thinker and a run. they would actually terrorize your thoughts. next, please. this is how we cope with censorship. but we cannot live without each other. she was talking about the blind sensor -- censor. next one, please. this is what happens to iranian journalists who are actually in prison for a while. even after getting an -- out of prison, there pandas in prison. -- there p -- their pen is in prison. when google was blocked, it was a lot through many internet

service providers in iran, and it was very difficult for people to use other search engines. this showed the problem. next one, please. we talk about balance and there are many of my colleagues that note this is hard 3 usually journalists take sides. it is funny, but they have to promote whatever the party leader is saying. during the election, when you're walking along the ballot box, you have to keep your balance. next one, please. sorry for my language. . sorry for my language. [laughter] >> this is how mr. mahmoud ahmadinejad claimed to actually win 62.6% of the votes but nobody could actually vet it.

and the journalists actually had a lot of questions. but whoever questioned the authority was imprisoned or had to get out of the country. so he's just showing the percentage, nothing else. next cartoon, please. next cartoon, please. [laughte bout citizen journalists. actually many iranian journalists turn into citizen journalists. and because of their names and their fame, many other people who were interested got involved and became citizen journalists themselves so they use whatever tools they could find like cell phones to actually record what was happening. so if 20 years ago in the tiananmen square people were able to use cell phones, they could have sent this. smile, you're on youtube. next one, please. years ago i drew a crocodile that caused a lot of trouble for me. i went to prison for it. because the name remind with the name of a powerful cleric.

but i usually use the crocodile to symbolize the iranian conservatives. oh, the elephant stands for -- okay. something like that. but he was first the judge of the press corps then the chief prosecutor of tehran. and when they had to get rid. -- of him they got rid of him actually. they cut him off. if there's too much pressure through the blogosphere and through youtube and although all readers coming out and people around the world would know what's happening, the conservatives have to bow. and they do it. next one, please. talking politics, i brought this up to have some fun. you remember mr. mahmoud ahmadinejad said that we don't have homosexuals in iran. when i drew this this was another conception. he's having this tango with mr. chavez. i don't know somewhere around tehran. and they're having a lot of fun.

he would deny this, any connections but it's happening. next one, please. [laughter] >> do you remember mr. obama said if our opponents unclenched their fists we would stretch out our hands and shake hands with them. okay. shaking hand with the devil with his hand is actually bloody wouldn't be that clean and clear. so i think somebody has to bring a wipeout after mr. obama who was shaking hands with him and stepping on the green members. this is iran and iranian journalism and somehow citizen journalism. thank you very much. [applause] >> so mohammed, if -- as moussaoui said every citizen in iran is potentially a

journalist, how does -- how does that kind of behavior -- and you state -- you quoted some numbers, upwards of a million iranians with blogging. it's about linking and networking and talking to each other. building communities, building conversations online. how does that community link to the larger world of internet broadcasting, international news, international information? what is the dynamic between the internal conversations that you are between and among iranians? and the broader world of news? and maybe also you could comment on that as well. >> as the iranian government took a number of actions -- i would say over the last 10 to 15 years they have really pushed sort of traditional journalists and many regular citizens into this arena. and people have made the most out of the new technology and

the tools that are provided to them. and so there is a lot of linking. there is a lot of exchange between the iranian blogosphere and the arab blogosphere. and the iranian blogosphere and the western european and the western blogospheres. the bloggers read the "new york times." they read some of the arabic newspapers and they link to them and they write their own stories about those stories. so i think the cross-pollination exists. and it's all over the place. and all you got to do is go to virtually any iranian blog to see that taking place on a daily basis. in many ways the iranian government has done itself a disservice by narrowing the options so much that people were forced to migrate to a new medium all together. and they're reaping that as we speak. >> you know, 70% like we said the demographic is under 35 or 30. and everybody saw that they

actually have a stake in this whole movement. primarily the movement was made up of a lot of women. and a lot of young folks. who were all technically savvy. so everybody with a cell phone, with internet access could find a way to put their voices heard. we know internationally that all the broadcasters from all the different venues were trying their way to get into iran and they couldn't prior to the election. and regardless right outside people were watching the social media websites like twitter, which became hugely on the map after that. so much so that the chinese apparently were learning from the movement that the iranians did. so everybody realize they have a stake in this. if they are going to make a change they literally have to take out their cell phone just like your brilliant cartoons show and put it out hey, you're on youtube now. how are you going to censor this. so i feel like -- everybody realize that if they want to

make a change, they have to do something about it. and now they have the tools. and that older generation of folks didn't. which makes it all the difference. >> if i may, let's go to a blog -- blogger. he was in jail in 2005. and he recently is calling for a campaign on other bloggers to write about the prisoners who are lesser known. this is his web blog. and he's calling it like a game, like a bloggers game. and he's calling on his other bloggers to write about these people who are still in jail. and nobody knows about them. and he himself has been writing about the fictional prisoner who can be called hassan ali who's sitting somewhere in a prison in iran and nobody knows about this. and this just shows how bloggers are using this new media. and the point you mentioned

about this movement, each citizen is a media. and this is what they're doing. they're publicizing the cases of prisoners who know one knows about them. you don't read about these people in the "new york times" or "the washington post." even in the media in iran which is under the control of the government. but these bloggers are launching this campaign. it's very powerful, i think. >> so is technology a silver bullet? >> not exactly. >> what is it? how does -- >> a rusty silver bullet. >> how does the technology interact with political movements and reform movements in fact? how should we think about that relationship? >> actually, it helps. but let's say the government cuts off internet connection in city a or city b or decreases -- what's the name the volve, how can people reach out through

facebook or twitter or other websites? so there should be a combination of traditional networking and modern networking. so if we combine these together, how did the networking work in the 1979 revolution in iran? did people have internet? no. did everybody have a cell phone? actually, a majority didn't have phones. but it worked. >> they had cassette tapes. >> that's right. that's right. >> faxes. >> you have to use whatever you can. iranians are very good and sophisticated in that. >> not a silver bullet at all. i mean, i think it is merely the latest innovation that is being used by activists and citizen journalists. and it's being used by the government. the iranian regime is very sophisticated in its filtering and its blocking. they are perhaps only really second to china in the way they

filter and the way they block. for example, it's the only government in the middle east region that is -- that has -- that is developing its own soft and hardware to filter and block. and journalists -- citizen journalists are sitting in prison a printout of their chats and their surfing history and all this stuff is thrown in narrow face -- their face and they're told to admit to everything they have done and haven't done. it's not a silver bullet. it's more like a cat and mouse game. the technology is available to the bloggers. the technology is available to the government. and there is no ultimate winner as it were. it's a catch-up game. incidentally it's the governments that is that are most repressive where you see bloggers and citizen journalists of the highest of technological sophistication. whether it's syria or iran or

saudi arabia. those bloggers are far more proficient at circumventing those kinds of restrictions when you compare them to a place like morocco, for instance, where the government isn't as severe in its approach to freedom of expression online. >> if i may, you mention how the iranian government is using the internet by filtering websites. but that's not all they're doing. they're doing more. there's an example of former vice president who was jailed in iran. and who actually updated his blog from prison. it was a very clumsy attempt by authorities to show how prisoners are well-treated in prison and nobody believed them. but still it was very awkward. and if you could click on the -- yeah, this is his blog from prison with his picture. saying how nice time he's having. and very nice talks with his interrogators who allow him to use his laptop. and how everything is rosy. he's out now.

>> one thing iranian bloggers and a group of hackers actually hacked his web blog for a while just to stop the government's propaganda. >> you know, it goes both ways. i mean, it's not a silver bullet. it's definitely a tool. but it also goes both ways. the same tools that we have, the government has. so, you know, you have the iranian cyber-army which went in and crashed all these websites and say you've been hacked by, you know, the cyber-army. so it definitely goes both ways. and one thing some folks shouldn't undermine the power of mouth-to-mouth. you know, giving news to each other that way. i know a lot of times when different signals will get jammed in iran, we would go take the steps of putting on five different satellites trying different ways to get around it. but even the folks in iran would actually -- those who would get access would put pressure programs onto cds and dvds and sell them on the streets to pass on the information just like in

the 1979 revolution. you know, pamphlet-passing cassette-passing. it's a tool but it's not the only tool. it goes back to the whole thing of being multipurpose amongst all platforms. and know how to utilize it effectively. and to get your message across. >> so what's next for the iranian citizen media community? we've seen this incredible movement. we've seen a recognition that's occurred around the world before its effects. about the potential for it? about what does that mean for the future of iran? what does it mean for the future of iranian public space? what are we going to see in the future with this kind of -- this kind of dynamic? >> well, i think it's more of the same. i think the only difference is that the journalists and the ma

mouse as it were the government, the cat will continue to play the same game. they will do it with more skill and with higher sophistication. both technological and also i think there will be an increase in volume. the number of blogs that cover political unrest and the %@ r"@

>> this cat and mouse game, sometimes even if the map that is faster, the mouse might catch the cat by its tail. i think that we abhor the mouse. so i think if we empower the mouse, this can happen. of course, i'm not talking about the wireless mouse or whatever. but by creating citizen journalism platforms for volunteer we're, what we actually experienced in the past few months -- we started this platform called self-writing platform. and we have about 2,000 members. and most of them are from iran. and they're trying to give -- they have a voice right now. but they're trying to give choice to the choiceless. it's not just about voice to the voiceless. so they're talking. and they're questioning the authority.

even questioning the leaders of the green movement. asking them questions. what were you doing in the 1980s? when people were being killed or tortured. so this is important. and we have to change the mindset as ms. nafisi said. if well-known bloggers can do it, others who are interested can get involved and continue. >> you know, another angle to look at is the mediums have provided a sense of anonymity. people have gotten more courageous about putting their stories out. before, there was a worry about being persecuted and being caught. since the volume has gone so much higher, people are more apt. they've become more courageous. and wanting to have a stake in this movement. you know, even as long as i remember when i was in iran, you know, just like ms. nafisi would tell us, there was some banned books. we couldn't read certain books in school.

and i could never understand that given that i grew up in the states. how could you not read a great piece of literature? it would be passed on from different people from folks to folks or poetry even for that matter. so this sort of has changed into another level now. where people are now becoming more open about sharing their thoughts about what they experienced. if they've been detained. if they have not. what they think of it. whether it's pro or against. i mean, it goes both ways. you might find folks, no i'm happy just the way i am. it's hard to believe but they might exist there. now there is a medium now for them to actually put it out there. whether it is anonymously, whether it's not. what have you. but they now have the tools to actually speak out. and the fear factor of it has gone much less. >> i think we have time for a few questions from the audience. so if you'd like to speak, please come up to the mic. >> hi. i'm miriam.

i'm part of a growing group of iranian-americans or iranians in the diaspora who are pushing hard for the u.s. government to break iran's firewall. the u.s. government has among its means the technologies that can do this, free gate tour and other antifiltering. but the server capacity is limited. so the number of people being able to access the internet freely is very low compared to what it was just after the iranian election. in june. which wasn't even high even then. we're trying to get the obama administration to release funds that the u.s. congress has already appropriated to the state department for this use.

we are encountering a lot of resistance. we have a lot of allies in the u.s. congress. senator brownback is a huge supporter. i'd like to ask your opinions on the panel, what can the u.s. do to safely, securely help internet freedom in iran? promote internet freedom in iran? and why do you think it isn't doing it so far? thanks. >> before we go to the panel, i think we have a quick -- >> we have a video from a blogger which is on the same topic. he's a blogger. he was one of the few -- the first blogger is to blog from the baluchistan province. it shows how blogging is popular and how widespread blogging is in the country. and now he's based in london. and he talks about the same topic. if we could have that video.

>> hello, i'm iranian blogger from london. citizen media and blogging have many problems in iran. but important problem are filtering sanctioned by american companies. and security of bloggers and citizen journalists. filtering is not working to stop blogging in iran. and iranian users are using google, it's or some program to reach their website or blog. but sanctioned by american companies but it's very important. sanctioned by american companies such as google and microsoft cause us to -- cause us iranian user cannot have some software or tools.

and it cause us big situation for iranian user. because insight of iran they are under pressure by filtering and outside of iran they are under pressure by sanction. and last item or thing is security of bloggers is very sensitive. because there are many red line in iran for blogging or writing something in the website or web blog. and if someone cross those red lines, it cause us the web blog will be blocked by government. >> anybody would like to comment? >> i think the top thing one

needs to do is education. i think -- you know, now the u.s. and other countries have -- are starting to understand what iran is all about and the repression and what the people are all about. and i think education is the number one thing and finding ways to get proxy servers. or to get ways to send out signals or spoofing mechanisms if i'm using that correctly to get means for them to funnel into websites to put their views on. to put their blogs on. to get their news out. and to be able to break down these firewalls that exist around iran. it's a very hard task. it's something that millions of dollars is poured into it with all sorts of different companies to try to do. it's not just for iran but other places like china as well. but i think the number one thing is education. because a lot of times they don't know. they just don't know how many users are out there.

and they don't know how many people -- or teaching them how to use it. that would be my number one thing. >> the main problem here is one must be very careful not to link the iranian blogosphere as a whole this is a very diverse group of people with the u.s. with the u.s. government. it is a heterogeneous group of people that are -- and they're not all pro-american. they are not all pro-mahmoud ahmadinejad. they're too many people and they're too different. and i'm not certain that a u.s. government initiative funded by u.s. taxpayer money would be doing some of these courageous people who are putting their lives on the line a service. there are multiple mechanisms

for people to use circumvention software and proxy service. is more of that needed? absolutely. is the u.s. government the best source for this kind of thing? probably not. >> just one thing to add. first of all, we have to know what are the capacities in iran? you have to study them. two, please avoid -- i should tell this to many lobbyists who might want to make money for a few individuals or companies in the states as they've always done. please stop just selling crazy ideas. like one thing i heard that an individual is going from door to door in washington, d.c., promoting the idea of giving satellite internet connections to people inside iran. the government can detect any sender receiving tools in the country. they arrested many people in 2002 and 2003.

they don't work then how can it work now. first of all, let's study. let's think. and then do something. not just do and then put a lot of people in trouble. >> i'm a writer and blogger and also am the secretary-general of iran students in the latest report of congressional research service my organization is the biggest student organization that had the most influential organization in iran now. and you can find it easily on the state department's website. three years ago i was foreign five years in jail and because of for my student activity and writing. after i came here i had testimony with the u.s. senate and i said maybe the radio can be better. i didn't say they are bad. i said they can be better. testimony u.s. senate, homeland security.

after that the voice of america persian department and and i could go to fox news, cnn, cbs and everywhere not in voice of america of persian services and -- maybe my farsi is not so good. but it's so good. my question is directly to hidal and jeffery can help you a little bit about this one. why you are boycotting the people that you don't like it in persian services. the voice of america persian services acting as a part of opposition group. and you can find a lot of family members there, husband and wife and their children. and that's a family business with the american taxpayers money. and i think that's wrong.

i don't know. it's part of journalism. but i'm sure it's not. if you want to give time to -- i don't know maybe you like it. but last week he was on voice of america for one hour. and the day after his best friend was there. and the day after was trita parsi himself for one hour. in the week you gave a lot of time to them. why you boycotted us. [applause] >> thank you. >> first of all, we don't boycott anyone. that i stand by firmly. i always say if you're pissing both sides of the arena you're doing your job right. the pronii-nyack folks and the

anti-nyack folks we are on both sides and giving equal playing ground. the media or the news is not something we generally like to cover. i mean, who likes to cover what happened just with the polish president yesterday? or so many other things and the things that are happening in iran all the time. there's so many voices out there that we are actively trying to pursue to bring on to the air. to give the different sides. it's a very tricky thing. but firmly, there's no boycott. it wouldn't be right to boycott. if that's the case we wouldn't have many at times members of different other parties that were also on our air. and that we actively pursue to come on our air. yeah. the media is always about going straight down the middle.

both the red and the blue both sides down the aisle wherever you are in the world to make sure you get both voices heard. >> the panelists have alluded to >> the panelists have alluded to td%@@ @ @ @ @ @ @ @ @ @ @ @ @ @ >> the wife of the presidential cabinet is holding the hand. more recently, the wives and husbands of journalists are writing letters to their loved ones. is this public or private? my question is, how does all of this boile andlurlurring -- hows

all of this action or hope for action -- these are wonderful cartoons. they have another aspect. it seems as though the opposition in iran -- aspect. the opposition in iran, the bloggers included, the cartoonists included seem to vent out more than what would want to vent out and complain than actually guide the way to some sort of action in iran. is this a remnant vestige of a shia mentality where victimization plays a big part. how can all this energy that you've all alluded to be channeled in ways that are more positive than we know we have a whole force.

what is being accomplished? and what can be accomplished within reason? thank you. >> regarding the guiding question, i don't think journalists could be a leader. but journalists can just describe what's happening. if a journalist turns into an activist and becomes a leader in some way, yes. the journalists can actually give a guideline especially cartoonists. i think what we usually do is making fun. but telling a story through making fun. and i'll pass it on. >> i think i have to respectfully disagree with you. i don't think there's a blurring between the personal and the professional. and obviously i'm not speaking for every single one of the 70,000 blogs i mentioned earlier. but i think in general terms, when the government detons --

detains a blogger or a journalist and this person is held in soltarily confinement and this person is tortured and he has his head is bashed into the wall and his family visits after 90 or 100 days without visits and they write a letter to a family or friend describing some of the things they witnessed the 3-minute supervised visit and that's then carried on a blog or in an online news source, that is, in fact, news. it's maybe not the most traditional news. it's maybe not the news that we saw 10 or 15 years ago. but that's the news that the iranian government has created in acting the way it's acted. and so i personally don't view that as a subversion of news as it were or as a broadening of news to include the personal -- as opposed to the professional. i think those are legitimate news stories.

and the iranian people above all more so than us need to know what their government is doing in their name. >> you know, i agree with you. i mean, the personal accounts that they're getting through these different letters or these three minute visits that people have been able to see a side of the dealings within the government and how they deal with things that become personal stories and memoirs of folks. and it's just a layer or a slice of life of what they're actually going through. i don't think it's all of the story. but it's just a moment in time. i think another way to also look at it would be, you know, the fact like let's say twitter. they would use these one-line accounts of things that would happen, whether it was on the street, different meetings, seeing whatever they saw and they would come back there and put it out, you know, for the world to see. it's a different form. it's a different media.

and it's also another way of getting sources and accounts that we didn't get before. >> and it's interesting. there's a lot of discussion about whether there's -- whether the blogosphere or the online space is pushing -- pushes forward a certain kind of political change. and there's an assumption of agency that might occur. i think a lot of the analysis that we see, though, is that successful online movements are very closely linked to off-line movements. each one works in a different context, in a different way so what might work in the u.s. might not work in iran. and what works in moldova might not work incurred stan. -- in kurdistan. and when you look at online conversation and community morphs or doesn't morph into a functioning and successful activist movement, you have to analyze the space and the world in which it actually exists. and who the leaders are. it's own history.

there's not an expectation that it's going to work in every case. it's not a determined relationship, if you will. >> can we have the iranian editor of global voices. and he's also the cofounder of the march 18 movement. this is a movement that was created after a blogger died in prison. and he has written a post for us. if we go to his -- and it's about that -- let me read from this. this is no doubt the citizens protesting the results of the june presidential election have made efficient use of twitter, facebook, youtube and blogs to i immortalize their movement. it's not about the people. it's the people. as he also says that iranian citizen media is the extension of real people's activities. so a lot will depend on the

people on the ground and not on twitter and facebook and blogs. >> and just on to follow up on what you were saying, eisen. -- ivan. this is a new medium and people are learning as they go along. and not every single blogger adheres to the same professional values. and we have to recognize that. there isn't a body in place to sort of regulate and maintain some sort of uniformity. and that's only natural. it's not a big deal. i think the readers are the ones who decide what bloggers become popular and what bloggers will frankly stop writing because nobody is reading their stuff. the other thing i wanted to mention briefly is what works in tehran may not work in the provinces. i mean, this is really not a difference from between to country to country.

this is a difference between the capital where there's -- people have certainly a lot more leeway than people in the provinces. some of the stuff that people write in tehran on a daily basis and don't get into trouble for would never be allowed in kurdistan or in other sort of less developed parts of the country where local administrators have far more power as individuals simply go and grab somebody and throw nem in a dungeon somewhere and have them forgotten. there's a lot of variety. and readers and writers we have to recognize the variety. and frankly give bloggers and writers the benefit of the doubt. they are putting a lot on the line, professionally and personally to bring us news we wouldn't get. this is not stuff you can, you know, switch channels and see on your tv.

very frequently this stuff only exists in this format. it's important that we -- we encourage it and it's important that it continues to grow. >> my name is jonathan cohen. i'm with the bush institute in dallas. next week we're having a conference on cyberdissent. featuring dissidents from countries around the world. my question is related to the variety of dissidents who are bringing to our conference. and i'm prompted by the interesting phenomenon from the green movement protests of last where the chinese religious movement provided servers to iranian dissidents. to get their message out. and i'm curious to know from the panel to what extent is there cross-border cooperation between iranian bloggers and other cyberdissidents. and other fellows in other countries.

>> actually there are many universities around the globe that are helping iranian bloggers or even iranian geeks. they are actually trying to provide iranians with proxies. you might have heard of siphon. of course, it doesn't work. that's the problem. it doesn't work properly. because the iranian government knows how to block it. but many iranian bloggers who are also studying computer science are trying to get help from the universities to pass that help. to pass the torch actually to people inside the country. it's working. but absolutely. many people are actually even creating videos. i know of a few who are actually doing it right now. email, not even to post on

youtube because many people inside the country have having watching youtube videos. they're sending the videos -- and these are guidelines that how people can cross the filters. >> a really quick comment on that. and that is about the network nature of online communication. i think there's an incredible amount of diversity across different countries and different communities. that has to do with first translation. and second recontextualization of the people throughout the world. when i talked in the beginning about the dialog and the conversation that's occurring in the iranian blogosphere and some people would like to to have and whether it should be a voa platform. we should note that conversation is occurring all the time.

and it's occurring on platforms that people make and build themselves. and what we should expect is that people will continue to figure out ways to build platforms to communicate with people that they want to. and those conversations will be diverse. and they'll be on different platforms as people build them. and they will be with people all around the world. in other words, it's not just an american-iranian dialog. it's not a polarized conversation. it's multinational and multipolar. please. we have time for one more question. >> my name is about user brown. -- buster brown. i'm a student at school here. what's been talking about is about exposing truths and a lot of about it we hear in the american media is about the extremist movements throughout the middle east. and what a lot of things i've learned about here at school is that these movements are misinterpreting the koran.

they are justifying murdering nonbelievers through religion. and so i was wondering if you guys thought that journalism -- that reporters should do more to expose these misconceptions? >> you know, there's a very fine line between what really -- the religion -- any religion is and the politicized form of the religion is. and a lot of times, you know, those lines get blurred even in broadcasting. you know, the images that we see with all the different, you know, acts of terrorism around the world. whether it's in the name of allah or in the name of what happened in wako. -- waco. i do think the media does have to educate more. and get more backgrounders an understanding about what -- what the story is really about.

and not what it's purported not to be. and sometimes in a news organization when you're fighting so hard to be first to get the story out, you forget the nuances in the back that give a bigger picture to those who don't know all the story, you know, all the stories in between. but, yes, it's something that it does need to be pointed out. it needs to be illuminated and put into context and what it really is about. and not, you know, the marketing formula is about. >> well, you're the boss. you're the viewer/reader. and so if you don't like what you see, turn it off. and go read something else or watch something else. and that's -- at the end of the day, if you zoom out far enough, that's what makes a successful show or newspaper or a blog. -- is really up to you and up to anybody else. >> that is an interesting way to

wrap up. it points, once again, to the diversity of the iranian blogosphere. we have the presumption that there is an extremist conversation out there. we know that this is mostly not about that. i think that it is a healthy reminder for us that we should be paying attention and listening more. we should be reading more. we should be absorbing the vast diversity. we are out of time. please give a big round of applause to our panel. [applause] >> thank you, ivan. we will panel of and if you would like some coffee, we have some of the second floor. we are going to get going pretty quickly in the next couple of minutes. if you do not need it, hang out. we will be right on.

[random chatter] >> up next on c-span, a number of former u.s. ambassadors that served in the middle east give their take on the current political situation there. after that, actor dennis quaid talks about medical safety. then, the new york federal reserve president.

>> the largest u.s. but to ever fail is said to have practiced in deceptive practices. live coverage from the senate governmental subcommittee on investigations starts at 9:30 p.m. eastern. >> c-span, our public affairs content is available on television, radio, and on line. you can also connect with us on facebook, youtube and water. > now a group of former u.s. ambassadors to middle east nations discussed the obama administration's approach to the middle east peace process. this is being hosted by the woodrow wilson center. it is just under two hours. good morning. welcome to the wilson center and

today's meeting. the obama administration and arab-israeli peace. today's meeting is the 19th session in the forums. we are delighted to have with us today the chairman of the board of the woodrow wilson center, ambassador joseph who has been a supporter of the middle east program. as some of you know, the woodrow wilson international center was established by an act of congress in 1968 and is our

nation's official living memorial to president woodrow wilson. the center is a nonprofit institution for policy research and a dialogue. we bring together the thinkers and doers, policy makers, scholars, and business leaders in the hope that open dialogue will lead to better understanding for operations and public policy. we are delighted to have with us today five former u.s. ambassadors, the fifth one is coming from union station, but we are delighted to have with us these ambassadors. my colleague, who is currently a public policy scholar at the

center, will chair the meeting. they served both democratic and republican administrations. his most recent book is "the much to promised land." his new book, "can america have another great president" will be published in 2012. i urge you not to -- i urge you to read his upcoming cover story coming out. he is very good at very provocative topics. before i call on aaron, can i please remind you to close your cell phones, do not text message during the session

because it will interfere with our live web cast. we have an overflow. we will take questions from the overflow. welcome. >> thank you. one of my greatest pleasures has been able to work with you. welcome and good morning. 15 months into the administration of a potentially transformative president, this president is wrestling with what i call the problem of the much too promised land. his determination to seek the creation of a palestinian state on his watch is exceeded only by the degree of difficulty in doing so.

according to some, one and a half years in, there are no negotiations. we are in the middle of a major rift with the government of israel. we have very little street credibility among the arabs and palestinians. according to some, not much has been accomplished by the president. according to others, there is a different view. this is a potentially transform the president that has reached celebrated the american relationship with israel. he is determined, absolutely determined, to see a breakthrough on his watch even if it involves the necessity of putting out an american plan because he is convinced that on his watch, a palestinian state will either be born or it will never be created and on his watch, iran may or may not

cross the nuclear threshold. these are important calculations for the legacy of a president. i guarantee he is thinking now about that legacy. to help us make sense of these matters and others, we have identified and created a truly exceptional panel. they're going to help us look forward but also help us look back. as a historian by training, i think looking back is important. it was mark twain who argued that history does not repeat as much as rhyme. it rhymes. of the reality is what worked and what did not work over the course of the past 40 years and our pursuit of arab-israeli peace needs to be of said project needs to be paid attention to very carefully. -- needs to be paid attention to very carefully. if you do not know where you have been, chances are you did

not know where you are going. we have over one century of experience which is quite extraordinary. more than 100 years of expertise and wisdom in dealing with the middle east tradition and that is quite extraordinary. i would spend most of the morning reading bios which i will not do. i will introduce them in the order that they will speak. undeservedly briefly, i might add. currently a lecturer of middle eastern policy studies at the woodrow wilson school of public and international affairs at princeton. who served both as international ambassador to israel and egypt as well as other capacities in region and here at the department of state.

and here at the department of state. jake wallace is a fellow for diplomatic studies. he served as consul general in jerusalem and our embassy in athens and holding many other positions in department of state. i will not introduce franc until he comes. edward gineen is at the elliott school at george washington. and he was an ambassador to kuwait, australia, and jordan. he held other positions widely throughout the region. the president and ceo of a company here and has served in many posts throughout the region. with that a brief introduction, i turn it over to you.

each panelists will speak no more than 10 minutes. i will ask a question of the two and we will go directly to your questions. thank you. >> good morning. i just want to clarify that the 100 years of experience is not individual. it is cumulative. i would like to say hello to joe and thank him for all he has done and for those who organized this. let me start out with just a short tail. i arrived yesterday from paris. it was a tough conference but somebody had to do it. what was interesting about the experience is barack obama retains all of the potential that many of us saw in him one year ago and none of the criticism that some of us now have for what happened over the past year. he is extraordinarily a

superstar in rep. if you'd hear this morning criticisms about the obama administration's policies, just remember that is an inside the beltway phenomenon and not necessarily the way the rest of the world feels about what we have done or failed to do. with that said, i want to offer some constructive criticisms and to look ahead in the spirit of the introduction. looking back to learn lessons and looking ahead. if this were my class, i would have given you two reading assignments, won a book that i did for the u.s. institute of peace that took the -- took a hard look of 20 years of american diplomacy and offered what we think we're rather stinging criticisms of how we failed to achieve in to the peace process. the second would be to estimate that i offered a couple weeks ago to the senate and which i tried to dissect the obama administration's policies and

approach to the peace process and found both the 11watno. on. if we had a strong middle east peace process policy, i am not sure we would be having this session. one of the first things to say about this first year is that the president launched the peace process rather significantly quickly by appointing george mitchell as special envoy on the first full day of the administration. by indicating both dan and subsequently that the peace process is an american national interest which is tied to the agenda of president obama. from that moment, however, the administration seems to have blundered into a number of steps, none of which have had any success in advancing the prospects of peace. let me look at three issues quickly and take an even

quicker look at the receptivity for the thein moodi in region. the question that needs to be posed as the situation on the ground, is it right and conducive to having a peace process? one could make the argument that the situation is far from right. that the israeli government is now essentially a conservative or right-wing government that seems more interested in advancing the prospects of settlements of them a chance -- than advancing the prospects of negotiations. the atmosphere in both communities is relatively sour. one could say on the surface that the situation is not right for active diplomacy. on the other hand, for those who have studied or worked this

issue, it is not as bad as it issue, it is not as bad as it has been in past -- public opinion -- public opinion polling shows the kind of concessions that would be necessary if there were a serious peace process. the palestinian economy in the west bank, while not perfect, is certainly better than it has been in recent years. palestinian security forces have been trained by american and other international trainers and are now providing the kind of objective opinions that we have long been demanded. in israel, it is a very vibrant economy and society. the public opinion polls show a great willingness to compromise. past administrations working in equally challenging or in some cases more challenging environments have succeeded in helping the parties make progress.

if we look at the first issue, which is the environment but the peace process has to operate within, is not perfect, but it is not a deterrence to an effort to try to advance peace. what seems to be missing could be made to advance peace. what is missing is the policy and approach. it is on these two issues that i would argue that if we had our five minutes with the president, what would we say? i would simply say, we do not yet have a policy or strategy. you will argue with me and say we have a policy. i would suggest that is an approach could not a policy. 43 years after the 1967 war, if you ask an american diplomat what is our view, the american view with respect to a peace settlement is he or she will not know because we do not have a view that we are able to articulate as a country. if we took a poll in this room,

my guess is we would have a very strong consensus about what it is that should emerge from peace negotiations. essentially 100% of the territory would be transferred to the palestinian state with swaps of some accommodation of heavy settlement blocks. it would be a very significant emphasis on security and jerusalem would be the capital of two states with a demographic division outside the walls of the old city and some creative solution, perhaps an international management solution, for the old city and the historic basin. settlements would effectively be withdrawn except for those places where there would be an agreement with the would remain within the state of israel and refugees would have the right to return to the state of palestine with some accommodation by israel, given its sovereign right to make this decision, to either admit or not admit some people based on thfamily

reunification. i think we should come up -- we could come up even in this room with a sensible approach that represent a consensus view in the region. yet the government does not have a policy that particulates that sort of approach. the first thing we need is a policy. it is not a plan or something we would seek to impose. it is not something we would tell the parties they had to accept nor something we would pre-negotiate pandit it is american policy. i would articulate that policy soon so that the parties know where we stand and our own diplomats and public know where we stand, as well. the second thing is we need a strategy. negotiations are part of the strategy. you will not have an outcome of this conflict without direct, face-to-face, hard-nosed negotiations between the parties.

if that is the only element to the strategy, we are missing out on a number of other factors which need to be taken into account. we need negotiations. we also need to continue efforts to build a palestinian institutions, bill the institutional capacity for statehood, including the capacity for security, you need an approach which brings the arab world into the peacemaking efforts far more ambitiously that has been done until now. you have since 2000 to an arab peace initiative that is potentially very far reaching but has sat out there with nothing happening. the arabs have taken no steps to activate it and the u.s. has taken no steps to find out whether or not it should be activated. last june, the president explored one confidence-building measure with the saudis and was turned down. he asked for overflight rights over saudi arabia but it made no sense because there was no

context to ask for a single confidence-building measure. we need to talk to the arabs about how you activate an arab peace initiative in which they argue it's a significant change from everything they have adopted in past years. one element of such an arab strategy would be to reconstitute and reinvigorate multilateral engagements. we had multilateral talks in the 1990's on several matters, one not resume these and get expert working together? have arabs and israelis actually meet each other, even while the diplomats are meeting in the negotiating room to work out differences. a third element to strategy is to activate the arab peace initiatives. i would also argued there is a fourth element which is not so much in the hands of the government but which is very

much something that places like the woodrow wilson center and other non-governmental institutions can do, and that is to start dialogue within two critical communities, both of which who have been left out entirely from the peace process efforts. that is the refugee community among palestinians and the settler community among israelis. it is critical we find ways to start talking to these communities because at the end of the day, if we ever do reach agreements, these two communities will have a large say in whether or not the two societies and up supporting the outcomes. let me suggest a word about the bilateral u.s.-israeli relations. this recent mini crisis between the u.s. and israel is in the absence of an american policy. frankly, it is understood that

we would be very upset or even angry that our vice-president was confronted with the settlement announcement during his visit which was designed to repair our relationship but to have a crisis over a neighborhood in jerusalem which under a demographic division of the city will end up staying in the state of a drill made no sense. it reveals the problems that i identified earlier which is there was no context for this crisis. i suggest we take a step backwards t and stepwo sets of trends in israel which are critical. there is a significant set of changes on the way in israel but i think are being ignored by academics and policy makers. an israeli professor who has done extensive studies on the effects of terrorism on political attitudes said recently something quite remarkable and the had a

analysis to prove it. he said that terrorism has exceeded in shifting the political spectrum to the left but to shift the israeli electorate to the right. in other words, 20 years ago, if you asked members if they would support a palestinian state, they would say absolutely not. one year ago, the prime minister of the state of israel, announced support for palestinian statehood with conditions. in other words, the debate was in israel -- within israel has shifted to the left and there is a much larger consensus within israeli society that supports a two-state solution. but the israeli electorate under the impact on preventing palestinian violence and incitement which continues today in terms of education, public media, has shifted to the right. it has found the right-wing

political parties more acceptable because those parts are willing to except the state but have a tougher approach with respect to the specific negotiation elements. we need to take this into account. there are changes under way and in her -- in israel. let's try to understand what is happening as we move forward. i would suggest that israelis have come more to do with respect to us, as well. it is not insignificant that 70% of the american jewish committee voted for barack obama and if the election were to take place today, that number would be probably relatively close to 78%. that does not suggest that 78% of the jewish community does not support israel. probably 99% is as devoted and loyal to the idea of israeli security and well-being as anybody else.

a large proportion of this community is willing to distinguish between the kind of support that israel is to have to maintain its security and well-being and the kind of support that perhaps it does not deserve with respect to matters of choice when it comes to issues like settlements. israel also has to do homework to understand the changes within our society where you can be pro-israel and you can watch -- want the best for israel in terms of security and well-being but you can also be critical of israeli settlements and of other elements of israeli policy which and not conducive to peace. looking back, we have lessons to learn about what had succeeded in failed. the situation on the ground is challenging but not impossible. a strong american policy and a strong american strategy i think has a chance of having the parties reach an agreement that is fair and sustainable and which will help american interests, as well.

thank you, very much. [applause] >> thank you. you never disappoint. i am really happy to see ambassador wizener fresh up the train from new york. he is currently the current affairs adviser. he served as an ambassador to egypt, the philippines and india. he has served as undersecretary of defense and undersecretary of state. he has had numerous other positions in washington and abroad. we are delighted to have you. >> thank you very much. i appreciate being included in such a distinguished panel.

i was struck as i listened that he might as well just continued on. he could have done my portion of the presentation this morning with greater facility certainly greater insight. i am privileged to have the choice to say a word this morning from the perspective of somebody who served in lived in and remains associated with egypt. it is a key partner of the u.s., a longstanding friend of this country for many decades and a serious partner and player in the peace process. the first point i make to all of you this morning seems rather self evident. that is there is no issue in egypt that has quite the importance of the palestinian-is really issue, nor is there an issue of quite the same

significance as the question of the peace process. this question of israel and palestine for the many decades since the late 1940's it has played center stage in government policy, public perception, and the wake of officials and political leaders from the dialogue of the country. . .

the issue of palestine and israel is complex from the stand point of any egyptian -- it is first and foremost a question of justice. the egyptians look at the question of palestine as an injustice committed and continues to be committed. it is a matter felt at all levels of society. it is an issue that can affect streets on cairo. it can threaten domestic stability despite the size and strength of the security forces in egypt. it could force the government to give the question a certain amount of latitude and safety to

the population at large. second, the force have taught egypt a vitally important lesson. lesson. that is that the@@@@@ dn)a@ @ @s likely -- aware to the fact that they feel fortunate that

they lay claim to the cyanite which is a sacred part of the jewish -- egyptian national territory. they do not want to put it at risk again. nor do egyptian statesman of this generation look at the question of palestine and believe that it should be allowed to block the tips fundamentally -- egypt's fundamental ties that the peace with israel makes possible for egypt. it is highly sensitive to the palestinian questions and abilities to become embroiled in radicalism inside egypt into lively fear that the fundamentalists will take advantage of it and use it against the seated regime.

it is for this reason among others that the egyptian government remains a deeply distrustful of hamas. when you stand back, it is not only the issue of palestine in justice and injustice or what ever of its the powers of egypt perceive as the relationship with us. it is also the longstanding view of egypt that it is a great nation of the arab world and that egypt must be front and center in carrying the politics of the palestinian cause forward. to lose control of that would undermine the position of egypt as she sees herself as a key player and a leader in the arab world. markell words, the egyptians do not believe -- mark my words, the egyptians do not believe

there is a settlement in the offering to the palestinian problem, not a settlement -- they believe it must be addressed in managed, which therefore lead me to my second point. how do we look at the peace process together? what is the latitude, the room for play between the two of us? i would argue that a part from this strategic identification written by the state, to which egypt detaches great importance, a belief must be met in a reciprocal manner by washington, and egypt believes we must pay the closest attention and skillful attention to the peace process and to the palestinian and israeli question. just as egypt seeks to shape the

arab consensus and will resist any one encroaches on the perception of their own plays in shaping that consensus, it looks to unite -- to the united states to recognize its centrality, to support egyptian diplomacy, to demonstrate respect for each of its leadership -- the leadership of egypt, and to have a cooperative approaches to the peace process. i highlight this last point because i believe in recent years we have slipped into the bad habit of quarreling publicly with egypt, criticizing their leadership on domestic matters, and failing to get a grip on the peace process which has left egypt feeling isolated. it has been estranged by other items as well, iraq being one of them. i welcome the particular

pleasure of the president to go to cairo and this nation and is view from the looks of an arab world. it was an inspired choice, one that needs to be called out. i do not believe or argue with any of you today with the importance to egypt and its importance to s as the largest nation in the arab world. egypt should have a veto over our approach to the peace process. it does deeply remain in our interest to have an active approach, to make sure we consult the egyptian and the saudis as well as others as we launch new initiatives and seek to implement them. the price of egypt for cooperation with the united states is not excessive.

egypt wants to see the united states involved, even if there is not a quick and ready outcome to a final settlement. one person remarked to me years ago that this land where it rains and very little, all of us need umbrellas. we need your umbrella to help us manage our crisis to the north. the second critical point on the egyptian agenda is the importance of being kept informed, of being listened to and sensitive to the egyptian perceptions and interests. the third, also pretty obvious, is the egyptians look to the united states to be clear and flexible to approach the question with the termination and use the powers of diplomatic persuasion with the parties both

israel and palestine to move the process forward. let me close, and then, with where do i think we are. i do not pretend to speak for all of egypt. she has her own views. i have been listening to the egyptians that can reflect some of the sentiment that this administration is seen to have been clear that it cares. it cares about making peace. it cares about moving ahead. it has not succeeded in doing so far as convincing its audience it knows how to translate that sentiment into action. it is not simply an does not sit suffice -- and does not suffice to say that quarrels over housing is a national policy. these clearly are not national policies. i join with him and end his

remarks to you that we do need a policy or some other american commitment that spells out our positions on the key issues at play on the settlement borders jerusalem, refugees, security, normalization, the linkage to syria and lebanon. there needs to be at this stage in our relationships with the region a clear articulation of american views. and there needs to be an articulation of the steps that will get us there. it should be backed up by a bureaucratic structure, a political structure at home, in which the president backed by the secretary of state, marshall's the best talent in this government and a team that works best teams have worked in

the past to produce steps forward in the search for peace in the region. but most of all, the region in egypt will be watching for an indication of will, whether we have what it takes to commit ourselves and the president at our head to move the palestinians and israelis through the tough choices that lie ahead. thank you. i turn the program over to the next speaker. >> thank you very much. that was terrific. [applause] >> thank you very much. i joined them in the banking you for putting together this panel this morning. -- in thanking you for putting together this panel this morning. there is an issue that touches

to the heartbeat of jordan and to the palestinian question. it begins with the states survival, which is wrapped up in the question pu+÷ is regional situation, domestic salt situation -- domestic situation politically throughout. let me come back just a little bit on those points. the survival of the state. the king has come under enormous criticism for the treaty signed with israel. members of parliament are included the tenet of the treaty and expel the ambassador. in all of its confrontational moments, the king has been eloquent and clear about his

views, policy. he will not violate that treaty. he will not expel the ambassador. i remember being with him once on the hill. there was a repetitive questioning from members about this very question. there was some notable exasperation said to the congressman. i am my father's son. he gave his life to try to reach this point in the relations. it will not change as long as i am king of jordan. he says this in arabic during television. the treaty with israel recognizes the kingdom of jordan. touching ride on the issue always played right under the surface -- not always under the qjetu that palestine already

exists. it is more than 50% of palestine. it exists already. there is no need for another palestinian state, a state between iraq and the mediterranean. this recognition of the state of jordan lays this to bed. one person who advocated early on in his career, this philosophy of joy in being a palestinian state said that that was -- philosophy of jordan being a palestinian state said that this was no longer his view. one has to understand the emotional issue as well. the country, many of you have been there and seen is. when you look towards do was on top of the hills, you can almost reach out and touch the west bank. at night, you see the lights of

jerusalem. there is a barrier there, which is the border. it is difficult to go there and get there. at the same time, 60% of the population of jordan goes back to palestine. it has property just across the other side. they watch israeli television as much as they watch -- probably more so than their own television. they see the reporting of what is happening. they become emotionally involved. they sense what is happening to their own families and relatives. it puts a lot of pressure on the government. i do not know how many times i have sat with the king and he has said right before the iraq war -- he said it to the president, if you are going into iraq -- and the artist said he

hoped he would not. please help me deal with one of the two problems on my borders. he was referring to palestine. he said, i need an active peace process. this turmoil inside the country and a concern that the way israel will solve the palestinian problem will be a chance for a population. this will be aggravated by this recent decision announced in the last 48 hours of israeli actions on the west bank on expatriate and others -- anyone who does not have a resident permit, which i will talk about later if there is an opportunity. the king is not his father.

this becomes very important to understand his attitude toward jerusalem and the west bank. he did not was jerusalem. he does not have the same stake. he has a strong commitment and the palestinian state. that state wouldo&h2 not statements by the officials feared these statements come out of a normal -- notable person in some very far-fetched when first mentioned. they are dismissed by almost

everyone as unrealistic. as you look over time, and become a reality. that is a lesson. on the arab side, simply dealing with the arab state is very difficult. you can deal with it if you do it in a forceful way, where there is a sense of progress. one of the things you also hear is that the arab street is not willing to seek peace. that is a flawless conclusion. there is a great feeling. this is certainly true in the gulf and the countries that are a little bit further from israel. it is very true in jordan. i remember once being on the rich looking over the west bank -- ridge looking over the west bank. there were a lot of children running around in circles.

he said to me, how much longer are we going to have to go ahead with this dispute? are these kids going to die still wanting to see peace deck not in my land. i think that is a very deeply held feelings. they look to the united states to be involved. they are deeply skeptical. they were really impressed with the president's speech in cairo, anticipating a very active part on the united states. this would lead me into several things. there is a mood in the arab streets for peace. capitalize on it. there is never a right situation for peace in the middle east.

i worked in the 1980's where there was in negotiation with arafat with the reagan administration. a statement was made that he would recognize israel in return for us except in the agreement. one person called me the night before they were going to make the announcement. he said, can you confirm to me that this is going to happen. he asked what i thought the odds of this working work. i chuckled. he got really angry and furious. this is not a joking manner. i said, you did not understand my chuckle. if there is a 25% of this working, go for it. we do not wait for things to be 60% or 70%.

he said, we are going ahead. but then arafat the next morning made an embarrassing remark for the king. we try confidence measures. they work as long as they're supporting another process. i agree with dan about the policies and the need for a policy and for enunciation. what i would say to the president is there is a need for a very strong and active u.s. effort. people want it in the region and americans want it. the reaction to the president's statements of their being national interest for a solution and i note in my own mind the remarks of general petraeus that there is broad support by americans. we have seen broad support among the jewish community. it supports an active, involved

american participation in trying to find peace. i would tell him to look at the way the issues that have been dealt with over the past decade and more. there lies a broad framework for a solution. work closely with the party and get them to negotiate directly. put it out there and go for it. >> thank you very much. [applause] jake? >> good morning. thank you for the opportunity to be here tonight -- this afternoon on such a distinguished panel.

after having listened to my colleagues, i am not sure how much more there is to add. i will make a few remarks. it is clear that we are in a very uncertain moment now in the middle east. the media has focused a lot on the crisis in u.s. and israeli relations. what we're seeing now is not so much a crisis. there is a crisis in the effort to restart the negotiation process. the focus is where it should be. it is not clear to me how the crisis is going to end and where it is going to go. i was in jerusalem for four years. in my job there, i was responsible with our relations with the palestinians. i will begin by looking at the situation from a palestinian

perspective. i will start also by talking about the situation on the ground. from that perspective, the current moment is quite positive and offers a real opportunity to move forward. to begin with, the situation on the west bank has improved quite a bit over the last couple of years. i will be talking about the west bank not gaza which is a very different situation. you have much improved security in the west bank. that has largely been due to the actions of the p.a., which was supported by the american training efforts. there has been a significant improvement in the security situation on the ground. there is an economy in the west

bank that has improved quite a bit, particularly over the last year. all of this is due to a significant change in approach and attitude on the palestinian side in particular. the changes that have been brought about by the prime minister have been helpful. the changes have been going on for a while. they have reached a point where it is serious and it is a sustained effort. the prime minister has also offered the context for this which is his plan for building the institutions of the state. it is better environment on the ground is not over coming the current issues we know about. it creates a context in which we can move forward. the palestinian leadership deserves a lot of credit for adopting a prodigal approach

focusing on improving the lives -- practical approach focusing on improving the lives of palestinians. when you look at the current leadership that they have in their president and prime minister, i think we can all agree that they are much better than any palestinian leadership we have seen. they are probably better than any palestinian leadership we could hope for in the future. that is why i say it is so important to take advantage of this moment of relative security and economic growth. we should get talks started. there have been some talks with the destabilizing influence in the west bank. if it continues indefinitely, it has the potential to lead it to violence and a broader deterioration of the situation, which would make peace even more difficult to achieve in the future. coming back to questions that

aaron asked, what every learned? how does the administration doing? let me start with those. i think the obama administration began on this issue on the right note. it is important to u.s. interests. the president appointed a senator mitchell to give this issue the attention it deserves within the administration. since then, the past 15 months, the going has been rough. i think even president obama it knowledge that himself in an interview he gave last december. much of the focus over the past few months has been on the issue of settlement. while i think there is a lot we could learn from that, in terms of the tactics, and how to do that better, it is important that it was correct the administration made this an issue began to deal with it in a serious way, which we have not seen before.

it continued settlement activity is indeed a serious problem. i would say other items in the west bank are positive, but this one is negative. it will be harder overtime to find a practical solution on the ground that will allow for this palestinian state alongside israel. it is correct for the administration to focus on this issue. some say the construction is only going on within the settlement blocks, which will remain a part of israel. that is an issue that has to be worked out in a negotiation. it is the area within and around the settlement blocks that is what is at issue. it will have to be discussed between the sides. it is not a foregone conclusion what will be the outcome of those talks. in the road map, there is an obligation on israel to pre-

settlement activity. over the course of the past year, the demonstration has worked with the israelis to find a way to implement that. with him out of that was the moratorium that prime minister and netanyahu announced last fall. that contains so many exceptions, that it did not have much practical impact on the ground to improve the political situation. it did not include jerusalem, which is what led to the difficulties we saw in the visit would vice-president joe biden. there was construction already underway. a lot of activities continued. i think something more will be required in order to address that issue. where do we go from here? i think at the core of what it needs to be done is to get back to negotiations. i would agree with my colleague,

dan, that it in and of itself is not a strategy. dillon with the peace initiative and other -- what needs to be done is to restart in negotiations between the parties. one way or another, we have to begin this process with the substantive issues and the refugees in jerusalem must be discussed. it has to be done whether the u.s. puts forth its own ideas or not. given the difficulties that we faced in the last 15 months, i think the idea of western proximity talks or direct talks is a good way to start. while it has been criticized in some areas as a step back from direct talks, i think it is a practical and effective and lower-risk way to begin to deal with some very difficult issues. aaron mentioned the difficulties

of these issues resulting -- if it were an olympic sport, i think it would be the highest difficulty of any on the table. we have been in a discussion about the process. what we need to do now is get away from that and begin to talk about the issues, perhaps in direct talks is not the ideal format. we need to shoot for substance rather than for perfection. this idea of indirect talks is a lower-risk approach, which is important. one of the lessons we have seen going back to 2000 is high-risk symmetry is something we need to think very carefully about. in order to begin, i think a lower-risk approach is better. negotiations have a way of the

evolving over time. if we can begin, i think the u.s. is in a position where we can begin to narrow down some @@@@@@@ @ "a@ @ @ @ @ @ @ @ @ @r

in the middle is a kid thing. i do not want to over-sell this, because the gaps on the issues our great. i think it is better to begin a process in almost every case. given the environment on the ground and the leadership we have on the palestinian side, we want to take advantage of that. in closing, let me get to the last question, which is what i would revise the president if i had five minutes with him. time is not on the side of the peacemakers. there are many aspects on this. from the palestinian perspective is the situation on the ground and the growth of settlements over the past 40 years. over time, we see a situation that is much more difficult in a practical way to see a state solution emerging on the ground.

we have a deep division between hamas and gaza and its allies in the west bank. this is a serious problem. something we could spend a lot of time on. i will not go in detail. we should not allow this division to prevent us from trying to move forward. moving forward in a way that can result in the political achievement for the current leadership will help them with this internal division on the palestinian side. and the israeli side there is an urgency to find a resolution to this problem. many have remarked on the democratic issues. i will not go into detail. it is an important aspects. from a regional security position, for the future of israel, it is important to resolve this issue between them and the palestinians, once and for all. it is an example of how the influence of iran has grown over

the last 20 years in the region. they're growing strength makes it harder to reach a deal with the palestinians. over time, this will become even more difficult. israel would be wise to try to strike a deal with the coming palestinian leadership. they will not be around forever or much longer. i do not think they will find a better leadership than what they have right now. if those leaders on the palestinian side fail, in the future, the west bank could look like south lebanon on or gaza, which is not in the interest of israel. here is what i would buy as the president is to choose your moment carefully -- advise the president' is to choose your moment carefully. we need to put a concrete plan on the table. once you jump into this, the

stakes are very high both for the region and the united states. the united states and the administration need to be prepared for what may come and may need to stick to a very difficult time as we engage on this issue. i will stop there. thank you very much. >> thank you and thank you for your presentation. [applause] >> i want to make sure we leave time for discussions and questions. i am discussing syria and the corrective movement will be celebrating its 40th anniversary this year. i do not think i need to go on a long time, because this regime has been there just about any challenge one can imagine and is still there. to some degree, its behavior is

predictable. not always, but to some degree. an israeli-syrian peace treaty brokered by the u.s. should be far easier to reach than a final israeli palestinian agreement. the broad outlines are well known. one constant is the insistence that any peace treaty must require israel to withdraw to the 1967 defacto line in a reasonably expeditious manner. in return for this tangible concession, the west side will need to be more flexible on several issues vital to israel's political security needs. the core issue for the syrian regime is the survival. let me point out that the syrian people are generally back very

strongly the foreign policy, these of the israel and the recovery of all -- vis a vis israel and the recovery of all. they want to neutralize a potentially more powerful iraq. this alliance was not based on any affinity that one regime is secular and the other is a defect of bureaucracy. i believe the regime can be weaned from iran, but only at the end of a process that up call a grand bargain. it is said the timing is everything. this victim certainly applies to israeli and syrian negotiations. to those the question serious commitment to peace, the correct

answer is we will never know until a final offer is on the table. most israelis are not convinced of the need to withdraw to the 1967 line for a variety of reasons. netanyahu has reinforced this point of view saying that he would make no such concessions to syria. public opinion in israel is volatile and can be changed. in its efforts to promote arab israeli peace, the united states during the terms of clinton large and referred to the leaders to set the priorities, the agenda, and the pace. u.s. dealings with syria in recent decades has isolated and humiliated the region to providing it with an exaggerated sense of centrality and importance.

a middle course between those two extremes is needed. u.s. diplomats have worked in and around syria and a stated that the only thing worse dealing with the syrians is ignoring them. its advice is what this administration has been heatine. the u.s. mediated negotiations with israel aimed at recovering all occupied syrian territory and accepted by lateral tract aimed at normalizing relations with the u.s. the two are inextricably linked. syria has shunted aside for negotiations with the syrians, it will continue to play a role very effectively. the u.s. and israel must find a way to address both tracks

simultaneously. i would advise the administration to keep in mind a couple of words, respect and reciprocity. nothing will go well of those two words are not heeded. the u.s. should make clear what we expect to come from a grand bargain. we should not put the prestige of the u.s. on the line until we are confident that in the regime understands that if and when they are presented with the new relationship with the u.s. including removal of assyria from other sanctions the same -- that they will accept the deal. that will mean that there are

some things they will not like. they will have to end their current alliance with iran. we can acknowledge that syria has the right for full diplomatic an relation is with iran so long as u.s. sanctions are not violated. they cannot however continue to have it both ways. full peace with israel supporting policies that are against them. we can pledge best efforts with arab and other states to supplant any civilian aid or investment loss as a result of the estrangement of syria from iran, as well as assisting them with as many problems not least water security, soil salinity, and oilfield damages. there are many issues i could cover, but i would like to say something about love and on in

the context of all this. during the -- leval johbanon ine context of all of this. during the clinton years, it wanted to become a valid political party. the u.s. did not seem to care if this area was to hedge level banon. syria has considerable influence there and important airlines there -- allies, but it is no longer a prize. we expect lebanon 70 in the end to be respected. thank you. [applause] >> thanks. before we go to your questions,

i will forgo one question that i asked, if you had five minutes with the president, what would you say. if there is a call consensus that time is running out, and the president has to be very involved. the time for process over substance, which has guided much of america's approach is long past. i have a views on these matters. i will not share them with you today. i will only say the following. hope is very important. it can never be abandoned. not if you have children, and even if you do not. some things need to be seriously tested. i think some questions need to be looked at and answered. can a u.s. president substitutes his own sense of leadership perhaps for the

absence of strong leadership that exist in the region? is a conflict-ending agreement between israelis and palestinians which deals with border security, refugees work? are the current israeli and palestinian leaders willing and able to pay the price for that agreement? there is a piece this morning in the l.a. times that raises the question that this administration may be less interested in changing the behavior of netanyahu in mortgages and in changing him. the question -- rather than in a changing him. can they get this right? that is an important question. there has never been an administration that has not done serious peacemaking and also engaged in significant fights with the government of israel.

the purpose of this fight is leaving both countries' stronger for it. that is the critical question. we have a special relationship with israel. it cannot become exclusive. that is a critically important point here. can it reset its relationship with israel is to become functional when it comes to serious arab and israeli peacemaking? i do not know the ins and to that question. you have been very patient, all of you. it is greatly appreciated. >> before we open the floor to questions, i was wondering whether any of the panelists

would like to comment on the points that adam made for the other panelists made. you are first, go ahead. >> i asked him if i could answer his questions. and the answers are yes, thank you very much. let me focus on the fourth question, because it is germane to the reason i am here. @@@@@@@ @ @ @ @ @ @ @ @ @ @ @ @

third rail of israeli politics. the question posed in the minds of israelis is whether the prime minister knows how to deal with the united states. the israeli public has a lot of views about everything. there are 11 or 12 different views of all of them in one room. but they are always united on this. they want a leadership that can handle the united states and deal effectively with the united states. there is a growing question as to whether or not the prime minister has found the key to deal with this different kind of president. barack obama is a different president from what netanyahu was used to. he was comfortable dealing with some president in the past. he had a challenge relationship

with bill clinton during his previous tenure. the israeli public responded to that. part of his defeat in 1999 was a dissatisfaction with the way he was handling the u.s. relationship. i think there is a responsibility on both sides to understand each other better. i think the president has not done as effective a job as he could in reaching out to the israeli public and talking directly to them. in doing what he did so effectively to the arab and muslim publics through his speech in cairo, he has not done the same thing through a speech in jerusalem or even in television interviews to israel vii media. but also suggest that israel needs to do its homework just as much as america.

it looks like he has his sea legs, a significant victory in health care reform and an advance in our relations with russia. that is in dealing with nuclear disarmament. a big summit is underway. the china relationship seems to be on the mend. you have a president who after a year of grappling with what it is to be a president seems to have found some of the keys. i would suggest that the prime minister pay just as much attention to how he handles the relationship in this direction as the president may need to pay attention in how to deal with israel in the other direction. >> do you want to add something to what you're calling said? >> let me try the third question. are the leaders of the region prepared to pay the price required to bring about peace?

that is a brilliant question. on this one, i am utterly convinced that the leaders are not prepared to pay the price required. could they be brought to is a different matter. as i consider the full range of choices that lay before the leadership, i reflect on the fact many questions have not been thought through, because they appear to be questions that will never have to be addressed. let me take several for example. [unintelligible] has anyone in the arab world contemplated what it would mean to carry out a refugee decision? what about the king's decision,

the beirut decision? has anyone thought about what would be fully involved in the normalization arrangement? what does it mean to respect the borders of 1967 in return for peace? these are questions that will require ground -- profound soul- searching and analysis in the air of a world that i find absent at the state. do of -- in the arab world that i find absent at this stage. they have to find the opportunity, which can only be discovered when there is an active peace process in which the questions are on the table and the challenges before the leaders and they try to make a decision, which becomes a reality. the tough questions can be

addressed and answered then. >> on the first question, and president obama substitute his own sense of leadership for that of leaders in the region? that is not the right question. he cannot. if you mean totally. he can exercise a leadership which is vitally important at this present time. in a leadership role that no other individual leader can do. being active or even through his envoy, being a major purchase of pet, he can bridge between those leaders. -- a major participant, he can bridge between those leaderships. they will step forward hopefully

will grapple with the issues. they all need to take actions that will prepare the public. >> i will take some questions. it is a very interesting question that we have. more than one can take this. what is the expected influence in the peace process? other concerns for the current turkish government? >> if there are no volunteers, i will do a bad job of it. [laughter] i was recently in assyria, and

the question came up from an arab and syrian perspective. that is the desire of the syrian governments to see the turks involved with a good relationship with israel traditionally on one hand and a very tight relationship with united states. and a fresh but a very positive relationship with syria where turkey could play a discreet but sensible exchange of views of the diplomatic agents moving between the capitals and set to many account. at -- meunues out and the u.s. could bring the parties to the

table. i think it was a little pie in the sky. it brings the question as long as the turks maintain some discipline, they do,entree and are showing themselves willing to communicate with all the parties. they are doing it out of their own essential interests. they do not want to see the middle east purely competed for by the iranians. they believe they have real interests that they must protect. the prime minister has those in his party that he has brought into the region. he is not held at bay by his military as he once was. i believe we can look at, despite a rhetorical excesses', wi so, with some aspect of turkh

elements. circuit does not have to many cards to bring to the table without -- turkey does not have too many cards to bring to the table without their relationship with the u.s. they have to play their cards shrewdly. >> i would take a slightly different tack. turkey has put a positive role in the past and could do so, but the first question is where our turkish interests headed? a cursory analysis suggest they are in a process of redefining its role and its interests in a variety of regions.

there seems to be a growing although reluctant understanding that is not soon going to become a full member of the community. it can be looked to other regions with perhaps a more assertive set of self interest. we see this respect to a growing relationship a better relationship between turkey and iran. improvements in the turkish and syrian relationship which has not always been that positive and some growing distance, albeit still friendly between turkey and syria. i think turkey -- turkey and israel. what we are seeing is not so much a firm decision by turkey in which direction to go, but a casting about for firmer ground on which to stand as it decides

where it wants to invest. this comes against the backdrop of a region. we had this discussion in a different form if you months ago in which the role called the periphery, the non-arab states of the region seems to be growing at the expense of weakening the air of a core. arab -- arab core, or state policy and structures are coming under increasing stress. it is a time of great the thrust. i would be cautious of suggesting that there is an immediate role that israel is going to want turkey to play until turkish interests are clarified a little bit better. >> could i ask you to give us your name and limits your comments or questions -- no comments, we are just taking

questions. anke. -- thank you. >> there was an article this weekend. .

>> understood and program. keni would trade that -- and probed. i would trade that for a real understanding and brokering with real substance, assuming that is possible. >> i agree. >> by -- my question is to mr. question. do you agree or disagree with me on the two following points?

first, you're very important@@@ political fallout of the united states coming out and saying, "here's the solution as the united states believe it should be in the middle east" would be very heavy politically.

first, why is there no policy? second, is it not true that there is a distorted vision in the united states when you only focus on the issue of settlements and whether they should be built or frozen or permitted to be built again or should be frozen, whether they are not taking into account that the settlements are only one component of a strategy to try to change the nature of the arab struggle. it is not only the settlement, but the demolition. there are roadblocks and 75% of the water resources are also used by the settlers in the west bank.

so it is not only settlement, it is a whole panoply of issues. >> on the first question, i do not agree that the absence of a u.s. policy is a result of domestic politics. there is a strong view held among policy-makers that, if the united states were to exercise its role as an honest broker, it should not prejudice the negotiations by having positions on the issues to be negotiated. i think this is a fair point. i disagree with it at this point, which is why i am arguing for it an additional policy. there is a domestic factor as well. there are a lot of things that go into it. it is not a full answer to suggest that it is only domestic

considerations that this issue has up in result. on the second issue that you raise -- that this issue has not been resolved. on the second issue that you raise, as long as i have been a critic of settlement policy, it is about having a coordinated overall approach. but even your question suggested you were selective in what he would choose. there are a number of issues on which israel needs to be asked about and policy needs to confront those issues. there are at least a number of issues that palestinians and syrians need to be asked about and that the united states need to confront. i mention a couple of them in my remarks. the continued incitement in palestinian education materials and the media, the absence of concerted action on part of authority to uproot the terrorist infrastructure -- syria's continued hosting of

groups that most of the world continues to see as terrorist groups with headquarters in damascus -- we have a different definition of terrorism. but the fact is that most of the world does not agree with the syrian definition in this case, to be fair, there are more issues on the agenda with israel than simply sediments. but there are also issues on the agenda with syria and the lebanese that need to be taken into account as well. >> there is an overflow. you have to be patient. please have very brief questions. >> how does how moss -- how does hamas factory to the question? -- factored into the question? how does -- how does hamas factor into the question?

is more complicated to reach a deal. can the leadership on the palestinian and on the israeli side and do what is necessary to reach a peace agreement? it will be difficult on the palestinian side. but i would assert that the important thing is to get in negotiating process going so that these issues can be framed. once the issues are on the table and the palestinian people can see what the choices are and be put into a position where they have to make a decision on

whether or not to upset those trade-offs, i think that is how you do with the situation. hamas will probably be a spoiler in any process moving forward. we have to be aware of that. they obviously draw their support from outside as well, including state actors such as iran. the potential that hamas brings to the process cannot be ignored. but the process needs to be put on the table and let the leadership make decisions on peace rather than the continuation of the current situation. >> we have no choice but to followed jake's recommendation. but to counterpoint, this is the kevin costner field of dreams school of middle east diplomacy, which is "bill that and they will come." if you can get a deal that so

sweet and so enticing, they will. in the end, it comes down to one essential issue. can the palestinian authority be one dime and one authority and one negotiating position? the chances of any israeli prime minister -- and i am not here to write a brief for this prime minister -- the chance of any israeli prime minister offering what will take to persuade the palestinians to sign an agreement are essentially slim to none. >> thank you to all of you for a wonderful presentation. let me ask the panel. there was an interesting article in "the *" about the

possibility of civil disobedience. how do you see that? is that realistic? what would be the potential in terms of them, the process -- in terms of outcome on the process? >> in the 1980's, there is a palestinian from jerusalem who emigrated to this country. he is now a professor at a university in ohio. he was trying to teach non- violence and nonviolent methods to the palestinians as a way of asserting their cause and their rights and the like. as i recall -- and my friends here could be more precise --

but the state department was very much enamored of this fellow and the israelis were not so much. they were determined to deport him. despite a lot of protestations from the state department, they succeeded. that told me that the israeli is very determined to seat the moral high ground to the palestinians. maybe i make too much of that, but it stuck with me all these years. i think that's salam fiat is somebody who does recognize that -- i think that salam fayad is and who does recognize the

importance of planting trees. i think it is a very hopeful movement. it is one that i would like to see continue. it is one that i suspect makes the current israeli government quite uncomfortable. >> a question from the overflow -- what is the way forward concerning the settlement? is there any chance for a compromise? >> the issue of settlements, even as the ambassador recognizes, is critical, but it is not the only issue on the agenda. the proposal that most of us on the panel have now ascribe to of a u.s. approach, which is more comprehensive than simply getting to negotiations, would subsume this question. with lemieux by that? behavioral changes -- what do i mean by that? behavioral changes will continue to be required on both sides. there has to be continued pressure on israel, in particular, to stop settlement

activity. but that should not be the only factor in american policy making. in fact, i would suggest that, in the context of an overall approach where there is a negotiating process under way and the process of engagement with the larger arab world and the process of multilateral engagement that begins to talk about issues that are quite important but have not been talked about for some time, dealing with the settlement issue will prove to be easier. the israeli public will begin to understand that settlements are an absolutely bad investment. israel is pouring a lot of money into areas that are not going to remain within the state of israel. if a peace process looks more serious, then the israeli public and the israeli knesset, those who have to take hard

budgetary decisions, they will decide that this is pouring good money after bad. i would enveloped it in a larger peace process strategy in which it makes much more sense than simply isolating it as one factor. >> those points are up slowly valid. there's one additional consideration which circles back to leadership. our real strong, because he had legitimacy -- r.l. shootaround -- ariel sharon, because he has a legitimacy, can any israeli prime minister -- this is the core issue -- in a set of circumstances, figure out a way to a next three quarters of those israelis into blocks that are proximate to the green line but will leave about 50,000 israelis in the west bank in settlements, communities that are not proximate? that is a nation splitting sort of decision.

i do not want to prejudge it one way or the other. but it is a core question that needs to be asked. it cannot be asked and answered honestly now. it is something that is there and it needs to be faced up to very honestly. >> i would just add to that that the other observation has been made here that you cannot just talk about just this in the absence of talking about all the rest. we have not mentioned the poor demographics today. there are a lot of discussions about demographics and how one

deals with that. that is another issue that has to play in the israeli view of the settlement and what it will look like and what would be advantageous to them and their interests. >> i appreciate very much of the comments from me to view. i wondered why there would not be somebody on the israeli side of it, perhaps a former ambassador or something, to participate in this kind of discussion. there were questions minivet israel that would be best answered by them. -- there are questions that -- there are questions about israel that would be best answered by them. if we can look get to the history of this area, the historical context, and the biblical context, this has been a for a long time. oslo should have resolved this. why hasn't the biblical and historical aspect of this huge

problem -- i didn't hear a single word about its -- please explain to me about a jerusalem, which has always been considered the capital of the jewish@@@@@@@ @ @ @ @ @ @ @ @ @r to american policy. we have had other occasions where we have brought arabs, israelis, and palestinians to these discussions. but this is about american interest in a critical time of american diplomacy.

that's to be the primary point of departure. -- that should be the primary point of departure. >> on the issue demands made by prime minister netanyahu to recognize israel as an independent state, and the question of jerusalem, this is another reason why there needs to be american policy. i didn't know what american policy is on the first question. on the first question, -- i do not know what american policy is on the second question. on the first question, whether it is a formal recognition of some land which were simply -- of some language or in israel that defines its own character remains for the parties themselves. it is not for any of us to define what israel is or is not. the recognition that they confront israel will include israel's definition. this is not solely an issue for

american policy. in one article -- i like to write for the common people of york. i addressed the issue of jerusalem. in 1967, when israel unilaterally expanded the boundaries of the city, it expanded in a way that it had no relationship to bible history. it was done for practical and security reasons. but the definition of what is jerusalem and what will be the capital of israel and jerusalem remains to be negotiated. jerusalem, even in the expanded boundaries, is large enough for two capitals of two states. >> i am sorry. no further comments. i am taking a question from the front, from the middle, and from the back.

we have a lot of hands. >> i am from the alliance of egyptian americans. i would like to hear your opinion of a statement that came from a civil organizations here, carnegie and freedom, that were issued to hillary clinton on the issue and egypt and if we will not have a stable egypt by having free and fair elections and having a change of the constitution as many people in that position ask for in egypt. change will cause further problems. i wish to discuss the. -- i wish you would discuss that. >> would you like me to respond? the discussion today is on the

attempt to secure peace. but there is a linkage between the strength and stability of egypt's leadership and government and our policy and our ability to pursue our goals in the region. i have to be very blunt and very frank with you. i took issue with the editorial that grows produced in "the washington post" over the weekend. i think it is wrongheaded. it is not the way that you have influence with a friend. the editorial points in referring to the carnegie, it treats egypt as if it is an enemy of hours or a nation with which we have a strained relationship. of course, the united states wants to see a democratic

process under way, once a full consultation, wants a full transition to a stable outcome. but the weekend that that discussion is a different matter, not by hectoring. the editorial is a hectoring editorial. one can deal with the authorities in egypt and people in the political structure of the country and a polite matter, not one that inflames passions, but one that permits a sensible dialogue to take place. i part company and think that that is not the way that i would advise the president to conduct his dialogue with egypt. >> thank you. yes. in the back, yes. >> i am leon weintraub. i would like those on the panel who have been ambassadors to egypt and jordan to talk about the nature of the peace between israel and these two countries. despite longstanding agreement, we have seen zero and a

discouragement between exchanges between artists, intellectuals, writers, and any kind of elements of civil society. i would like to ask you if you think, number one, that is the result of a line laid down by the government? if it is not, if there is a strong element within those egyptian and jordanian civil society is attempting to discourage that? it is, is it possible for either governments to do something that might encourage these elements of civil society exchanges? >> i can certainly speak to the jordanian side of that. when this -- when the peace treaty was signed, there was

enormous exchange between jordan and israel, with people on both sides of the boundary moving in large numbers. i think there were 6000 to 8000 going to patrick in tours. many of my jordanian friends were telling me about taking their families to the beach along the coast of israel for the first time in a long, long time. there was a lot going on. you did indeed have a public reaction to israeli actions on the west bank. having said that, we cannot forget that the relationship between the government of jordan and the israeli government are in a lot of

significant perricos, security and political issues. there is a constant dialogue and a constant exchange between jordan and israel on many issues that are vitally important. that relationship would not exist, otherwise. you're quite correct. the public view in jordan is very hostile to the issue of israel, but primarily because of a failure on having process in the peace process. >> ok, the lady in the back. yes. >> my name is mindy riser. i want to talk about the roles of russia and china. we are quite fascinated with the meanderings of chinese foreign policy and russia is moving in interesting directions. i wonder if you could project where you see these two countries being held for not. >> thank you. ok.

>> russia is, as you know, a member of the quartet. one of the questions of the development in in american strategy is what to do about the quartet. i would urge the administration to look favorably on keeping the structure, but perhaps finding a better way of utilizing it then we have in the past. it is useful and try to conserve our approaches and speak with one voice. -- two concert our approach and speak with an invoice -- and speak with one voice. china is the big question mark. there is a love of literature about countries looking of the chip -- looking at the chinese model of development. students are working -- there is a lot of literature about countries looking at the chinese model of development. students are working on this at

princeton. having been to the middle east a couple of times recently, there seemed to be more questions about this growing then there are answers. chinese behavior in the region is still uncertain. china certainly has interests, particularly when it comes to securing long-term contracts for raw materials. but its obligations might be and what kinds of investments it might make in the region beyond those simply related to the raw materials is one of the great questions, particularly in egypt where china has always had a reasonably good relationship, but the egyptian side spoke with a couple of months ago are confused over -- but the egyptians i spoke with a couple of months ago are confused.

>> i would simply pick up with the challenge that ban left me and comment on the chinese. i think we are all in the process of watching the early stages of evolution of chinese form policy, albeit in the middle east are many other parts of the world. china's political expressions are going to start being more pronounced in its own immediate neighborhood, that it has not yet made up its mind about how to assert a political presence inside the middle east. it is in observation mode, as opposed to an activists or participatory mode at the same time that is developing an

economic stake throughout the region. china will not be applying for membership in the quartet. china will be observing for a while to come. >> the wilson center will hold a meeting on china and the persian gulf on april 12. -- on july 12. you may want to wrap up, please. >> thank you. >> are there any pressing more compelling and urges to make some final observations? >> i would like to make one very quickly. for all the obstacles that are held there and they're easy to define, i do believe there is an opportunity here. with our president and his approach and his team, we have a chance of taking a leadership role in moving this forward. >> i would second that. but also jack kennedy described himself as an idealist without illusion.

on the issue here is really peacemaking. that is where we need to be, never giving up on the help of the possibilities, that comprehensive peace can be achieved. as the united states goes through this process, it has to go through it with its eyes wide open. >> valid. >> thank you all for coming. >> thank you all for coming. congratulations to all of my

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human error combined with systems failures causes the majority of harm due to medical accidents. i'm an actor, if i make a mistake, i have a take two or three or four or 37 and believe me, i've been there. but if a caregiver makes a mistake, it could mean somebody's life. hospital staff are working without a safety net sometimes working double shifts and they are expected to make crucial decisions often without any backup except neighbor overworked caregiver -- maybe the overworked care giver working behind them. once you have engaged leaders in standardsized practices enormous power can be used through innovative technologies.

safety-centered designed technological backup for human factors, related error. the installation in modern airplanes are essentially a safety net. to aid a pilot when conditions are zero visibility and to alert him if he makes a mistake. even pilot with the right stuff, a career reference there, know that mistakes happen, when they open outside the safety performance envelope. that envelope is defined by their own human performance and the airplane's technologies. technologies like bar code systems, smart infusion pumps, electronic medical records, automated infection tracking, bedside bar coding and cpoe all require investment in safe adoption but they can have a huge impact on safety.

a national approach at getting at zero health care harm will have to involve all stake holders and they are getting involved. dr. alan corn who is sitting before me is leading the national blue cross, blue shield programs for hospital boards and pursuing programs to reduce central line infections. dr. howard kohn sitting to my left is pulling the leaders of the government together to reduce health care harm and his deputy assistant secretary is leading the charge on health care infections for the entire government. we have merged our quaid foundation into tmit in order to -- that i can more effectively play my role in helping drive

awareness to chase zero arm in more than 3100 hospitals and 500 experts that work with them. it is time to make a call to action to encourage policy makeers to tie the safe practices to health care reform. challenge hospital leaders to adopt them and ask the public to demand them. on april 20, i will be speaking to leaders from around the world at a global patient safety summit in nice, france. chasing zero, winning the war on health care harm. david, c.e.o. of care fusion and the president of aorn, the association of paraoperative registered nurses are leaders of

the educatal responses. they are here today as well. our documentary uses patient and caregiver stories to demonstrate that zero harm is reason reach. it proo pro-vided the example of chasing zero role models to inspire and encourage others. we even have stories of some of the unsung heroes. cleaning staff who developed checklists to reduce infections and medical students with their check a box save a life programs are already saving lives before they get their m.d. after the documentary airs on discovery, we will give it to every hospital board of directors in the country and it will become a continuing educational program for caregivers. looking forward to the future, we envision engaging those from industries like aviation, interested in helping accelerate the development of our

leadership, safe practices and technologies. to speed our learning curve. experts like john, a media expert who believes we can learn a great deal about patient safety by applying the discipline of safety in the aviation industry such as the creation of the ntsb, the national transportation and safety board. technologies that protect us from human error. where we need your help, you in the media, is helping us tell stories. stories can unify head and the heart and put our leaders' hands to work. in our article entitled "story power: the accelerate weapon" we talk about how health care can

imimpact and aabout the the goliath, fear. fear of failure. fear of malpractice. fear of shame that they might indeed have a bigger problem than they realize. so i ask of you, is to help us tell not just the stories of harm, but the stories of great caregivers, and organization who is live in that high-performance envelope of leadership, safe practices and technology dedicated to safe high-performance care. the greags great organizations of people who can help america push the envelope and make the zone of safe care bigger for all of us will prove to be those who truly have the right stuff and many of you are in this room today. and we thank god for your dedication. and thank you all for inviting

me here to speak today. thank you. [applause] >> thank you, mr. quaid. we'll now be beginning our question and answer period. if you would like to stand and come forth here and our audience, we know they can sing but we want to make sure they can ask questions too. first question here, obvious connection to what you're talking about today is the health care reform legislation that passed last month and the question for you that came from the audience was in light of the passage of health care reform, how does that relate to your goals of reducing medical errors. are there things that still need to become part of the follow on that will help you?

>> a lot of what we're trying do are shovel-ready programs that really don't cost a penny. things like checklists. things like that. some of that is also covered in the incentive money that was still some of it still to be released that's gone out last year. as far as the details to have health care program, i guess we're going to see how all of that plays itself out. so we'll see. >> do you see any issues with the regulatory structure in our health care system now? ways of procedure that are brought forth by the government that may be creating some of the problems in some of the systems issues you discussed. >> what i have found, especially in the technologies that are out there, that are available already is enter prabble --

interon para-- one product will not work with another product. like beta and v.h.s. i think government is a good way to get all of this linked up to where it is all interprabble. that will bring the costs down. it will make the training easier for everybody. >> do you think training will have any effect on the frequency of medical malpractice? >> once again, i think that all needs to see itself played out. we're all hopeful about the outcome. >> would you go to the cedar sinai hospital again despite -- in short has your faith in medicine been restored? >> well, the day after the incident with the twins would have been a good day to go there

to have your baby delivered. put it that way. everyone was really on high alert. i think it woke up a lot of people, really. and hospitals around the country. a lot of good is coming from it. i must say i do applaud cedars for stepping up to the plate. they spent a lot of money to put in stronk recordkeeping and bedside bar coding and sterile cockpits and lot of training that i think is going a long way os toward making them one of the premiere hospitals on the cutting edge. >> what sort of questions should families ask their doctors before treatment? >> a lot of questions. any little question, i think, no matter how trivial. don't be embarrassed to ask. ask a doctor and values someone

there in the hospital with you if you happen to stay there because they are your best caregive really. they are your advocate. you may be asleep when someone comes in to give you medication, and you need someone there to ask the questions. >> what might a couple of those most important questions be? >> well, just to ask any nurse or doctor that is coming in, what they are doing. why they are doing it and what is this medication? and just all the simple things that to find out because we're consumers and we're also, you know, we're caregivers as well. we're patients. we're also responsible for our own health care as a patient we should ask questions. >> having -- given your personal

story in several different forms, people have been tched and moved by what they have heard you say. you're also in the genre of celebrity with a cost. you see people come through washington, d.c. with various things they want to promote. what are some of the challenging pitfalls on being a celebrity speaking on behalf of a cause and how do you deal with those? >> yes, it is another celebrity to be mr. smith goes to washington. or was it tom hanks? what i found in the role that i can play, i didn't plan on making this a cause. i remember being in the hospital with the twins and it was after the 41 hours of danger that they were in and they were out of the danger period and i remember thinking these little guys, they are 10 days old and they are going change the world.

so that's -- that's what propelled my wife and i to get involved, really. being a known person, i -- that's what i can use. so i welcome that. there are so many people out there who have had worse instances. we were lucky we had a happy ending but there are so many people out there who don't have a voice for what happened to them. that's what i was hoping i could do for other victims. >> that leads into our next question. this is a person who wrote, i, too, nearly lost a twin baby shortly after birth due to misdegrees. she miraculously survived. how should i engage hospital on patient advocacy and safety? >> well, i -- open up a dialogue

with them. there is a -- i would say that would be the best way. dialogue needs to be open. there is hesitancy on both sides. mistrust on both sides. i'm talking about patients and hospitals. there has got to be avenues open. more transparency of hospitals. so the patients feel that they have access, access to their medical records and access to information and also just kneeling someone cares rather than someone's worrying about liability. and that's what i would say. >> do you plan some day to share with your twins the story of their survial? when would you tell them and how would you tell them? >> you know, that's something that i really haven't thought much about yet because they are

just learning to communicate. keeping up with them is -- having two is like having four. [laughter] it really is. one of these days, i guess we will tell them what happened to them. it is well documented and there will be a lot to show them and they should be proud of themselves for really what they have done at such an early age. they really have changed the world already. >> question from the audience. just for clarification in the work that you're doing with medical errors, are the changes and structures that you're working also dealing with assisted living centers and other places of medical care outside of clinics and hospitals? >> sthearnl 235u8s under the -- certainly that falls under the umbrella of health care harm because it happens in all kinds

of places. but we have been -- my wife and i have been focusing on hospitals. really, what we focused on originally was where we saw the problem with what happened with our kids. they were overdosed there and it happened at the bedside although it originated really at the drug manufacturer because of the mislabeling or the similarity of the labels. it is a chain of events, what happened there. the pharmacy made a mistake in storing them. they were stored in the same by and taken out of there and put into the technicians and nurses stations and from the nurses station into the room and given to the kids so what we focused on was originally bedside bar coding because a nurse can walk in and scan the patients'

bracelets and scan the medicine and scan her own i.d. and if there is a mix-up, wrong room, wrong medication, there will be an alarm go off. that's what we focused on to begin with. >> are you bringing your cause directly to members of congress while you are here and who are some of your bigger supporters? >> well -- waxman has been a great supporter. that's when we were here we gave testimony before congress. i feel like there is a lot of things that are wrong with health care. not just in spending money but in bringing everybody together as i mentioned before, the

inoperability of all of these different technologies that are out there. >> how would you propose a way to engage the younger population a conscious effort to understand the health care problem that is existing in america today? >> that's the thing when you're young. you really don't think about those kinds of things. you feel like you're going to live forever, don't you? [laughter] then you turn 36. you start to see the end of the tunnel. you know, but i think the first sign is you start to see your parents getting really older and they start -- then the problems arise. also my wife and i found out after this incident, we had so many people coming up to us telling us their stories about what had happened to them or a loved one or a friend and i

think everybody out here knows someone or has a friend or a loved one or it has happened to you that you have had some sort of medical error happen to you. >> of course along with the many questions on health care policy and your own efforts, there are several questions about hollywood. following in transition, the first question is how does age affect the roles you are offered? [laughter] does hollywood have enough good parts for men and women who may have turned 56 last friday? >> yes. well, if they do the waltons again, i guess they will be saying good night grandpa. actually, i'm having more fun with acting and in movies more now than when i did in my 20's

and 30's. maybe i was trying to be something or something but i just don't care anymore. i'm just having fun. i'm doing it -- i'm really thankful that i still have a fire in my belly for it. so many people can get jaded and bored and blase and just give up. i really love it. that's why. that's why i still do it. >> looking at all the cameras clicking away as you speak, how do you learn to live with the celebrity scrutiny. are the paparazzis, excluding any photographers here today, out of control? >> out of control? when they start coming over the wall. actually, i have a very vabe rant private life, believe it or not -- vibrant private life, believe it or not, and really don't get it all that much.

sometimes i really thank god i'm not tom cruise or michael jackson. it is kind of hard to just go someplace. i go someplace anyway. people are people and for the most part people are nice. it gives you a chance to meet people. it gives me a chance to do this. >> medical drama is a popular genre of storytelling in television and film. based on your own experience and your work on preventable medical errors, what change if any would you like to see in the way health care is depicted on screen? >> that's a very good question. you know, oh, yes. i did play a doctor but i've never played a doctor in television or in the movies. i don't know. usually -- well, they just had a

movie on health care come out recently with harrison ford, i think. usually they don't do so well. they have gone way of westerns, it seems. i think with documentaries and stories of real people, that really has the greatest impact. >> when you say that you haven't played a doctor on tv or screen, yet having noted your doc holiday presence, is that because you don't consider doc holiday a traditional doctor character? >> i know this is going to offend some people but he was actually a dentist. [laughter] >> among your historical figures or current events actually, roles that you have played, president clinton and the special relationship and you played a character in the film

"american dreams". the it was a thinly veiled take on president bush. what were the challenges of playing those two different characters and did they teach you anything about them as people as you were learning that role? >> well, i learned that i never really want to get into politics. let's put it that way. no, it was really actually a great challenge just recently playing president clinton, i actually spent a weekend at the white house with him 10 years ago and kind of got to know him a little bit. smartest man i ever met, by the way. when they offered me this role, i didn't know what i they would do that. it was written by the same guy that wrote "frost/nixon". it was a real challenge to do. sometimes i think you should do the thing that you're most afraid to do. that's why i did it. >> there was a assassin a film where shirley mclean played a

mother and went into a frenzy in the hospital when her daughter didn't get enough medical attention. what is the appropriate reaction? >> that was very appropriate, i thought because it got the job done really quick. and it woke everybody up. i think really that scene kind of spoke for anybody who has had to stay in the hospital sometimes when things are not going right. >> health care questions. how does the drive for profit in the health care sector affect party safety? >> in the private sector? well, i would like to see more done in the private sector. in the end that's the way it is really going to work. not just with government handouts but by making it a

business that is profitable. it make it sense economically for all involved. i mean, the best deals are deals where everyone is happy on both sides. that makes things run more efficiently for the hospitals and saving money and by saving live, which is what it is all about, we're also going to save money in the end, in all kinds of ways. >> have you considered enlisting the assistance of the medical malpractice community in your cause? you can you work with folks trying for changes for those sorts of rules and regulations into what you're trying do from a lobbying standpoint in washington, d.c.? >> you mean changing rules and regulations as far as making litigation tighter? well, i think i'm not really a lawyer to really speak to that. i mean sometimes i -- there is two sides to that issue.

and to get politically involved if that, i would really rather focus on the positive side of improving patient safety. rather than back and forth of lawyers and insurance companies and litigation and all of that. >> is that something that being an actor is something you feel more suited for? rather than getting into the regulatory details? >> well, just mainly interested in speaking out in reference to what happened to our family and in speaking out and rather than being confrontational, i'm really looking for ways to bring people together. >> what have you learned about running a foundation from your experience running a foundation? [laughter] >> that i'm not all that well suited for running a foundation

actually. to tell you to truth, on a day-to-day basis, i'm a great delegator. i guess i'm a pretty good front man. but the day-to-day work of running a foundation, especially with my day job and being a father and the rest of my life, that's why i'm so glad to announce that the great foundation has merged with tmit, texas medical institute of technology, the doctor has become a great friend and he is one of the great leaders and experts in patient safety in this country. and he runs a great organization. it is really engaged and it can really do something. so we're joining up with them because he is much better at running things than i am.

>> will you consider making a movie about your own experience with medical error, the story of your twins? >> no, i don't think so. it is in some ways it is really difficult to relive that and i don't think i would want to spend two or three months making a movie about it. i think the story is already powerful enough. it is out there and -- >> what sort of research or preparation do you do when preparing to play a historical figure opposed to playing an entirely fictional character? >> good question. it is really different. for one thing, when i'm playing an historical figure, especially somebody who is alive, that is really the most difficult.

i try to put myself in their shoes and tell it from their point of view. that's what i try to do. try to get at least kind of the look right and what they sound like and when they are known so well. but i really try and capture their spirit, rather than just becoming them. i try to capture their spirit as much as i can. >> do you have any interest or efforts in issues globally or outside the united states dealing with medical errors or any other sorts of fields? are there any global issues in which you have a personal interest? >> well, for the last 25 years i've been involved with an organization called the international hospital for children and we were going -- we go down to places in central america and really all over. we were in africa a few years back.

we identify children who need medical attention that they cannot receive in their open countries and we bring them back here in the united states and doctors and surgeons donate their time and hospitals donate rooms and we get them better and take them back to their families. what better diplomacy is that? >> what advice would you have for a young person, maybe your own children, who would want to be actors? >> well, actually my son is going to n.y.u. next year and he definitely wants to be an actor. what do you know? i can't believe it. my advice to anyone would be the same that i would have for myself and for anyone, for my own son. i just want all of my kids really to do the thing that they are passionate about. do something that they have fire in their belly about that makes them happy that they just have

to do. the worst thing in life is a job that you just don't care about. so that would be my advice. make sure you really want want it, success or not. >> looking at younger actors today, is it different or more difficult to break into acting opposed to when you began? >> you know, i would imagine it is just as hard today as it was back then. it is impossible is what it is to break in. you know, everybody starts at a certain point but that's where i say you have to really want it to -- i mean, i really feel that part of the big reason for my success is that i just won't go away. i'm staying around. you're not chasing me out of here. finally i got a little older and maybe the parts would change or something and that's what happened. >> when you look at a figure

such as a clint eastwood who is still doing starring roles into his 70's. is that something you can see for yourself? are you going to be sticking around for another generation? >> i hope so. clint eastwood is the model, he's the role model for everybody. who wouldn't want to be clint eastwood? the great thing about acting opposed to being an athlete is you can do it until you die. some people have dropped dead on the set but -- [laughter] >> so why did you choose to do the film "soul surfer"? is it in any way tied to your commitment to medical error? >> no, it isn't. i was home last christmas watching my 2-year-old son. it is the story of bethany hamilton. a little surfer girl when she was 13 this hawaii.

she had her arm taken off by a tiger shark. she was a little wunderkind surf . the way she handled that experience and the way her whole family handled that experience, it is an amazing story. of faith and courage and life and i'm just sitting on the couch and tears are coming down my face because she is on "the today show" talking about her book and then two days later they asked me to play her father. i went hmm. it was kind of a no-brainer. then you get to be in hawaii for two months and getting paid. [laughter] that was my first island paradise location actually in my entire career. usually i'm over in eastern europe up to my chest in mud and it is 2:00 a.m. and unseasonably

cold so it was great. >> aside from the weather, what do you look for in choosing a project to sign on with? [laughter] >> that there would be -- when i get a script, they send me script and read it, it is the only time i get to be an audience member with the first time experience of that movie and that's the way i really decide how and where it takes me. how i feel. >> during your address today, you had kind words for news reporters and media, which has not been universal among speakers at the national press club. what complaints may you have about the news media and what could they do better in covering issues like your own and others? >> well, you know, we're on a 24-hour news cycle, of course. so there is not much time to spend on any given story,

really. it is also -- the media is run by the marketplace. so much more than i even think it used to be. a couple of years ago. so that's the way things are. that's just the way it is. so you have to work within that. i would like to be a little bit more -- see a little more in-depth coverage on stories and really staying them from the beginninging to the end and i think there is also, maybe it is because it is the appetite that we as americans have for sometimes for gloom and doom but everybody says they would like to see more positive stories out there that inspire us. >> in your career, you have played several roles. some have already been mentioned. famous people who are still living. what kind of feedback if any do you get from the people you have played? >> well, i can tell you this. when i was doing "great balls of

fire" jerry lee lewis was right over my right shoulder every day on the set. you got it wrong, son. [laughter] he was packing, too. you didn't want to make him mad. but i like it when the people i play are actually on the set. when i did "the rookie" jim morris was actually on the set. it is good. it makes me feel them. i would be nervous if someone was doing a movie about certain parts of my life as well. so it is good to have them in this. reassure them. >> several bloggers have stated that you would be perfect for a biopic about john edwards. interested? [laughter] >> that concludes today's luncheon. [applause]

call my agent. [laughter] >> i can't tell you how it feels to be played by dennis quaid. i'll give you my feedback later. a couple more questions dealing with health care reform and your effort before we go into our final part of the program. when you're looking at supporters for your efforts on capitol hill, are you seeing this as a truly bipartisan effort? >> that's what we're after. chuck and i agree with that. we're trying to be as independent as possible. as non-partisan as possible. it is not really a political issue. this is a human issue, really, that we're talking about. it affects everybody. >> where can you expand your support?

who are you targeting to get your message out to now? >> everyone. you know, we have been doing television shows you know, that have been out there. that's my role is to be out there and really be the frontman, to be a voice for patients. so anywhere we can get a gig for it basically that's what we're doing. why? you have something on your mind? >> one of the questions was about your band and asking if you would sing a few bars for us. i don't know if you would want to go that far. >> no, you got to pay for me that. -- pay me for that. >> sorry. leading out of that, we are almost out of time. before asking the last question, we have a couple of important matters to take care of. first of all i want to remind our audience of future speakers and guests. on april 15, janet napolitano.

on april 19, congressman sandra levin talking on financial reform and other topics and ray mavis secretary of the navy presumably discussing the navy. second, this is a moment we have all been waiting for. we do not pay guests at the national press club. it is certainly something that we try to keep and we appreciate those from hollywood who'll come without being paid because that's very refreshing for all of us out here and we appreciate your willingness to come and speak with us but we do have a token of our appreciation. we would like to now present you with the one, the only, the famous national press club mug. [applause] >> oh, fantastic! [applause] >> beautiful.

really. thank you so much. it really has truly been an honor to be here today. i want everybody to have at least a fingerful of this cake over here. ok? >> we have our last question. often we try to ask something offbeat and humorous and lively but we have had a lot of that today. you have mentioned faith and prayer several types today throughout your address and actually attributed prayer to what you think may have saved your twins. did you incident with your twins change the way you view your faith? >> i've always had -- i think i've always had a strong faith. in god. i really do. no matter what your definition might be of him, i think we all might experience that, even atheists at times. one thing that really woke me up

to the power of prayer with what happened with the twins because they were really -- it really does work. it really does. it has a lot of power in life we can all share. [applause] >> thank you for coming today. [captions copyright national cable satellite corp. 2010] [captioning performed by national captioning institute] >> we would like to thank national press club staff for organizing today ease event. for more information please go to our website at www.

press.org. thank you and we are now adjourned. [applause] >> up next on c-span, remarks by new york's federal reserve president, william dudley. after that a look at the white house nuclear weapons summit. on "washington journal" topics include wall street, the economy and an update on the retirement of justice john paul stevens. senate investigators of

washington mutual, the largest u.s. bank to fail. former executives for the company testify this morning. live coverage from the senate governmental affairs subcommittee on investigations starts at 9:30 eastern on c-span 3. last week, the president of the new york's federal reserve offered support for the fed to keep interest rates low. william dudley is the former chief u.s. economist at goldman sachs. this is 50 minutes. >> good afternoon, everyone. if i could have your attention.

it is my pleasure to welcome all of you to this 408th meeting of the economic club of new york in our 103rd year. i'm glenn hubbard, the chairman of the club. the economic club of new york is the nation's leading non-partisan forum for remarks about business or the economy. more than 1,000 guest speakers have appeared before the club over the past century and have established a strong tradition of excellence which of course we will continue this afternoon. before we begin, i want to thank the members of the club sen ten yell society. during the club centeniel year, advancing the club into the second century, 232 members have joined us and they are in the

program. we are honored today because of the occasion of a distinguished speaker and because he is our trustee, bill dudley, the 10th president and c.e.o. of the reserve bank of new york. he was sworn in january 2009 and serves as the vice chairman and member of the open market committee, the group responsible for the formation of the nation's monetary policy. mr. dudley has been the executive vice president of the market's group at the new york fed where he also managed the system open market connecticut for the fomc. prior to joining the bank in 2007, bill was a partner in managing director at goldman sachs and was the firm's chief u.s. economist. having written with bill, i join a course of people very pleased to praise his intellect and market knowledge. after his remarks, we will have two club members as our s our

custom to ask questions. bill, thank you for coming. the floor is yours. [applause] >> thank you, glenn, for that fine introduction. how should we deal with asset bubbles? as i see it, we need to re-examine how the central banks should respond to potential asset bubbles. after all, recent experience has underscored the fact poorly regulated financial systems are prone to such bubbles and the cost of waiting to respond to an asset bubble until after it has burst can be very mifmente today i will try to define some of the

important characteristics of asset price bubbles. however that bubbles do exist and they typically occur after an innovation has created uncertainly about fundamental evaluations. this has two important implications. first a bubble is difficult to discern and second, each bubble has unique characteristics. this implies that our approach is likely to be ineffective and that tackling bubbles to diminish their potential stabilize the financial system will require judgment. despite the fact that it is hard to discern bubbles, especially in their early stages, i conclude that uncertainty is not ground for inaction. instead, the decision whether to act depends on whether appropriate tools can be deployed to limit the size of a bubble and whether it is the benefits of acting and deploying such tools are likely to exceed

the cost. that cost-benefit calculus in turn depends crucially on the tools that we can deploy to limit the growth of bubbles and the consequences when they burst. in this respect, i'll argue that in most cases, use of the bully pulpit and macrotools such as limiting loan to value ratios or leverage are likely to prove superior to monetary policy. turning to the first issue of whether there are asset bubbles, i'm going to be a bit of a heretic. there is little doubt that asset bubbles exist and they occur fairly frequently. they become unmoored from fundamental evaluations. i want to be clear here that i'm distinguishing this from price movements tied to changes in fund menls. i know this runs afoul of the

market hypothesis. if the bubble were obvious the bubble would take the other side and the bubble would not occur if the first place. there are several reasons why this argument does not hold in practice. first, it is not always easy to take the other side. there are constraints on the ability to short the asset in question. it are rise for many reasons. for some assets short selling might simply not be possible because the markts are not sufficiently developed. also, even if there were instruments to be used to go short it may not be an easy trade to undertake. for example if, a bubble builds up over many years, the participant's conference saying is based on a year-to-year performance, there may be disincentives to take the shorter side. it may create a bias that simply trades with the market.

second, bubbles may emerge from the way the market participants process information and trade. experimental work done by behavioral economists show that people often trade in ways that generate price bubbles. in many carefully controlled experiments in which the intrinsic value of the assets could be determined with certainty, participants still bid a price far above evaluations with the bubbles being followed by sharp declines in prices. let me give you an example of one of the studies of this type. in this experiment, all investors start with an identical asset that pays the same dividend generated from a known distribution at the end of each period. the participants are allowed to buy and sell these assets from one another.

in this framework, if they were all fully rational then trading should occur only at intrinsic values but this is not what happens in practice. in 14 of the 22 experimental runs undertaken in the study, prices rose significantly above fundamental evaluations and these price bubbles were followed by crashes. when traders in these experimental runs were experienced, meaning they had participated in the experiment before, the probability of a bubble was reduced but not eliminated. what we learned from the particular experiment is that a common dividend and common knowledge thereof is insufficient to induce initial comment expectations. the lack of common initial expectations leads the a willingness to trade to try and earn capital gain above the

fundamental value. relaxing the conditions in these types of behavioral studies to emit more uncertainty about fundamental asset evaluations works to enhance the propensity for bubbles by encreasing the degree of dwergeance and the participant's initial expectations. lastly, over the past few decades there have been too many episodes in which asset prices have dramatically overshot on the upside and violently corrected to subject the behavioral study did not have real world counterparts. in the united states these include the run up in the value of the dollar in the mid 1980's. the stock market rise and crash in 1987. the compression of spreads and the runup to the long-term debacle in 1998. the technology stock market boom

in the late 1990's and the stock market crash of recent years. they were marked by price booms followed by collapses. while asset bubbles are idiosyncratic in terms of their causes, duration and severity, they often share several significant features. these shared features are important in assessing how policy might be used to temper bubbles in the future. in my view, asset bubbles often come about through a particular sequence of events. first there is typically an innovation that changes the evaluation in a meaningful but uncertain way. asset evaluations associated with the change, -- this leads to a divergeance in expectations

concerning how much the fair value of the asset should increase. i believe this uncertainty about what constitutes fair value is important in fueling bubble. for example, the technology stock market boom in the late 1990's coincided with the development of the internet which fostered the reorganization of many businesses and generated productivity improve identicals. at the time it was unclear just how significant the innovation would be and how successful the companies would be that sought to take advantage of it. on one hand there were companies such as cisco, which sold the shovels, the route hears the enabled the internet to work that were very successful. on the other hand there were other companies such as web band that sought to use the new technology to revolutionize the delivery of grocery supplies and services that failed miserably.

similarly, the recent housing boom has been driven by two ino rations. one in housing finance, subprime lending made credit available to those who were of lower income andless credit worthy and structured finance such as c.d.o.'s. the first innovation significantly broad tight end availability of mortgage credit to households. the second reduced the cost of this credit. cash flows from the underlying mortgage assets were portioned during june or and senior tranches. they were distributed to a wide range of investors. the structured finance innovation was supported by oin vegases in the securities banking system. conduits bought the highly rated tramplings and financed these assets in the wholesale short-term funding markets.

the second element is a surge in economic acknivet a particular sector associated with the innovation. in the case of technology and stock market boom there was a surge in business investment and technology good and services. in the subprime structured finance boom there was a surge in demand for housing as credit availability increased sharply. this surge in activity is important because it reinforces the notion that it is significant and that this time is different. third, there is also often a positive feedback mechanism that tends to reinforce the belief system that underpins the evaluations associated with the boom. without this feed mechanism the boom isn't likely to persist for long or push recommendations far above what is just find by the fundamentals. without the feedback, the asset

price movements are likely not to be big enough to threaten economic stability. the technology stock market boom there were a number of important reinforcing mechanisms. one was the strong notion that those who got to the market with their internet innovations would achieve large first mover advantages. this was due to the fact that successful internet-based models could expect to achi strong network feblingts thamed create significant barriers to entry and the prospect of extraordinary profits. amazon might be a good company that eventually succeeded at this. in this environment, many firms invested neavel the new technology. the ensuing sharp rise in investment and technology equipment and software led in turn to rapid earnings growth which helped for a time to

sustain evaluations. in addition, the sharp rise in stock prices led to a reassessment of the appropriate equity risk premium. the higher the stock prices rose, the more people thought that equities were at risk. everyone could become a millionaire with little risk or effort. similarly in the subprime structured finance boom there were several important positive feedback mechanisms. in particular, the surge in credibility drove up the demand for housing and pushed up housing prices. this increase in demand caused a default experience associated with such lending to be very low. this reinforced the notion that subprime lending was not very risky and enforced the demand for complex coast secured by such assets. during the boom models appeared to be sound because losses were low and because the correlation