welcome to "gps," the global public square. i'm fareed zakaria. at the one-year mark of his presidency, if you remember, barack obama looked like he was in real trouble. the economy was in deep trouble, his domestic agenda had stalled, his ambitious push for health care reform looked bad and none of his pushes had yet yielded anything substantiative. three months later, the world looks a lot different. let's start with the american economy. now, it's possible to exaggerate the data, and some of this is te tentative, but the fact is the u.s. is in the midst of a broad-based recovery. the stock market is up more than 70% over the last 12 months. and all assets have been moving

up at a similar pace. exports are up, manufacturing is up, retail sales are getting stronger, and even employment has finally increased, although only slightly. corporate balance sheets look very strong across the board. now, these are moves up from the depths of the financial panic, real lows. and much of it has to be attributed to broad factors, perhaps not to the administration. but surely one would look back at the measures that were taken a year and a half ago and conclude that they stabilized an economy that was in free fall. remember, once the financial crisis really hit, global trade contracted at a faster pace than at any point since the great depression. we really were looking at the abyss. and credit for getting us out should be shared by ben bernanke, hank paulson, and the obama administration.

the bank bailouts will end up costing the taxpayer less than any previous bailout of the financial system in the last 30 or 40 areas. on other fronts, obama has been able to get his health care plan passed, although a majority of americans remain anxious about what it will mean and more crucially, about what it will cost. in foreign policy, the surge in afghanistan is succeeding with some success and he has managed to get countries to take a step forward in preventing the spread of nuclear weapons and nuclear materials. now, obama's poll numbers are still pretty bad, but polls are often a snapshot of conventional wisdom from the past. if the trends i'm talking about continue, the poll numbers will change. on the show today, we have a fascinating set of conversations. to try to understand where the economy is, whether or not this recovery is robust, and whether global trends, what's happening in greece, could still pull us into a second dip, we talk to the man who oversees the financial global system, the

head of the imf. we have a lively debate about what appears to be a bold new approach from the obama administration. apparently trying to force movement on the israeli/palestinian peace process. >> a strike on iran is a very risky and unfortunate option, if it has to happen. there are options that the united states -- >> what does it mean to be safe? >> i think the word we're looking for is catastrophic, disastrous. >> but first, we have an exclusive conversation with the foreign minister of poland, one of the few leaders who was not on that plane. he'll talking about how poland goes on after a staggering tragedy. stay with us. i want you, for a moment, to imagine the unimaginable. imagine if air force one went down while carrying the president, the first lady, the chairman of the federal reserve, the national security adviser, the deputy secretary of state, the deputy secretary of treasury, the army chief of staff, and some 50 other key

american leaders. that is the equivalent of what has just happened to the polish government eight days ago. and now poland's government and the nation as a whole needs to find a way to pick itself up from the ashes. radek sikorski, poland's foreign minister, was the first leader in poland notified of the crash. he joins me now from warsaw. >> hi, fareed. >> tell me what your reaction was when you first got that phone call? >> well, one's first reaction is disbelief. one's second reaction is hope that the accident is not as serious as it sounds. i was informed that there's been a crash, but no explosion, so there was hope that maybe they crash landed. and then there's, of course, a dilemma. what do you do after one phone call. do you put the entire country on alert?

so i sent a preliminary message to the prime minister and then i telephoned our ambassador, who was on the spot, but when he saw the wreckage and it was obvious that nobody could have been survived, then i rang the prime minister again, i rang the speaker of parliament to held him that he is acting head of state. >> you raised the issue of what exactly does one do. once you realized that this was, in fact, the tragedy that it turned out to be, everyone was dead, what do you -- how do you go about the process of ensuring that government functions, ensuring that the apparatus of succession is put into place? >> well, with succession was the easy bit, because the constitution here is very clear that the speaker of parliament automatically becomes acting head of state, but it was establishing the list of those who died and then, of course,

going to the place to identify the body of the president and of the other victims. you could add to the poignancy of what happened that all those people died wanting to commemorate the 70th anniversary of the katten massacre of soviet secret service in 1940. i'm not sure what the equivalent american place would be, i suppose alamo or 9/11, in fact. so imagine if your people died on the way to commemorate the victims of 9/11. >> and there is a geopolitical aspect to this, of course, which is that katyn was a massacre that the soviet union long denied and russia had only very recently come to terms with. this was the first joint commemoration, and yet the crash takes place over russian air space. were there suspicions in poland

that somehow this might have been -- there might have been some russian hand in this crash? >> there are always conspiracy theories. this time, i think they are -- we haven't seen many serious ones. because the russian authorities have been completely open and i think we will have quick preliminary results of the investigation. russian response has been more than correct. the russian authorities and the russian people have shown empathy with our suffering. i think, partly, because prime minister putin was with our prime minister at that place three days before, and he felt the horror of katyn for us, where 5,000 polish officers died. and so he must have realized what it means to us, what soviet russia did to us, and why it's so horrible that people should die in that place again. so paradoxically, i think we

have something of an emotional breakthrough in relations with russia. we've improved our relations with russia before, but now there's evidence that the russians are feeling our pain, which is -- which i hope will lead to better relations. >> radek, i have to ask you something that is awkward, but needs to be asked. there is an episode, as you know, two years earlier, when president kaczynski was to land in georgia, where the pilot felt it was unsafe to land and the president effectively ordered him to land. could this have been a case where the pilot was being asked to land against his will? >> i was on that plane to georgia and i remember it well. but this time, we have no evidence so far that that happened. >> one of the hopeful signs that has come out of this tragedy has been just how stable poland has been. and it is, i suppose, the culmination of a process of the

consolidation of polish democracy and its market economy. is it likely that this will destabilize things, or do you feel comfortable and confident that poland's democracy and, in fact, its economy, will endure and will remain as stable as they've been? >> the logistical operation of bringing back those departed and organizing all these funerals is actually a huge organizational operation and we are doing it, i think, quite efficiently. and it shows you that we have a new poland, a poland that has not suffered recession. >> tell me, radek, personally, how did this affect you? you knew everyone on that plane. you have probably known many of the relatives, many of these people are close colleagues, some of them are political opponents. and here you are, a survivor and witness to all of this.

what does it make you feel? what do you think -- how do you approach this? >> it's terribly depressing, because it's the people one liked, it's the people one had controversies with, that one also misses, in fact. i'm going to funeral after funeral. the associations, the levels of grief are just -- are just too many. >> but you do believe poland will be able to pull itself together and move on, fairly quickly? >> oh, i think it will be a spur for another modernization of poland. we needed to modernize those planes for years. we need to improve our procedures, improve our airports. i think the lesson that we should draw from this is more organization, completing the process of transformation towards a free market democracy

that we've done so successfully over the last 20 years. >> radek sikorski, thank you so much for joining us. and of course, our condolences to you and to everyone in that country. >> thanks. basically, as i see it, you're saying, you phrase it more delicately, a strike on iran in return for the approving of settlements on the west bank? >> seriousness about iran. and right now we're not -- >> you're speaking like a diplomat. what does seriousness about iran mean? this country definitely needs to focus on other ways to get energy. we should be looking closer to home. we have oil on our shores. natural gas can be a part of the solution. i think we need to work on wind resources. they ought to be carefully mapping every conceivable alternative. there is an endless opportunity right here.

each year food executives come to grasse, france to work with roxane. here in this centuries old town cargill creates flavors. and food companies come to collaborate with cargill. creating unique tastes from thousands of rare flavors. helped by roxane... an ingredient mixing robot. and a team of flavor experts. food companies find the recipe for success. this is how cargill works with customers. a man can only try... and try...and try. [ male announcer ] honey nut cheerios tastes great and can help lower cholesterol. bee happy. bee healthy.

what did we make better ? communities. industry. energy. her. this. lives. how ? by bringing together... information. ... people ... ... machines ... ... systems ... ideas... verizon helps businesses worldwide... including fortune 500 companies... find and achieve... better. better. better. better.

american soldiers are in more danger overseas because of the stalled middle east peace process. that's the claim. it's a controversial idea that both president obama and general david petraeus have voiced in some variation over the last few weeks. it appears to be a shift in america's view of the israeli/palestinian conflict, casting it as a national security issue, directly for the united states. and the new approach comes amid talk of a new obama peace plan

for the middle east. joining me to talk about all of this are rashid khalidi, professor of arab studies at columbia university and bret stephens, a frequent guest here. so, bret, what petraeus seems to be saying, look, i'm out there, i'm talking to these arab leaders. it hurts our relationship with them. it makes it more difficult for them to ally with us. they all complain about this. so he's sort of reflecting that ground reality, no? >> well, i think there's some element of truth to that. and it's certainly convenient for our political leaders to make the case that discontent in their country has to do with what settlements israel might be build in parts of jerusalem as opposed to, say, their own policies, mubarak's repression of egyptians, the repressive policies in saudi arabia. so, of course they're going to blame israel and not sort of look at their own mismanagement. and when you look at actually the jihadi complaints against

the west, obviously they include israel, of course they include the settlements. these complaints predate the settlements. . they have a lot to do with long-standing radical objections to western life as it's carried out in all of its liberalism. i wrote a column saying lady gaga is in many ways as much an emblem of the problem that these characters have with the west, with modernity as really the settlements are. so essentially say, well, if we can only solve the settlement problems, we'll relieve ourselves of a large share of the burdens we carry in the middle east is preposterous. >> well, i read that column, and thanks to them, because i have kids, i know who lady gaga is, but the idea that their discontent is all about the fact that american women are scantily clad, it seems to me it doesn't quite address the issue of america as an imperial power, as a great power in the region.

because, after all, swedish women are scantily clad, but the jihadis don't have anything against sweden. >> of course american power and the projection of american power has a lot to do with some of these -- with sparking discontent. it also has something to do with putting -- with damping disconte discontent. in iraq, american is seen as the key player. sunnis are relying on the united states to keep shiite power at bay. so i'm just saying i think it's uniquely kind of simpleminded as well as convenient to say, if only israel weren't building settlements in the west bank or in east jerusalem, many of these problems would go away. i don't think that's what david petraeus will say and that's why i think it's somewhat unfair to suggest that he was. >> rashid, what do you think? does it strike you as a shift for the united states to be suggesting that this stalled peace process hurts america's ability to pursue its interests? >> what they're saying is that

israel is a drag on the united states. it's not a strategic asset. and this is a discoursive shift of some significance. i don't think they're saying you know, remove settlement "x" from hilltop "y." what they are saying is that israel is not the strategic asset it was touted as during the cold war. and we've gone back, in effect, to the eisenhower administration's view where the middle east is an area where the united states has problems and israel is in a sum's small way one of those problems. >> do you see the shift as dramatic as you were just describing? because what obama has said and what petraeus' report has said is not israel is a strategic drag. it is that the lack of progress in the peace process is the problem. you know, that we need this process to be energized. otherwise, it is pointed to by jihadis, it is used as a recruiting tool. that's very different from saying, israel is a strategic drag. >> i think that discursively, if you sit down and parse what

they're saying, at base, at root, that is essentially the message. far from being an enormous asset, if israel continues to act in a way that antagonizes opinion all over the muslim world, all over the arab world, and in other parts of the world, to tell you the truth. you go other places and say, why is the united states supporting this crazy policy, then it becomes a liability instead of an asset. >> yeah, but at that point, if you accept that analysis, at that point, you ask yourself, what can the administration do to move the peace process along in a direction that serves both israelis and palestinians well? and what the administration has been doing, i think, serves the opposite interests. it basically sends a signal to israel that this administration is not reliable, there's no longer a kind of hug-me-close mentality, which has, in fact, moved israel to, for instance, remove its settlements, its settlers from gaza. it tells the israelis to hunker down -- >> hug me close led them to

withdraw from gaza? >> yes. >> sloan led them -- >> no sloan led them -- >> from his april letter requ? t >> -- the realities on the ground. that's what led shirone to sell to israel. >> i think first of all, the hug the israelis and then they're forth coming is not an argument you can show a lot of argument for in the past. the american embrace of israel has led to decades of standoff. that's the point i argue in my piece on foreign policy. and secondly, i do agree with bret. i occasionally agree with bret. i don't think they're likely to make progress, but i think it is important for the united states to lay down a marker that we have these or those important relationships with israel or we have these shared interests with

israel, but there are also other areas on which we fundamentally disagree. >> so why do you -- >> and secondly, i think that it is important for the israeli public to know that there's some kind of cost for cocking a snook at the united states, which israeli prime ministers have done since the days of baker, pretty much anytime an american envoy goes out there, israelis slap a new settlement on the ground in the occupied territories or whatever. baker says, every time i go there, day do something to offend us. and it's been happening systemically for decade. i think it's worthwhile for the israeli public to realize that the united states doesn't like this sort of thing. and in the past, two american presidents who have made their displeasure clear, president clinton at the time that netanyahu was president in '98, and president bush, the -- 41, george herbert walker bush, over the issue of loan guarantees made it clear that the united states had differences with israel over some things, and the israeli public, in time, came around to realizing that maybe

these weren't such good prime ministers. that israel needs good relations. and that was part of the 1992 election result and part of the '98 election result that brought barack to power. >> well, we're not living in '92 or '99 with barack. i would say to you that the real template is the camp david accords of the egyptian/israeli peace. both zoth and baygan could go back to their publics and say, we won. i got something from this kind of deal. and the problem is that this administration is trying to balance israeli and palestinian or israeli and arab interests. it needs to start bonding with both sides. it needs to find formulas in which it can go to the israelis and say, in exchange for some concessions, we will give you something that you desperately want. and what i argue is what the israelis are most worried about is iran. that is their core strategic security interest and the united states can give things to israel on iran.

and similarly, with the palestinians, it also has to change the incentive structure so it makes it more and more interesting to the palestinians to, again, accept the two-state solution as the template, which they've been moving away from, to reject hamas, which is a deal breaker for israel. it's really a deal breaker in any kind of negotiation, to continue to invest in palestinian industries, palestinian economies, finally rise -- >> the core of your piece is basically, as i see it, you are saying, you phrase it more delicately, a strike on iran in return for the approving of settlements on the west bank? >> seriousness about iran. and right now we're not -- you're speaking like a diplomat. what does that mean? >> a strike on iran is a very risky and unfortunate option if we have to have -- >> what does it mean -- >> i think the word we're looking for is catastrophic,

disastrous. >> you guys have to take a break and we have to take a break. we'll be back with bret stephens and rashid khalidy. >> what people really don't like is in certain ways people support undemocratic, autocratic, keptcratic, rotten regimes. se we believe in the strength of american businesses. ♪ ge capital understands what small businesses need to grow and create jobs. today, over 300,000 businesses rely on ge capital for the critical financing they need to help get our economy back on track. the american renewal is happening right now. ♪

[ female announcer ] switch to swiffer 360 duster extender, and you'll dump your old duster. but don't worry. he'll find someone else. ♪ who's that lady? ♪ who's that lady? ♪ sexy lady ♪ who's that lady? [ female announcer ] swiffer 360 duster extender cleans high and low with thick all-around fibers that attract and lock up to two times more dust than a feather duster. swiffer gives cleaning a whole new meaning. [ cat meows ] ♪ who's that lady?

and we are back, debating israel and the palestinians with rashid khalidi and bret stephens. you said you thought that the united states was going about getting to a palestinian state the wrong way. the obama administration seems to be suggesting, this is only rumors, but some good reporting, that they're going to present their own peace plan. presumably this would be some version of the plan of 2000. is that a good idea to say, look, there's no point going through the endless negotiations. we know what the end point is going the look like. let's start there and, you know, some minor negotiations around the issues of jerusalem and the holy sites is fine, but let's not reinvent the wheel. >> well, again, i'm again in agreement with bret. his piece in foreign affairs talks about how unready israel in some respects is and how unready the palestinians are. and in my peace, i talk in

particular about the palestinians. if the obama administration were to put such a plan as you're talking about, and such has been reported, on the table, i don't think the conditions are propitious. and i don't think they've spent their first year in off making sure they become propitious. one of the things is what i talk about in my piece. you cannot negotiate with a fractured foreign policy. it's not up to the united states to rebuild palestinian unity, but the united states can stop saying, this is a deal breaker if you include hamas. you have to figure out a way to bring a palestinian consensus to the table, and that includes, necessary and invariably, hamas. bret argues, they'll never change. that's rubbish. >> i was just quoting hamid marsha marshall. >> there are many things you can quote him of saying. you can quote things left, right, and center of people who have been blown away in the past decades of saying quite different things, hundred-year

truce with israel and so on. i don't think it's going on an easy thing, but neither in israel, where you have the most right-wing, most unamenable government in quite a while. nor in the case of palestinians where off completely divided policy is the situation propitious. and those are the kind of things that they should work on if they actually seriously intend to put a proposal on the table. >> but isn't it fair to say, bret, that we kind of know what the end point is going to be, so why do we have to go through this elaborate confidence-building process when, you know, the cloeten plan of 2000 is roughly where the only viable solution, right? >> yeah. because the end point is a state of mind, it's not just a division of borders. it's very easy, if this were a territorial conflict, for reasonable people to say, okay, let's draw the border here. the issue is then, what are the intentions of the parties after that or refugees a part of the mix? is it really an end of claims?

i'm really speaking from an israeli point of view, but palestinians also have, you know, their own sets of questions. so there is something dish mean, it's not because the parties are stupid are just vindictive or petty that this kind of settlement hasn't been achieved. it's because there are cultural, religious issues on both sides that simply can't be easily resolved across a negotiating table. and this is what worries me about bringing hamas into a palestinian government. because this conflict, and i think the middle east generally has been shifting from kind of a nationalist type of politics to a much more religious kind of politics. and when these things become tied up -- >> in the west bank? on the west bank, tough most secular, the most modern government for the palestinians that they've ever had. the prime minister strikes me as the most competent prime

minister in the arab world. >> but he wasn't elected. the guy who rightfully holds the job, if you accept the results of the 2006 election. and mahmoud abbas is a year -- has extended his term by a year. he essentially rules by decree. so as popular as these guys, fie ad and abbas are in the west, because we see them as moderates, people you can negotiate with, there's a real question about what the second legion or the second rank of palestinians are actually thinking. so it's not at all clear to me that you really have that moderate core in west bank politics. i think hamas is only seen as weak -- is seen as weak in the west bank because they haven't been able to act militarily, the way they were in gaza. >> what do you say about bret's point, that this is not something that can be resolved as geographic division. >> the first thing that has to

be done is the united states has to get off the wrong track, which it's been on for a couple of decades. i think you do have issues of state of mind, but you also have issues of interest. you have developed in israel a settlement industrial complex, a vast network of people whose jobs and livelihoods whether in the israeli bureaucracies depend on israel controlling the palestinians. there's a huge database and every palestinian is on it. dozens of software companies produce stuff for that. there are security companies. there are half a million israelis who live in illegally occupied territories, the west bank, occupied arab jerusalem. those are issues that are at least as important as state of mind. what people really don't like is certain ways in which america, a, projects power, and b supports undemocratic, autocrat autocratic, cleptcratic rotten regimes instead of letting them work themselves out.

>> rashid is a neocon. on that note, we are going to have to stop. rashid khalidi, bret stephens, a pleasure to have both of you on. the articles you both referred to many times are in the current issue of "foreign affairs," the upcoming issue, but they are on the website of "foreign affairs" and you can read them. fiber one -- i'm looking for some fiber.

this bar is an excellent source of fiber. there's no fiber in this. it tastes too good. they have 35% of your daily value. oh, samples. mmm. fiber one. cardboard no. delicious yes. mmm. ♪ well, look who's here. it's ellen. hey, mayor white. how you doing? great. come on in. would you like to see our new police department? yeah, all right. this way. and here it is. completely networked. so, anything happening, suz? she's all good. oh, my gosh. is that my car? [ whirring ] [ female announcer ] the new community. see it. live it. share it. on the human network. cisco. aren't absorbed properly unless taken with food. he recommended citracal. it's different --

it's calcium citrate, so it can be absorbed with or without food. also available in small, easy-to-swallow petites. citracal.

now for our "what in the world" segment. what got my attention this week was the predator, the unmanned aerial bomber who has just marked its 1 millionth hour of flight time. now, ever since it's first started flying, the predator has been a sore point, with complaints about its legality and angry cries mostly from pakistan over how many innocents civilians it has killed. some estimates run as high as 50 civilians killed for every terrorist killed. but the u.s. government loves

it. gates recently testified that they're now running more drone pilots than fighter and bomb pilots. and drone pilots never even get into the cockpit of the plane. they fly the predators from remote control from a base just outside of las vegas. the cia director, leon panetta, says the predator is, quote, the only game in town for disrupting al qaeda's leadership. but are we really doing that? some say no. most recently, robert wright in the "new york times." he says studies show that killing leaders of terror groups, especially religious terror groups, doesn't actually lead to the downfall of the organization. in fact, in some cases, it makes them stronger. the leaders can always be replaced and the organization is energized by the attacks. then there's the legal problem. the obama administration recently authorized the assassination of an american, anwar awlaki.

the aclu is in a court battle with the u.s. government to try to force it to release information on the secret i have program. now, late last month, state department legal adviser harold koh, a very distinguished liberal, usually on the same side as the aclu, provided a spirited defense of the predator. he says the use of predators complies with all applicable law, domestic and international. his basic argument boils down to this. on 9/11, the united states went to war with al qaeda and the taliban and koh says the u.s. government therefore has the authority and responsibility to defend itself, including targeting terrorists from afar. how do i feel about the predators? on balance, i agree with koh and with the administration. fighting al qaeda this way seems legitimate. but i worry a lot about the precedent. imagine, for example, if russia were to announce that there were chechen terrorists in georgia and were start lobbying missiles into that country.

how would we feel? now, pakistan, which has been the country complaining loudly about the american use of drones, was recently promised by defense secretary gates a dozen drones of their own. theirs would be smaller than the predators and unarmed. so at least pakistan won't be complaining anymore. and we will be right back. some people in the united states have been saying, look at greece's problems. this is where we're headed. hey -- who's our best presentation guy? carl. i thought you said carl was our best presentation guy. [ worker ] well, he is.

last week he told my team about fedex office print online for our presentations. we upload it to fedex office, then they print, bind, and ship it. the presentation looks good, right? yes, but -- you didn't actually bring carl with you. good morning! but i digress. [ male announcer ] we understand. you need presentations done right. and right now save 20% on all online printing purchases. visit fedex.com/print. [ vrrroooooomm! ] black one! where? [ vrrroooooomm! ]

black one! where? [ vrrroooooomm! ] black one! ow! where? [ male announcer ] the volkswagen tiguan. the only compact suv with a turbocharged engine, standard. [ vrrroooooomm! ] black one! where? there. [ male announcer ] lease the 2010 tiguan for just $269 a month. it's a whole new volkswagen.

i'm candy crowley and here are stories developing this sunday morning. polish president lech kaczynski and his wife are being laid to rest this hour at a private burial in krakow. an official state funeral was held earlier today.

many world leaders who were scheduled to attend today's service, including president obama, had to cancel their plans because of the volcanic ash that's disrupted air travel across europe. the kaczynski died along with 94 others in a plane crash in russia nearly a week ago. iceland's volcanic glacier continues to spew a cloud of ash, and that's stalling air traffic in much of europe down to a trickle. air traffic control officials in europe estimate some 20,000 flights will be canceled today due to the restricted air space, leaving tens of thousands of travelers stranded and looking for other means of mobility. those are your top stories. gps" and then howie kurtz' exclusive interview with white house press secretary, robert gibbs. that helplessness again. [ male announcer ] be sure to talk to your doctor before you begin an aspirin regimen. talk to your doctor, and take care of what you have to take care of.

you can label as "different." like janice. uh-huh. yeah. fashion deficient. and tom... copy incapable. it's open kimono time. looking good, dan. oh, we want to make sure all our ducks in a row. yeah. volume control syndrome. but we focus on the talent and skill that each person... brings to the team. i mean, no one's really concerned about labels. not even mine. labels get in the way. disabilities rarely do. visit thinkbeyondthelabel.com to evolve your work force. communities. industry. energy. her. this. lives. how ? by bringing together... information. ... people ... ... machines ... ... systems ... ideas... verizon helps businesses worldwide... including fortune 500 companies... find and achieve... better. better. better. better.

a man can only try... and try...and try. [ male announcer ] honey nut cheerios tastes great and can help lower cholesterol. bee happy. bee healthy. 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.

greece is now, by many definitions, bankrupt and might become the first european country in decades to get a bailout from the imf, the international monetary fund. some in the united states believe that greece's problems today are america's tomorrow. to talk about all this and more, we are delighted to welcome dominique strauss-kahn. he is the managing director of the imf, as well as an important political figure in europe and france. he is often mentioned as a potential candidate for the presidency of france. dominique strauss-kahn, thank you very much. >> i'm happy to be here. >> when people look at greece, as you know, some people in the united states have been saying, look at greece's problems. this is where we're headed. neil ferguson, a very distinguished economic historian at harvard wrote a piece in the "financial times" saying america should worry about the greek problem, because this is going to be america's future. do you worry about it?

>> historians are not always right when they talk about the future. and i'm not sure that the situation of greece can be compared to one of the united states. united states is the leading economy, has nothing to do with greece. so if what ferguson means is the high level of debt is a problem, is a problem for greece, will be a problem for the u.s., he's right. will be a problem for everybody. because that's the cost of the crisis. we escape the crisis doesn't mean you have no cost. and the cost is they increase the debt level. but if he means that the kind of problem greece is facing today can replicate in the united states, i won't buy that. >> would you say that the united states actually handled this crisis pretty well? it was early in terms of acting on fiscal stimulus, the auto industry. did the measures that were taken by both the bush administration and then the obama administration were quick, fast, massive, decisive. >> yeah, i think so. i think that, obviously, this crisis comes from what we didn't

expect. i mean, the system, the united states system, but as soon as the crisis has been identified, as soon as, and probably the imf role plays into this, then i think the measures taken by both administrations were the right one, and because of the size of the u.s. economy, it's one of the reasons we avoided this big collapse. if things had been -- have been worse in the united states, no way for the global economy to recover. u.s. is still one fifth or so of the global economy, so it's really the motor of the global economy. but if you have the broad view, really, what has been done, what was what needed to be done. >> help us understand, what does it mean to see greece in this situation? we think of this as a european country, part of the eu, host of the olympics, and now we learn

that the finances of the country are in shambles. what happened? >> this crisis put a lot of pressure on countries and the fiscal situation of countries and when some of them, like greece, were not really in a good shape before the crisis, the crisis creates even more pressure and so then you have this kind of, you know, disruption in the fiscal stability of the country. >> but is there thing broader at work here, are we facing a crisis of the west? i'll tell you what i mean by this? we had a massive problem of private debt, private leverage. the way we solved the crises is the government took on all this debt. so we have transferred all the debt from the private sector's balance sheets to the public sector's balance sheets. the government now owes all this money. the debt burden of the g-8 is roughly speaking, the like 120% now. the debt margin of the emerging market countries is a quarter of

that. so it's a sort of topsy-turvy world. and are we witnessing a kind of gradual decline of the west. where these debt levels, huge spending on retirement, huge spending on health care, is going to sag the western economies while the indias, chinas, brazils will move forward? >> well depends what you're looking at. if you're looking at growth rate, then certainly, emerging market and certainly asian emerging market is going to go faster than the u.s., north america and europe. which is the decline. what i will say is the balance of power in the global economy is going to be rekonsdent and especially asian emerging economy, but not only china, india, but also brazil and some others are beginning to have more weight in the coming decades. but is that bad? i won't say that. a more balanced world is

certainly better than an imbalanced world. >> let me ask you about one european leader in particular, president sarkozy. how has he done? >> well, i think everybody agrees that in october of 2008, when he was chairing the european union, he was really effective in convening everybody in paris and say, okay, now you guys, you're going to work together and we need to do something, has been done. and i think for the european side, that was very -- that was certainly the most important thing that could have been done to avoid the crisis to spill over. so from this point of view, i think in the crisis, he has been effective. >> that doesn't sound like somebody you might -- you might be contesting in some fashion for the french presidency. i realize he can't run again, but -- >> where did you get this idea? i'm leading a -- i'm heading an international institution, i'm happy what what i'm doing. i think it's -- maybe it's a bit

pretentio pretentious, but i think it's important for the global economy to have those kinds of institutions working well and i have no other projects. >> when you are done with the imf, would you rule out the prospect of returning into french politics? >> maybe i want to stay in the imf for years and years and years. who knows? >> you're a very distinguished french politician, former finance minister of france. what advice would you give france's socialist party, to which you belong, in terms of how would they -- how should they position themselves to recapture the hearts and minds of the french people? >> i won't give any kind of advice. >> all right. advice to countries, but not to political parties. >> exactly. >> dominique strauss-kahn, a pleasure to have you on. >> thank you. >> and we will be right back. what's around the corner is one of life's great questions.

and while it can never be fully answered, it helps to have a financial partner like northern trust. by gaining a keen understanding of your financial needs, we're able to tailor a plan using a full suite... of sophisticated investment strategies and solutions. so whatever's around the corner can be faced with confidence. ♪ northern trust. look ahead with us at northerntrust.com. sweet & salty nut bars... they're made from whole roasted nuts and dipped in creamy peanut butter, making your craving for a sweet & salty bar irresistible, by nature valley.

at the end of the day in sitka, alaska, everyone awaits the return of the fishing boats. their safe arrival is highly anticipated. as is something else. a shipment of natural sea salt from cargill, essential for preserving the catch. we deliver the salt on precise schedules and ship it efficiently all along the alaskan coast. saving the fishermen money and their catch. this is how cargill works with customers.

now for our question of the week. here's what i want to know. do you think american soldiers are in greater danger in afghanistan, iraq, and beyond because of the israeli/palestinian impasse? let me know what you think. as always, you can go to our website to see some answers to last week's question. while you're on our website, take a look at our weekly podcast. if you missed a show, you can watch it on the web. you can also find the gps podcast on itunes. subscribe to it, it's free. and make sure you'll never miss a show. now, as i do every week, i'd like to recommend a book. it's david remnick's fascinating

biography of barack obama, "the bridge." remnick explains in great detail how this jumble of a person, who didn't really fit into any group, half black, half white, raised in hawaii and indonesia much of the time by white grandparents put himself smack in the middle of the narrative of american civil rights and politics. he arguably won the election because of that. the details in this book are truly amazing, down to the future president's favorite type of marijuana. and now for "the last look." if anyone thought the life of a president was a walk in the park, this video i'm about to show you will prove otherwise. at the nuclear security summit in washington this week, president obama welcomed heads of state and dignitaries from 47 nations. and he had to shake hands and make small talk with each and every one of them, over and over again. the process took one hour, at least. and that was before dinner even began. so an enterprising photographer shouting 1,338 pictures of the

process and put it all to music. take a look. but while you do, try to identify every world leader you are about to see in this clip. e-mail us your list. we'll send signed copies of my book, "the post-american world," to as many as ten viewers who get them all right.