>> rose: welcome to our program. tonight we look ahead at the new congress with al hunt of bloomberg news, former senator judd gregg, republican from new hampshire, congressman thaddeus mccotter, republican from michigan, and gillian tett, u.s. managing editor of the "financial times." and for an assessment of what is happening in afghanistan and pakistan, two reporters from the "new york times," alissa rubin, the paper's kabul bureau chief and rod nordland, the deputy bureau chief. a look at the new congress and an update on afghanistan when we come back. maybe you want school kids to have more exposure to the arts. maybe you want to provide meals for the needy. or maybe you want to help when the unexpected happens. >>. >>

additional funding provided by the following: captioning sponsored by rose communications from our studios in new york city, this is charlie rose. . >> rose: we begin this evening with a look at the new congress which begins its first session tomorrow. republicans have set an ambitious agenda following their sweeping victory in november's midterm election. they have vowed to cut taxes and

launch congressional probes on a range of issues. their first legislative initiative comes next wednesday with a vote to repeal the health care law. the new republican initiatives are sure to inspire fierce opposition from democrats who retain a slim majority in the senate in addition to the control of the white house. joining me now in washington, my friend al hunt, executive editor of bloomberg news. from new hampshire, judd gregg, the former senator, he's retiring this week after serving three terms as a republican senator. from michigan, thaddeus mccotter, he's a republican congressman who's been with us before and here in new york, gillian tett, she is the united states managing editor of the "financial times." i am pleased to have all of them on this program. i begin, as usual, with al hunt and the question is what should we expect from this new congress coming in, al? >> first, charlie, i think john boehner's going to strike exactly the right tone. it's going to be low key. there's not going to be a great deal of hoopla and i think

that's smart in these times. then there will be a number of symbolic things republicans will do such as trying to repeal the health care bill. it's not going to happen. they'll read the constitution and then i think everyone will go home for what i think now we call state or district work periods and come back and the real clashs will begin. i don't think the first couple months will be terribly productive in getting things done, but i think both sides will join the battle. and, charlie, what you have is when you talk to republicans and you talk to democrats you get a totally different perspective about where the country is now. republicans genuinely believe that they received a mandate in november for an agenda that they're going to aggressively push. democrats genuinely believe it was a protest vote and had nothing to do with their agenda which i think means for the first two or three or four month there is will be a lot of confrontation and very little compromise. >> rose: senator gregg, what do you think the election said? how did you read it? >> i think the election was

pretty definitive. i think it said very clearly that the american people are extremely concerned about the future of the nation, especially on the fiscal side. they're worried about the spending, the debt, and the deficits and i think underlying all of this is the genuine concern that for the first time in our history we may end up passing on to our children a country which is less prosperous and less secure than we have. and that's not acceptable to the american culture. that's simply not acceptable and i think that was what the american people were saying in the election. they want the government to get control of its fiscal house. i'm a little less pessimistic than al, though. my sense is that there are a lot of places where there can be agreement. and i think the tax compromise that you saw in december was a precursor of what could happen. sure there's going to be confrontation over issues like health care where there's a fundamental difference relative to the health care bill. but i think the president understands that he needs to govern. and i know the people i worked with in the senate like mitch mcconnell and jon kyl understand that governing is good as long

as you're doing it from a standpoint of getting things done that they see as progress. and there are a lot of areas where there's fertile ground for progress which would involve both the president and the republican leadership. for example, energy. i think some of the immigration issues could be addressed. health care in some areas could be addressed. tax reform is a major area of opportunity for both sides to move forward on. obviously education. so i'm not quite as pessimistic. i think sure you'll see a flash and there will be some confrontation, but this is not the congress that you got in the 1995 period when newt gingrich came in after 40 years of democratic control which was basically a revolutionary movement at the time for all intense and purposes. and it turned out they were good revolutionaries but not such great governors. i was in that congress. i wasn't in the congress but i... actually, i was in the congress but i wasn't in the house. and i think this is much more thoughtful, very substantive group of people who are going to be running the house.

a very impressive group of leaders in house and i think there's a sense at least in the senate from people like mitch mcconnell who are serious that there are places where there needs to be cooperation. there are obviously places where there needs to be distinct lines drawn. >> rose: congressman mccotter, tell me how you see that division within the republican party over certain issues, some from the tea party and others coming from a more mainstream republican background. >> well, there are always divisions in both parties. i mean, we have a country of over 300 million people and we have two major political parties. as republicans may have differences amongst themselves, we've already seen that occur within the democratic party. so i think that's really non-germane to what we do. what's going to happen is some of the fundamental principles that almost all democrats agree on and almost all republicans agree on are going to be in conflict to a certain extent. i think that's one of the things we have to be mature enough to recognize. this is a tumultuous time in the life of the country. i don't think we've seen any

time like this age of globalization as we have since the progressive era where we moved into a fully industrialized society. the principles of both parties are in play as to how they think the future shape of the country should be directed and the people who are going to weigh in on this should we stray too much into partisanship or bickering is going to be the american people. i view the election results that we just had rendered by the sovereign citizens of the united states to be a rejection of the one-party rule of the democratic party in the same way that it was with the republican party. i think america remains center right and i think if you try to pull too hard in one direction or the other the independents are going to go back to the other party and give them another chance. when we heard earlier about the 40-year rein of the democratic party in congress, i think those days are goon and we've gone back to a more traditional cycle of you have two to four years to peru whether you've learned your lessons and we're going to give the other people a chance. i would hope the republican party-- my party, be they conservative, moderate or liberal in our opportunity-- understand that we have not redeemed ourselves in one

election. that we have to take it one day at a time, one election time and build support not only for the policies we put forward but to remind people of the underlying principles in which they're based. if we do that, i think we'll be okay. >> rose: do you believe the congress in the house will be able to change the obama health care measure? >> well, we have to be realistic about it. i think one of the things we ran on-- those of us who did-- was to attempt to repeal it. now, we know the republican party only has control of half of the congress, that would be the house. it does not have control of the senate. but as we move forward and republicans put forward proposals to help improve the health care of the united states put forward the principles we have, it does give us an attempt to maybe engage the senate in repealing parts of the bill which people do not like and now with the democratic majority concurring and with the democratic president concurring. if we do not go forward and follow up on our promise we're going to be mired and there will be no effort at all from the house let alone the senate or president to repeal parts of

that law now. >> rose: and now perspective from someone who just got back from london where she took note of what was going on there in terms of a dramatic effort to bring austerity to government. how is it different from our congress? >> well, as john said, the american people are very concerned about long-term future right now. but the financial markets and many of america's partners and allies around the world are also extremely concerned because right now you really do need to have bipartisan zahn cooperation and sbe jens solutions to these longer term problems. particularly on the fiscal side more exclusively and yet thus far we've really not seen very much action and what we agreed in december was essentially both sides could have what they wanted, tax cuts and more spending. the question, though, is can this congress actually make tough decisions and inflict pain? and thus far... i mean, i hope that senator judd is correct in

saying that this is a sensible group of people who are going to rally around. the polls certainly show that the american people want to see cooperation and intelligent solutions but it's still very much in doubt whether or not that's going to happen. and, frankly, there's considerable nervousness in the markets right now about what's going to happen in the coming weeks. >> rose: and what will reassure the markets? >> some sign... there doesn't need to be necessarily austerity today or doesn't necessarily need to be do coneian cuts today. but there does need to be some evidence about the ability to produce a medium to long-term plan. and one very interesting example you can look at right now is europe, say to the u.k., where george osborne and the u.k. chancellor, the finance minister has earned considerable credibility and in some ways staved off a potential bond market crisis in the u.k. by drawing up a plan of part of a coalition government and so i think the interesting question right now for america is can it emulate some of that in trying to pull together and produce some kind of medium-term plan for tackling these very, very serious issues.

>> there is a template and it was put forward in a bipartisan way and that's the simpson >> rose: i was going to brick that up to you. >> if you look at the people who supported that, you had tom coburn, senator tom coburn, conservative, fiscally responsible, probably the leading fiscal hawk in the senate and dick durbin, a really progressive guy but a guy who understands the significance of what we're confronting from a fiscal standpoint. so there is a template to work off of. and it will be interesting to see how much of that is picked up by paul ryan in his budget proposals and how much of it is picked up in the president's state of the union. i wouldn't be surprised if you saw a pretty significant convergence and a number of initiatives that grow out of the simpson/bowles proposal which is an attempt to address the long-term problem, not the short-term problem. and the long-term problem being the fact that our deficit-to-debt ratio is headed to 100%.

we're headed down the roads of a greece or ireland. >> it was very interesting because george osz osborne was in new york and had a pretty rapturous reception and he pointed out that the simpson/bowles plan is not that different from what the u.k. government is trying to do right now. it reese roughly speaking three quarters spending cuts, one quarter tax increases. and many outlines are quite similar. so as senator gregg says, there are templates on the table, the question now is are they going to fly. >> rose: congressman mccotter, what did you think of the simpson/bowles deficit recommendations. >> i ties in what w what we've been saying before. the question is about austerity and painful spending cuts. but what people want to know is towards what end? are we talking about still working within whether the great society modern of governance from an industrial is this big, is it this big when the reality is, as we many michigan understand from what our auto companies went through, what our families have gone through, is that the age of globalization, the communication revolution in

which we live in is decentralizing, decision making back into individual's hands. people have had to adapt to that. businesses have had to adapt to that. only government has lagged behind. if we continue to still think that we can have a 1960s/'70s model of governance which can be bigger or slightly smaller we're missing the fundamental point that the world around us has changed-- as i believe you've had mr. friedman on. if the world is flat, it's tyke to make sure the government is less concentrated, less bureaucratic like every other successful surviving organization has been. if we continue to try to figure out how centralized, how concentrateed and how bureaucratic it has to be we're missing the fundamental point and austerity becomes pain for pain's sake, not the sake of changing to adapt to a changing world. >> rose: al? congressman ryan's budget cut $100 billion. is this congress ready, prepared to vote for $100 billion in budget cuts? >> certainly the congress is not because there is a democratic controlled senate. i think it's going to be tough

to get a hundred billion... not just a hundred billion cut, it's a hundred billion cuts from discretionary domestic programs. that takes entitlements off the table, defense off the table and other homeland security issues off the table. that's a huge cut. they're going to have to cut into programs that will involve a lot of pain. paul ryan has already proposed and been very forthright and boldened n what he's pro poised. i think he's going to have a difficult time for getting a majority in the house for a number of those and i think it will be impossible. but to go to judd gregg's good point, the senator may be right in the long run but when you look at simpson/bowles, that's the perfect starting point and it is the middle ground and yet since senator gregg and some others courageously voted for it since then all house republicans and i'm excluding congressman mccotter because i don't want to take a position for him-- almost all the others have opposed it. the white house has said very little about it. and i think that judd may be right that eventually we'll get

to something like that, but we certainly aren't even close to there yet. >> we don't have too many options, unfortunately. this financial situation is no longer over the horizon, it's closing fast. we're getting all sorts of warning signs. we know the international community is becoming very antsy about our debt and our deficit situations. major rating houses are doing the same. and when you get a financial meltdown where you have a... where the dollar's value becomes in question and the ability to sell debt becomes seriously limited, that happens as a flash. i mean, it just occurs, bang. the international community or the community that buys the debt decides we're worried. and we know it's going to come if we continue on the present path so it's really to our... it's our responsibility to step up and do something sooner rather than later and simpson-bowles has laid out a $4 trillion adjustment in our deficit-to-debt ratios, reducing

it $4 trillion over ten years. sure it isn't easy and especially on the discretionary side there's a huge hit. but it has to be done. there aren't too many options because you're either going to do it now or it's like that oil filter ad. "pay me now or pay me later." if we pay in the middle of a crisis it's going to be extremely painful. >> rose: congressman al hunt did not want to speak for you but would you speak for yourself? if you were a member of the commission with congressman ryan and senator gregg, would you have voted? >> no, no, i wouldn't have. i go back to what i said before. look, when you try to lose weight, you can lose weight by crash dieting and that's good for you in the short run. what then happens if you haven't changed your life-style or readjusted your focus to getting in shape, you can have lost 40 pounds, still be out of shape and you balloon right back up when you're done. what we're talking about is still working within the existing system and the existing principles and premises that big government was based on. so for a time you can come back

down. you can maybe save $4 trillion over ten years. maybe you can't. maybe the public decides to change its mind because they don't like austerity and send new people in. or maybe we're in a flush of a blaef brief recovery and people think we can go back to the old ways. unless you start to lay out how the world has changed, how it has been decentralized, how government now has to focus on what it needs to do rather than what it wants to do and how it can help empower people to make their own decisions to relieve the government of that burden that it places back on to people through the side door and even the front door you're going to be right back where you are and there will be no long-term plan, there will be no short-term plan because it will still be the same thing over and over with the same old tired treadmill except you're stepping on your own sweat and slipping off it. >> of course, i'm attracted to that type of an approach, but unfortunately what we're confronting here is a demographic shift of historic proportions. we're going from 35 million retired people to 70 million retired people. we have a populist society, in

other words an elected government, and an entitlement society. we have medicare and social security. so adjustments are pretty clear. they have to come in medicare and social security. now you can talk in broad context about philosophically where you want to go, but if you're going to straighten out the fiscal house of this country you're going to have to talk about both medicare and social security issues. the commission did step up aggressively to the social security issue, did not do do a good job on medicare because basically that got us back into the health care debate and chairman bowles and simpson decided they didn't want to reopen that debate at this time. you can't deny the basic facts and the basic facts are these. we have a society which is spending far more than we can afford and it's going to get a lot worse because of the fact that we have this massive movement in demographics and the size of the government is getting well beyond our capacity to pay for it and we're going to have to adjust those entitlement

programs in order to get this government to be affordable. and you can put in the any philosophical context you want but the bottom line is you're going to have to change those programs. >> rose: al, tell me about where you think the head and mind of john boehner is as he finds himself in this new and powerful role. >> i think that john boehner is a very skillful politician. a far more skillful politician than newt gingrich. newt gingrich was a great guerrilla worrier, he led a revolution, as senator gregg said earlier. but i think as a speaker, boehner will be far more effective. he will understand his caucus, he will know there are times that he probably has to go along or pander to certain elements that that caucus that he might not otherwise do but he'll be very shrewd about it. he will know what to avoid and i think he will be a very... i think given the context, given the limitations and, as i said earlier, i'm not confident much

will be done in the first four to six months, i think congressman baner will do a very effective job. >> rose: he's not likely to threaten to shut down the government? >> well, that brought down newt gingrich and his revolution in 1995 and i don't think that john boehner or able lieutenants like kevin mccarthy want to bring down this caucus in the first year. >> rose: all right. gillian? >> if you lift your eyes out of congress for a second, one issue's going to throw into very sharp relief the challenges that america faces is that we have a visit by the chinese president hu jintao and by golly is that not only going to serve as a reminder of structural challenges america face bus also the fiscal issues because the chinese are holding a lot of american debt. they, like many other international investors, want to see what america's going to do to make sure we can repay that debt. >> rose: what is it that you, congressman mccotter, would like to see the president say in the state of the union about creating growth and creating a competitive economy that can be up to the challenge of emerging

of the emerging nations like china? >> well, first what i'd like to see him say about communist china is the reality that it's not a free country. what they have is an economy that they've allowed people to go make money, they've allowed it to be entrepreneurial but they've retained the right as the vanguard of the proletariat to pull back wherever and when ever they want. they don't have a free and fair competition with the united states and i think they're very, very much a predatory state. i'd like to see the president talk about free flow of capital between the countries, free investment on similar terms or that it won't be allowed to happen. i'd like to see the president say we're atraching human rights to communist china so they cannot treat their citizenry the way they have and continue to do. i'd like to see a recognition by the president of the united states that the american people who have shaped the destiny and shaped the foundations of the greatest most prosperous and equitable economy in human history which is that of the united states. and i'd like to see him express his principal support for

continuation of that rather than his previously expressed support for him trying to create the new foundations of an american economy. that's not the role of the president of the united states, it's the role of the entrepreneurs and workers of the united states. so i think i'd like to see some of that from the president on those two areas. >> rose: what would you like to hear him say, senator gregg? >> i agree that i think we have to press china on the issue of currency and on the issue of human rights, on the issue of protection of assets which are there that are american such as intellectual property rights. there's no question that we're now moving into a new phase in this world where market economies that are democrat rick continue fronting market economies that are state-run. and i'm not sure how we sort that out but it's clear we need to keep pressure on china to be more democratic, to be more pluralistic, to be more... to allow more liberty and to especially stop manipulating the markets through their currency and, as the congressman said,

their basically predator mercantile state. but we values to recognize that we have to do some things here to make ourselves more competitive. for example, we shouldn't be buying $300 billion a year of energy overseas. why are we shipping that overseas? we should be spending that money here in the united states to develop energy sources here. we should also be looking at our tax laws. our tax laws are an incredibly an incredible barrier to our businesses and our small businesses and large businesses competing in the world and we should taken a entirely different look at that. that's something the simpson-bowles commission did in a most dramatic way, by the way. and i think if we pursue some of those things like energy reform, immigration reform. why shouldn't we go around the world and say to the best and brightest people in this world "if you want to come to the united states, we'd like to have you come to the united states." they're all job creators. talk to bill gates, he says every time he brings northbound in n here from india or china who's a scientist he adds four, five, ten jobs around that person. so we have an immigration policy which forces those people to go

home after they've gone to our universities and doesn't allow them into the country. there's a lot of things we can do to reenergize our economy, make us more competitive. but the congressman is basically right on the fact that china has been playing unfairly in the market economies of the world. >> rose: so why did you leave the senate? >> (laughs) well, i've been in this business for 32 years, run for nine major jobs and my wife and i sat down and said "time to move on and try something else, do something else." there are good people still in the congress and the senate, a lot of good people on both sides of the aisle, by the way. a lot of good dedicated people like the congressman and hopefully they'll be successful in carrying on and trying to make this country... >> rose: but it was not frustration with the system. >> not at all. i am a huge fan of the united states senate. i think it does exactly what madison and randolph wanted it to do which is to the cold ron of democracy because it is the place of the rights of the

minority are protected. the minority gets to speak in the senate, it gets to amend in the senate and it gets its point across in the senate because it takes 60 votes to pass something significant in the senate. that was the whole idea behind the checks and balance form of government we had. the founders really were concerned about a majority overwhelming and subjugate ago minority. the senate is the center of the protection of a minority in this country and making sure that we have a balanced government that is subject to checks and balances and it is filled with, i think, very good people who are trying hard and, you know, it gets caricatured but i'm still a big fan. >> rose: this is al hunt's question but i'll ask it. suppose the president calls you up and says "senator, i need you. i like what you say, i like a lot of your ideas and i need you come join the administration." i know you thought about it one time and back then at the last moment something happened. why not now? the country is at a moment it needs all the wisdom it can find. >> well, it's kind of you to say that. i don't think the president will call but obviously whenever a

president calls you listen. but right now kathy and i are looking forward to going out and trying some other things. >> rose: but you're optimistic? >> i am optimistic. i'm optimistic because we are a resilient nation. we are an inherently... a nation which inherently confronts a problem and solves it when we see it. sometimes it takes us a while to get there. winston churchill says after america does everything wrong it will do what's right. and he was right. and we're confronting... we're facing some pretty big problem, as the congressman said. he's absolutely right. and i just believe in the resilience of our nation and our institutions. the fact that we build our nation off of liberty. and liberty is a very strong energizer of good things. >> rose: so, al where will the rubber meet the road? where will we see the first test of all that we have been talking about? >> we're going to see it fairly early on, charlie, with the debt ceiling. that will be a key battle.

the budget battles we'll see in the beginning. those are short-term issues. and i am a pessimist as far as getting done in the short-term. i think judd gregg makes a very eloquent point and i would say as a quick aside that barack obama will be passing up a huge opportunity if he doesn't try to enlist the advice and council of senator gregg in some way. but i... over the long run, his optimism may well be justified. that's certainly history of america. but i think short-term when they... the rubber meets the road as you put it on the debt ceiling and some of the other budgetary issues, i think they're going to have a great deal of friction. >> rose: what is it you think the rest of the world is looking for from the united states at this time? >> i think it's very simple. the question, charlie, is can america actually take radical decisions and really impose some painful measures on the population without a market crisis? because in many ways if you look back in the history it's taken a bond market crisis, taken a

financial crisis for tough decisions to be made. this time around america has had a period of grace because invest have been very forgiving in the markets. but the question now is can congress get its act together to start taking the tough decisions without being forced to by the international markets first? and if we have to have a crisis to actually force action, that's not going to be good for anybody. >> rose: what role do you think the 2012 election will be playing in all this, congressman mccotter? >> i think in terms of the house members and the senators, the one-third that will be out since they're focused on serving their constituents and they have their own skin in that game, when you talk about the presidential politics, it's the pundits that are driving this thing right now. off whole bunch of new house members-- largely republicans but also democrats-- that are trying to get acclimated, trying to figure out how best to serve their districts in the short and long run. i think in the end it is what it is. one of the things i liked about what senator gregg said is the fact that liberty is the basis of our success as a country. our system also allows that

liberty to be filtered in the most haphazard and discombobulateed and discordant ways. with the presidential election out there it can become discordant. but am i optimistic we can get past this? yes, it's a very important time in the country. everybody want theirs voice heard. people want decisions. some people will agree with them some people won't, but that's the strength of what we hear. so as we head into the presidential election, will thereby those who will have a much more interested demeanor towards it? a much more interested and in the impacting it through the legislative process? if they're running for president yes. if they're really committed to a candidate, yes. because they're just trying to serve their constituents as what they're supposed to do they'll let the presidential chips fall where they may because i think vast majority of us are not going to be visiting senator gregg in new hampshire any time soon and we'll be in our district explaining what we. >> rose: (laughs) on that i should make one final point that we invited several members of the democratic caucus and they, in fact are having a caucus meeting at the time we're taping this and couldn't come

but we will continue to solicit opinion about where we are and the role of government and all of the events leading up. i think the two most important challenges for this program over the next several weeks is to look ahead to what china represents and the possibility there is and how the president frames the debate in the state of the union. i thank all of you for joining me and we'll talk about another big issue when i come back which is afghanistan with two of the "new york times"' finist, the bureau chief and assistant bureau chief back from afghanistan in new york and we'll get their perspective on what this other issue looks like in there vision. back in a moment. stay with us. we turn now to afghanistan. the mission has seen both gains and setbacks in the course of 2010. 13 months ago president obama ordered an increase of 30,000 troops bringing the total number of american forces to nearly 100,000. as operations increase, so did

casualties with civilian and nato deaths hitting record levels. in june, general stanley mcchrystal was replaced by general david petraeus as the overall u.s. commander. u.s. offenses on taliban strongholds like marjah and kandahar showed tenuous but inconclusive gains. president hamid karzai was a complicated partner in parliamentary elections in september were once again marred by fraud. finally, the unexpected death of special representative richard holbrooke has been a loss for the mission's civilian efforts. in president obama's strategy review last month, he called the gains "fragile and reversible." but he said the mission is on track and that the transition to afghan forces will begin this year and conclude in 2014. joining me now, two reporters for the "new york times," alissa rubin is the paper's kabul bureau chief. rod nordland is deputy bureau chief. i am very pleased to have them at this table. what's happening on the ground in afghanistan as we speak? and what does it portend for the

near term? the next six months? >> well, i think you have to look at it both in the sort of cities where there's one sort of set of events unfolding and then the countryside which are really where the taliban are and what the next six months brings is going to show us how effective military's efforts over the last three or four months as they've ramped up has been and also how effective all of their efforts to take out a lot of the mid-level leadership. the next six months at taliban will almost certainly try to make a rebound. a lot have been killed. a lot of the mid-level commanders have been killed. a lot have been detained-- hundreds now. but i think the question is what will it look like in the spring and summer? and typically what happens is it's quieter now. it's winter. the taliban... although it's more of an a year-round war they

do still fight in the winter now. both 2009 and 2010 and looks like they will into 2011 but in a lower level and will they rebound in the way that they did last summer? and really be able to have a lot of operation. and the thinking, i think, seem r it seems is they they will not... may not be able to rebound as much in the south. there's this enormous number of largely american troops now as well as british and some of the rest of the coalition. will they spread and how much in president north and the east where there's been less of an augment... augmentation of troops. and that's what one sort of set of events that people are watching. and then the cities, i think, there's a lot of attention being paid to how politics unfolds and how much the government is really going to be able to function because the elections were fought. they are very unclear about

exactly whether the particle element sit on the 20th, 21st of january where it's supposed to and if it doesn't or some people are replaced what the fallout of that is, how president... whether president karzai is really able to lead a government and that's sort of the other piece is sort of will the government will able to exert power and influence and make people believe in it? and they may not want to support the taliban over time. >> you know, general petraeus among his many remarkable talents is his incredible ability to spin things the way he wants to and to persuade people. and in a way that kind of creates a certain reality, too, and he's managed to take the same set of data that many people have read as saying things are getting worse all the time and spin those data into a kind of rosie picture that things are starting to improve. and we'll see, really, the proof

of that will be in the spring, whether the taliban are able to bounce back and to really come back strong. again, that will put pay to that... that will just prove that it was more spin than anything else. you know, they claim they're playing a kind of game of rope-a-dope. they're moving elsewhere, they're laying low and that may be true and we'll find out in the spring i think for sure. already, though, there's a lot of indications they're much stronger in the north than they ever were before. there are more districts and provinces than they were in the past and the response of the military to that is well, so are we and we're bringing the fight to them and that's bringing it... more incidents out in more places. i think we'll all sigh hit in the spring. >> rose: what is the petraeus strategy? because some of v said that what he really hopes to accomplish is to convince those who are on the fence-- perhaps even pakistanis-- that this is not necessarily going to be a

taliban victory and that, you know, you shouldn't necessarily be holding back because the chances are it may not... your worst fears may not... >> yeah, i mean, the strategy... there's two strategies. there's the geopolitical strategy concentrating in the south where the taliban is the strongest and there... more generally hurting them wherever with night raids and special forces operations. >> rose: and it's ramp cheted up the black ops. >> ratcheted it up tremendously. many just in the last six months with the hope that that will bring... both of those efforts will make them more interested in coming to the table. right now right or wrong they feel like they're winning and they don't really need to come to the table and they're not negotiating seriously or even

making feelers seriously. >> they feel like they're winning, the taliban. >> they do, yeah. that's their propaganda, of course, but i think there's a certain amount of truth to it. >> the ability to proliferate elsewhere, even if it is, in fact, at a lower level gives them the appearance of being able to be everywhere and gives the population a sense that it's a game of whack a mole. now, what's... i think what's more difficult is if they were to want to negotiate, who do you negotiate with? who are the leaders of the taliban who could negotiate on their behalf? a real problem that the americans and the coalition faces is that it's not really clear how you'd get to that goal because of having a negotiation which is presumably the way a war ends eventually is that you negotiate a peace deal on your terms and... ideally. and at this point the taliban

is... there's the peshawar shura there's the quetta shura, there's mullah omar who people seem to think is maybe not even in quetta anymore. where do you go for that deal that you're going to make? who are the leaders you're going to work with to get some guarantee and how do you do it without the pakistanis since most of the leaders are not in pakistan. >> rose: whether where do they think mullah omar is? >> he's thought to be either somewhere else in the tribal areas or in karachi. that's what we've heard because most of the quetta shura leadership has gone to karachi. but, you know, who knows? and... >> rose: went to karachi because? >> because they're worried about pressure in quetta from drones, from being hunted down, potentially maybe even by the pakistanis. >> rose: does petraeus have a different attitude about civilian casualties than

mcchrystal did? mcchrystal made it a big point. >> right. i think petraeus feel it is same way. they both understand very well the liability of civilian casualties. >> i think there's a difference in tone. >> rose: i do, too, from a distance i do, obviously. >> petraeus has emphasized ate lot less and he hasn't made these kind of groveling public apologies that mcchrystal did. well, groveling isn't the right word but he did, very contrite apologies and very quick to make contrite apologies. petraeus has not done that. i think some of his staff officers have issued apologies and they are quick to respond and that's part of the policy. but it's definitely a different town. >> rose: so where is petraeus with respect to... and the president and the secretary of defense, secretary of state with respect to karzai? >> i think they feel they can't change him and so they... and they... >> rose: there's no alternative? >> there's no alternative. and that has led them, i think,

to de-emphasize something that they for a while were emphasizing a lot, which was corruption. and they're talking about that a lot less even though for the afghan people that's an enormously important subject. you can't have a conversation without ordinary afghans complaining about that. >> yeah, i mean, they've really de-emphasized that. they won't even discuss that off the record. >> rose: really? >> it's amazing, yeah, the difference in attitude of the american officials on the corruption subject. >> rose: you say this is not on the record, just tell me what it is you're doing about corruption? >> they won't... or even deep background to check facts. "no, i'm sorry, we can't." >> rose: can't help you on that. >> can't help you on that. >> rose: so where is karzai's head if he thinks that he can... you know, that the u.s. has no choice because... what is... what is his whole on the united states? >> well, i think his hold on the united states is that we want to have our troops there and our base there is so that we're as

close to pakistan as possible since we can't actually fight a war in pakistan. >> rose: yeah. >> and from the surveillance standpoint and the drone standpoint and everything else you have a lot of resourcingss you can have in afghanistan not to mention having the ability to watch it one as well. >> and he's backed us down every time that we've complained about something. he's gone on the counteroffensive and american officials have backed down over it. we made a big stink about the major crimes task force that he pretty much shut down and he came back swinging and we basically gave into him. we've done that on every major controversy beginning with the fraudulent presidential election right through to the... >> rose: in the end it sounds like somebody who know it is americans have no alternative other than to get out. it's me or get out and if you get out they're not here because of me, they're here for another means, another reason.

so what about north waziristan and pakistan? do you see that changing in the next six months? >> they haven't been able to. they have a domestic set of politics that's falling apart to actually rally the army to go into north was. seems pretty unlikely to me. >> if they want to. >> rose: but is this all impossible if you can't get into north sfwhz if there are safe havens in pakistan is this war unwinble? >> i think a lot of people would say that, yes. >> rose: well, i'm asking you. i don't know. is it unwinable? i don't know. >> rose: i know that these are terms that are hard but it's difficult. make it easier. is it difficult to prevail... whatever your definition of "winning" or "prevailing is as long as the forces you're fight having a place they can go where you can't reach them? >> and where they are also

constantly training, recruiting. i mean, there are hundredings of madrassas that are all through the tribal areas along the... >> rose: training new recruits. >> and that's the question. obviously they're not going to be as experienced as the leaders who have been at the field and as those get killed it will take time for those to gain some skills but if you keep having a resupply then you're not really gaining enough ground to change... >> rose: could anything change that? i mean, you'd have... >> well, i mean, i guess... >> rose: what would petraeus say. if you say to him "what could change your opportunity to do something about safe havens in north waziristan or wherever they are" he would say what? >> there would have to be a change in pakistan. >> rose: in the leadership? pakistan? >> in the leadership of the

security forces and the willingness... >> rose: that's kayani, isn't it? >> it's kayani. but i think it's the whole picture, it's i.s.i. there would have to be a willingness to allow to move forward. >> i think the leadership in pakistan and the i.s.i. actually in a way honestly reflects its population with all its duplicity. pakistanis hate meshes and they hate americans more all the time and every drone strike makes more enemies and the depth of anti-american feeling in pakistan is just... >> extraordinary. >> and i don't see how you can overcome that. >> rose: this question, why we there? >> we're there to defeat al qaeda. that's the purpose of our mission in afghanistan. it's not the build the nation of afghanistan. it's to make afghanistan safe from al qaeda. but al qaeda is in pakistan. >> rose: exactly. i don't want to do the drill because you know it too well. we're there to defeat al qaeda but there's not that much al qaeda in afghanistan. >> there's hardly any.

>> rose: so, i mean... >> it's the closest we can get to pakistan. >> rose: because it's close closest to pakistan where the kald is. >> and if we left the karzai government could not survive. the taliban would come back and then you would have more areas where al qaeda could presumably live and prosper. >> rose: so therefore you hear this, maybe joe biden was right after all when he says, look, we ought to be... it was his whole argument made at the time of the great review, it's a counterinsurgency strategy or a counterterrorism strategy. if it's counterterrorism, you go after al qaeda and do it with a limited number of forces in a very specific kind of... >> which you could still do. >> right. and which to some extent... >> rose: and you always... it's not either/or by some people,

right? or you do both. >> i think there's a question now about the extent to which it has become a counterterrorism war. there is, as rod said, more black ops, there's a lot of night raids, there's been an enormous increase in the presence of special operations forces and they're being used in more and more of the sensitive areas so where is the line? and there's a pretty general assent that changing governments in afghanistan is a 50 to 100 year task which is part of what counterinsurgency strategy tries to do. so maybe we're drifting that way of necessity in any case and there's... it seems like the only reason you need to have all the troops there is that you do need intel sdwrons do the counterterrorism strategy. and so you do need a certain number of troops to have kind of all the intelligence assets.

i mean there's... i don't know what the threshold is, but that is one of the questions is how many troops would you need on the ground in order to have the intelligence in order to do the counterterrorism? you can't just have special operations. >> rose: so as you approach this new year, what are the questions you want answered? what is it... what is it you're trying to find out? >> to what degree is the taliban really tlurt. >> rose: in and can star in >> in kandahar. >> rose: and whatever happened to the kandahar initiative or campaign or whatever. >> well, in some ways it's been successful. i mean, the assassination campaign in kandahar city which at one point was... they were knocking off four people a day. that's almost stopped and it's been like one every couple weeks. >> rose: because there are not that many more to kill or... >> or because they've decided to pull out and lay low or because they've taken... the military's version is they've taken out so many of the taliban that they're no longer a serious threat in kandahar city. i'm not sure that's true. we need to watch very closely to see how that goes.

and also the districts around kandahar where i think they've been less successful. but they've managed to exert their will in the most important districts around there. but is that going to have a long-term crippling effect on the taliban? i don't think so. the other thing is whether anybody is successful at getting reconciliation started. a lot of people are trying. >> rose: does karzai want reconciliation? >> i think he does. >> i think he does. >> rose: he was? >> he's sincere about that. >> rose: he does? >> yeah, i think he really does see himself as the father of the country so he sort of wants nerve the tent. but how you actually get all... give power to all the people who want power is the $64 million question. >> rose: and what's he willing to give up for it. that's another big question. >> rose: what would he have to give up? the power, obviously. >> women's rights, perhaps. >> rose: oh, yeah. >> girl's education, maybe. a lot of women are really afraid... >> rose: and that's central to

what the taliban wants. that was obviously central to what they did when they were in power last time. but is that the expectation that like the republicans in congress say if we get power we're going get the conduct budget. the taliban says we're going to take away all the rights of women? >> they don't say it. they're very, very careful never to say it. >> rose: but they believe it. >> it's pretty central to their existence. >> rose: so they're going to turn afghanistan back. >> well, i think what you... the question is why is it that in taliban-held districts no girls are going to school. and their answer would be "well, it's not secure enough." and the question is "when is it secure enough?" and there is never any answer to that question. it never secure enough for girls to go to school. >> rose: where does it come from? >> from afghan culture as much as anything else. their views on women are more extreme than saudi views, even, in terms of their mean... "their meaning afghan views. >> rose: that's an interesting point which i didn't know.

>> the taliban speak to a lot of people in afghanistan. they're on the sage page as most of rural afghanistan. >> okay, then speak to this question. some people will retreat into this look, why do the americans think that they can do something no up with else did in history? afghanistan is is afghanistan is afghanistan. so why are you so... >> well, i think they've actually been sobered by the last cup years and that's why there's this... people are defining the mission in a more narrow way and success in an increasingly narrow way because there's a recognition, grudging perhaps, that they can't change things. but i think we always have a kind of inflated view of what we can do. i mean, we saw this in iraq as well. that there was sort of this report in all this money and an awful lot of money went to ruin pretty quickly. similarly we keep thinking that we can get things going and, you know, if you just put in a

little... prime the pump somehow it will work in a place where it's never worked. >> it's a different situation now than it was. we didn't put resources into afghanistan the first few years and it's only been the last two years and especially last year that we've really ramped up the kind of resources we've given. >> rose: the kind of resources that were under the jurisdiction of richard holbrooke or more of a different kind? >> i guess it was under holbrook yeah. holbrook and mcchrystal. >> holbrook and mcchrystal and all of our contracting with afghan companies. but... richard holbrooke. but there you run back into the problem of corruption and really... >> obama decreed we're going to make afghanistan a war that we're going to... that's the right war and we put a lot of resources into it that we never had. and a lot of people are kind of holding to: that it's been nine years but we never in these past nine years devoted as much to it as we have now. >> rose: tell me what the

soldiers on the ground are saying. >> they're often there for relatively short periods so their view is often that things haven't changed much. they're there, they're fighting maybe individual areas like kandahar it has gotten better. they fight, they've gotten rid of the taliban, it seem mrs. peaceful but there's these i.e.d.s everywhere and you don't know what's going to happen next but there's often a lot of feeling is it really worth it. is it... what am i fighting in this desert for? >> rose: you hear that? >> you do hear that. and you hear a lot of contempt for the afghan security forces. i mean, they... >> rose: because they see the corruption. >> the corruption, the laziness, the drug taking. just the whole nine yards. the fact that they hardly fight at all. you have to do is look to the statistics of the afghan national army which is, you know almost as numerous as... actually more numerous than our army and the police are still

more numerous and their casualties are lower than ours. >> rose: what's the role of iran in all this? >> first of all they have a lot of interest in the husband czar a parts of the country and parts of western afghanistan. >> or shi'a. >> they also are, according to the military, very involved in supporting the taliban even though their ideologically completely at odds of them. >> rose: and they used to be enemies. >> completely. >> rose: lost 30,000 or 40,000. >> but the enemy of the enemy is my friend and they very much play that game. >> rose: they support them with weapons and everything or whatever... in the same way they did with the iraqi counterinsurgency forces? >> right. >> periodically the individuals insist relatively recently a huge haul was something like 18 phans of fertilizer. some enormous amount in trucks was coming across from iran. >> the kind that can be made into bombs.

>> the kind that can be made into bombs and there's also... i think there's a feeling that they were quite influential into the elections. they poured a lot of money into it, that's what we heard from lots of people. what they expect is access to karzai, they want to influence how he makes decisions. >> rose: so finally there's. in july, 2011... we'll call that... whatever that meant. now magic sedate 2014. >> they've changed the date. >> but now you increasingly hear petraeus and others talking about well, we're going to be there well past 2014. >> rose:2a'k because they want s there. >> rose: >> because we need more time to train the afghans and so on. >> rose: it's already the longest war in our history. >> yeah. >> rose: if you're you... you read the strategic review, there

references to the post-2014 support that will be given. >> yeah, and part of that is about reassuring karzai and the afghans, too, that we're not going to... >> rose: that's the big fear. >> yeah. karzai's generation of leaders has very vivid memory of the soviets who left over a weekend practically. they turned around and they were gone with disastrous consequences and i think's part of them that fears that will happen again. >> rose: and then we left. >> right. >> pretty quickly. >> rose: rod nordland thank you, alissa, as always, thank you very much. i thank you both for taking time. i come away certainly knowing more if not more pessimistic but thank you very much. thank you for joining us. see you next time.