thanks for watching "state of the union." be sure to watch us each week at this time, or you can set your dvr so you won't miss a moment. fareed zakaria "gps" starts right now. this is "gps" the global public square. welcome to all of you in the united states and around the world, i'm fareed zakaria. we'll start today with sky-high temperatures, 100-year floods and severe storms. a terrific new report tallies up the cost to you and me and everyone from climate change. i will talk with two of the many high-powered people behind the study, two former treasury secretaries, one republican, one democrat. hank paulson and bob ruben. then, a cleric and his army, why the familiar face of al sadr may

play spoiler in iraq. also, an assassination 100 years ago sparked the outbreak of world war i. some say 2014 feels a lot like 1914. we'll explore. and washington, d.c. is broken, that's a fact. but america still works and works pretty well. i will take you somewhere that succeeds where the federal government has failed on immigration. but first, here's my take. in recent days, much of the political chatter inside the beltway has been about hillary clinton and her wealth or lack thereof. but mrs. clinton's problem is not her money. despite the media based on a couple of awkward remarks she made, most people will understand her situation quickly. she wasn't born rich but has become very rich and aren't likely to hold it against her.

mitt romney did not lose the last election because of his wealth. hispanics and asians did not vote against him in record numbers, for example, because he was a successful businessman. hillary clinton's great challenge will be to decide whether she represents change or continuity. mrs. clinton will make history in a big and dramatic way if she's elected as the first woman president. but she will also make history in a smaller, more complicated sense, as well. she would join just three other nonincumbents since 1900 to win the white house after their party had been in power for eight years. she would be the first to win who was not the vice president or the clear protege of the incumbent president. let me give you some examples to clarify. only three candidates who were not running as incumbent presidents have won a third or fourth term for a party since 1900. william howard taft, herbert

hoover and george h.w. bush. six others tried and lost, james cox, stevenson, hubert humphrey, al gore and john mccain. even the three successful ones had one term in office. but the challenge for hillary clinton can be seen through the prism of her predecessors. should she run for change or continuity? the three who won all ran firmly as proteges of the president. promising to extend his policies. they also ran in economic good times with popular presidents. that's not always a guarantee, of course. james cox promised to be 1 million percent behind woodrow wilson's policies. but since he was wildly unpopular, cox received the most resounding drubing in the popular vote in history. today the country is on a slow recovery and president obama eas

approval ratings are low. that might suggest hillary clinton to distance herself from her former boss. but obama, obamacare and other policies of this president are very popular among many democratic groups. and remember, the three people in her shoes who have won all ran on continuity. now, mrs. clinton's recent memoir suggests she has not made up her mind as to what course she will follow. the book is a carefully calibrated mixture of praise and criticism, loyalty such that she can plausibly go in whatever direction she chooses. now, the word today is different and hillary clinton is in a unique position, especially if she can truly mobilize women voters. but history does suggest that choosing change or continuity, that will truly be her hard choice. for more, go to cnn.com/fareed and read my "washington post" column this week. let's get started.

according to an important, dramatic new report, the future could be bleak for most americans. by mid century, it says, $23 billion of property will likely be underwater, literally in florida alone. crop yields in the midwest will probably be down 50% to 70%. americans will likely experience two to three times as many days with temperatures above 95 degrees as they do today. all this the reports also say if we don't do something about climate change now. the report has serious pedigree. it was released this week by an organization called risky business. joining me now to talk about it. one from either side of the aisle, in the risky business organization. hank paulson is a co-chair of

the group. he was the 74th treasury secretary serving under president george w. bush. and robert rubin is a member of the organization's risk committee and was the 70th secretary of the treasury serving under president clinton. we'll talk about the u.s. economy in a moment, but let's start with this report. >> the most interesting thing about this report is the idea of the cost of inaction and what would be the cost of doing nothing. and you say it's pretty high. >> yeah, i think the cost of inaction is quite high. there's a tendency for people to say let's wait for more information. but the longer you wait, you get to a dangerous position. the only thing you can do is adapt to the adverse consequences as opposed to being

able to prevent them. one thing i think is pretty clear is that if we act soon, we can avoid the most adverse consequences. >> hank and his new york times piece makes an analogy between not doing anything and allowing the risks to grow to the situation before the financial crisis where the united states may have done too little to be aware of these risks and then the whole thing explodes. do you think that analogy works? >> well, i think it was a terrific op-ed piece. with the financial crisis, virtually nobody, a lot of people saw excesses but nobody saw the possibility for a megacrisis. we know it can be catastrophic. we must act yet we're not acting except in a limited way. >> now, as you know, one of the principal reasons why very little is happening in washington is that much of the republican party would not agree with virtually anything you've

said and virtually anything you wrote in that op-ed. how to think about this? what to do about it? >> there are business leaders and political leaders that are ready for a serious discussion about the science and the risks that come out of the science. and i think the resistance to doing some of the things we need to do is much broader than just republican party. >> yeah, what i said about a carbon tax is some people that oppose it. are opposing it because they don't like the government playing a big role. and, you know, the perverse aspect of that is, frankly, those that are resisting taking action now are guaranteeing that the government will be playing a

bigger role. because we're seeing now and we're going to see an increasing number of natural disasters, we have forest fires, floods, storm surges, killer tornadoes. tornadoes, and what happens? when those events occur, one part of society gets hit particularly hard and government comes in. and that's a role of government. government should come in, but we all pay. >> so a number of people who support the general idea say, look, we're not going to get a carbon tax in the united states and let's be real. let's accept the fact that we're going to have to deal with a lot of second best solutions which are fuel efficiency standards, net metering. do you think that's the better path to go or is it worth holding out for what seems very probable. >> i wouldn't phrase it the way you did, fareed. if you have the view which hank and i have that the risk is catastrophic and catastrophic to life on earth as we know it, that's a risk we cannot take. once you start with the

recognition that this could be catastrophic, then it seems that you do a full-court press on all fronts. >> a lot of people will listen to this and say we can do all that we want here in the united states. the chinese and the indians are building coal-fired plants all week. the chinese by some measures, one coal-fired power plant each week and that's going to change the climate no matter what happens in the united states. what do you say? >> fareed, i think the answer is not complicated. this is a trans national issue that will affect all of our countries. it is of enormous importance to all of us, as i said catastrophic risk. i think the way the united states can best contribute is, a, get our own house in order and by get our own house in order to put ourselves in a better position to work with the chinese and those around the world. >> i'll be back with much more from these two former treasury secretaries. they'll give us their sense of the american economy and the outlook ahead when we come back. s above the competition, but we're not in the business of naming names.

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hank paulson and robert rubin are back to talk about the economy. >> i think it will be fair to say that in general the american people feel like the american economy is out of the recession, that we're back to employment levels that the united states had in 2007, but nobody feels satisfied. what is your sense of the picture of the american economy? >> yeah. i think my reaction a little bit is to differ with the premise as you've stated it, fareed. the unemployment rate doesn't reflect our labor situation unfortunately. there are all kinds of other groups of people that are not included in the unemployed.

>> stop looking for work? >> stop looking for work. or people that are part-time employees and would like to look for full time. the unemployment rate is probably higher than the reported rate. it might be headed to a little bit better or it might not be. i'm a little less inclined to think it is only time will tell. there's so much we can do. you can put in place fiscal program, government of the sequester that had an up front stimulus and real fiscal discipline that deferred the implementation -- >> spend money now but do some structural budget reform -- >> exactly. >> -- later? >> exactly. >> that would have substantive effect. >> there's so much we can do. the problem is our political system is, as you well know, in dysfunction. congress is unwilling to act. i think fundamentally our future depends for the short term and the long term on a recovery of effectiveness and our political system which fundamentally means a willingness of people with different views to engage in principled compromise.

that is how our system works. >> we would have a stronger recovery if we could enact the bob rubin program stimulus now, cuts later? >> i would say this. i agree with almost everything bob said, that we have a very small recovery, that there are structural problems that, you know, don't come out in the unemployment numbers. they are more significant. again, i believe that the solution is bipartisan compromise to get some structural things done. i think we need a new tax policy, a tax policy that gives us the revenues we need and lets us be competitive. i think we -- i think trade policy would help. i think that immigration reform would make a huge difference and so as we focus on the budget, we need to do it in a way in which we -- you know, we don't cut so much we hurt the fledgling recovery and that we don't raise taxes. >> the chairman of the fed says the stock prices are within historical norms. do you agree or do you think they're too high?

>> fareed, i have no idea with all due respect to the chair woman of the fed who i know well, she doesn't know either. we've had enormous increases in stock prices. they may or may not be in excess. whatever the evens is to that, they'll correct. markets that are over price will correct. >> final question. hank, listening to you on climate change, i think you are talking about the need for immigration reform, stimulus up front and structural reform later, it's difficult to see a -- meet a lot of elected republicans who agree with you. are you feeling lonely in the republican party? >> well, let me tell you, i am a republican and i think you're seeing a growing number of

republicans that favor immigration reform. i will bet that republicans are very interested in having a very serious conversation about the risks -- economic risks associated with climate and with a number of economic issues. and, remember, when it -- when it came to, you know, the sorts of things i would be suggesting that are structural reforms to have to do with health care and social security, i think those are major -- major structural reforms that are necessary. i think immigration reform is necessary, tax reform. so i think the republicans are interested in those things. >> draft you for president. gentlemen, thank you very much. >> thank you, fareed. coming up next on "gps" we will tackle iraq. i will try to make you understand why its prime

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now for our "what in the world" segment. it seems that everyone, president obama, john kerry, nato, grand ayatollah sistani, even the iranian government has the same advise for prime minister nouri al maliki. reach out to the sunnis. that would take away some of the sense of the grievance that fuels their support for radical sunni groups like isis that are threatening iraq's ability to exist. why is he refusing to do this? he's a hard line shiite himself who is not particularly disposed to the notion of being nice to the sunnis, their former overlord, but it's probably at least as much because maliki needs to worry about radical shiites as well as radical sunnis. he has his own tea party, and

this one has an army of its own. they're called the peace brigade and they paraded by the streets of baghdad by the tens of thousands displaying their readiness to protect holy sites and shrines. the leader is a well known figure in iraq and dominated the region. remember muqtada al sadr. back then they were responsible for some of the deadliest days of the war, then he overplayed his hand. the u.s. got others to turn on him, issue an arrest warrant and in 2007 he fled to iran. when he returned in 2011 his followers remained loyal to him and he wields real political political power. malaki kept his power because offal sadr's help.

since then he's called him a dictator and recently added pressure on him to step down by calling for the creation of a new emergency government right after malaki rejected the idea. al sadr urged the iraqi government to incorporate moderate sunnis who have been quelled to stop the bloodshed. he's trying to become the new power broke injury of iraq condemning isis and the sunni terrorist groups. but also appealing to moderate sunnis. whether or not he succeeds we are probably witnessing serious splits in the shiite coalition and that can only mean more chaos in an already chaotic situation. a peace in foreign affairs says this is a ri ignition of the

2006-2007 iraqi civil war. they fit a pattern. over 1/3 of all ethnic civil wars flare-up again within five years. what's more, approximately 1/3 of all power sharing arrangements borne out of those conflicts fail within that time period. it's true of angola, afghanistan and sri lanka in history. now it's true of iraq. when we come back, something to cheer you up even more. world war i started 100 years and 1 day ago with a problem in the balkans. his shoes! and a third simply doesn't want to be here.

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war. today some people are pointing out geopolitical similarities between 1914 and 2014, similar dynamics of rising powers, falling powers, new technologies, and dangerous tinder boxes. i wanted to explore that. joining me to do so are former cia deputy director john mclaughlin who had a new piece on ozy.com titled how 2014 is strikingly similar to 1914. historian geoffrey wawro author of "a mad catastrophe, the outbreak of world war i and the collapse of hapsburg empire." john, why don't you start us off. what do you see as the principal similarities between 1914 and today? >> well, there are two or three. we had a tinder box in 1914. it was called the balkans. today we have a tinder box in the middle east, a situation

which could easily spin out of control in exactly the way that the balkans took things out of control in europe in 1914. we also have a geopolitical rivalry that looks similar in some respects today, it's between china and the united states. back then of course it was between brittain and its empire and a rising germany. today we are lulled by the prospect of globalization will somehow save us from catastrophe because we are so interdependent. back then they had the same illusion. they thought the steam engine, telegraph, air power would save them because they were becoming increasingly interdependent. >> walter, when you listen to these similarities, where do you come up? >> biggest similarity is that the same problem that helped

drive world war i and the balkans, the bad fit between state boundaries and nationalism, the popular forces of identity, culture, language, we see that all over the middle east today and that's driving a lot of conflicts. >> the -- >> the sunni/shia divide and kurdish question. nationalities whose identities are weak. syria and iraq are both multi-communal states and they're not holding up well. we see these forces ripping them apart in the same way they were ripping apart the great empires at the start of world war i. >> and yet there's a kind of indifference on the part of the great powers regarding the middle east that didn't apply in the balkans. the balkans were a hotly contested area in 1914. they saw their future spreading down to macedonia. they were getting control of the balkan peninsula controlling the eastern mediterranean. we have eastern fatigue. they have eastern energy, security, courts on the case and yet they're not willing to go all in in the sense they did in 1914.

i think that's a key difference. >> i'd like to push back on that a little bit because i think there's a similarity there, too, in the sense that in 1914 there were certain things that great powers couldn't tolerate. brittain couldn't tolerate russia mobilizing. today i don't think in the end the united states can tolerate a terrorist state occupying territory in the middle east which is where this situation is going. i don't think iran can tolerate in the end a shiite power next to it that is defeated and i doubt that the saudis can tolerate in the end a shia crescent which stretches across that part of it. >> so this is a very important

point. i was struck, as geoffrey was, that the big difference that strikes me is then the great powers were really eager to get involved in jockeying for advantage. right now the great powers are almost trying to stay out but you say they will get sucked in in the end? >> i'm saying that i think the prospects are good that they get sucked in in some way. it won't look exactly the same as 1914 because it is 100 years later. the weaponry is different, the ways of influencing people are different. we have social media and cyber. they can bring surprises just as machine guns and air power brought surprises. >> the other powers were dead set against a balkan inception of the war. the only ones eager to have a balkan inception were the russians. the french, the germans and the britains didn't see anything being worth a war. they got in basically to maintain their alliances so i think this is where the parallel is somewhat forbidding because, you know, it could be a case where we feel we need to back somebody to show -- to demonstrate credibility.

demonstrate strength and not to lose influence over that client or not to lose influence over adversaries. that's sort of how brittain and france and germany got involved in the war in the balkans. >> would that apply to iraq, that we would get in because we wanted to show the iraqi government? >> it would be less the iraqi government than the saudis in a sense because the sense that the sunni/shia war is a proxy war between iran and the saudis. the biggest difference though that i actually see is in 1914 you had germany, a rising power and then all around it every other power in europe was in decline. you look at asia today, japan doesn't really feel that it's declining. vietnam is a rising power. there are a lot of rising powers in asia. it's a different kind of dye dynamic.

>> asia is the most reticent. you have a rising china that reminds one of germany, sea power and also its imperial reach and this is an area given the u.s. pivot putting troops into australia making alliances with vietnam, the philippines. germany goes to war in 1914 because they feel encircled. there you see the tensions. >> last word to you, john. we may not be interested in the middle east but the middle east is interested in us. repair a phrasing. that's your concern, right? >> yes. what starts in the middle east never stays in the middle east. there's an important aspect of the decision making now that i think needs to be highlighted, and that is to a greater degree than any other situation i can recall, there are no good choices in the middle east. every choice you make has a very serious down side which demands a great deal of political courage to make a choice, but the problem of not making a choice is that you are making a choice. >> we're going to have to leave

it at that on that ominous note. gentlemen, thank you very much. fascinating discussion. coming up next, washington is broken, everyone agrees on that, but we are going to show you where america is working and working pretty well. where the two parties cooperate, government and business team up, and good results follow. we're going to kick off a brand-new "gps" with america's likely capital of immigration when we come back. everyone knows that i don't want to think about the alternative. i don't even know how to answer that. i mean, no one knows how long their money is going to last. i try not to worry, but you worry. what happens when your paychecks stop? because everyone has retirement questions. ameriprise created the exclusive confident retirement approach. to get the real answers you need. start building your confident retirement today.

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everyone knows that washington is utterly polarized, but we focus on washington, too much. it's focusing in a crucial zone, america's cities. for the next five weeks i'll take you to cities where america works. here's our first city. eric cantor's stunning defeat. the first time a house majority leader lost in a primary may have killed any chance of overall immigration reform from washington, but many states are finding a way to make immigration work for them. and despite being in a state

with a 1241 mile border with mexico, houston, texas, is attracting, integrating, and celebrating immigrants, defying many stereotypes in the process. in houston in the 1930s a big factory reportedly had a sign over its hiring office, it said, no mexicans hired here. in 1967 racial tensions between whites and blacks led to a riot. in 1978 another riot, this time the dispute between whites and hispanics. and then everything in houston changed. >> the decline in oil prices and demand is having a bad effect on the overall health of the golden city. >> during the 1980s the liquid gold that surrounds houston plummeted in value. from $34 a barrel to less than $10. rice university's professor steven kleinburg said houston suffered the worst regional

recession that had been seen anywhere in the u.s. since the second world war. >> 82% of the jobs were tied into the oil business. >> that industry town was very white. more than 65% white. african-americans accounted for less than 1/5 of the population. the houston metro area was less than 1/5 hispanic despite being one of the biggest cities next to the mexican border which is approximately 350 miles away. the asian population was barely a blip, under 2%. now what does houston look like today? >> we tell people outside of houston, this is the most ethnically diversity in america. you're crazy. this is texas. this is george bush country. >> but it is possible. take a look at that graphic of houston's demographics in 1980 again and now look at it today. it's a pretty even breakdown. minorities are the only majority. blacks are 18%, hispanics 41%,

other ethnic groups make up about 8%, and whites are 33%. >> and it's biracial southern city dominated and controlled throughout our entire lives by white men has become the single most ethnically diverse regions in the country. >> and as the demography has shifted so dramatically in the last 30 years, what happened at the same time with the economy? it's gone from bust to recovery to bust but now once again it is booming. of course, oil prices have quadrupled over the last decade, but the growth is also thanks in part to immigration. >> we may have the largest economy in the united states. clearly we have a very hot job

market right now and we're doing well in job creation. >> thank you. >> houston's current mayor is understating the facts. houston was the first city to regain all of the jobs it lost in the 2008 recession. it actually created more than two jobs for every one it lost. that job creation has been a driving force behind the changing face of houston. >> in order to fill those jobs, we attract some of the best and the brightest from around the world. >> and the city has done just that. today 1 in 5 houstonians was born in another country. but those immigrants, of course, don't come here and realize the american dream on day one. many immigrants land in houston right here in gulfton. what some call the city's ellis island, the most densely populated 3.4 square miles in the whole city.

>> i tell people, the way you know who's coming to gulfton next is look at the world. where are the points of pain and unrest. they'll be here. they're coming. >> the tired, poor, huddled masses that came to gulfton needed help integrating into american culture. some arrived with striking education deficits among other tough problems. >> so the meeting we had -- >> and angela blanchard, the president and ceo of the non-profit neighborhood centers says gulfton was a place to be avoided. >> you drove around it. the police said, gosh, we hate to even go there. and that was the story on the street about gulfton, nothing good happening there. >> but the whole of houston seemingly came together to try to transform gulfton. the city government, private enterprise, and the civic community. it was 2008 in the midst of a national recession and election. >> we have to secure the borders first. >> every night on tv there was

another diatribe about immigration, about how horrible it was, and then every day i would go back out again to raise money. no, that's not true. here's what these folks can do. here's what they've figured out on their own and the gains they've made, the businesses they've started. this is how enterprising and industrious they are. then in true houston fashion, people got interested. >> neighborhood center ceo angela blanchard was able to cut through the partisan rhetoric and get democrats and republicans on board. together they raised $25 million to build a baker-ripley neighborhood center which opened in 2010 and this five building, four acre complex offers services from tax preparation, low-cost banking and a clinic. >> will they be on time for english class? >> and even classes in english as a second language.

>> these children won't know any better. this is the world they'll know and remember. that is a powerful way to make a community safer. belonging is the most powerful medicine. >> since the center opened, crime has decreased 11% in gulfton. in houston, overall, crime is down 4%. one final point on demographics. remember that pie chart of houston's racial and ethnic makeup today? it is not too dissimilar from this census projection for the entire country. in 2060, about 52% of americans will be minorities and no single ethnic group will be a majority. rice university professor steinberg. >> we are 25, 30 years ahead of america. ♪ i tell people, how houston

navigate this is transition will have enormous significance not just for the houston future but the american future. this is where the american future will be worked out. >> reporter: houston is also one of the most segregated cities in america, both by ethnicity and income. it still has work to do. up next, when's wrong with this picture? we'll tell you after the break. ♪

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this week india's newly elected prime minister modi surpassed the white house twitter account in number of followers reaching 5 million. short time since his election his victory tweet india has won was retweeted more than 70,000 times and favorited if that's a verb by 46,000 people. it brings me to my question. who is the most influential world leader on twitter today by rate of retweets. barack obama, pope francis, the

dalai lama or narendra modi. stay tuned. the book of the week is "the director." it's another superb espionage thriller from ignatius. it reads like it's from the front pages and brings you vividly into the strange world of hackers, fascinating. now for the last look. take a look at the boloivian congress. the numbers on the clock are reversed. on purpose. you see, modern-day clocks reflect the way a sun dial's travels. this clock reflects the position in the southern hemisphere. the foreign minister said that this clock of the south was installed so that they would embrace creativity and question the status quo.

a symbolic change like this isn't unique, of course. venezuela's chavez changed the country's 200-year-old flag adding an eighth star in tribute. he changed the direction of the horse faces from right to left declaring the horse is free. critics at the time pointed out it was costly to free the horse from passports, currency and other government documents. in africa, the former president of malawi changed the flag's rising sun to a sun that's fully risen. he wanted the flag to imply they're not developing. it had developed. maybe clear symbols and what doesn't seem clear to the leaders you can change the horse's direction, a sun's position or what clockwise means but your country's successes will still be based on the substance of your policies, not the style of your symbols. the correct answer to the gps challenge question is, "b," pope

francis. barack obama's personal account has the most followers at 43 million but according to a recent study, pope francis is retweeted much more frequently. the barack obama tweets retweeted 1,400 times each. the pope's spanish tweets alone retweeted 10,000 times and has an account in latin. thank you for being part of the program this week. i'll see you next week. hello, everyone. i'm fredericka whitfield. shocking revelations from the mother of a toddler who died after being left in a hot car. hear what the georgia mom told police and her decision to stand by her husband even though he's accused of murdering their son.

and severe weather is threatening tens of millions of americans and the midwest is baring the brunt of it. entire communities are underwater. minnesota's governor calls the devastation in his state unprecedented. >> i've never seen damage this severe and widespread. usually it's, you know, a flood or a hurricane or tornado or ice storm. you know? one or two counties. this is all over the state. plus, the conflict in iraq having a definite financial impact right here in the u.s. soaring gas prices. so just how much pain at the pump can we expect? the answer this hour. we begin with another stunning new twist in the case of a georgia toddler who died after being locked in a hot car by his father. the father wasn't the only one

that researched child deaths in hot vehicles. the boy's mother did, too. i want to bring in cnn's nick have lens yeah. nick, startling information. you were at the funeral yesterday in alabama and now there's more information about what they uncovered, seen and the next set of questions. >> that's right. the search warrant released a couple of hours ago and details about lee anna harris. it says the child's mother was also questioned regarding the incident and made similar statements regarding researching in-car deaths and we don't know the context to which the statement was given to authorities or when that search was conducted. yesterday, at the funeral inside little cooper harris, 22-month-old who died, the red casket in front of hundreds of people who came to pay their respects. >> under a light summer rain in tuscaloosa, alabama, cooper harris was laid to