powers, iran, and saudi arabia. threatens a region that's already inflamed. saudi insider is live with us. and here the former british foreign secretary jack straw tells me the severing of ties is a serious blow to the fight against isis. >> it will make cooperation, which is essential, against isis

and the jiedists and other extreme groups difficult. >> also ahead, a new year and year of change in china. the new two-child policy. >> good evening, everyone. and welcome to the program. we're in london. if anyone thought this new year would bring new hope for peace in the middle east, the dramatic escalation of the cold war between saudi arabia and iran could derail that possibility. sunni, saudi arabia, followed by bahrain and sudan have severed ties, and the uae has downgraded

relations. they accused someone of terrorism after which a few dozen extremists stormed in tehran. the arrest was ordered of those responsible, and saudi arabia says it's severing all ties with tehran. >> we decided to cut off all diplomatic relations with iran and also all air traffic to and from iran. we'll be cutting all commercial relations with iran and have a travel ban against people traveling to iran. >> for its part, tehran accused ree yaud of looking for excuses to further harm relations between their two countries. >> translator: iran is naturally taking regulations to protect all diplomatic relations. the saudi government has taken action when everything is under control and there's no threat to saudi diplomats.

>> there are now growing fears the crisis could seriously derail efforts to end the wars in syria, iraq, and even yemen where iran and saudi arabia back opposing sides. let's go directly to saudi arabia to an insider and influential journalist close to the leading family. welcome back to our program. has saudi arabia overreacted? why has the kingdom done this now? >> reporter: no. i don't think the kingdom has overreacted. it is the last straw that broke the back of a very sour, very bad relationship between saudi arabia and iran that had been devastated with suspicions and doubts from both sides. it things were really bad between us and iran for the last five or six years.

it was manifested in the form of sectarianism, sectarian militia fighting in syria, killing syrians by the thousands, ascending arms and creating a sectarian party that could break up in yemen. so saudi arabia basically wasn't happy with what the iranians are doing, and that's what happened yesterday or just the tip of a major problem that has to do with the remaking of the new middle east. >> both sides, ir iran and saud arabia have accusations about freedom and dictatorship. the rest of the world was hoping they could get around the table, and have some kind of political resolution. is that out the window, the effort to end the syria war, the fight against isis? where does that go from now? >> it is always a good idea to

sit at a table and negotiate, but it is not a dispute over territories. it's a dispute about future, about project. for us saudis to accept most of the middle east, to accept germany in our region, or to rush it out. we have no option but to fight the iranians. it's not about territory. it is not about the right of this minority or that majority. it's about -- >> you say fight. so where is this going to go next? i mean, is this -- is it going to get worse? saudi arabia has now cut all diplomatic and commercial ties with iran. is this going to be made better or get worse? >> i think it's going to go worse. saudi arabia will put more effort to help the syrian people, and that will lead to

more confrontation with the iranians and the russians, unfortunately, who come to the side of the iranians, and try to put an end to the war in yemen and bring yemenis back to the table so they will look for the future, but it is fire and dynamite. iran and saudi arabia in one room, anything could go wrong. a major disaster could happen in the middle east. that's why the international community, particularly, mr. obama is needed to look seriously into the matter in syria and put an end to it. >> well, it is very troubling, indeed, and you say fire and dynamite in the same room. very troubling. thank you for joining us this evening. >> thank you. and now to jack straw whose long push for the normalization of relations with iran, including nuclear relations, and

he says this rift between iran and saudi arabia could harm the fight against isis which has just launched a new threat against the uk. welcome back to the program, jack straw. can i ask you, first and foremost, the execution by saudi arabia of the sheik has been criticized in the united states, the united nations, europe. what would you government have said after the execution of this sheik? >> that this was a very unwise move without justification. in britain we're against capital punishment in any circumstances. but if it's going to used, it needs to be used for serious, egregious terrorists. some of those executions were terrorists. you understand that. but there was no evidence, that i'm aware of that the sheik was in any active way involved in terrorism. he was an oppositionist to the

saudi regime, but he was not a terrorist. and the saudis muff calculated what the consequences of executing this man in these circumstances would be. >> let's talk about the consequences in a moment. by the same token you would condemn iran storming and violating diplomatic immunity of the bembassy? >> that's clear. this kind of invasions of embassies has to stop. what this illustrates is the serious divisions inside the iranian regime. >> in terms of the bigger impact, what will this do to whatever is going on in the middle east right now? >> it exacerbates divisions. it could lead to quite serious civic and civil disorder in saudi arabia which has a very large shia minority and in

bahrain where it's not a minority, and it's going to make the settlement of the conflicts in syria and in the yemen and in northern iraq much more difficult, because you begin to settle the conflicts. you need the principle supporters of the party's ends, saudi arabia and iran to try to reach an accommodation. so very serious, indeed. >> this is the 21st century, and yet we have an ancient struggle between two strains of islam, shia, islam, and sunni which resolves around saudi arabia. let me play you a sound bite explaining why they've cut ties with iran. >> we are determined not to allow iran to undermine our security. we are determined not to let iran mobilize or create or establish terrorist cells in our country or in the countries of our allies.

>> how is this resolved, do you think, and how serious is the sunni shia divide? >> it is very serious, and for every claim, maybe justifiable, made by the saudi foreign minister, there are equal claims made by the iranian foreign ministry about the fact that for a long time there were elements in saudi society funding jeihad extremists. it also has a history going back to the iran iraq war, and eight year terrible war, unprovoked by iraq at the beginning, which is the saudi arabia yns helped to finance. and these scars are still not resolved. >> and there's isis. >> and there's isis and other jihadist elements, which, by the narrative of the iranians, they

see that the saudis have, in part, encouraged. and if they will point to the fact that almost all of the terrorists involved in 9/11 were saudis, none were iranians. >> thank you very much. >> so tension piling upon tension in a region already fraught with sectarian division. when we come back, you heard what jack straw said about needing both powers to defeat isis in syria or iraq. next, how is that going? we get a special report from the iraqi city of ramadi. let's celebrate these moments... this woman... this cancer patient... christine... living her life... loving her family. moments made possible in part by the breakthrough science of advanced genomic testing. after christine exhausted the standard treatment options for her disease, doctors working with the center for advanced individual medicine at cancer treatment centers of america suggested advanced genomic testing.

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the major world powers have staked their hopes for peace in syria and iraq largely on even limited cooperation between iran and saudi arabia. as we've said, they're backing opposing sides. the crisis that's erupted between them is coming just as iraqi special forces helped by the united states tried to consolidate their grip on the city of ramadi. we are brought this special report from there. >> reporter: in ramadi, the

fight still rages through the killing fields isis has sewn in the city. we arrive. the helicopters, a watchful eye, and all around us, what remains after six months of isis rule. driving through here, you just really get hit by the desolation, the devastation that was visited on this city. what the air strikes and the ground defensive didn't destroy, isis rigged to blow. ramadi fell in may last year. since then air strike si courses have been battling. it is slow, painstaking work, and every inch lies the unknown. >> okay? >> reporter: here, okay. the only way we can safely walk

is in his footsteps. even though they've held this for the last few day, there are still areas within this that are booby trapped. a week on from the announcements of liberation and counterterror forces battle. blindfolded and bound, captured isis fighters face the wall. they were, we're told, attempting to blend into what remains of the local population. a reminder isis fighters could be hiding in plain sight. we're hearing some pops of gunfire. they're a little further across the other side of the river. the fighting is ongoing. the cleanup operation is still going on, and that's why the helicopters circling overhead. ramadi was home to nearly a

million families. today as troops continue their push, we're told possibly over 1,000 families remain trapped amid the rubble. the ones you see here are the lucky ones, extracted during the ongoing operations. as the fighting still rages, it's hard to get a sense of the toll on civilians. counterterror force people filmed these images for us. some like this woman who appears to have been shot. much of what they filmed is too graphic to show you, like the remains of a little boy carried to burial. the head of iraq's counterterror force told us the liberation of ramadi should be celebrated around the world. >> translator: defeating isis and this victory has impacted upon isis's plans and its very

existence causing weakness and desperation. the road to mosul is now open and clear. >> reporter: everyone here knows so much is at stake in this claimed liberation. and not just for iraq. >> translator: this victory is a victory for humanity because isis is against iraq and against all of humanity. >> night falls in ramadi and more rescued families escape. this little girl can't stop crying. for now, at least, she's safe. cnn, ramadi. >> and from trying to consolidate that long awaited liberation to the domestic front lines in china. imagine a world where the new year ushers in new domestic freedoms. china's two-child policy comes into effect. that's next.

finally tonight, we imagine a world in the next stage of a social engineering experiment. it's happening in china as this new year the country ditches its one-child policy. that program of forced abortions and sterilization and harsh penalties was first introduced in the late 70s amid rapid population growth. know it's challenging china. so the new two-child policy goes into effect right now. as our matt rivers reports from beijing, the pain one child families had to bear lingers on. >> reporter: their voices carry beyond the small room where they gather. men and women, some off pitch, most filled with emotion, all

with two things in common. they each had one child, and that child has died. this man sings louder than the rest. he lost his son last year, leukemia took him at 31 years old. >> translator: he was sick for so long, and suffered for so many years. we tried our best to save him. but we could not. >> reporter: young is like so many other chinese parents who raised children over the past three decades. the official policy here was one couple, one child, so he only had one. now his son is gone, as is any chance for grandchildren to carry on his name. >> translator: i think if i had had two children, it might be a little easier to deal with this loss. i think we've made a sacrifice for china's economic developmentment. >> reporter: parents pay the

cost of social engineering that was at times carried out in cruel ways. sterilizations and abortions were regular occurrences. couples who could afford it could pay fines to have a second child. >> translator: the so-called social support fees are actually a method for local authorities to rake in money. >> reporter: this is a chinese lawyer who says local governments strongly rely on fines to help fund their operations. he says he did his own study and sent letters to each of china's 31 provinces asking for information on the amount of money made on one-child policy fines. together they reported they made 20 billion yen, about 3.2 billion u.s. dollars. enforcing the policy and collecting the fines takes a lot of man power. roughly a half million people work for the family planning

commission. they think the bureaucracy will use old methods for the new policy. >> i'm not optimistic about the new policy. i think the local family planning commission will continue to force abortions. >> reporter: continued enforcement including fines because local governments will still need that revenue. for people like this, questions about this future are irrelevant. he and others here grieve about the past. he says his son was very kind, getting choked up. nothing will ever replace his fei pain, he says. whether things change for others in the future no longer his concern. matt rivers, cnn, beijing. >> and that's it for our program

tonight. remember, you can check out our all-new pod cast or watch us online an amanpour.com or follow me on facebook and twitter. thanks for watching and good buy fr -- good-bye from london. (singing alougetting to know you. getting to know all about you... getting to like you. getting to hope you like me... is someone getting to know your credit? not without your say so. credit lock lets you lock and unlock your transunion credit report with the swipe of a finger. getting to know you. getting to know all about you... get one-touch credit lock, plus your score and report at transunion.com. get in the know.

>> this is "cnn newsroom." we want to welcome our viewers joining us from the united states, and welcome back our international viewers. it's the time to update you on the main stories. the diplomatic rift between iran and saudi arabia is deepening following the execution of a clerk. protests took place across the middle east, and bahrain, sudan and the uai have severed all ties with iran following