on nato/eu, you're right. we have not reached the full potential of a nato/eu cooperation. but having said that, i would add that we have made a lot of progress during recent years. when it comes to operations, we coordinate and cooperate seamlessly in theaters where the eu and nato operate together. so from a practical point of view, it works quite efficiently. when it comes to capability development, we have achieved a lot of progress. the european defense agency and allied command transformation norfolk work very closely together, and i think i could safely say that we avoid duplication and waste of resources through close coordination, and i would say an efficient division of labor. finally on political consultations, here i think we have the biggest problem. because of these well-known topics and disputes, it's sometimes difficult to organize joint nato/eu meetings. there's one area we are allowed to discuss in formal meetings, namely bosnia because the eu operates a so-called berlin-plus operation, which means that the eu can use nato assets to conduct their operations

on nato-eu, you are right. we have not reached the full potential of a nato-eu cooperation. ut having said that, i would add that we have made a lot of progress during recent years. when it comes to operations, we coordinate and cooperate seamlessly in theaters where the eu and nato operate together. from a practical point of view, it works quite efficiently. when it comes to capability development, we have achieved a lot of progress. as the european defense agency and allied command work very closely together. i think i could safely say that we avoid duplication and waste of resources through close coordination. i would say an efficient division of labor. finally, on clinical conservation, i think we have the biggest problem. because of these well-known topics and disputes, it is sometimes difficult to organize nato-eu meetings. there is one area we are allowed to discuss informal meetings, namely bosnia. the you upper -- the eu operates a 30 plus operation which means the e you -- eu can use nato assets to conduct operations. so we are allowed to have formal nato-eu meeting

last, washington and brussels should clarify to nato and eu members that belong to these organizations that it entails organizations to protect the securi security. up until this year, brussels has increasingly pulled out of the visit of ensuring energy security but the market pace alone will not be enough to encounter a relentless russia. national and eu institutions must take a more active and strategic role and the ut shoni states should support this. thank you. >> thank you. mr. chow. chairman murphy ranking member johnson i'm honored to testify on energy security and the ongoing crisis in ukraine. when it comes to energy supply in europe we focus on natural gas supply. it is interesting to ponder why because europe is more dependant on oil supply. the level of anxiety is much higher with gas than oil. why? the root causes are in part related to incomplete market integration in europe when it comes to gas and electricity. the gas markets have been dominated by long term contracts at fixed volumes with prices indexed to oil. suppliers have restricted competition with destination cla

within both organizations, and there is also growing evidence of individual members of nato which are also members of eu doing stuff together. so i think that's an important area of future capability as well. >> ywhen it comes to the burden sharing, it's also inclusive of nato, but the u.s. is not thought of as part of that. is the u.s. helping in line with the burden sharing conversation, or is it considered the u.s. is going to take care of itself no matter what. this is for the rest of the members sort out? >> well, the united states pays the share for a long way by the moment. i don't think anyone thinks the united states should be doing more. but what the united states can do is engage with the rest of us in a number of different ways. one of the opinions that i happen to hold is that if we are to continue to persuade public opinion across the alliance that their valuable taxes should be spent on defense, that there's got to be an extent to which they see this contributing to their own industrial defense, employment, prosperity, objective. that is to say, if you're going to spend lots of money, it

>> trying to do work with our alliances, within nato, the eu, other regional groupings, but's just notorking. look at what's happening in iraq, david's point is right on with the isis thing, whereas you could look at what's going on in syria with the civil war, once they control territory and he set up the trappings of state, now you have got afghanistan revisited, afghanistan, 1996. so, now we have a real threat, not the somewhat threat or ambiguous threat, now a real threat, now that has to be dealt w so the trouble is we are fatigued with war, people are sick of this, but now we are faced with a real thing that we are going to have to stand up and respond to. >> showing the direction the world needs to go or should go in the president's opinion, do you think that the other countries have stepped up? is the rest of europe, is the rest of the world doing enough, or does this all, again, sort of fall to the united states to combat terrorism that is now apparently spinning out of control, to combat everything >> the colonel is absolutely right in the way he described things. europe has

be hisiders ukraine to stand against further encroachment by the eu or nato and therefore ukraine is really under heavy pressure from him. he is attempting to create alternative institutions, the he has beenon, that talking about with kazakhstan and belarus, for example. he will go as far as he can go but i also believe that he will not be totally reckless. he will take stock of what's happening with sanctions, energy and perhaps begin to negotiate some kind of withdrawal. he's done has been popular at home even people in the west say he's making significant missteps. is like any leader who plays the nationalist card. it's going to be popular in the short run. the problem with that kind of popularity is there are parts of russia that are third world status. they have not developed the way you see in moscow, st. petersburg, and a few other places. i was recently in vladivostok. you could see how undeveloped far eastern russia is. at some point the russian people themselves are going to say, wait a minute. are you spending money in crimea that could be spent at home, money destabilizin

putin's goal is to crush nato and divide the eu, both are frail.get into our relationship, our alliances with europe -- with european nations. there are path in these sanctions for the french, for the british, and for the germans. so, but they are far -- they are far further than they have been willing to go than ever before. if it wasn't going to inflict pain, he wouldn't have been on the phone with president obama on july 17th crying about the couple of names that obama was doing, adding to a list unilaterally to freeze assets or whatever. it is going to be a problem. but, whether he meets his goals of redrawing the map of europe and continues on to try to crush nato and everything else, at this point is he pledging to do so. >> the president was asked today, charles, about this. about lethal weapons and the possibility of moving those into the ukrainians. take a listen. >> the issue tim is note the ukrainian capacity to out fight the separatists. they are better armed than the separatists. the issue is ohio do we prevent blood shed in eastern uk

first cold war and expanding its influence to the doors of russia, and then the whole nato question, unreported. when this euer triggered this -- what was unreported was there was a trigger in this, a secret entry door for ukraine to enter nato. this is a russian redline. first of all, we should not be having nato in these times. it is a military alliance. media in this country has so demonized putin. as i said, he is an authoritarian, but i will quote someone that i know we have mixed feelings about, henry kissinger. putin isid demonizing not a policy but an alibi for not having a policy. i think america needs a policy, not an attitude, as it engages with russia. >> thank you for being with us, editor and publisher of" the nation." we will link to her column "downing of flight 17 should trigger talks, not more violence." in arizona, looking at last night's execution and how a procedure that usually takes 10 minutes instead took one hour and 57 minutes, the execution that took lace -- place for joseph wood. he was injected with a controversial mix of drugs. media journalists describe what they saw next. joe

putin will not rest until he can at least prevent ukraine from moving to the west, either with the eu or nato. and i think he will continue to create problems in ukraine as part of his effort to keep it from moving into the orbit of the west. i think there are also other areas on the periphery in russia to be concerned about. but this is his strategy. we need a long-term strategy. i think we will get this, we will have the investigation. my guess is the investigation will show that, that this was a mistake on the part of the pro-russian rebels, that they did not know they were shooting down a civilian airliner, but the russians enabled them to do it. whether a russian was pulling the trigger remains to be seen. but i think it does illustrate the lengths to which putin is prepared to go to keep ukraine from sliding to the west. we have to figure out how do we give the ukrainians economic, political, and even military support in terms of helping them improve the quality of their own military to help them counter that? >> can we simply accept ukraine as a buffer between east and west, neither pr

the president should be organizing talking to the eu and nato about this act and what is the call to action that is going to take place on the part of nato to deal with this. >> you know, he seems to want, general, an investigation. you know, similar to what we've heard in response to other terrorist attacks elsewhere that we need to fully investigate it before we do anything about it. >> will, i absolutely think he's hiding behind the investigation because it delays and it will take weeks to do something like that. the fact of the matter is, megyn, when you have crisis, you don't always do the first thing to de-escalate the crisis. it depends on the crisis. in this crisis you should confront the adversary who caused the crisis. and that is putin and russia. lay out the case to the world because they're watching that he has been conducting a covert proxy war in ukraine, that he has directed his officers, fsb, his intelligence, his special ops guys are in charge of that war. he's using ukrainian proxies as foot soldiers. and he is providing heavy equipment, technology, arms ammunition

is long-term some sort of buffer in east ukraine which would prevent ukraine from moving into nato or the eu in any fast way and would allow that for russia long-term. >> chris, thanks for that. it's great to have you both on. still to come on the show, are the bulls overrunning the bears? base odd the credit we're seeing in markets could last until early 2020. we'll discuss in two. >>> welcome to "worldwide exchange." i'm julia chatterley. these are your headlines. the u.s. and eu agree to impose fresh sanctions on russia, sending the company's markets lower. russia president putin denounces u.s. foreign policy as aggressive and unprofessional. the country's foreign ministry says it will not tolerate plaque mail and warns of retaliation. >>> reports suggest volkswagen could be considering a bit for some parts of fiat's business. its shares jumped. >>> plus, time warner investors want more money from murdoch. the firm rejects an $80 billion bid from 20th century fox as too low. the stock closer much higher on hopes of a better offer. >> announcer: you're watching "worldwide exchange," bringi

deployment of nato troops in the frontier states, the border states, the ones on the russian border, poland. and now they feel somehow betrayed because of so many countries wanting to not only join the eu but also nato. so it is a tough issue and the west i think has not always been on a very, you know, how would you say it diplomatic side and the negotiations did not always go well saying we won the cold car and some of the rhetoric was never very good. obama told putin that russia was only a regional power and i think that made him furious. you need russia to negotiate and so they are on the world stage. >> do you think the issue with crimea is more important to russia than either the europeans or the americans? >> i think most certainly. i think the question which gets that is the cold war mentality of putin, you know, a former kgb colonel. and i think certainly the obama administration to the united states and to the less extent in europe is a failure to understand this. i often feel that u.s. foreign policy treats putin as sort of a reasonable, western-minded individual with whom one can do business and i think it's more complicated than that. >> quite the opposite, more weapons g

. >> nato is not the vehicle to do that, though. >> what about the eu?he eu has its own military force. that might be an option but when you talk nato, you're talking basically an american presence and that's one thing vladimir putin does not want. you mention nato and ukraine in the same sentence, that will drive him into orbit and will cause a confrontation. >> bob, the dutch is getting caught up in the fight between the ukrainians and separatists. could action from nato effectively indicate that an increase in separatist activity? >> look, you know, the last thing -- rick is absolutely right. the last thing we want is nato. this is one of the reasons that putin has gone there in the first place, that he's afraid that nato is going to set up a missile shield and send troops. that's a red line, having nato troops or any sort of nato influence in the ukraine and right now if any role in that -- even if the eu as well, it's only going to encourage putin to cause more problems in the ukraine. and what we want to do is step this crisis down and not make it

number two, he considers ukraine to be his stand against further encroachment by the eu or by nato.d therefore ukraine is really under heavy pressure from him. and he is attempting to create alternative institutions, so-called eurasian union that he's been talking about with kazakhstan and bellaruse. he will not be totally reckless, he will take stock what's happening with sanctions and energy and perhaps begin to negotiate some kind of withdrawal. >> rose: but so far, what he's done has been popular at home even though people in the west say he's making significant missteps. >> well, it is like any leader who plays the nationalist card. it's going to be popular in the short run. the problem with that kindh9popf russia that are third world status. they have not developed the way thatpetersburg and a few otherr. i was recently at a conference with putin. i write about some of the stories he told me. you could see how undeveloped that part of far eastern russia is. so at some point the russian people themselves are going to say wait a minute, are you spending money in crimea that coul

nato in former soviet union territories and they want to stop that. so from a standpoint of can we just say to the ukrainian government we will help you and put our troops in. can the euthat? no. can nato do that? no. can the united states do that? we could, but it will intensify the danger with russia. russia knows that. the next several days and weeks will be interesting to see how far mr. putin pushes his luck in expanding in ukrainian terrain and what the european union and european forces will do about it. ukraine has conducted exercises with nato and non-nato partners. i have been at those. they are establishing a professional force. russia doesn't like that. they are leaning more to the west than the east. that is something that mr. putin doesn't like. >> barbara, early they are week, you were invited behind closed doors by u.s. officials to receive a special briefing on the causation issue. what is it we can say or cannot rule out about direct russian involvement with regard to the downing of mh-17? >> several reporters from major news organizations around washington attended that briefing because the intelligence community wanted to put out what it knew. a lo

ukraine is probably realistically not going to be joining nato, maybe not even the eu any time soon.hat means we have to have a dialogue. and actually, the silver lining that i see in the disaster of the airliner is that putin's nominal position is we need a ceasefire. we need to be able to do a credible investigation, and we need to negotiate. now, obviously, if it's true that the russians are shelling across the border now of all times, then he needs to be called out on that. and i would think given that the casualties were largely european, the europeans are in a perfect position to do that. and they should be doing that. >> and this does change the game. robert, stephen cohen is a russian studies professor at princeton and nyu. he had this to say about putin on this show earlier this week. take a listen. >> people were telling him that we're spitting distance from an actual war between the united states and russia, and he has to act cautiously. we're close to war. and we're missing that picture. we're close to war with russia. this could happen. >> do you believe that we are, as

result in autonomy for east ukraine that would allow eastern ukraine to vito any attempt to join nato or join the eu. right now the card he's playing is the card he's wanted all along, and i don't think we should allow him to get away with that. >> do you see increased western pressure and western acceptance with the fact they have to do more to get him to come around? >> yeah. across the globe the pressure is growing to take tougher action against russia and i think that tougher action can come in two forms. one is a significant ratcheting up of sanctions. the other is moving from nonlethal support of the government to lethal support. those are the two things on the table being discussed and really have the potential to push putin in the right direction here. >> mike, how culpable is president putin if at all in the downing of the aircraft? >> really hard to say at this point what he knew personally. my guess would be he was aware of the support by the military to the separatists, but whether he knew about the specifics, whether he knew about this particular anti-aircraft system, whether he knew ab

. >> does this give them an opening there in the eu or nato to now do something after this -- at theent, this disaster that we're reporting on? >> well, the short answer is yes. there's always an opening. especially after a circumstance like this, which catches everybody by surprise. but it's going to require the concurrence of moscow in order to do this, because they're supporting these guys in the eastern ukraine. the battle has been joined for some time and will continue. without moscow's support, there won't be any battle that will continue for very long. so yes, there is an opening, but the opening also has to be an opening at the other end from russia. if russia signals that it might be willing to sit down and work out a deal of some kind, or at least have a cease-fire, then there's something to be done. otherwise this will just carry on forever and ever. >> we've been watching reports coming from the ground there near the crash site and areas close to that. those of what some headlines are calling the king, or the prince of donetsk. and headlines like that. what does that mean

nato troops in the frontier states. states and theer ones on the russian border. now they feel somehow betrayed because so many countries not only wanting to join the eu but also nato. it is a tough issue. always the west has not sideon a very diplomatic and negotiations did not always go well. sometimes, the west was hosting and saying, we won the cold war. some of the rhetoric was not very good. well, russia is only a regional power, i think that harmed him and made him furious and show the world russia is a power and you need russia to negotiate with iran and syria so they are world states. int: do you think the issue syria and ukraine is more important to the russians then either to the europeans or americans? guest: certainly. what the question gets that, it and it is very good, is the of,ific cold war mentality a colonel, his historic ambitions or a great russia. certainly from the obama administration passes and if you come the united states, and to a lesser extent, europe, this failure to understand this, i that u.s. foreign policy treat spoon as a reasonable, western minded individual, and it is a lot more complicated than that. we have seen it in recent d

eu. keep it inn attractive to nato through this low grade insurgency which is now getting more and more lethalbut, what really worries some analysts, andrea is that putin will try to lead any investigation now into the crash. control the black boxes, for instance, and there are growing reports and conflicting reports now about those plaque bblack b. >> jim maceda in moscow. kelly ayotte joins me from the hill. thank you for being with us. was the president tough enough today with vladimir putin, or does he have to preserve lines of communication to moscow, or what should we be doing with putin given the evidence we have of the russian separatists who apparently fired this missile? >> well, i think it's very clear that the evidence is pointing at moscow. the russian separatists are being funded by moscow. the equipment comes from moscow. and essentially this investigation at the end of the day will have, i think, the fingerprints are really on moscow. and to see the -- really the serve. i'm never ceased to be amazed by the nerve of vladimir putin to actually blame the ukrainians in terms of clo

that's what the ukraine example suggests, and i do think that there's eu meetings going on right now and then there's a very important natohink eu discussions and the nato discussion in wales is going to produce a stiffer resolve in europe to try to face off and not just kowtow to russia. so on the energy side, here is what we should do. the united states should be helping europe to develop their own energy resources. we should be exploring whether strategic export of liquid natural gas from the u.s. can help european nations wean themselves away from russian energy. there are other partners like algeria, for example, that wants to build a new energy pipeline under the mediterranean to supply europe. we ought to be helping european nations find other suppliers. these are all things that we can do. russi russia is a rust belt economy with natural resources. if we can reduce the reliance of other countries on their natural resources, that's the thing we can most do that would affect the russian economy and hopefully curb this kind of completely outrageous aggression by putin. >> i think on the part of the united states and

i expect from the eu and nato assistance to the ukrainians and enhance economic sanctions.hey cannot politically look at this situation and not be more closely aligned with the united states since our last round of sanctions. >> let's bring in senior fellow of the atlantic council and former deputy assistant of defense for europe and nato policy ian brzezinski. ian, thanks for being on. >> a pleasure to be here, mika. >> whether or not the russians themselves or their missile provided to separatists, what are we looking at in terms of options for the world community and particularly the u.s. now? >> mika, i think this is clearly a game changer. i was struck by the report that u.s. intelligence now reporting that this was either fired by the separatists or by russia. this should, as richard pointed out, mobilize the europeans to take a more firm stance against russia's's invasion with ukraine and it should bolster the u.s. government to take a more firmer stance in this crisis. so we will see what happens in the coming weeks. but i think certainly increases the pressure on a

orientation of ukraine, maybe formal assertions about ukraine not a curing nato for a certain future, certain connections between ukraine and eunnections between ukraine and russia, and it gives putin some way to back down and to save face. >> very good. richard haass with us for the hour, council on foreign relations, jeff rosenberg as well. >> that is interesting. an offramp for vladimir putin. >> president obama gave him an offramp on syria. >> our border question of the day -- as the world focuses on ukraine and gaza, what are we ignoring? is it syria, is it iraq, is it asia? tweet us @bsurveillance. ♪ >> a good one, everyone. "bloomberg surveillance." i am tom keene. jeffrey rosenberg as chief investment strategist at black rock. he strategizes so his clients may have a pot of money at the beginning of the retirement trail. as expected, the expected return work the so-sumpedon of investment return. it is changing. not all of it is good news. this is an important conversation. where is our expected return? >> expected returns are links to economic performance. at the end of the day, the ability to generate returns is a fun

pressure on russia and shows solidarity between the eu countries in the united states, which is a strong signal to putin. beyond that, he needs to strengthen nato and work together on energy. the danger is that the russians will divide europe from the united states because they can exercise energy leverage. we had this in 1973 when the divideuntries tried to us. we need to make sure that we are together and have an energy summit to demonstrate we are working together on reducing vulnerability to russian energy leverage. >> that has been the biggest leverage russia has been able to hold over eu countries. let's get to this morning's company news. scandal scandal -- meat and mcdonald's is having a ripple effect in asia. the japanese units will step up to ensure safety of food. packaging oldht chicken and beef and repackaging and calling it fresh. morgan stanley associates will get a pay hike of 25%. it is part of an effort to improve working conditions and keeping retention, bankers paid on wall street. uber will offer car bookings from business travelers. among the companies who have signed up, deutsche bank and it may be a company near you. you

. >> and there's really not even a role for nato in this at this point. where the eusanctions in areas that will hurt individual economies. the brits have vulnerabilities on finance. the french on arms. the german and italians on energy. so, they're trying to do this by limiting it to sanctions. the reality is, the europeans don't want to do any of this. the europeans don't want any confrontation with russia. but because the russians are not backing off, and i would argue the russians have overplayed their hand on a consistent basis, they're essentially forcing the europeans to do things that they really don't want to do. >> but isn't it true basically that no impact is going to be seriously felt in the near term on russia unless, as becky suggested, there is, you know, you hit gas coming out of russia to the european economies that buy them and there's no way europe's going to do that so what we're going to see are pr moves by europe to see like they're doing more in terms of sanctions but in reality they're not doing anything that's going to have any near-term impac

though nato has ratcheted up the presence of troops in ukraine and in the surrounding area, we don't know what impact that has had. i would point out that the baltic states aren't eu members and they're the ones who feel quite threatened by what's going on. though we have sent more troops to help protect them, that is not really doing anything directly for ukraine. >> the danger that strikes me here is the most dangerous syllogism in all. job referred to it is we have to do something. this is something, so let's do it. the question is, what's the something? it seems that russia's been perfectly -- russia's calculations of its interests that securing a buffer of influence around its border is so important they're willing to sacrifice all kinds of things. they did it over crimea which everyone just saw them yoink in front of the world. >> right. absolutely. the thing that remains the most important thing for putin in this crisis is making sure that the newly elected ukraine an president, petro poroshenko has an incredibly difficult time securing power. the whole purpose of undermining the operation by continuing to send arms to russia is undermine poroshenk oor poro

nato coalition is drifting, its lost its purpose since the cold war. the unity is devolving and we saw it after the elections in may. and through these crises he is challenging the west to sho*eu show unity and time after time they have failed to do that. in that way also it's sort of confirming some of his wishful thinking about where the west is headed. >> again, simon shuster's new cover story for time magazine is in the magazine's august 4th issue. simon good to see you then, again, thank you. >> thank you. >> with vladimir putin drawing strength from the ukrainian crisis with the west pressure russia to stop the war? for more i am joined from washington, d.c. steven hadley former security adviser to president george w. bush. as we were just discussing time magazine's covering is calling what's going on cold war two. you published an opinion piece in the washington post on tuesday entitled russia should be punished for did he stabilizing ukraine but not isolated. hasn't putin isolate himself and created a new version of the cold war with his own actions? >> he certainly has. and i think that the challenge we have is to use sanctions and other things to try to pressure him

eu dependence. resuming an open door to succession to the european union. the united states recommiting to the security of europe and some of our deployments and exercises, revitalizing the nato alliance coming getting europeans to make more of a commitment and really focus on the core mission of preserving and protecting the security of europe subject to russian pressure to build self-defense forces and finally helping ukraine succeed as a democratic, prosperous country able to provide security and prosperity for its people. those long-term commitments are what are really going to eliminate the opportunities for putin to make mischief in the future. >> i appreciate that. from the end of the cold war assumes a been made to draw russia into the community of nations as a stable, prosperous, and democratic partner. but given his high level of domestic support in recent polls i guess there is some zero or a month portions of an empire, power over other countries is being attractive and. could we have done things differently that would have changed the course of events, or was putin russia inevitable? what kind of policies would you advocate that the u.s. and international communi