>> make it quick. >> have you heard what a myrtle is? >> tell me. it is a man gerdle is what it is. it is -- shapeware -- >> tummy tuck. >> why not? takes two inches off your waist. >> very good. fareed zblk care ya, "gps" is next. this is "gps," the global public square. welcome to all of you around the world. we have a great show for you today. the next president of afghanistan, the iran and the global economic recovery. first afghanistan. flow? how do we staunch the blood flow?

talking to the taliban, reconciling and even buying them over to our side is something we've discussed on this show. it is something i have long been a proponent of. this week, i think i heard the strongest endorsement yet from two crucial players. british foreign secretary david miliband said in a speech on monday at nato headquarters that the afghan government needs to, quote, rank and file taliban soldiers and give them reasons to switch sides. later in the week, u.s. secretary of state hilary clinton seemed to agree. she commended the important nato speech and said it's consistent with the united states. so why isn't it happening? meanwhile, the top u.s. commander in afghanistan, stanley mcchrystal, is expected to ask for additional troops and equipment. that request will first land on the desk of secretary of defense robert gates. now, listen to what gates said in april when he and i talked about troop numbers. >> i have been quoted as accurately as saying i have real

reservations about significant further commitments of american military to afghanistan beyond what the president has already approved. >> but that means that a year from now, six months from now, you are unlikely to approve a request for additional troops in afghanistan. >> i would be a hard sell, there is no question about it. and i've not made a secret of that either publicly or in government meetings. >> so, it appears that he has now changed his mind. in recent days, gates said he is waiting to see mcchrystal's request, but if needs are demonstrated, he would be open to sending more troops. now, while all these forces gather, a crucial event will occur in afghanistan in a few weeks. on august 20, the country will first-ever truly contested

election. hamid karzai has led the country since the fall of the taliban in 2001. a once-friendly relationship with the west has frayed and his own popularity has dipped substantially. so, could a new afghan president change the dynamic of the country. will he be more friendly or less friendly with the west, and what will it mean for the battle against al qaeda and the taliban? coming up in a minute, a presidential debate of sorts. i will talk to the two candidates with the greatest chance of upsetting karzai's recent hopes. and what exactly is the governor doing in iran? my guest last week complained about the it tv signals beamed into iran by the west and the effect on the crisis. is it true? what is actually going on in iran right now? we have a great panel to talk about all that. let's get started.

now, first up in our faceoff of the afghan candidates who hope to unseat harmid karzai is ashraf ghani. he is a former finance minister of afghanistan, educated in the united states at columbia university. he has a ph.d. he's been a guest on our program before, so i welcome him back. mr. ghani is coming to us from a tent in kabul. welcome, ashraf. >> thank you very much. it's a pleasure to be with you, fareed. >> ashraf, begin by telling us what you think went wrong with harmid karzai's government. he comes into power with a great deal of hope. you were there at the time. you saw it. what happened? >> he turned out to be a very poor manager in the sense that he could not deal with issues in a manner that met response to the needs and aspirations of the

people and create a sense of momentum. the other side was -- is tolerant for corruption that grew into massive disease, into a cancer that's eating through the society, and then the poor quality of governance. the people he has appointed where today the heart of the insurgency is. these are people that have failed to govern before, and it was their bad behavior that has given rise to the taliban. >> you said recently to george packer of "the new yorker" that shakespeare is in some ways the best guide to what happened in afghanistan. what did you mean by that? >> the palace is full of intrigues. it's all about tactical play, who gets closer to the king. because the style of karzai is

created in the palace is much more like medieval, where the intrigue's all around. somebody gets close in order to outmaneuver somebody else. all is a game of pretension. king lear, he does not understand that he is being fooled. so, it's there where we're really getting the sense of shakespearian tragedy. because it truly is tragic. afghanistan did not need to become what it has become, the fifth most corrupt government according to brookings index, the second failed state, the center of drug production, but most significantly, a place of disenchantment of the population with this government. >> you said something very significant. you said that he has restored the taliban. so, you believe that the failure

of governance is at the heart of the rise of the taliban and not a kind of military resurgence or religious idealogy that is refueling this insurgency? >> i've talked to a lot of people where the heart of insurgency is. and time again and again, their story comes to one thing, an injustice that could no longer be tolerated and force them to active resistance. they point out its effect during the first three years. there was no insurgency. the taliban disappeared. they became ordinary men and women and some went away. so, 80% of what's happening in afghanistan is due to bad governance. >> lots of people are advocating some kind of national reconciliation, talking to the taliban, reaching out.

i've written about it. the foreign secretary of britain recently gave a speech advocating it. it doesn't seem to really be happening in afghanistan. is that because karzai is not making the effort? is it because, so far, the taliban are not responding? >> how would they trust in his word where we, who were his closest colleagues at one time, cannot trust in his word? the president changes his mind on an hourly basis, save a daily basis. he makes policy on the hook. first we need to get a cease-fire. this is not going to be an easy issue, but we need to try everything possible so we can build a cease-fire. and once we have a hint of a cease-fire, then we can discuss the second issue of an exit date

for international forces. those of the united states are not here to colonize afghanistan or to build an empire. they are here to create a stable afghanistan that would be a source of stability to the region and the world at large. so we have an organic basis for a partnership between the afghan people who strive for nothing else but stability, peace and prosperity in the international community, but we have not had an afghan leadership that can credibly represent the wishes and aspirations of the afghan people to the international community and take the kind of action that would establish the political framework for lasting peace and a just order. >> what do you think of the obama administration and its strategy towards afghanistan? is it an improvement on the bush years? >> there is a very good team from the president himself to

general jones at the national security council, secretary clinton, ambassador holbrooke and ambassador eikenberry. this is a team of stability. i think the team of afghanistan, really is an act of courage and determination. we in afghanistan and the region need to help him gain credible momentum so that his commitment can be appreciated and that the american public can be persuaded that the commitment was wise, timely and effective. >> ashraf ghani, we thank you very much for taking the time from the midst of a campaign and sitting there in a reed tent in afghanistan for joining us. thank you. >> it's a pleasure to be with you, and it's an honor.

>> i think the previous administration in the united states are sort of having a blind date with bush and karzai. ( car door closes ) ooooch! hot seat!

hot! hot! hot! time to check your air conditioning? come to meineke now and get a free ac system check. at meineke, you're always the driver. now we have abdullah abdullah. some analysts say he has the best shot of unseating hamid karzai. he was the one-time foreign minister of afghanistan with strong ties to the u.s. he was a key figure in the northern alliance, the opposition group that helped the

united states topple the taliban in the days after 9/11. welcome, sir. >> thank you. >> let me ask you, do you see president obama's approach to afghanistan as one that is better than president bush's? how are you reading the new administration in washington? >> i think the previous administration in the united states was sort of in a blind date with mr. karzai and continued until the end. and toward the end they realized the partner is not sincere and cannot deliver to its own people. at that time, it was too late. i think in the united states, it's a new beginning and a new approach toward many issues, including afghanistan, and afghanistan gave us hope as a result of the elections, that there will be another opportunity for working together

in order to make afghanistan stabilized as well as to attest the needs of the afghan people, and, of course, the concern in the hopes of the friends of afghanistan in the united states helping us. >> there are a number of people who have argued that the united states, and most importantly, the afghan government, should be talking to the taliban, trying to get members of the taliban to switch sides, to isolate the hard-core employments and broaden the base of support for the afghan government. you have called the current efforts of reconciliation a joke, quote, unquote. so what's wrong with the way we are trying to talk to the taliban now, and how would you do it differently? >> the current administration is losing the people, and because

of the intent of the people, dissatisfaction of the people towards the government, the current administration is losing the people. and it is strengthening that insurgency. that trend has to reverse before anything else could happen. next to that, there are thousands and thousands of people who have joined the ranks of insurgency because of other grievances rather than taking the taliban to bring the state down through the process. there are thousands of people under that same brand, taliban, which have joined the insurgency because of other reasons. by taking those reasons out, you can take a further step towards national reconciliation. >> mr. abdullah, you have worked with the president karzai. you were his first foreign minister. what do you think of him as a leader?

what are the flaws that obviously lead you to feel you must challenge him in this election? >> our hopes were he would be a fair leader and take action in the beginning where the whole afghan nation joined hands in supporting the afghan people as well as the process. he has turned, under his leadership -- a golden opportunity has turned into today's situation, which is a disappointment, a total disappointment. so, i am disappointed because of my support earlier but i should mention that i didn't vote for him in the earlier election, despite of the fact at a i was the foreign minister and i told him, i had told him that i have not voted for him for a certain reason, because i could see that he is leading the country toward the wrong direction, which is today's situation.

in today's situation, afghanistan should have been more stable, democratic institutions should be functioning better, and the corruption issue, we shouldn't end up being on the top of the list, and many other issues, including the failure to deal with the insurgency. >> let me ask you finally, mr. abdullah, if you are elected president of afghanistan, what would be the first thing you would do to signal to the afghan people that there is a new administration in place? what would be your first act as president of afghanistan? >> i think the first thing is about the message. what is my message to the people of afghanistan? it is a message of change and a message of hope. i will not promise to the people of afghanistan anything that i will not be able to deliver. the main issue is the show of trust and mistrust.

in today's afghanistan, that issue of trust is very high and very serious. so to change that, an honest message that this leadership would be a disservice of the people of afghanistan rather than a gain which is benefitting from the hardship which has been imposed upon the people of afghanistan or from the billions and billions of dollars which has been thrown into afghanistan under the name of supporting afghanistan and the afghan nation. so, that's -- it was hard for the people to believe any leader, any future leader, because they will judge it against the current situation, but an honest approach for the people, the people who give you time and they will test you and the first place will come from the first day. >> abdullah abdullah, thank you very much for joining us. >> you're welcome. i drove my first car from my parent's home

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now for our "what in the world" segment. here's what got my attention this week. it's rare that a set of statistics make news, but the

release of this month's case shiller price index was the report of the new lead story in both "the new york times" and the "wall street journal." why? well, the industry showed the decline in the american housing market ended and the recession would soon end. this is big news. why? the decline of the housing market has been the single largest cause of the crisis, and its end could well be the beginning of a recovery. remember, when you're trying to understand your way out of the recession, the single most important question is still will the average american start shopping again? i know you've heard about china, brazil, the european union, trade, but as a share of the world economy, the american consumer is currently equal to the total economy of china plus india, doubled. so when governments around the world are spend ag lot of money, they will not be able to do that indefinitely.

at some point, the american consumer has to get back into the market. so is he or she doing that? well, we don't really know yet. the housing data is good news, and actually, most recoveries begin with recovery of the housing markets followed by automobiles, appliances and then other consumer categories. but many experts argue that this is not an ordinary recession and will not be an ordinary recovery. the consumer went deep into debt over the last ten years, is slowly paying that off and won't get easy credit any time soon. the optimists point out, on the other hand, that the american savings rate is already back up to 7%, which is close to its 30-year average. the pessimists say yes, but americans are going to be very cautious now and save more in the face of the uncertainty and hard times they foresee. so, the key to understanding whether and when we will experience a real economic recovery around the globe lies not in the set of hard economic

facts, but a very soft question. when will americans feel confident and secure enough about the future that they will start spending again? is it when the savings rate is 8%, 9%, 12%? the fate of the global economy rests on the answer to what is ultimately a question of human psychology. and we will be right back. i think what we're doing is reporting news that they prefer the people not know. that's what annoys the government and it's nothing watever to do with espionage. we don't send out codes or anything like that.

hello, i'm don lemon live at cnn headquarters in atlanta. first, headlines for you. the remains of the first american lost in the persian gulf war 18 years ago has been found and positively identified. military officials say they belong to navy captain scott

speicher, the navy pilot shot down in the first night of the gulf war in 1991. our pog correspondent barbara starr has been working on this story. earlier, she spoke with tj holmes. >> at this point bharkts pentagon is telling us is they were acting on information provided by an iraqi citizen or -- in early july and that led the u.s. marines who were stationed in el anbar province out in western iraq to go to a location in the desert which was believed to be a crash site of captain speicher's jet. the iraqi citizen said that he knew of two iraqi citizens who recall an american jet impacting the desert and the remains of the pilot being buried there by the bed wins. so when you ask, tj was -- how much they followed up, every time they got a hint, every time they got a report. you know, once the iraq war started in 2003, there had been

a lot of hope, actually i with the military that, you know, that would open upper rack and that they would find him. and of to courcourse, over the f the iraq war this he did not. >> much more on that story including the latest of the family at the top of the hour. the fate of three american hikers is uncertain at this hour. they were hiking in iraq's kyrgyzstan region when they went into iranian territory. reports are they are being detained by guards. one is identified as from elkens, pennsylvania, his mother spoke with cnn confirming her son was among those being detained. turn now to our weather. cnn's jacqui jeras checking it for us, hi, jackie. >> wet weekend, eastern seaboard. havent had a lot in terms of

severe weather, isolated severe thunderstorms but the biggest issue we have been dealing with, the storms have been 'causing big-time delays at the airport. so, my condolences to if you you're trying to travel today. believe it or not, these numbers have improved a little bit over the last couple of hours. to over an hour to get to atlanta, jfk, 1:45. 2 1/2 at la ga ward ya, philadelphia looking better. we are dealing with hot conditions through much of the south. >> not good, jacqui, when tough apologize for the forecast. it is aviation-related. >> see you it he top of the hour, jacqui. much, much more on the fate of the remains found in the desert. i'm don lemon. fareed zakaria and "gps" continue in just a moment. and lasts for hours.

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responsible for the iranian anger of the disputed elections. just last week, a conservative iranian man made this charge. >> right now, you have almost 40 television channels in persia basically funded by the american government and the european governments or in some cases owned, which have played a very negative role in the past few weeks, turning people against one another. >> it is, of course, an absurd accusation. the iranian people are angry at what they see as a fraudulent election, not because of something they saw on tv or heard on the radio. but it does raise the question, what tools are western countries using to figure out or to influence what is going on in iran? is it propaganda? is it espionage? joining me to talk about this from washington, john mclaughlin, the former deputy director of the cia. from berkeley, california, robert barrett, a former case officer for the cia, and from prague, john o'sullivan, the executive editor of radio for europe.

welcome, gentlemen. john o'sullivan, the charge is really centrally directed at people like you, who are broadcasting stuff from outside iran, beaming it into iran and a it's principally voice of america and the bbc, though there are many others. what are you doing that is getting the iranian government so riled up? >> i think what we're doing is reporting news that they would prefer the people not know. we are acting in a way like a domestic broadcaster for the iranian people. although, i'm the executive editor of the entire organization, radio fattah, our iranian service is staffed entirely by iranian journalists, and they are doing what an iranian journalist would be doing if you had free television or free newspapers in iran. that's what annoys the government, and it's nothing to do whatever with espionage. we don't send out coded messages

or anything like that. we simply report the news. and we provide a forum for debate among iranians. on both those counts, free debate and truth, the government doesn't like it. >> so, you don't encourage people to go out and demonstrate or protest against the government? >> no, we don't directly do anything like that. of course, if we report, for example, that people have been shot or killed while demonstrating, it might have the effect that some people will then respond by being indignant and by turning against government or possibly perhaps demonstrating themselves. oppression is severe and people who want to take peaceful action like demonstrations is taking a a risk. you can equally well argue we are persuading people to stay at home because we point out the dangers. >> john mclaughlin, you saw this

play itself out in the former soviet empire. how powerful are these tools of information technology, information warfare some people call it? >> well, they were powerful tools during the cold war, fareed, but that was a time when we didn't live in the media-saturated environment of today. i don't think those kind of tools are as important to espionage as they once were. and while i don't know what the u.s. government is doing at the moment on this, i strongly doubt there is anything that would justify the charges coming out of iran. in fact, looking at iran today, i think the reputation for this is in iran itself, not only the street demonstrations that are so evident in the world media, but also i think what is most striking and what the iranians should be more worried about is not what outsiders may be doing but what insiders are doing and saying. the most striking thing to me in the last couple weeks has been the degree to which we see

splits developing within the iranian government. we see conservative newspapers criticizing the government. we see the grand ayatollah who has scolded the republican guard for its treatment of protestors. friday's term by rafsanjani made very clear that he is upset with the way the government has handled the situation. former president khatami has called for a referendum. the head of the nuclear program has resigned. there are splits obviously developing between the government and the guard. these are not things you influence with propaganda or with media piped into the country. these are things that develop when a country like iran is confronted with some of the choices it now faces and some of the engagement strategy that's come out of the obama administration, i think, has obliged people within the country to think about their options, and as a consequence of that, fractures have developed. >> do you think the offers of

engagement by obama have been useful in that they have complicated the life of the iranian regime? >> i do. i do. i felt this for a long time. because clearly iran is not a monolithic society and not monolithic at the top, either. so, when obama offers thoughts about the future and the future relationship with the united states, i think, unlike a circumstance in which you are not engaging them and in which the iranians can simply cast you as the great satan, when they're confronted with choices, they use their heads and they have differences among themselves. so, it hopefully drives a wedge, i think, between some of the factions in iran. >> bob barrett, do you think this kind of appeal to nationalism that the iranian regime is trying to employ works? that is to say, you know, we may say look, this is absurd,

obviously, the west is not involved. but iran is a proud country, a prickly traditionally a country of nationalism. might it be true that the united states and britain have interfered in the past? as you probably well know, one of the great best-selling books in iran is called "my uncle napoleon," and it's basically a book about how the brits actually control everything that's going on in the country. so, does it work when they say, you know, it's all this western interference that's causing our problems? >> fareed, no, i don't think it works. the regime has certainly made these charges against the demonstrators and the leadership of the opposition, but what we have to remember is mousavi and others were all extremely close to khamenei. they have impeccable credentials. they were there at the beginning of the revolution, many of them were there in exile in france with khamenei.

they have absolutely no important foreign contacts. they are not susceptible to charges they're taking money from the cia or from outside. so, i think when they made these charges right after the election was disputed on 12 june, they fell absolutely flat, and they arrested the british employees at their embassy in tehran. that fell flat as well. it was a strategy that's failed, and i agree with john completely. we see these cracks inside the regime which were, frankly for me, two months ago were unthinkable. this has come out of nowhere, and yet what we're really seeing is many of the ayatollah's people are coming out against khamenei as well as ahmadinejad. >> john o'sullivan, what do your analysts tell you? you had many from iran. are we in a pre-revolutionary situation in iran? >> well, we are in a pre-revolutionary situation that

could continue for a long time, because we've seen splits in the regime at every level, which we couldn't really have imagined before. but why have we seen them? they emerge because the regime itself made the colossal mistake of blatantly rigging an election when one of the things which is important to its survival and success was the idea that there was a democratic element to it. the result was the people came out onto the streets. there was a genuine resistance. they forced people like mousavi really to leave them in a more dramatic situation than intended. i think what will happen is a loosening of the regime in the long term, even if the president succeeds, which is by no means certain. whether or not he succeeds, i think we're going to see more people, more factions at all levels of society demanding the right to express their view and gradually gaining that right.

and that is going to open up all sorts of opportunities, although i think for the moment, it's not going to have a great deal of impact on the diplomatic relationship between the united states and iran. >> gentlemen, we will be right back. we'll be back with john mclaughlin, robert baer and john o'sullivan. >> what i think happened sent shock waves through the region as well as iran, so that it no longer has the standing it had and it no longer seems like this force that cannot be stopped in the region. i think i'll go with the preferred package.

good choice. only meineke lets you choose the brake service that's right for you. and save 50% on pads and shoes. meineke. we are back with john mclaughlin, the former deputy former cia case officer and john o'sullivan, radio for europe. john mclaughlin, do you believe there are important rifts emerging within the iran regime? and do you think this is significant in a broader sense? >> the iranian republic is one of the great survivors of the last three decades, so i think

we should not underestimate the resillience of the regime. but i don't think these things can be papered over as it was before the election. it's impossible to know at this point where it's going, what it might look like a year from now, but i think it's fair to say that iran will never be quite the same again. just, for example, how we thought of iran, say, two years ago, when the united states was pinned down in iraq, when israel was fighting hezbollah to a standstill in lebanon. iran at that point seemed like a collosus forming in the region. its prestige was high. what happened in the aftermath of this election, i think, sent shock waves through the region as well as iran, so it no longer has the standing it had and it no longer seems like this force

that cannot be stopped in the region. it has been weakened in that respect in terms of its regional posture. in a way, it gives the united states a lot of openings it didn't have before, openings with regional partners in the gulf and elsewhere, the middle east. it gives us openings to throw proposals in there that they have to think about and disagree with, although i think the prospects for actually stopping this nuclear program are very low. >> talk about that for a minute, john. what would you do? a weakened ahmadinejad, a wea n weakened economy. would you try to strike a deal in exploiting that weakness and getting a good bargain, as it were? >> the argument can be made that because they feel weakened and they have a sense of legitimacy in the region that they may be open to proposals now that they would have rejected some time ago. i think that's a thin read though, personally. my sense is that the belief, the

conviction that they need and want and deserve a nuclear program of some sort, this is not unique to me, it's widely held that this is a broadly th broadly shared conviction in iran, so i think the united states at this point has to be thinking about three options. one is extremely intense diplomatic engagement to exploit the situation and hopefully move them toward some consensus with us on this. the problem there is you have to have the russians and chinese on board, and i think the russians would have a very high price. the second option that people don't take off the table is a military option, but frankly i think it's a hor right-handous option. i think it would have horrible consequences that would lead to proxy retaliation on the part of iran's proxies, and kind every an endless struggle that no one needs. the third option, which is

almost unthinkable, but which people really need to be thinking about is what if we can't stop them? how do we manage an iranian nuclear -- a nuclear iran? so there are no great options here, i don't think, but i believe the united states' hand is somewhat strengthened in pursuing the diplomatic option in these circumstances. >> bob, let me ask you about a very important point that john made, which was it does appear or at least one can speculate, that the current events have weakened iran's influence in the region. you'll remember a few months ago, what everyone was concerned about is iran has emerged as the great new power in the region, its hand had been strengthened in iraq with its proxies in lebanon through hezbollah, in the palestinian areas through hamas, and on the arab street there was a general feeling that ahmadinejad and the iranian regime were the great proponents

of the great arab cause, that is, the cause of palestine. looking at things today, do you think that iran's current troubles have weakened its proxies and informal or soft power in the renal everyone? >> i think we should watch that. remember in 1981 when there were car bombs going off in tehran, where there was truly a violent struggle for power, iran was just getting under way its revolutionary message. a year later it was coming into lebanon. right in the middle of the iran/iraq war, iran continues to export its message even when things aren't well at home. you look at the last couple days, clearly there was an iranian hand in iraq in raiding the mujahedeen/al qaeda camps, the iranian opposition. i think whatever government

comes into power, even if ahmadinejad resigns or something dramatic happens like that, he'll find a replacement that would take iran in the same -- i'm saying an aggressive iran, we shouldn't count it out. >> finally john o'sullivan, let me ask you a simple nose, which is have many of the people that you would have worked with on the ground in iran been intimidated, harassed, arrested? what is the status of people who have done some of the on the ground reporting for you in iran is it. >> well, i think you know yourself, from the -- from youtube, from sms messages and such, that an awful lot of the stuff that's coming to us and later through us, comes from citizen journalists there. many of those, of course, have been arrested, beaten up,

attacked, some of our reporters actually described to us what happened to them physically, but i think it's important to know that there is a very large reserve of people who come back as professional journalists or as citizen reporters and keep getting this message out. before one begins to despair about the power of authoritarian governments in this regard we should loot at today's news where only a week ago an election was apparently stolen, a new election today which has produced a defeat for the government. when we look at the battle between, so to speak, democratic crowds and authoritarian governments, it's far from concern that the authoritarian governments are winning that battle. in the case of iran, i think that although they will probably sustain themselves in office for some time, they will not have the power that they had previously.

and they're goods to have to make more and more concessions both to the rivals within the ruling clique, and also to the crowds on the street, in order to be able to sustain themselves. while they're doing that, they're not in the self-confident position of being ability to export revolution on the one hand or continue an aggressive diplomatic policy on the other. so i do think this battle on the streets in tehran and other -- serb in other iranian cities does have in some sense a restraining effect, because it simply compelled to pay attention to make some concessions, and to pay regard to what's going on in the streets. >> john o'sullivan from prague, robert baer, john mcloughlin, thank you very much. >> thank you, fareed. >> thank you. thank you. and we will be back.

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and now for our question of

the week. last week i asked you whether we're nearing the end of the recession? it was a pretty close vote, but the majority of the actually said no. one viewer, who did not give his name made a point -- is the light of the tunnel actually that? or the headlight of an oncoming freight train. now i know -- let me know what you think. as always, i would like to recommend a book called "free, the future of a radical price," by chris anderson, the editor in chief of "wired." he says sometimes the best price for your book, music, art or your magazine is, well, free. as an author, as a magazine editor, somebody who puts out a tv show, this