>> rose: welcome to our program, tonight, iran and inngcreasi tensions between that y countreaand tun westovernucler pls and economicea sanctions we begin with nazr, vali nasr, and david ignatius of the washington pt, a national security columnist and also best selling author ofpy forms and jay solomon of the wall street journal. >> i think within the administration is a sense that, you know, we have got them where we want them to be. you make a good point that the regime feels it is threatened, that this is an existential threat to this regime and so it is going to fight back and, you know, i do hope the administration thought through

carefully what it would do if suddenly you were in a much more serious crisis next week, a month from now, whenever. >> rose: we continue with ian bremmer of eurasia group and his listing of the top risks to peace and enomic pgress in 12. >> fear is tually the single noggesrisk in 2012. it is not that the big tngs are blowing up, the euro n' going to blow up, the united stat isctually doing better noan people think, china is not going to have a hard landing y all of the headline risk around political volatility is keing money on the side lines, it is keeping people investing in@ gold, and it is stoppingthe global economy from developin the way it probably should be. >> rose: tse are things you call red her rings. >> that's right. >>e w continue with jeremy rifkin his book is the third dustrial revolution. >> what happened in the last two years which is reallyga interesting is this internet communatn techlogy is just now merging with the new energy gi, distributed energy, and when they comecc together we create and infrastructure for a

completely new economic paradigm. >>ose: a finally this evening a bit of culture with a great italian novelist umberto eco. >> it was important foc me to keepc the character far away fm the reader and far away fromc s in a way, at thatc point, well, as a writer it was also a pleasure to invent this disgus@ character and i did my best in doing that. >> rose: iran, top risks, third industrial@ revolution, ad umberto eco when we continue. funding for charlie rose w provided by th flowingga dc1rereo

adtional funding provided by these fders. >> and by bloomberg, a provider of multimedia and news and inrmation services worldwide.gvc captioning sponsored by rose communication from our studios in new york city, this is charlie rose. >> rose: tonight weurn to the growg cces over iran, a repo issued by t united nationin november stated there

is new evidence iranc is carryg t actities that suggest it is developin a nuclear device. e s.acnd other major western pors have responded by imposing increasing economic sanctions in late december iran threatened to block the strait ofc hormuz the wld's most imrtt poinin transit of oil since iran continued to arn its pone toward the united states, joining me nowc from washington, vali nasr of tufts university and ignatius of e washinon post and j@ somon of t washington post. >> vi, let me start with you, where do you think iran is heed with this@ increasing type of response to the threats o onomic sanctionsgainst oil which is a primary revuega source for that country? >> well, i think iran is wried about the next set of sanctions, because it alreadygv was hurtinc economally, the next set of sanction accountcuinto the government'sto revenue, it could

make it much more difficul diffr the government to meet1 payroll, to be able tore subsidize many prrams and it can also create political instability. untinow, sanctions have been abt things that iranouldn're buy, you know, prenting them from buying aircraft parts, consumer goodsno industrial products, now the sanctions are going to be about cuttin government revenue and i think irannshink t sanctions are movi inonto whole new arena and therefore that is a problem. >> rose: jay, add to that. >> i think what we a seeing, i know there is a lotgv of fear amongsa lot of people that the financial war nowon iron really is in some ws unprecedented, igv mean, basically the the entire financial system is being c off from the global economy and as of the enofgchis month there is going to be a european, basicay embargo on all oil sa1s and i think there is a coern th you can have like agc situation like japan, going into the second wor warhere you had a full ego on japanese

oil mi in from indonesia and lacoed out with pearl harbor, a lotof people forget that thic was kind of what happened before the japanese move, t t amount of the financial pressu on iran is so intensec now and li vic s saying it is not what they can't buy, can they do any kind of global transactions when you target seo's central bank a lot of people@ think that is an act of war and what, how the anians, are they just going to t back? is this ally just bluster because we @d it before or sort of entering a new phase where the financial war is so intense that they almost feel that they have no cic n respond in some waga and possibly in the investigates of zero hmuz or in the gulf would be the most likely place. >> rose: david there your own sources from the government and europe is there a growing concern abou iran being a b might do something crazy in a momentfhc conict? >> .. >> y, i think there isconcern

that ira1 might act in a provocative way, might y stage a crisis, in pt becse it files backed tore corner. i think within theno u.s. government there is a feeling that the policies that the obama administration has adopted arere workg,hat tnos policy of ever tougher sanctions is rllt having a effect. what we have seen over th last couple of weeks@n iran is sothing, the beginning of a real financial panic where pele are rushing to sell rials, the currency, the doars are suddenly scae, u.s. is working hard to makegv sure that hcthey are as scarce as poib, and iran is feeling cornered, lashing out, makinggv statements that are veryic strident, warnig thathe u.s. shouldnend aircraft carriers back into the gulf, making other warnings. 1at theame time, interesrengly, this week, the iranians signaled

with thetus who often have been their diplomatic partners that they mighc e interested in going back to the negotiating table, that they mitbe interested in rejoining the so-calledc 5 plus 1 talks about some diplomatic resolution of is question of their enrichment. so on one hand they are lashic out with threats and on e other they are sending peace feelers and i think in t administration it has a sense theyre responding to the pressure that isei@ put on them there is concern, i think, charlie,bout the nex step as sa@nctionget even tougher, making sure that that doesn't end up hurting the.s.and its allies more thant hurt igan, there is a lot of thoht going on now how to make th next set of sanctions work in an gaeffectway, to some extent deal with the problem of china, iran's most important oil customer. rose: you see that with reect to italy too, asking for gradual ratchin1 up of the

sanctions becausthey havre ntracts with italian companies 1re ings lik that. this gradualc ratcheting up that the europeanseem to be moving s toward, i think is qte advantageous, again, from thno standpoint of the u.s. and its allies because you don'tav a sudden dramatic change, you have one contract runs out an does notenewed another contract runs out and is not renewed andw gradually just fewer plac for iran to sell ioil and i think whathe ogvma administration is yi to sa is, iran has to choose, is it going to be an o power with the oil renues that go along with thatgv and the sod econy, ois it going to be a nuclear power? increangly the message is, you can't bejc both. >> rose: jay -- yes, go ahead,1 vali. >> i was saying davidkc has it t right in t sense that sanctions arworking d biting but whether they will change iran's behavior is a different

eson,he largely because you have a situation where the sancons are now going tno dermine, a n s of sanctions are going to undermine the stability of the regime and that actually encouragesc the iranian vement tc double down on the nuclear power there is a libyacenari here, if you are going to gi up your nuclear power and also you are going toace@ popular unrest, the regime has no way of protectingtsf against outside intervention andight now, there is@ no pathway before is regime in terms of h they would clb down from the tree, so in some ways, you know, the sanctions are being over successful, they are putng so much pressure onth iranian government it is actually taking gaay the incentive participate in the -- to give up thr nuclear program. >> rose: david, go ahead, yes, plse. go ahead. >> part of it too is like the question is do we end up hurtin1 rsves asell as david was saying, you know, th oil rks are very jittery and in some ways people think thec

iranians want to cause these lets to cause the oil prices to spike up but alsore thcredible diplomacy going on with saudi arabia,he united arab emirates, qatar and ghana and libytore jack up their oil production as a way to sort of keep the markets, and that is a big part of what igoing on in the diplomic fro, okay, we are going to get our allies like south korea and japan italy to wean offf iranian oi but to do tt th have to be assured thatomeone ee, whether it is saudi abia or the uis going to sp up and fill that voi so it is verygv delite and i think the iranianlc arsort of in a position they see what is going on and know this cou hit gvem badly and in se ways the provocations are a way to make lcople realize this could go very bad if there is a huge global oil spike and it rebounds back into europe and t uted states whic wii just seems to be mic out o an economic malaise so there ic so much goingon internationally with japan, south korea to try to get

these ys off and make sure otrc counies can fill void c d it doesn't cause this spike you know, i just wou note that oninteresting thing for me this week@with all the tension with the barbseing shot back and@orth, the oil market was pretty stable, the lwent up only a fraction today and hovered around $100 r aga while and i think what that tells us is the oil market hasalready discnted a lot of thedi danger of closure of the strait of hormuz, that is not to say if it mctually happens it wouldn't spike again but if you look at the actual oil markets, charlie, this week with a of1 the noise, thethey were pretty calm. >> i agree with you but i mean, still,he w the irians a1 playing this is they have made a decision clearly to tryo meet threats with threats and to re the ante and try to useno the ol

maets to put preure on th united states and the west, ande currently, the way this is playing out is tt the sanctions are not -- e not showing encouraging signs of iria actuay backing off, but rather, of the themng tryi to find a way to create trouble, so you the strait of hmuz they y take other action but a key decisi hasee bmade in iran that the best way oeef managing the west iso be preemptively agsi ave until and unless you have aittion wre the iranians decide to back aygv from thatnc strategy, you are running aanger ani think we are in a situation where the obama administration talks of sanctions as an alternative to war but the economic sanctionsc are almost putting us in a situation of greater risk of the iranians -- >> may choose to do somhing provocative and to gc to war force military action,ut again, i think within the administration, there is ac see

that, yoknow, we have got them where we want them to be,you make a good point that the regime feels itc is threatened, that this is an existential that to is regime, and so it isoing to ght back, and, you know, i @ hope the administration has thought dof suddenly you were in a ch more serious crisis next we@ek, a nth from now, whenever. >> rose: vali you were part of thadministration working with former ambassador horolb, the laga ambassador richard horook. do you believe there is a lack of an assessment of the damage gaeyre doing to iran with the economic sanctions and what it mit prode in terms of a reaction from them whi mprht include doing something in the strait of rmuz? >> well, i think th underand that they are doing a lot of1 damage to the iranian economyre and that is intentional as dav said, they want to put pain on iraq, i thin wha they might be 1undereimating is that there iranians may n react ithe way that the sanctions are

designed to do. secoly the sanctions and particullynon elecon year are designed to alor dealing with the destic pressure on the president to be tough on iran, and -- b the iranians are not seeing the sanctions in a way as mere punitive. they are now seein themgv as a much me an existential threat, issues that jay mentioned for instance if you go out and get countries like an saudi arabia, et cetera, to make pital investment in der to be able to produce more oil and bring it to thepcmarket basically cld cut iran out of the oil market for a much longer peri of time so the iraanspe eier have to come to the tpcable right now, tomorrow to sto the ghana or theau1 arabias to make thi investment, otherwise down the road iwould be much more difficult so the iranians have decided that if theyc ame to the table right now, third not going to get as much, without being aggressive they may be ablec to deterc he

european american action. >> rose: there is this dilemma seemso me in terms of consequence. ifin fact, it is often said @ere is some military strike, that it would unite the irania out of a sense of natnalism. is it@ possible forces around ro economic sanctions which are hurt the people, not just the governnt? >> charlie, i will take a first shot at that. ave parliamentary elections in march, so there will be a chance to have some reading, the iranian politics is so fragmented now with president ahmadinejad and the supreme leader ayatollah practically at war with each other, let alone the united states, and in a sense, it is -- if ever there was a time to put pressure on iran, you could argue it is now because internally they are so divided. i found interesting this week this sense from the reports from

our correspondent, in washington post has a resident correspondent in tehran, reports of a kind of bank run psychology there, i mean, people really getting nervous that war or something close toit is ahead, and reacting and, you know, if that continues or escalates, then you have a situation the government is going to have ouble controlling tehran and then things i think really get complicated and a the policy choices r the u.s. are in a much tougher -- i mean they are going to have to decide the thing they wouldn't decide i 2009, when the elections were, should we intervene to help the iranian opposition? >> i mean, too on the economic front because i was there in july, and i mean, ahmadinejad has over the last year has taken some pretty radical economic policies and the imf was lauding him but he basically cut almost all price subsidies at the beginning of last year and it caused a huge spike in basically

everything, because iranians were getting energy for free, basically, so you had, you know, evything from bread to water to electricity spike and now you have got the sanctions on top of that so when i was there in july most people were much more focused on ahmadinejad like why are you cutting these subsidies you have made our life so much more difcult, so the focus was more on the government than it was on the foreign, you know, the foreign impact of the sanctions but now with these other things i think you cod have as david wow said a very unstable situation and i mean do they blame the west now for this or do they focus on their own government? i don't know, but what has happened in the last week is feeding what already has been a very unstable economic situation. >> rose: some argue that iran -- go ahead, vali, you go ahead. >> i was going to say that also we don't know how long itakes for this kind of economic pressure to translate into street protests, food riots, et cetera.

the iranian government now sees the race of getting to the point of no return on the nucle program and facing street protests and riots caused by sanctions, so in an ironic way the tougher sanctions can give them an incentive to double down because if iran given its relationship with the west now wants to have street protests without a kind of nuclear capability to keep us out, wrong the administration or the europeans would make the mistake of 2009 as david said, they would intervene and i think ayatollah, ahmadinejad, the revolutionary guard understand this very well .. so the race to nuclear capability now is arace to survival, an iro ironically,i think maybe we are encouraging that. >> rose: here is what interests me as swell this phenomenon. iran and its arab neighbors and iran and its relationship with syria and what happened in syria, what impact does it have on iran? what is iran's posture

towards the shia and what is happening in iraq and are they using that as an opportunity to extend their influence there? do they have the capacity to support hamas and hezbollah as they have in previous times? take a crack at that, somebody. >> well the arab spring provided iran with some opportunities and some challenges, syria clearly is a headache for them, the regime was a close ally, syria was the main conduit for supplying hezbollah but iranians would feel if this thing is going to be played out over the next four or five years, a military strike with sanctions, et cetera, there are also strategic challenges in the region for the united states. you know, egypt, you could look at the situation the in bahrain, iraq obviously has not turned out the way we thought, as soon as we took our finger off of it

it is falling apart and having trouble with pakistan, afghanistan, et cetera, so there is a fluid regiol situation as well and we shouldn't look at just the iranersus israelor iran versus the united states as if this doesn't matter. i mean, the ability of the arab governments to support the united states is greatly contingent on how some of these things will play out, and iran and syria and then i think the iranians are also watching this carefully. i think a big mistake we might make is to try to sort of disassociate what is happening in the broader middle east with how do we handle iran, they then we may have some unexpected outcome. >> charlie, i would say in answer to the question that you posed, an and that vali was talg about, the iraans have in the part of the revolution guards, what many people think is the most effective covert action arm in the world. it is very well deployed, it operates through surrogates like

hezbollah, it is deeply embedded now in iraq. it is in a position to cause trouble in the eastern province of saudi arabia, where the oil resources are. so they are in a position to cause trouble. with tt said, i can't remember a time since i have been covering this over the last decade when iran's position has been as weak as it is now. >> rose: right. >> iran's key ally in the arab world, siri can't i mean that regime is --ooks like it is about to go. the sunni world has been energized by the arab spring all of the momentum for a while was with the shia movements, with iran as their patron, iran was the demand guard, that is past. the energy is elsewhere and i think the iranians feel it so again. looking at this, it seems to me the iranians are on their back foot and their actions show it. this combination of bluster and peace feelers sit is

fascinating but to me, i think it is not a strong iran in the way that it was. >> i don't disree with you, but there are also opportunities, just because you have a fluid circumstance, like if iraq begins to disingrate into much greater sectarian violence and provides them in ways to maneuver in a way they wouldn't if iraq has a stable government. iran could fall in different ways. the foreign minister at one point says if syria falls apart there are no winners that jordan or israel or lebanon would also be equally losers as iran might be. and so, you know, they are going to basically gain this, and as this sort of unfolds over a period of time, the diplomatic forces, et cetera would provide them with some opportunities as well as with some hindrances. >> i think syria in at that lot

of ways is going to be the mt interesting barometer because the blood, the number of deaths has gotten so high there, there has been this kind of push in some ways for some sort of intervention, and the arabs have never loved as sad because he was such a close ally of the iranians but there is a fear if there is any sort of movement by the arabs or the turks or french or some sort of coalition that could spark a wider conflict, what would iranians do if there was some intervention in iran, what would hezbollah do? and also as molly was saying, vali is saying, it is not clear, definitely if as sad goes down they lose a key patron but if you suddenly had a new government that had some muslim brotherhood leanings the syria may come to accommodation, they seem to have a better relaonship with the egyptians than under number rec and i don't think a new government in syria would suddenly say we are not interested in getting the

golan heights back let's have a peace deal with the israelis there could even be me of a highine that the as sad had and i think syria is going to be very kind of interesting barometer as far as who is up and who is down as this thing moves forward. >> rose: i have to leave it there, thank you, david, jay, thank you, vali. good to have you here. >> thank you. ian bremmer is here and president of the eurasia group, this week the group released its annual top risk report, identifies the upcoming years key political and gentleman political areas to, geo political areas to watch, i am pleased to havian bremmer here for the first time in 2012. >> gd to be here. >> tell me what topisk means to you. how do you define top risk? >> the top risks are sort of the places that are going to cause volatility, and the way we rank them, the first, the likelihood of them having an impact,

secondly, the size of the impact it is going to have and third how eminent, you put the three of those things together, pakistan is very likely to flow up but won't have great impact on the global economy so you havhave you have to push it dow. >> rose: i will come to other things but the end of the 9/11 e.r.a. is here, what do you mean by that. >> it is clear we are done with bin laden, al qaeda has been degraded significantly from a global perspective and we are t of iraq, we have pulled troops out of afghanistan, to it is not going well but we have a definable end date, talk about 9/11 it is done, that is in principle a good thing but what are we actually focused on? focused domestically our governments on our economies and the united states, europe and japan and also, of course, we are pivoting away from the middle east toward asia and the markets don't like the fact that economics are on top of each other this year and make them more scared than ey should be, in other words, fear is actually the single biggest risk in 2012,

it is not that the big things are blowing up, the euro zone isn't going to blow up, the united states is actually doing better than people think, china is not going to have a hard landing and yet all of the headline risk around political volatility is keeping money on the sidelines, it is keeping people investing in gold and it is stopping the global economy from developing the way it probably should. >> rose: these are things you called red herrings. >> that's right. >> they are not going to have the potential for explosion that we might presume, let me list them here .. because i have them. they are 2012 political transitions, elections in mention mexico, venezuela, kenya, and maybe egypt, political ansitions in the u.s., russia and france so you don't think -- you think that is a red herring to believe that will bring dramatic change or certaiy accelerated risk? >> everyone is talking about 2012 as being the year where there is massive political transition, in fact, about 50 percent of the world's gdp is having political transitions in 2012, they are scheduled and yet

won't have a very significant impact in the united states, we are not gointo have any legislation this year, in france, even if polan wins over sarkozy whic looks likely, they have the same view on the euro zo, many want putin out and they are not going anywhere and in china we have known the next leaders for some time so no major instability in these transitions. >> rose: and no mayan apocalypse. >> no mayan a pock lis lips and if i am wrong we won't be talking about it so that is safe. >> rose: so if you had to look at those things where history is getting better, where is that .. for example number 2 here as a risk is g zero in the middle east which is something i assume means there is no great sense of coming together on the middle east. >> >> there isn't and there is no international capacity to maintain stability but the local forces are either not paying attention or they are fighting each other. so for example, the united states pulls out of iraq,

china is not going to be in there, russia is not going to be there, the euro zone is not going to be there bhorks is going to help iraq put itself together and the answer is nobody and what is happening as a consequence is we are seeing maliki is under a lot of threat and starting to go after the sunnis, there is an explosion of sectarian violence that could accelerate. >> that is right, the g zero in the middle east is one of the biggest risks out there, it is not just in iraq, the syria, the arab league has shown itself to be ineffectual so the arab, the transition is not going well, and it is not likely to, so, you know, therare lots of -- the united states is absolutely not critical leadership and not indispensable in every part of the world, the euro zone doesn't have geithner bailing them out they will mulled through themselves but the middle east absent any international intervention and absent effective regional powers that

have leadership that can coordinate, we have got saudis, we have egyptians, we have got turks, we have got iranians, they are not playing well with each other. >> rose: all right. we also saw this week, the united states sort of announced at it is redirecting its focus. both in terms of its military focus as well as bringing some austerity to the pentagon, does the world welcome that? do they believe at long last the united states should be preoccupied with asia and with change in asia? >> well, publicly in the middle east, of course, they will say they welcome it, privately a lot of pokes don't. in asia, the america's asian allies have en begging for it, and singapore and japan, of course, and vietnam and indonesia, they have all been saying, look, we wantsome commitnt. >> rose: we e worried about the china being our partner. >> i tell you, shin with a, the chines state media came out a few hours agand said the united states, that this new

peagon speech, america was going to be a wl in,ull in a china shop, i can't imagine they meant that intentionally, asia ashe china sp but nonetheless the chinese clearly are feeling very, very insecure and defensive about the fact that the americans are now focusing laser like on asia as the key area for security. >> rose: how about north korea? >> i mean, i can't see how king jill un is going to run this country, the guy is 28 years old and groomed for less tn two years. there has been a series of high level accidents of party leade in the next 12 months they don't have that many cars there, this is not going to be a smooth transition what concerns me in the next month or two north korea is going to be relatively quiet because no one is going to suddenly move against this guy and we are going to forget about it and leave the headlines but the transition will not have been affected there is the world's most totalitarian rime and one of the world's poorest and run by someone who is not capability capable of running it

that is the single biggest country risk out there in 2012. >> you saw saw a program i did on iran that preceded you. >> i did. >> rose: what do you make of where iran is going? >> well, i think there are two things that are driving iran more in at that in a corner right now, the fixis that they are losing geo politically in the region, assad is on the wrong side and eventually forced out with civil war. >> rose: sooner rather than lar? >> he still has capacity, the arab league is ineffectual there is no libya option on syria right now s so he could hold on for a while it is going to be bloody and horrific. >> rose: there is no turning back on it. >> there is no turning back i think that is right and i think in bahrain the iranians are the losers supporting the shy a majority there, maliki has been sort of the -- the sunnis are looking to move away from him so if you are iran, geo politically you are on the back foot, also more sanctions are going against iran and it is startinto bite,

and there is new energy sanctions from europe because the countries that are getting oil from iran have all changed their governments recently, greece, spain, and italy all have governments now that are much less well disposed toward working with tehran and in the united states we have tougher sanctions coming though there are big holes you can drive through on the central bank. all that is making t iranians tweak quite a bit, they are not going to shut down the straits of hormuz, you know that it is economic sue sid but going this is going toe a provocative environment. >> there is the arab spring and there is the coming of islamic governments in which islamic parties have a majority the government. should we worry abt that? >> well, i think in a question, if you are talking about egypt of course, i think what we are seeing right now is that the muslim brotherhood and the military both of whom have said they are not going to stand a candidate in the upcoming presidential elections, they are going to work together, and they are going to work together to come up with someone that is

going to run that country now, clearly, the odds on favorite in there, who everyone in the root is gng to root for is -- although he is not kind to the israelis because he used to be foreign minister folks can deal with him. >> rose: they know him. >> they know him and he is not going to be overtly offensive to the folks on tehrir square but if they go with someone else more attached to mubarek and the military regime you won't see legitimacy and so many of the folks who lost so much in the past month to bring about this transition are going to feel like they have knock to lose. and that is a danger. >> we have close ties to the military there there, i assume we are cautioning them not to overreact. >> we can caution them all we want but if you think we were not very effective in cautioning the europeans with too much austerity, look, we are a taker and not a maker o foreign policy in the middle east and obama's speecmade that even more clear, we are trying to get something done in asia, i think that is right and it is over

due, but it does mean that the middle east is going to be much more fractious. >> rose: finally this, tell me how america's relevancy in the word is changing. >> well, overtime, there really only, there are only real two options, either china is going to do well i which case the united states and china together are going to be coming up with some form of what the world is going to look like and maybe be cooperative and maybe it won't be. >> rose: g 2. >> or china is going to fall apart. >> rose: really? >> well senate the other option,. >> right and if china falls apart you don't get a g 1 because that would be very bad for the u.s. economy, what i am trying to say the world we had r the last 50 years, it isn't coming back, the only question is, who are we going to be sharing the sthaij with? and how are we oriented towards them? that is a very different kind of world and kind of projection of power for the u.s. and what is very clear it is not fundamentally about the area that we have clearly dominated everyone else, the military

side, it is primarily on the economic side, one we will have to focus a great deal more as our own government. >> rose: thank you for coming. >> go to see you, charlie, have a great day. >> rose: thank you, plus one. >> rose: ian bremmer. >> rifkin is here and president of the economic trends, the third industrial revolution is his new book and looks at the convergence of internet technology and energy i am pleased to have him on this program, welcome. tell me what the third industrial revolution is. >> well, it is based on a premise in how the great economic revolutions emerge in history and that is the great economic shifts really occ when two thingcome together en we create new energy regimes and new communication and energy come together they really do change the way we organize society, very fundamental ways, for example the 19th century print technology became really cheap with steam power and put in

public schools and created a very literal work force with the media skillings to work with comb and rail infrastructure. we couldn't have done it with illiterate work force and the 20th century centralized electricity, especially the telephone and later radio and television became the communication vehicles to manage the complexities of an auto oil culture in a suburbansociety and mass consumer society. now obviously that revolution, second industrial revolution is on life support, you know the fossiluel energies are getting expensive, the technologies are old, the infrastructure is dying but we are now on the cusp of the third industrial revolution which could rejuvenate the global economy we had a powerful communication revolution in the last 20 years, the intern, in whh interesting about the interesting is that it is organized so it is distributed and collaborative, i it scales laterally so 2 billion people can now send their own video and text to each other with far more laterapower than the centralized telecommunication tworks of the 20th century.

what happened in the last two years which is really interesting, is this internet communication technology is st now merging with a new energy regime, distributed energy, and when they come together we create an infrastructure for a completely new economic paradigm. >> rose: what is the best example of that where the merge has taken place. >> the best example is germany, i work with the chancellor since she came into office and they are working on all pistons, remember they started the second industrial revolution with the internal combustion energy. >> germany has targeted 20 percent green energy, renewable energy by 20-20, germany now exceeded that that's and going to 35 percent green electricity way ahead of the united states, piar 2 is interesting how do you collect renewable energy because it is found everywhere, the sun, the wind, the heat under the ground, garbage backed energy, ocean tides tides so pillar 2 what germany is doing is converting

every single building in germany to your own green power plant so you can collect sun on the roof, wind all the walls, geothermal heat under the ground and t new buildings they are putting up a actually positive power this jump starts construction, this gets thousands of smes moving, small to medium side size businesses and millions of labor hours think of think way, 1970, centralized mainframe computers, controlled by a few companies, they shared the information. steve jobs comes along, creates a desktop computer, now the internet, and now 2 billion people create their own information and share it, so in germany the same idea, pillar 2 you are going do have your own power plant and now thousands and thousands of buildings creating their own power, pillar 3 you have to store this energy because the sun isn't shining all the time and sometimes the wind isn't wloag when you need it so the idea is to create a storage carrier with hydren, hydrogen will store these energies soive sun hits the roof of your house you generate a

little green electricity, add surplus you don't need, you put think water, hydrogen comes out in a tank when the sun is not shining on your roof in berlin you convert that hydrogen back to electricity, pillar 4 is where the communication technology comings together with e energy. we use off the shelf internet technology, and we trance form the power grid, the transmission grid of europe, germany and europe into an energy internet that actually, that acts exactly like the internet so when millions of buildings in germa are storg their own energy, storing hydrogen like you store media and digital and if they don't need some of that energy they can share it like the internet to the door steps of russia and five is plug and transport, fuel cell vehicles in three years so you will be able to plug in your vehicles anywhere, get green electricity from the grid or sell your own back. >> rose: at is the time line for this? in jeremy theyre moving quick and testing the energy internet in six regions and created hundreds of thousands of new jobs, i would

say on infrastructure in place, by 20-20 five, and they are definily leaded the world into this new e.r.a. >> how long will we immediate fossil fuel is. >> the problem is the crisis we are facing i think we haven't come to grips with and the real earthquake was july of 2008, remember when oil hit $147 a barrel and everyone stopped purchasing because all the other prices went up, because everything is made out of fossil fuels, fertilizers. >> rose: of course. everything, yes. >> and that was the earthquake and the collapse of the financial market was the aftershock related but what we have learned in the business community now is tha we know outer limits how far we can glalize the wld bed on fossil fuel about $150 a barrel and every time that happens all the other price goss up, purchasing power goes down and shuts down. so what i think we are seeing here is the beginning of a long tortuous end game over the next 225 years and try to start to te

engine again. >> you change the economic model what do you do. >> you put in these five pillars in every city and region this and this is what they did in the 20th century, first they came up with the car and put in the pipelines for the oil and then put in the highways and the interstates and then put in the suburban shopping centers and housescross the interstates and all went together as a package, and what germany does well is public private partnerships, they realize that to lay town an infrastructure for a new economic revolution requires government at every region has to work with the buness community to create these nodes, these infrastructures and then you create all sorts of new business opportunities, and lots of jobs, and germany is the most robust industrial economy in the world today and leading exporting power in the world with china, it only has 80 million people so what i have been saying to my colleagues here in the states is, we ought to take a look at what they are doing, german business, they are very smart and if they think the third

dustrial revolution has long legs we ought to take a deep look. >> rose: where is the technology coming from? who were the pie in other words in terms of creating alternative energy sources? because, you know, you look at the enormous amount of capital that china is pouring into alternative energy sources at the same time enormous amount of pollution china is creating because it is engaged in its own kind of industrial revolution. >> well, you know, the long and the short of it is a lot of the solar operations in the united states and wind operaons are coming from europe, somebody of the companies in my group are european companies. >> rose: and the scanned nature companies several that have been very, very -- >> very successful. the wind companies, the solar companies so if you go out west and where you haveanchers that are leasing out their land to wind farms, those are european companies by and large and same with some of the large solar operations out west we should do it here, what has hapned is, we created silicon vali, that was the internet part of this

revolution and brought universities together with companies, what europe is doing is creating putting their internet technology together with green energy and they are creating all sorts of new business practices and models. what is critical here is you take these five pillars, separately they are nothing, when you put them together they credit a node as we say and it ishat node, it is a synergies between those pillars that creates all the new business opportunities and if you don't do that you are los i hope i don't step on toes but where president obama made his mistake here he really wanted a green economy and his heart was in it but he sidined all of the projects that they spent money on so you would get a battery factory over here a they financed the solar company over here, they didn't connect them , there was no narrative, there was no vision, so we ended up waste ago lot of the taxpayers dollars actually. >> rose: do you favor cap and trade or tax on carbon >> well, i think that some kind of carbon tax is inevitable, but

really the reason i wte the third industrial revolution it is an economic model it is not an energy plan, not a climate plan, it is an economic model to transform this society, but it more effectively addresses climate change and energy security than all the targets and taxes you can put together because it is about business and creating millions of jobs and thousands of new opportunities. and i think that is what european companies are picking up on. especially germany. >> the book is called a third industrial revolution how lateral, lateral power is transforming energy, the economic and the world, thank you. >> tnk you very much. >> rose: good to see you. >> nice to be here. umberto eco is here and a philosopher, he a novelist and best known for his book the name of the rose. his latest novel is called "the prague cemetery, it is about anti-semitism and conspiracy theories, the spanish newspaper said the novel restores the irreverent and provocative spirit of great literature i am pleased to have him back at this table, welcome. >> hi, charlie.

>> rose: let's talk about the book you have cread a despicable, terrible, hateful character. >> yes. >> tell me, who -- how did you go about this? what was it you wanted to do? >> well, first of all, i was not the first one to think of shakespeare. >> right. >> these disagreeable characters. i certainly exaggerated for it. i wanted to design a racist, and among the other forms of racism, and anti-semitic person, so i was maneuvering such a dirty, material that it was important for me to keep the character far away from the reader, and far away from myself in a way. at that point, well, as a

writer, it was also a please your invent this, it was also a pleasure to invent this disgusting character and i did my best in doing that .. >> rose: to the moral imperative here is what? in other words, you have said that this book was a moral imperative. >> no. i think that being a book about forgeries, the book -- >> rose: conspiracies. >> conspiracies, and the book about the biggest -- the most tragic of the forgeries, is the protocols of the -- that they inspired even hitler. >> rose:. >> for doing what he did. the was a more im, a moral imperative that is it is not necessary to have a moral

imperative to write a novel but this time it was to make evident how a forgery can be concocted and produced, how forgery, how the protocols, like the protocols are very difficult evolution, because they affect many hands, they are something like the frankenstein monster made up with different -- >> frankenstein monster with different corpses. >> and to make the reader aware of the self contributoriness, the scandal of the protocols, they are so naively sel contradictory that you could think that it is impossible to take them seriously. the scandal on the protocols that after they proved to be a fake in 1921, by their own -- they were republished and then republished and still believed more and more, an incredible

phenomenon, i triedto explain what sort of swamp was beneath the growth of this text. >> rose: the chacterwhere did you get his name from? >> that is a historical, because the grandfather of my character simon was allegedly a historical person, at the end of the 18th century, he had a book of the paranoia of general conspiracy saying that the french revolution had been planned by the knight o tell particulars, the philosopher of -- and many other people and it was received, he was saying, ha, ha, you have forgot.

and thisletter contains all the cliches that then in the 19th century were used against the jews. did captain simon really exist? was that a forgery or a real letter, we don't know. we know as a historical evidence that this letter was used and published and republished many times in the 19th century, so it got a certain affect in order to produce -- it was not the only anti-semitic attacks produced in that century, but in part it heed, step by step, to arrive to the protocols. >> rose: he is the only fictitious character in the book? >> yes, all the other ones are true, and that's why they look so fictional, there is nothing morphickional than history, studying characters that really existed, you though, there is a

character there that everybody believed it was invented by me and i was a genius. no. he was really existing. he was a professional liar, changing the kind of lies, opinions, positions, every season with a sort of erotic taste for fakes. an incredible character, and he existed. >> rose: he is driven by the desire for food and the hatred of jews? >> food is another story. i gave to my character an enormous quantity ofood as a stut f sex, and i thought that the reader could have been disgusted for such an amount of food, but since i worked to find the typical dishes of that period, the names, the french names of those dishes, so

fascinating that people believed i was making this up. and i said, no, i am a mcdonald person, they thought i was a chef. >> in writing this book, you hoped it would be a remind to all of us to be vigilant about anti-semitism? >> y, i think so. you know, there was a position in the jewish community, at least the two articles, that maybe somebody can take seriously or argue anti-semitic arguments, but the response you can find on the internet, so it is not that -- but another rabbi in the a meeting said sometimes for political correctness we try not to mention those cliches,ree tend to forget them.

why they are still alive, they are still circulating, there are still people sharing those ideas, so it is important to spell it loud and to remember that they are there and they are still very strong. >> rose: there is also a lot of lists in this book, lists of this, lists of that. >> i have written an illustrated book on lists. i think that in the history of literature, lists are an important stylistic device, i used a lot of lists in my own novels, and, therefore, there are lists ao there. it is part of my -- one of my styles. >> rose: and so you started writing thoferls because you had stories you want to tell? >> i discovered not to have a definite answer to this question, because i can give

numerous answers, for instance, the fact that i told stories to my children and i grew up -- >> rose: yes. >> but the real -- the real answer is that i wish to do that. it is -- it is like falling in love. there is no explanation. it happens. but i was a great narrator in my childhood, simply i start many novels and i stop them at the first chapter, so i was the author of many unaccomplished masterpieces. >> rose: one chapter masterpieces. >> yes. >> rose: what is theuture of the novel? >> i think, first of all, what is the future of narration? because there are many forms of narrative which are not necessarily the genre of the

novel, because there are what are called natural -- what comes from outside, i tell you oh i have seen somethi extraordinary, there was an accident, we are always telling stories, the mothers, so the narrative is a fundamental human activity. >> will you immediately start on another novel or wait until the idea -- >> my novel took six years at least and the next in eight years, in one month i will be 80. >> rose: in one month you will be 80? >> yes. 80 years old so if i survivor until 88, maybe. >> rose: the pragu "the prague , umberto eco, thank you. great to see you. pleasure. ss

foruinnd ro pd endeviby ro pvided byco tla a-oc colaco company, supporting this program since 2002. .. >> and american express. the additional funding provided by these funders. and by bloomberg. a provider of multimedia and news and inftimase services worldwide. be more. pb s.