." up next for our viewers in the u.s., "fareed zakaria: gps." >> i'm fareed zakaria. i want to wish you all a happy new year. we have a terrific show for you on this new year. what better to do on the first day of 2012 than look at the entire year ahead. what will it bring in international affairs, economics and much more. a great panel of prognosticators who look into their crystal balls for us. next we look farther ahead in

the future with a brilliant harvard physicist. then deep inside the way your mind works and sometimes why it doesn't. fascinating conversation with nobel prize winner daniel kahneman. a big birthday but an awkward time to throw a big birthday bash. i'll explain. first here's my take. it's the start of the new year and we will do predictions on this show. i thought i'd try my own hand at some before asking others to risk their reputations. and in the spirit of keeping myself honest, i'm going to look back at what i said and wrote in "time" magazine at the start of last year and see how i did. it's always risky to stick your neck out and humbling to look at your predictions but here goes. the only indulgence i allow myself is to start with areas i did well. i said i thought china would moderate its foreign policy behavior recognizing its assertiveness and arrogance over the last year had caused jitters throughout asia. i think that happened. i said the taliban's momentum would be broken in afghanistan.

it has somewhat. i said the drawdown of american troops in iraq would take place and would not cause great regional crises or instability. all of that seemed to play out pretty much as i predicted. i said that iran would continue to be checked by a large group of regional and global powers but there would be no american or israeli strike. so far so good. now, my misses. i said that europe would survive. it has taken the europeans much time and many crises to come to the realization they will have to bail out their spendthrift and unlucky partners in greece, ireland, perhaps portugal, spain as well. germany can afford the bill. well, europe has survived, but the situation did not resolve itself nearly so easily as i thought it would. but my biggest miss was probably the u.s. economy which i thought would recover more vigorously than it did. so what do i think this year? i'm going to double down on my bets.

i might have got the timing wrong but the substance right. europe will deal with its problems, not in a clean dramatic way, perhaps not the way i thought. there will be various complex mechanisms that will involve european central bank, some kind of bond insurance. i remain convinced germany will not let europe fall apart. if things get too dangerous germany will write the checks. it's trying to get the best deal it can, the most reforms from countries like greece and italy before it does write the checks. as for america, i'm still bullish. i think the american economy continues to have great strengths, consumers have rebuilt balance sheets somewhat, savings rate from 0% to 3%. corporations are flush with cash. yes, washington remains dysfunctional. but remember, there's a new dynamic at work even there. if congress does nothing, something it does very well, there are two sequestrations that take place.

one cuts spending and one raises taxes. remember, bush tax cuts expire if congress does nothing. so all of a sudden there are pressures that can bring the budget deficit down. the deficit problem gets solved in a blunt, crude way but maybe that's how democracy works. it's easy to spot all the problems we face, but i think there are also some silver linings here and that's where i'm putting my money. so let's get started. you've heard my thoughts. i'm now joined by three experts who have agreed to gaze into their crystal balls for 2012. anne marie slaughter, teacher at princeton, previously did strategic planning for hillary clinton. ian bremmer president of arab group, global risk research firm.

daniel franklin, editor of the economist magazine's world in 2012 special edition. welcome. so, ian, you do this kind of thing for a living. let's first start with something simple like iran. is the united states or israel going to attack iran in 2012? >> absolutely not. i can't see the united states doing it. keep in mind, it's still obama no matter what happens with the elections in 2012 at least for the purposes of that year. and the israelis are highly incented to convince everyone that an attack it could come if they aren't satisfied. if it's going to come it will come from the u.s. the two sides aren't coming together. sanctions will clearly escalate. there's a lot of internal pressure within iran. when you have a potential assassination against the saudi ambassador to washington, the british embassy being occupied, that's telling you there's a lot of internal instability at the top of the iranian regime. there's risk takers and folks that don't like us but much more pragmatic. that plays out potentially in

dangerous ways in 2012. that's very different from saying we're going to take out -- attempt to take out the nuclear program. >> anne marie, one of the things i've heard in washington is there are a lot of people in washington who feel that the israeli belligerence is an effort to play us rather than a signal they are about to strike iran. do you think that's right? they are trying to say to us, look, we're getting really serious so unless you guys in washington do more, we might strike? >> i do, but i don't think it's working. i think everybody knows where everybody else is in the game. i agree with ian, i don't think there will be a strike. we'll just go ahead as we've been doing. the policy is not actually working. the iranians are getting closer and closer to a nuclear weapon, but i don't see any overt attack, covert maybe. the one thing i will say, i'll go out on a limb here and make a point prediction, i think there is a substantial chance that ahmadinejad could actually be impeached and that the iranians

would move more toward a parliamentary system, because you are seeing these tensions within the iranian regime. turkey is pushing very hard on iran. turkey is playing the role iran wishes it were playing. with the turmoil in syria, i think ahmadinejad -- he has obviously allies. but he's got a lot of opposition within the top clerical establishment. >> to the point about being impeached, the supreme leader made a very strange statement in which he said one wonders why we have a parliamentary system. there are certainly benefits -- why we have a presidential system. >> exactly. >> you look, he's had trouble with ahmadinejad, who was sort of his guy. he had trouble before that. trouble with rafsanjani before that. so he may be thinking, look, why do i need this nationally elected figure who inevitably becomes a rival? why not a parliamentary system where you have this low profile

prime minister figure? really interesting would be the supreme leader, the longest serving leader in the middle east now, very old. if he were to die, would you have a new supreme leader or would that call into question the whole system? >> that would be a mess, in my opinion. you do. you have rural constituencies versus clerical constituencies. i'm not going to call that one. >> daniel, iran. anything? >> what's been painted is a benign scenario. the worst is avoided, the real showdown. if ahmadinejad were to go one way or another, that would obviously be a good thing as far as the west is concerned. my fear is it might not turn out quite as benign as that. at the very least i think and hope you're right that israel won't strike but things could go wrong. at the very least there will be a ratchetting up of the rhetoric. it is after all a very, very serious existential concern for israel. i think you could see some nasty

moments in the coming year with iran. >> anne marie said the policy wasn't working in that iran is moving forward. what's your best sense as to what the trajectory is in terms of nuclear development? >> i think it's working for iranians. that's part of the problem. right? in other words, you can only get so much sanction against them. this is part of the problem. united states, brits, europeans are all moving towards much tougher sanctions against the iranian but you can't sanction on energy. in a recession, low growth, that's going to spike oil prices. who is going to do that. can't get them to sign up to sanctions that are meaningful. this is not libya where they'll say take these guys out. they know they have a lot of leverage. their nuclear program continues. the real question unlike north career ya is would the iranians actually test a nuke. there's lots of reason they might not. one is that the israelis have a couple hundred nuclear weapons. they have never tested one.

if the iranians do, what's the israeli response? do they force sunni states to move toward their own weapons if they do? strategic ambiguity from iranian is a reasonably serious strategy. no question that if ahmadinejad stays in place and there's a big fight, there's greater potential for a rogue sort of action, which is very destabilizing a la what we've seen on the isi in pakistan. doesn't mean israel will attack and doesn't mean we'll see a nuclear weapon anytime soon literally on our horizon in 2012. >> you mentioned syria. is assad going to be in power by the end of 2012? >> i do not think there's any chance that assad will be in power by the end of 2012. who will be in power, far more complicated. but i think the chances he will hold on for another 12 months are nil. >> daniel? >> i agree with that. not quite nil. we saw in libya how long these

regimes can be in falling. >> that's right. >> i think it's inevitable he goes, but it could be quite long and certainly messy. >> i say a little longer on balance. he has the military still behind him. in some ways the military is leading, not assad. it's not getting rid of one person. this is not the mubarak analogy. the opposition is still relatively inchoate, isn't well armed. domestic opposition and international opposition is separate. the international pressure is huge. the sanctions from the arab league are meaningful and starting to really bite into the syrian economy. i wouldn't be stunned -- i think he's going. i wouldn't be stunned if we have this conversation in 12 months' time he's still there. >> that's a pinpoint prediction. you can call us back in a year and we will know. what about looking at the region one last time, israel. is anything going to change in israel, israeli-palestinian situation? hasn't changed 30 years. i suppose this would be a safe

one to say nothing will change. >> i don't see anything changing between israel and palestine. i think there's more likelihood of real internal protests within israel. we saw that this summer. i don't see that translating into major movement in any peace process. >> the change would have to come from israel, not just an american election. not going to be a huge amount of external involvement. >> fine on the israeli domestic environment. but internationally israel is not a winner in this environment. you talk about presidential elections. you're not going to run on let's keep the peace treaty. you'll run on let's support the arab streak. if that's true in egypt, also places like jordan, certainly turkey. a lot more pressure on the israelis, and hard to imagine with the geopolitical environment turning that much against them will be able to forestall violence someplace,

whether breaking open with lebanon, maybe even on syria, certainly with more palestinian attacks both ways. that's something we need to be worried about. >> all right. we're going to take a break. when we come back, more predictions. china, pakistan, all kinds of fun, troubled countries coming right up. what is that? it's you! it's me? alright emma, i know it's not your favorite but it's time for your medicine, okay? you ready? one, two, three. [ both ] ♪ emma, emma bo-bemma ♪ banana-fana-fo-femma ♪ fee-fi-fo-femma ♪ em-ma

very good sweety, how do you feel? good. yeah? you did a really good job, okay? [ female announcer ] to nurses everywhere, thank you, from johnson & johnson.

aspercreme breaks the grip, with maximum-strength medicine and no embarrassing odor. break the grip of pain with aspercreme.

we are back with ann a marie slaughter, daniel franck lin and ian bremer. predictions for 2012. in the economist edition you edit, you say we spent the last years talking about the debt problems of the developed world, get ready for the debt problems of china. we think of china as the world's greatest creditor. >> china intervened to massively support its economy in the response to the credit crunch that happened in 2007 and 2008. that is now a huge problem. they face the difficulty of controlling that at a time when the chinese economy is also slowing generally. bear in mind 2012 is a year of transition in china. they have a leadership transition starting at the october -- probably october

party congress. so the chinese leadership is going to be struggling with a difficult situation at home while this delicate process of moving from one generation of leaders to the next is taking place. >> they have generally handled these kind of problems, bank debt, real estate bubbles, because they have so many levers to control. do you think they will be able to get through this one? >> the chinese government, as stable as it is, has more capacity to kick a bigger can down the road than anyone else. long-term that's a greater problem, greater chance of hard landing, xenophobia and other risks. for 2012 i think china is relatively safe on that front. >> how do you feel internally but also externally? what we've seen over the last few years is china got somewhat aggressive a year ago. and then for the last six or eight months they've been dialing it back. they realized that rattled their

neighbors in asia. where do you think china is going first internally but also externally over the next year? >> i think there's a better than even chance there will be a naval incident between the chinese and either the vietnamese or the philippines. worse for the u.s. if it's philippines because they are a treaty ally. but it could be actually provoked by china. i'm more with daniel. i see more signs of instability, seesawing between trying to control inflation but realizing they are choking off credit and going back and forth. it's quite possible if they really get into trouble and could be connected with the leadership fight that they would provoke something. >> they are going to try to keep heads down in 2012 precisely because of this leadership transition. i think they have every incentive not to create any waves in the south china sea or elsewhere. if they can possibly help it, i think they will try to keep things very calm with their neighbors until this leadership transition is out of the way. >> they may be provoked. >> arab spring.

what countries are going to be clearly successful or clearly fail by 2012? >> i don't think that degree of clarity is going to be easy to spot. what i do think you might well see is a spreading south of the arab spring to parts of subsaharan africa. >> like? >> well, i think in particular the most vulnerable countries are the nine countries that have had the same leaders in place for over two decades now, countries like zimbabwe, guinea. angola. i think that's where you will find this desire for change. among people who now see what's going on and have been following very closely what's been happening in north africa and have the mobile telephones and other means of communication to organize. i don't think carbon copies but

very much a sense of the legitimacy of protest and the possible of protest. >> i think there's been a presumption among us in the west that the arab spring means authoritarian regimes transitioning to something else. there's an enormous amount of economic pressure on brittle democratic regimes as well. particularly about the european periphery, greece, hungary. those are places we could seed a lot more social discontent, populism that moves them in an authoritarian direction. they shouldn't lose sight and presume arab spring is just about countries we don't like. >> that brings us to europe. easy question. will the euro survive in its current form with all its members in 2012? >> i think there's probably now about a slightly just about even chance that it will survive but very uncomfortably large possibility that it won't. i say "uncomfortable" because the precipice that that represents for europe is a very scary one. >> i would probably give it a little better odds than that,

more in the 60% to 70% range. i think it's striking all the people have been predicting it would collapse. they wouldn't believe in june it was still around in december. they were sure it was gone long before. i do think not just that the europeans are looking at the precipice but so are the chinese. europe is china's biggest trading partner. i think there are other sources of funds. if it really comes down to it, there will be -- there's funds available to make this happen. the real danger is miscalculation of timing. >> miscalculation of the markets. >> exactly. the timing isn't quite there. >> what happens on the streets. not necessarily in the control. goes back to -- >> a lehman-like moment. >> yes. >> even then if the chinese were to come in with a big bushel of money it would help. >> the chinese aren't going to come in with a bushel of money. interesting when sarkozy went over with chapeau in hand and said let's help and they said

let's be multilateral, which is chinese for no. going forward i think the eurozone actually stays together. but i also think in 12 months' time we may still be asking this question. the ability to continue to muddle through, especially if we have a slightly more benign economic environment in the united states and chinese continue to do we will is greater. we've seen central banks able to coordinate, make money, pump money in. if italy doesn't seem to be insolvent and if technocratic governments are able to stay in place and continue with austerity, possibly the germans, the french will continue to press down. muddle through as unlikely as it seems right now may well be something we continue to see. >> technology. you in your issue have some interesting thoughts about what's going to happen in the world of technology. >> technology is always fascinating and moves very fast. i think you could imagine as a new territory to be fought over

for technology in the year. there are incredibly rich pickings which will be fought over by fascinating combination of the existing tech titans and new startups. you have new ideas, new exciting business models to take that sort of territory. >> do you think those new startups will, as has been true in the past, over the last 50 years, will all come out of america? >> i think they will tend to. america is just such a huge market and has a potential for a company to grow so quickly. you have the whole infrastructure, venture capital, ecosystem of silicon valley. that makes america a good bet for commercialization of the ideas. >> i agree the united states is the bet you make. that's where the entrepreneurship is, the technology investments are. chinese turn out millions and millions of engineers that's different from folks creating new businesses. 50% of chinese millionaires want to live in the united states.

quality of life completely matters. look, steve jobs is dead but long live steve jobs. >> on that note, ian bremmer, daniel franklin, anne marie slaughter, thank you very much. we will be back.

now for our "what in the world" segment. 2011 ended just hours ago and it will likely be recorded as a year of historic change. mass uprisings upended governments across the arab world. economic mismanagement in europe led to changes in italy, greece and spain. 365 days ago you couldn't have predicted these events. you couldn't have imagined so many leaders would lose their jobs. so what if i told you you can predict in 2012 a lot of leaders will say good-bye? i'm not gazing into a magic crystal ball. you see, 2012 is the year of elections. 59 countries will be tallying up votes, local, state or national. there are 193 countries in the world, so that's about a third of the world's nations. 26 of these may see a change in national leadership. together these changes could affect 53% of the world's

population, representing half of the world's gdp. a lot of the change is concentrated in the world's most powerful countries. four of the five u.n. security council members could see changes at the top. that's russia, china, france, and of course the united states. these four countries alone represent 40% of the world's gdp. of all of them, china will not have democratic elections but will see the biggest wholesale change at the top. 70% of the country's leadership will be new. we're not expecting any surprises. it's widely believed hu jintao and wen jiabao will be replaced. get used to their names. you'll be hearing them a lot. russia's election will be the most predictable. we know prime minister putin will become president putin again. even that change isn't as clear-cut as you would imagine. for the first time in years it seems like it's becoming acceptable in russia to criticize the kremlin. putin was recently booed at a

boxing match and his party had a stunningly weak showing in the recent parliamentary elections. what about washington? as you know, one year from now we could have a president mitt romney or newt gingrich or, of course, another obama term. south of the border that perennial pain in washington's back side, hugo chavez, himself needs to win an election, though he rigged the last one. there will be changes, too, in mexico, egypt, taiwan and kenya just to name a few. some of these elections and leadership changes involve nothing more than personnel shifts. others will be occasions for fundamental debates about the future course of the country. they could mean shifts so that we see a different europe, a different china, or a different america in the next few years. so for those of you who have been struck by the volatility of recent years, the roller coaster ride we've all been on from boom to bust, crisis to crisis, i

would say keep that seat belt strapped on because you're going to see a lot of churn over the next year as well. it may not be bad, but there will be no shortage of political twists and turns around the world. those are just the ones we know about. one thing i can promise you, we'll be tracking them all right here on "gps." so happy new year and we'll be right back. we've looked at the short-term future. coming up, we look way into the future of science and technology with harvard physicist. sovereign of the security line. you never take an upgrade for granted. and you rent from national. because only national lets you choose any car in the aisle. and go. you can even take a full-size or above. and still pay the mid-size price. i deserve this. [ male announcer ] you do, business pro. you do. go national. go like a pro.

[ding] announcer: clean kitchen surfaces, utensils, and hands with soapy water. one in 6 americans will get sick from food poisoning this year. keep your family safer. check your steps at foodsafety.gov.

it may sound like a weapon out of "star wars" but it's engineering that's allowed more more extraordinary breakthroughs in our understanding of the physical world. scientists say in 2012 they hope to find the elusive god particle which would unlock many mysteries about the beginning of the universe. in past decades, these sort of advances would have naturally been made in america. so it is particularly galling to some that it was built near the border of france and switzerland. lisa randle is a top american scientist who teaches

theoretical particle physics at harvard. she has a new book called "knocking on heaven's door: how physics and scientific thinking illuminate the universe and the modern world." she joins me now. thank you for coming. ? thank you for having me here. >> what is going on in science and physics that excites you? how are we going to explain to the world or the universe in different ways? >> well, right now i'm very excited because this is the era of experiments, even if the experiment is in europe. i don't care of there's an experiment going on. it's going to tell us very fundamental things about the underlying nature of matter. this collider, large, 27 kilometers in circumference. it collides together protons, and they're at high energy, which means we can look for things we've never seen before, because as you know, e equals mc squared, as einstein tells us, which means bigger energy as bigger mass. it can tell us about mass particles, how masses come

about, also why masses are what they are. the thing that's amazing about this is how challenging that question is to answer. that answer could tell us things about symmetries of space and time. i've been doing this a quarter of a century which is about the time the hadron has been under development. we wanted to study this scale, and now we're finally at the time this is happening. it's a very exciting time in that sense. >> what does it say this experiment was done in europe? we have come to think of these kind of big scientific experiments as essentially being done in america. there were similar colliders in america. >> we shut down the closest thing we had, a lab near batavia, illinois, near chicago. >> we shut it down because congress refused to fund the money? >> we shut it down for a couple of reasons. one is the large collider clearly will be a better sha machine. it has higher energy, higher intensity, more events. we probably could have kept it

running for a couple more years and got a lot of useful information out of it, i think that was more political and money considerations. a rather small amount of money on the scale of what a particle collider costs. >> do you worry the federal government is not funding basic science at the level it used to in the 1950s and 1960s? >> i worry we don't have a vision of how we're doing to continue funding it. i think for a long time america was the place where discoveries were made, at least my field. in particle physics. i visited a lab a european there saying we're better find a particle because they just weren't finding things in europe. they were all being found in america. it's clear the attention has shifted to europe, at least as far as the experiment goes. >> you're worried as you look forward into the future, america is losing faith in science. if you watch the republican primary debates, i think you ask them how many of them believe that evolution is, you know, a valid theory, i think there were

maybe seven or eight people, one or two willing to say that. >> i think that's what i'm worried about, a country built on scientific events, technology, really served well for us. i think we should value that. why we would want to ignore what is being shown scientifically is a little bit beyond me. obviously dealing with the actual reality even if we don't like it, we're more likely to come out ahead. >> do you think there's another form of life somewhere out there? >> so the answer to that is first of all, it's just my opinion. i have no evidence. but i think there probably is another form of life out there. i think we probably won't ever know about it. i think given the vastness of the universe, how many possibilities there are, it seems extremely unlikely that we would be the only form of life. the odds we would actually know about it because they communicate or interact or enough like us or close enough

they could send -- i think is highly unlikely. we have wonderful technological tools that let us look out into the universe, but there's a lot of the universe we don't see. the fact is we basically see with various forms of light in some sense, and that will only tell us so much at this point because there are so many sources. you can only see so far very clearly. but you know, having said that, that doesn't rule out the possibility there will be evidence or this we will find planets that seem enough like ours. it's certainly been quite impressive how many new planets have been discovered recently. i don't want to say this will never happen. everyone makes pronouncements this will never happen and then they do. i think it's unlikely we will discover life. >> lisa randall, glad to have you. >> thank you very much. >> we'll be right back.

okay. put on your thinking caps, it's time for a pop quiz. a baseball bat and ball cost $1.10 together. the bat cost $1 more than the

ball. together they cost $1.10. how much does the ball cost? what is your answer? so i bet you said that the ball costs $0.10. if you did, you'd be dead wrong. don't worry. you have good company. the majority of students at mit and harvard got it wrong, too. the correct answer is the ball costs $0.05. the bat $1.05. if the bat and ball there's only a $0.90 difference between the bat and ball not a dollar. why does everyone get it wrong? the next guest will explain, being the recipient for the nobel prize for economics but actually a psychologist. he has a new book out, "thinking fast and slow." welcome. professor, pleasure to have you on. >> glad to be here. >> so what struck me about the example, it's a perfect example of why it's not a good idea to think fast. you're convinced you're right

and it's dead wrong. what is it we're doing there that makes that happen? >> there are two things. one is something that happens in your mind, the association. for some reason that problem brings $0.10 to mind. the other thing is something that doesn't happen. you don't think. that's the key difference. >> if you wrote it out as an equation i found you don't -- >> you don't make a mistake. $0.10 and another dollar that comes to $1.20. they don't trick. there are interesting differences between the people that trick and people that don't. at harvard and princeton, half of the people, or over half in some cases make a mistake on that one. other universities, have to stand up for princeton, other universities it's worse. >> tell me this, is this a pattern that you detect in human behavior that there are some

things people think fast about and some things they think slow about? how would you describe this difference? >> most of the time we think fast. most of the time we're expert at what we're doing. most of the time what we're doing is right. we do it with very little work and very little effort. there is slow thinking, effortful, it's hard work. it turns out by and large we clearly -- most people are wired to avoid it. we try to do as little as possible of the slow thinking. very hard work. so sometimes the fast thinking delivers the wrong suggestion and the slow thinking doesn't block it, than people come out with mistakes. >> people point out that racism is kind of a product of that kind of very quick thinking. prejudice comes to mind quickly. >> of course. we have associations to i think so we have associations to tables and to dogs and cats and harvard professors and that's

the way the mind works. it's an association machine. >> when you think about this, does it make you feel the way in this economics is done, the way we think about economics is all wrong? because there is a sense in which what you're describing is the human capacity to really make false judgments all the time, to not know what is in your best rational self-interest. >> the idea that people are completely rational really is something very important, which is that the government has the responsibility to ensure disclosure. that people are given correct information when they interact in the market. it doesn't matter for a rational agent whether the print is small or large. it matters a lot for people with a lazy sort of system, lazy, slow thinking.

they don't read the small print. none of us read the things that flash on the computer screen and you say i agree at the end. that is a place where behavior economics is making an important contributions and i think a correction to the old classical economic model of the rational agent. >> the sort of classic example of what you're saying, you give people the default option to save rather than not to save. on their salary forms you say check here if you want to opt out of the ira or savings plan so the default is they save and the result is you have many, many more people saving. >> one of the most dramatic examples of that is in europe. about half of the country is on organ donation have an opt in form. you have to check if you want to donate your organs, otherwise you don't, the default is you don't.

the other half is the default you do donate and you have to check if you don't. the percentage of donations is roughly 90% in one case and about 15% in the other. on very consequential decisions people can be guided by those s people can be guided by the superficial aspects of the situation. >> do you think that what this tells you is that the government should be more active in trying to shape people's choices? what areas would you advocate more is done? >> well, you know, i think this is something that is actually happening today in the obama white house because you have a behavior economist who is in charge of regulation. and the focus there is consumer protection. it's making sure not only the things are disclosed, which everybody agrees, i mean that's the law, they have to be discloesd dosed but disclosed in a way na 0 accommodates the

limitation of people. >> you don't think it interferes with the good functioning of a market? >> nobody wants a world in which the government will decide what you eat, that's not a -- that's not going to prevent people from eating fat food. there's a balance. there's a balance between freedom, which everybody wants to protect, and you know, the need of individuals to be in some cases helped, make decisions that they will want to have made. i mean it's not that you are forcing people into things they don't want. and in the case of saving, most people want to save more than they do. and they are grateful when you help them save more than they do. that's a balance that they're seeking and it's a difficult balance to achieve. >> when you first saw the baseball bat and ball question, did you get it wrong or right? >> i think i got it right. but i am, you know, i'm good at those things. and i check.

>> daniel kahneman, a pleasure to have you on. >> it was a pleasure to be here. >> we will be back. welcome. i understand you need a little help with your mortgage, want to avoid foreclosure. smart move. candy? um-- well, you know, you're in luck. we're experts in this sort of thing, mortgage rigamarole, whatnot. r-really? absolutely, and we guarantee results, you know, for a small fee, of course.

such are the benefits of having a professional on your side. [whistles, chuckles] why don't we get a contract? who wants a contract? [honks horn] [circus music plays] here you go, pete. thanks, betty. we're out of toner. [circus music plays] sign it. come on. sign it. [honks horn] ...homes around the country. every single day, saving homes. we will talk it over... announcer: if you're facing foreclosure, make sure you're talking to the right people. speak with hud-approved housing counselors free of charge at... ♪ sing polly wolly doodle all the day ♪

♪ hah

as we welcome 2012, one more look back at 2011 for the question this week. what was the biggest story on twitter in 2011 based on hashtag use? if you don't know what that means, ask your kids. was it a, egypt, b, bin laden, c, japan, or d, the super bowl? stay tuned and we'll tell you the correct answer. make sure to go to cnn.com/gps for ten more questions. while you're there check out our website, the global public square, where you'll find smart interviews and takes by some of our favorite experts. don't forget you can follow us on twitter and facebook as well. if you haven't bought all your christmas presents yet, maybe you can make up for it with a new year resolution to buy this week's book of the week. drum rolls for crass self-promotion, the new investigation of my book. "most post american world 2.0" revised and updated edition. if you haven't yet bought a copy, please do. my publisher will thank you and my kids will thank you. while i'm at it, if you are a gps fan buy our mugs.

michael lewis of blind side and money ball told me they are the best tv show mugs he's ever seen. i think that's a compliment. go to the website for the link. now the last look. does a big birthday to note today, taking place on the other side of the pond. the celebrant is 10 years old. sadly the youngster doesn't seem to be in much of a mood for a party today. ten years ago euro bank note born. to mark the occasion the embattled european central bank spent some of its precious euros to make a video. >> europe builds bridges and inspires hope. it enables its people to look to the future with confidence. >> really? hope, confidence? has the ecb been reading the same news i have? the video goes on to tout the bills themselves. >> placed end to end the 14.9 billion bank notes produced for

the changeover could have stretched to the moon and back five times over. >> quite impressive. but have you ever looked at any of those 14.9 billion euro notes? they are the epitome of the problem of design by committee. in order to come up with designs that were sure not to offend any member countries, the bills depict no statesman, no landmarks, no identifiable anything. these bridges on the back of the bills, they don't exist anywhere, nor do the architectural fragments on the front. anyway, happy birthday, euro. maybe you have a long and healthy life so you stop causing global economic panics. the correct answer to our gps challenge question was a, egypt. that was the most popular topic on twitter around the world. the runner up, tiger blood. and people say america doesn't export anything anymore. thanks to all of you for being part of my program this week. happy new year. i will see you next week.

lel hello, thanks for joining us. i'm fredricka whitfield. first, an update on some of the today's top stories. iran seep to be one step closer to being a nuclear nation. the country's semi official news agency reports that scientists successfully built and tested iran's first nuclear fuel rod. the rod contains natural uranium used to fuel nuclear reactors. the number of suspected arson fires in the los angeles area is now up to 39. investigators say seven of them were set last night. they are offering a $60,000 reward for information leading to an arrest. most of the fires have started in cars, then spread to nearby homes and businesses. a sad start for the atlanta braves. the wife of a