2008 Rocky Mountain Roundtable on International Relations: Luncheon Discussion: Foreign Policy Challenges Facing the Next Administration

Wednesday, August 27, 2008
Elizabeth C. Economy
C.V. Starr Senior Fellow and Director for Asia Studies, Council on Foreign Relations
Bernard L. Schwartz Senior Fellow, Council on Foreign Relations
Tom J. Farer
Dean, Josef Korbel School of International Studies, University of Denver
Madeleine K. Albright
Chairman, National Democratic Institute for International Affairs; Former U.S. Secretary of State
Jim Polsfut
Chairman, 2008 Rocky Mountain Roundtable
John Hickenlooper
Mayor, City of Denver
Robert D. Coombe
Chancellor, University of Denver
President, Council on Foreign Relations

MR. COOMBE:  Secretary Madeleine Albright has served the United States as permanent representative to the United Nations and as secretary of State in the Clinton administration.  She is currently Mortara Professor of Diplomacy at the Georgetown University School of Public Service and serves on the boards of the Council on Foreign Relations, The Aspen Institute, and the Center for a New American Security.  And of course, she is the chair of the National Democratic Institute.  She is surely a shining example of just what that special blend of courage and commitment and intellect can accomplish in this world.

Ladies and gentlemen, please welcome Madeleine Albright.  (Applause.)

MS. ALBRIGHT:  Thank you very much, Chancellor Coombe.  It's delighting -- really delighted to be here with all of you.  And I have never been so integrated into anything as somebody who is on the board of the Council on Foreign Relations and chairman of NDI and the very proud daughter of Josef Korbel.  And I must say to the mayor that diplomacy and babysitting have a lot in common.  (Laughter.)  You have to teach people to share and respect each other.

Delighted to see my good friend and partner in the Clinton administration, Bill Perry, secretary of Defense.  (Applause.)

A lot of people ask me how come I got into international relations and foreign policy.  Those of you who might have known anything about my father know that I never had a choice.  And it is, as Richard Haass said -- you were comparing us to economists, but I really think we are a growth industry, there are so many issues out there and so much to talk about.

I really am delighted to have been able to participate in this whole forum.  And we are here to explore the challenges that the next president will face.  Although it feels like this year's campaign began in the Mesozoic era -- (laughter) -- there are still five months to go before inauguration day.  It is possible that the world will look far different on that day than it does now, but I doubt it.  Even in the best case, our next president will inherit a list of headaches beginning with hot wars in Iraq and Afghanistan, plus the global confrontation with al Qaeda.  Because these conflicts are unconventional, they are unlikely to end conventionally through a clear-cut victory or a negotiated peace.  They could well drag on, which is dangerous because time is not on our side.

Success in an unconventional war depends on popular backing, and it's hard for Western troops fighting in Muslim lands to gain support and still be aggressive.  Thus it should not be surprising that many Iraqis and Afghanis are ambivalent about our presence, while leaders in Pakistan see a gap between their best interests and ours.

The job for America's next commander in chief will be to develop a policy that works militarily but also politically so that we do not end up creating more enemies than we defeat.  And that's easy to say but hard to do, and only the beginning of what our new president will be called upon to accomplish.

From the first day his administration will be tested by an assertive Iran; a belligerent Russia, as we have seen in Georgia recently; a rising China; a splintered Middle East; an embattled U.N.; and such interrelated global perils as climate change, high prices for energy and food, and an increasingly corrosive split between the rich and the poor.  More difficult still, our 44th chief executive will take office at a time when our armed forces have been stretched thin, our alliances weakened, our Treasury depleted, and our reserves of international popularity drained.  The new president must therefore come to the Oval Office equipped not only with some brilliant ideas but also with the necessary temperament to handle the world's most stressful job, and he must adapt to changes that are occurring across the globe, which means he updating our understanding of America's international role.

Ever since I've been in public life, I've heard presidential candidates refer nostalgically to the period right after World War II.  This is when American power and prestige were at their highest.  We had defeated Hitler, founded the United Nations, forged NATO, and launched the Marshall Plan.  We're told now that our goal should be to recapture that golden moment, but we can't, for nostalgia is no substitute for strategy.

Back in 1948, Japan and Germany were occupied by foreign troops.  Europe was in ruins, China was engulfed in a Civil War, and much of Africa, Asia and the Middle East were still under colonial rule.  Americans might want to revisit the era of Truman and Eisenhower, but the world has other dreams.

To young people across the globe, the Cold War -- let alone the Second World War -- is ancient history.  The conflict that has made the deepest impression on them is Iraq, and the image of America many now carry in their heads is shaped less by Omaha Beach than by Guantanamo Bay.  Today few countries are sitting around waiting for America to lead.  Consider that recent Middle East diplomacy has been brokered by Egypt, Jordan and Turkey; that France negotiated the ceasefire in Georgia; that India and Brazil determined the fate of World Trade talks; and that Iran, whose government we're trying to isolate, recently hosted a non-aligned summit that represents a majority of the world's population.  Meanwhile, the economic center of gravity continues to shift away from the United States and toward countries that are rich in energy and cash.  And all this is why the next president must do more than reminisce about our nation's history.

His mission will be to enhance America's ability to lead in a future with numerous centers of power and multiple sources of danger.  To succeed he must be patient.  We will not recover all the ground we have lost in the first 100 or even the first 1,000 days of a new administration.  It will take time to get our fiscal house in order, to extract ourselves responsibly from Iraq, and to develop a more effective response to violent extremism in Afghanistan and Pakistan.  It will take time to formulate innovative policies toward each of the many trouble spots around the globe, from the Caucasus and Middle East to Sudan and Congo.  And it will take time to restore our nation's reputation as a champion of human rights and international law, and to show a renewed commitment to fighting the axis of evil: poverty, ignorance and disease.  (Applause.)

It will take time to convince skeptics that the promotion of democracy is not a mask for imperialism or a recipe for the kind of chaos we have seen in the Persian Gulf.  Promoting democracy in Iraq has been a real problem, and there are not a lot of other countries in the region that look at Iraq and say, "I want my country to look just like that."  (Laughter.)  And it will take time to establish the right identity for America in a world that has grown suspicious of all who claim a monopoly on virtue and that has become reluctant to follow the lead of any one country.

It will take time for the next president to succeed, but the opportunity will be there.  The world may not be clamoring for American leadership, but there is no doubt that a guiding hand is needed.  That direction is unlikely to come from radical populists, aggressive nationalists, autocratic modernizers, or the apostles of holy war.

America makes no claims to perfection, and we have no interest in domination.  But we do have a conviction to offer the world, and that conviction is not confined to any particular period of history or area of the globe.  It is valid now and always will be, and that is a belief in the fundamental dignity and importance of every human being.  This is the principle that is at the heart of every democracy.  It provides the basis for the kind of leadership that could restore international respect for America.  It creates the foundation for unity across the barriers of geography, race, gender, and creed, and it can serve as a useful starting point for discussion about every major issue that will confront the next president of the United States.

Thank you all very, very much.  (Applause.)  Thank you.

MR. HAASS:  Well, what I'd like to now do is follow up on what Secretary Albright said, who teed this up perfectly to follow up on our conversation this morning that some of you may have seen involving Secretary Albright again, Ambassador Holbrook, Congressman Weber, and Jessica Mathews, who runs Carnegie.  We wanted to continue the dialogue about foreign policy and national security issues.

I'm Richard Haass.  I'm fortunate enough to be the president of the Council on Foreign Relations, one of the cosponsors of this event.  To my -- we sort of stocked this with the home team here -- (laughter).  I apologize in advance.

We've got Ted Alden, who's the Bernard Schwartz fellow at the Council and oversees a lot of things at the juncture of politics and economics for us.  He's just finishing a book on immigration and is also working on immigration issues as well as trade issues.

To his left is Elizabeth Economy who oversees all the things Asia at the Council and is the C.V. Starr Senior Fellow in that part of the world and is really one of the leading experts in this country about China.  And if you haven't seen her book about China and its environmental challenges, you should -- "The River Runs Black," coming to a theater near you soon.

Tom Farer, the dean of the Josef Korbel School of International Relations here at the -- at Denver University -- is it Denver University or University of Denver?

MS.     :  University of Denver.

MR. HAASS:  -- University of Denver, and is someone who has written widely and for years and all sorts of aspects of international law and international relations.

And last but not least, Mike Levi, who is the David Rubenstein senior fellow at the Council on Foreign Relations on such issues as energy and climate change.

What we're going to do is I'm going to take a few minutes and start off the conversation with these four individuals and long before I run out of questions, I'm going to turn it over to you.  And I know people have busy schedules so we'll run this for just over the next hour, give or take, but I wanted to start with them -- start with Ted, who has the disadvantage of sitting next to me.

The question of trade -- recently there has been quote, unquote, the "failure," unquote, of the trade round at the so-called the Doha Development Round.

Before I ask you what we should do about it, the first -- let me raise the question that so rarely gets raised:  Why should we care about it?  Is this something -- even if it doesn't it lead to a 3 a.m. phone call, should it lead to a 3 p.m. phone call and be a matter of some concern?

MR. ALDEN:  I think we should -- thank you very much, Richard, and thanks to the Rocky Mountain Roundtable and others for hosting this.

I think we should care about it deeply for two reasons.  One reason is just the aggregate economic benefits that trade has brought really, you know, throughout the entire period since the end of the Second World War.  And I think the United States has benefited tremendously from that, and many other countries have, too.  I mean, we've seen in the last decade a surge of development in countries that for many, many years were terribly, terribly poor.  And I think that the rise of the global economy has been fundamental in that and the trade negotiations are therefore part of that.

I think the second reason we should care has to do with the bigger theme of this morning's meetings and the meetings we're continuing this afternoon, which is global collaboration.  The World Trade Organization is the single most successful example of global cooperation ever created.  It's an international organization with binding procedures for resolving disputes among nations.  That was a tremendous accomplishment.  And it's something that we need to be very careful to preserve and nurture because it's a powerful example of how nations can work together in a way that doesn't involve domination; it involves equal rule.  So those are two reasons why I think it is an important issue.

MR. HAASS:  Do you think that it's possible to square the circle -- given the international politics of trade and the domestic politics of trade, is it possible, do you think, to produce an agreement that could be successfully negotiated and then successfully sold?

MR. ALDEN:  I think you might be able to produce a Doha Round agreement that you could narrowly get through Congress, but there is a bigger problem in the United States of rebuilding what is very tattered support for the trade agenda.  You look at the sort of polls that Pew and others do internationally, and support for free trade is lower in the United States than virtually any other country in the world.  I mean, it's lower than France; it's lower than Canada; it's lower than Great Britain; it's lower than developing countries.

So we have a lot of work to do at home, and I actually don't think a lot of it involves what we do in the Doha Round or what we do in bilateral trade negotiations.  It involves the fact that prosperity in this country for the last -- really for the last three decades, but at an accelerating rate for the last decade, has not been shared.  And so people do not see the benefits arising from the aggregate economic growth that trade is producing.  And until we begin to resolve that problem, we're not going to rebuild any kind of strong basis of support for moving forward on international trade negotiations or bilateral trade negotiations or any other trade negotiations.

MR. HAASS:  I don't think you'll be hearing exactly those themes tonight from the floor, but I could be wrong.  (Laughter.)

Let me -- let me turn to Liz Economy.  I was at a dinner the night after the Olympics opened and the entire conversation was about the opening ceremony.  And I've got to tell you, it wasn't about the artistry of the opening ceremony.  Words like intimidation; "we could never do that"; "what does this tell you about China," and so forth, flew around the dinner table.  What should be the takeaway from the Olympics?  And I don't mean who won the most medals.  What's the political takeaway of the Olympics?  What have we learned about China?

MS. ECONOMY:  Let me just say first, it's interesting that you mention the, sort of, "we could never do that" aspect because Zhang Yimou, who many of you know was the sort of chief architect for the Olympics opening ceremony has said in fact that it would have been too difficult for him to produce such a ceremony here in the United States.  And why?  Because people here would want coffee breaks; we have unions that would complain about the hours of working, the fact that people couldn't go to the bathroom and had to wear diapers and this kind of thing.  (Laughter.)  So it's probably true.  We couldn't have come up with such a ceremony.

But I think more importantly the takeaway -- I think what the Olympics did so brilliantly is half of what China wanted, which is to announce its arrival on the international stage.  And it did.  I mean, it was a brilliant opening ceremony and they did a beautiful job of the Olympic venues -- everything that China does well as a state, as a governing entity was illuminated by the opening ceremony.

At the same time I think what China feared most also came to pass, and that is that the Olympics also illuminated for all of us the real challenges that this country faces, and I think that's not part of the dominant narrative here in the United States about China.  We tend to think of China as this rising global economic power, political power, something that's going to rival the United States or already does right now.

But instead in the lead-up to the Olympics what did we see?  We saw unrest in Tibet -- serious unrest in Tibet; we saw bombings in Xinjiang; we saw an inability to fulfill the promise of a green Olympics.  It's true the latter half, the second week, was better than the first half -- nonetheless, the kind of changes that they needed to put into place to produce a green Olympics, they didn't manage to put into place.  And certainly back in 2001 when the Olympics -- the International Olympics Committee and the Chinese government talked about the role that the Olympics would play in advancing human rights, broader political rights, even to the smaller, narrower area of media freedom -- the Chinese didn't produce that either in any sustained or impressive way.

And I think what that speaks to, fundamentally, is that those things that China didn't do so well, those challenges that the country faces -- those are things that really require fundamental reform to produce.  So if you're really going to have sound environmental protection or if you're going to have media freedoms or broader human rights, protest areas where there're actually protest -- where you're not arresting the people who are signing up to do the protest -- that's fundamental political, reform and the Chinese leadership is not the prepared to do that.

So I think the greatness of the Olympics was really that it brought these two competing narratives of China together in a way where I think it's going to be impossible for us and for the Chinese to disentangle them again.


MR. HAASS:  Now, I'm tempted to ask you whether those gymnasts were really 16, but I won't.  (Laughter.)  I'll try to stay on message.  (Laughter.)

Just imagine for a second you're wrong, which you so rarely are -- (laughter) -- and China does reform much more than many think possible.  What does it look like, though?  At the end -- the reason I'm asking -- and we've had something of a running conversation about this -- given Chinese culture, given the 1.3 billion people and so forth, at the end of the day, is it an individualistic-oriented society or will there still be degrees of collectivism and authoritarianism, just given the culture and history and scale of China?  What's, if you will, the most positive scenario you can imagine?

MS. ECONOMY:  Well, I think, you know, the most positive scenario is that we have a China that evolves --

MR. HAASS:  If you'd like to speak up a little bit here.

MS. ECONOMY:  Oh, sure.  Sorry.

I think the most positive scenario is that we have a China that evolves into a system that is transparent politically, has rule of law, and has some form of official accountability -- real official accountability.

What that looks like I think is anybody's best guess.  I mean, Taiwan has -- is moving toward that very aggressively.  Some would argue it's already achieved that.  You know, we have that at some stage -- some greater stage at some point in time and lesser stages in other points in time.  I mean, I don't know what point at which China will land in this continuum, but I think those are the three things that I would hope the country would strive for.

I've never been a particular fan of the political culture argument that China somehow is unique and because of its history can't achieve this system of rule of law, official accountability and transparency.  Other Chinese societies -- Taiwan and even Hong Kong -- striving for those forms of governance.  So I think that's my hope for what it looks like.

MR. HAASS:  Let me turn to the dean for a second.

Rumor has it, based on what I learned before I came here today, that your enthusiasm for the foreign policy of the incumbent administration is finite.  (Laughter.)

MR. FARER:  You're right so far.

MR. HAASS:  Okay.  Not all intelligence is wrong.  And so imagine Senator Obama were to become President Obama and he were to appoint you the national security advisor or secretary of State or to some other senior position.  What should he do going out of the box?

MR. FARER:  I hope someone is here from his campaign who heard you say that.  (Laughter.)

MR. HAASS:  Actually, you better hope not.  (Laughter.)

MR. FARER:  You're right, Richard.

A good dean usually associates himself with the views of one of the school's best friends, namely Madeleine.  But as I was listening to her I thought perhaps we disagreed a little bit at the margin.  She said we can't go back to the golden days of 1945.  I thought -- and I was thinking about this because I thought you might ask a question like that -- that "back to the future" might be a theme because I think what the president needs to do -- despite the particularity of all the problems that he is going to face -- is an overarching theme, particularly since the president wants to change the overall image of American foreign policy.  He wants to change the narrative about American foreign policy.

So I think that the president -- I hope it's President Obama, obviously -- is going to have to say something early on which distinguishes what he's trying to achieve.  And he's also sending a message to the bureaucracy at that same time, and to the Congress, and to the country.

So what is it about 1945 that's positive, that's good?  I'd say two things:  The number one thing is -- this has to do with the question of what's our role in the world.  I would withdraw -- I would state that I was withdrawing the National Security Strategy Document of 2002, which -- (applause) -- oh!  I thought only I had read it.  (Laughter.)

MR. HAASS:  I should -- in the fairness of this -- (inaudible) -- I wrote the first draft of that strategy.  (Laughter.)  What you'll be glad to know is 80 percent of what I wrote was tossed out.  (Laughter.)  But, anyhow, just in the fairness of full disclosure -- (laughter).

MR. FARER:  And just to be completely honest, I thought about 20 percent of it was pretty good.  (Laughter, applause.)

That document -- and particularly for the international visitors here -- was universally interpreted as a statement that we must perpetuate hegemony.  And I think that the president should say -- and this is going back to 1945, where in a sense we enjoyed the greater military power because only we had the, then, atomic bomb -- that our theme should be not hegemony but playing the role we played in '45, '46, which is as catalyst, as architect of cooperation -- of institutionalized cooperation.  That is a fundamental change over the past eight years -- you could say it goes back further than that, but I won't because there was a Democratic president before then -- (laughter) -- without spelling out all the institutional developments that need to occur, but just to say that we need to move toward institutionalized cooperation, we need to do it cooperatively, and that's what we're about in the world.  So that was the -- that's one thing.

The second think I'd say -- I would repudiate the idea -- if it still has any traction at that time -- the idea of a league of democracies.  I think that guarantees a long-term, intensely competitive relationship with China, to come back to your theme, Elizabeth.

Can we survive with an intensely competitive relationship with China?  Of course we can survive, but can we adequately address the great human security issues of the 21st century in such a relationship?  I don't think so.

MR. HAASS:  It's good that Secretary Albright isn't here to hear that last bit since she's one of the architects of the community of democracies.

MR. FARER:  Community of democracy is good.  (Laughter.)

MR. HAASS:  Let me turn to Mike Levi for a second.

It's interesting -- both candidates differentiate themselves significantly from the Bush administration when it comes to climate change.  So if you were handicapping, at the end of the first administration of either Senator Obama -- or by then President Obama -- or President McCain, is there likely to be Kyoto 2.0 in some sort of a global climate change abort?  And if so -- and if not, why not?

MR. LEVI:  I think there's likely to be strong, domestic legislation in the United States and strong domestic efforts in a lot of places around the world.  I'm less optimistic on the possibility of a genuinely global agreement following on Kyoto -- not that we shouldn't be trying toward one, but I'm less optimistic about it for a few reasons.

The first is that to make an agreement like that happen, it's going to need to have broader participation.  Of course Kyoto, signed, ratified by most of the world's countries, but most of those signatories didn't actually have to commit to any specific actions under it.  We're going to have a much more complicated effort if we want to get a broader array of countries -- not just the advanced industrial countries but also the rapidly emerging economies -- on board.  We'll need to be flexible; we'll need to look not just for caps on emissions and for timetables but for commitments on specific actions they can take to control their emissions, things that the governments can really get at.

But even if we sharpen our focus like that, are a bit more flexible, it's still going to be challenging.  Now, I'll caveat still by saying that doesn't mean I don't think we're going to see a lot of cooperation.  But we need to distinguish between the prospect of a lot of cooperation and the prospect of one grand treaty that sorts everything out for us.

MR. HAASS:  Let's turn -- on energy issues for a second.  A lot of the campaign seems to -- on this area seems to have boiled down to drilling versus alternatives.  And Jessica Mathews this morning made the argument that that was the wrong way to couch the debate.  And the way she put it was it was really an issue of demand management and what you were willing to do to reduce demand, and until the American political debate got serious about demand management, talking about supply increase was essentially something of a copout, if I'm not putting words into her mouth.  Where do you come out on that?

MR. LEVI:  I don't think it's entirely solvable through demand-side efforts, but demand is an absolutely essential component.  And on the supply side, drilling is not what's going to address the challenge.  So we do need to deal with supply.  (Applause.)  We need to deal with alternatives.  And we need to deal with demand also.

Does that mean that offshore drilling should be off limits?  I actually think it's almost neither here nor there.  It's a bit of distraction.  If there can be a political deal made that moves ahead aggressively on renewables, on demand-side management, on efficiency, and it's part of a package that includes some increased access to offshore drilling, that may be a package that will improve our energy security and will improve our position on climate change.  But it's these pieces that we're going to have to look at all together.

MR. HAASS:  I want to ask a couple more questions then I promise to open up.

Let me turn to Ted again and ask essentially the same questions about a different subject.  Why should we want comprehensive immigration reform in this country?  And -- well, and then what are the prospects for it?  Is this one where we can see the sides coming together or not?

MR. ALDEN:  There are really two big reasons for comprehensive immigration reform, I think.  One which is rarely emphasized is -- I think it fits with our whole debate over human rights and respect for the fundamental dignity of individuals.  We are out in the country right now aggressively enforcing laws that do not work.  We are arresting, imprisoning for long periods of time, deporting tens of thousands of people -- a lot of it in a very brutal fashion.  I mean, few people know right now what happens to asylum seekers who come to this country.  I mean, we used to treat them humanely.  Now we put them in jail with their families for three months while we consider their claims.

So there's a message that we're sending to the world there that a lot of the people who are coming here are not worth being treated with dignity.  Sometimes they've violated immigration laws very blatantly, but immigration law is so complex that even if you haven't violated it blatantly, even if you've made mistakes, you can find yourself in a kind of Kafka-esque nightmare.  So I think there's a big human rights reason for making these laws workable and sensible.

The other big reason is economic.  I mean, we depend tremendously on immigrants.  We depend on them at the very high end -- I could quote a lot of numbers, but I won't bore people with it -- on how important highly skilled immigrants, the ones who come to our universities and stay here and do research, are to the success of this economy.  And at the lower end there's no question that there are a huge number of service jobs that Americans aren't willing to do, or at least not at wages that are realistic to expect restaurants and hotels and others to pay.

So there's a need of that too, so I think if our economy is going to continue to be dynamic, we need to work this out.  So I think it's about the dignity of individuals, and it's about our long-term economic interests.

I didn't answer your question about prospects.  I'm a little pessimistic, the reason being -- it's just -- you know, if we have a democratic administration, as I suspect 99 percent of the people in this room, possibly more, are hoping for, it's not in the top -- (laughter) -- it's not a top five issue.  I mean, there are so many things that a new democratic administration is going to have to deal with on taxes, on healthcare, on Iraq.  I'm just afraid that immigration is such a heavy lift that it gets forgotten.  And so we'll continue down the road we are right now, which is just ramping up enforcement.

I think a McCain presidency is a bit more likely to tackle it just because this is a gut issue for McCain.  He's from Arizona.  But it's not clear to me how he deals with it in his own party.  He's had to move away from his principle position in order to shore up his base.  And I don't know how he moves back if he becomes President.  So I'm rather pessimistic actually.

MR.    :  Liz, there's so many things on the U.S./China agenda, in part because we're the most powerful country in the world and China is clearly rising to a position of extraordinary importance itself.  Strategy, in part, is about priorities, and it gets a little bit at what goes on inside of China, as opposed to what China does around the world.  But everything can't be a priority if the word priority has any meaning.  So what's the priority or the priorities, the top two or three with China?

MS. ECONOMY:  I think if you take the top two or three priorities, I guess I'd put them at sort of -- the trade and economic relationship is clearly --

MR.  :  Could you speak up a little?

MS. ECONOMY:  Sorry.  The trade and economic relationship is clearly central.  I guess I'd put global climate change as second, and then probably improving and working toward improvement in those three issues that I mentioned about transparency, and official accountability and the Rule of Law in China is third because those are fundamental to getting anything on what we want for any other priority actually.

But I think in many ways that priorities is only -- is one part of the picture when we're talking about U.S./China relationship and the next President.  I think the second part of the picture has to be how we approach China.  And it was interesting.  I was just reading Secretary Paulson's piece in Foreign Affairs before our lunch here.

MR. HAASS:  Hope you all heard that.  Foreign Affairs -- (inaudible) --

MS. ECONOMY:  Sorry, Foreign Affairs -- before our lunch here.  And, you know, I noticed in the beginning it was sort of -- you know, all we need to do is engage in the first half of the piece, and, you know, we have this high-level strategic engagement, this high-level dialogue.  But when you point to concrete advancements in the relationship as a result, they're few and far between.  And then the second half of it is peace and sort of where we need to go from here, and then there really is a pretty tough laundry list of things we need to accomplish.

And so I guess when I think about what we need to do, I think about how we need to do it.  And part of it is I think first the U.S. has to get its own house in order, right?  So if we're thinking about issues like product safety or even trade, or global climate change, as Mike was talking about, you know, we're going to have to get our own house in order and step up and lead.  So we need to take the first step because we've lost that kind of authority, as I'm sure everybody's heard a million times here, but I think there's some reality to it.  So first we need to do that.

Second, I think there has to be a recognition, as Secretary Albright was saying, that there are a lot of other actors in the field now, and we need to take advantage of working with them.  So when we're talking about a collaborative foreign policy, yes, it's collaborative with China, but it's also collaborative with everybody else to bring pressure upon China to do the right thing.  And I think that's got to be a key element of it, because we don't have that much bilateral leverage with China, I think, if we're really honest about it.

And then third and sort of last resort, I guess -- and this is something that a lot of people don't like to acknowledge, but I think there's some truth to it -- is that some of those pressures that are brought about by, you know, ugly bills, like, you know, Schumer's bill, Schumer Graham, and, you know, Mia Farrow and the Genocide Olympics -- those things do work, and they can work in the sense that they allow actors that are actually interested in doing the right thing in China to say if we don't, look what we're facing, I think.  So those kinds of sticks have to be held out there.  And maybe it's not the next President that uses them, but people around him that employ them.

So I think it's not just about setting the priorities, but it's really about thinking through how we're going to engage with China.  Engaging China is the right thing to do, but how are we really going to gauge them to bring about change?

MR. HAASS:  Thank you.  Tom, you talked about your problems with the national security document.  One of the -- indeed, the most controversial -- several paragraphs in that document, as you and those who have read it will know, deal with the case for so-called preventive attacks.  The word preemptive is often used, but technically these are preventive attacks, such as the United States carried out against Iraq several years ago, such as Israel carried out against Iraq more than 25 years ago.

It's quite possible that early on in the tenure of the next President -- in the first year or two regardless of what diplomatic efforts we try, we are going to be faced with the choice of whether we undertake a preventive attack against Iran or greenlight an Israeli preventive attack against Iran, or live with the consequences of an Iranian nuclear weapon or something close to it.  So what do you advise?

MR. FARER:  I advise first going for a new set of security arrangements, a whole new set of relationships with the countries of the Middle East, starting with Iran.  I think Obama was right when he said I'm willing to talk to Castro, the leaders of Iran, or any country without reservations.  That's a step in the right direction.  But I'd like to see -- is put that in a broader context, that is, the relationship between the United States and the Islamic world in general, particularly its Arab and Iranian parts, but all the Islamic world.

We need to change the narrative, or we need to blunt the Jihadist narrative, which I think is all too successful.  That is, it's a narrative in which we are attacking.  We are hostile to that world.  And the question is what moves can we make to alter that narrative?  And one of the moves is, of course, to say not only that, as everyone says, we favor a settlement of the Palestinian-Israeli conflict -- which is not a silver bullet.  It won't end all our problems, but it's an element in changing the narrative.  It not only -- we have to state what the end result should be.  What is our view of a fair settlement?  Never been said explicitly and in detail by an American President.

As far as Iran is concerned, I'd like to see the American President say we have injured each other historically.  There's a history of the relationship between the two countries.  And I'd like to hear the American President say if we hadn't overthrown the only elected President of Iran -- 1953 with the help of the British -- Iran would've taken a different course.  We hurt the Iranians then, as they hurt us when they in violation of international law seized our embassy personnel.

We've been hurting each other.  We're in a hurting relationship.  And we need to step back, start again, and see where that goes.  And that also has to be part of a larger -- and this --

MR. HAASS:  I'm going to be a difficult moderator.  That's fine.  You can try that.  But every --

MR. FARER:  If it fails.

MR. HAASS:  You only have about a year, a maximum two years to do an awful lot.  And it's at least 50-50 -- I would say much higher -- that it doesn't succeed in stopping the Iranian effort to develop -- to enrich uranium on a large scale.  What do you do?

MR. FARER:  It's a tough question.  My call is not to bomb.

MR. HAASS:  But that means, then, living with this (instability ?).

MR. FARER:  It means -- I think the potential negative consequences are too great.

MR. HAASS:  That's a straight answer to a difficult question.  Michael -- this is the last question.  Then I'll open it up to you all.  People talked about energy security, and there's a growing awareness that this is probably one of the top priorities facing this country.  I think every time people drive anywhere they get reinforcement on that issue.  There's also great concern about climate change.

To what extent is there tension between -- or to what extent is there the opposite of tension?  I hate to use the word.  I hope this part is off the record.  Synergy -- (laughter) nobody heard that -- between what we might do on energy security and climate change.

MR. LEVI:  There's both.  There are a lot of potentials for conflict, and there are a lot of potentials, let's say, for actions that will take us in a positive direction on each agenda --

MR. HAASS:  Thank you.

MR. LEVI:  -- to use some compact language.  What's also important to remember is that the same challenge is going to exist for all of the other major countries that we're dealing with on climate and energy.  And for a lot of them when you look at the balance between climate change and energy security, it's going to tilt even more toward energy security than to climate change.  So we're going to need to understand that interaction.

Let me give a couple examples just to understand where we may have to manage the tensions and where we may manage to push both agendas at the same time.  If we look at things like converting coal to liquid fuels, that's something that is going to be very damaging on the climate front, but a positive development on the energy security front.  If we look at the global expansion of nuclear power, especially to countries that don't already have it, well, that is a positive development on the climate front, but potentially a negative development on the security front tightly tied into the energy sphere.

And we can look at a range of these things.  We can also look at it from the point of price.  You may see in some areas necessary energy price increases to drive the shifts in energies that will help us on the climate front.  That's not exactly what people seem to be looking for in an energy agenda right now.  But at the same time -- we talked about demand earlier.  Demand management is something that can help us deal with climate change and with energy security.  A lot of renewables can do the same thing.  So can coal with carbon capture and sequestration if we can make it happen.

The key is not to think that the two are in inevitable conflict and we have to pick, but at the same time not to be Pollyanna-ish and think, well, if we just sort out one of the problems, if we just have a really sharp climate agenda, it'll fix our energy security problems too, or vice versa.  We have to be aware of the challenges, aware of the conflicts, and help navigate in a more constructive way.

MR. HAASS:  I like Mike's answers.  When I used to teach at the Kennedy School, I used to say that foreign policy is hard.  And that's a perfect example.  In several months we're going to move from campaigning to governing, and it's going to be tough.

With that uplifting comment, (laughter) let me open -- and I think we've got a couple of microphones.  When I ask this to people, to very quickly say who they are, where they're from, and to state as succinct a question as they can -- 'cause that way we'll get to as many people as we can.  If they could wait for a microphone -- we probably need to get one microphone up towards the front of the room 'cause there are several hands up here.  Let's start with one in the back of the room, all the way back there.  Sir --

MR. EUGENE MATTHEWS:  Eugene Matthews.  Eugene Matthews, president of -- (inaudible) -- Incorporated.  This question is for Elizabeth and also for Dean Farer.  In the backdrop of what we've been talking about as far as China is concerned, how do you view how the new President should look at Japan, and what should his posture be toward Japan, particularly in the context of Japan's security concerns?  There's one school of thought that suggests that Japan should move ahead and be more military.  There's a second school of thought that says they should not.  What would be your posture toward Japan in the context of our discussions about China?

MR. HAASS:  Liz, why don't you take Japan?

MS. ECONOMY:  Okay, well, since, Eugene, you're actually a Japan expert, I would welcome your thoughts on the matter as well, but --

MR.    :  (Inaudible)

MS. ECONOMY:  -- I guess, you know, my feeling is that, you know, in general we need to, you know, shore up all our ties with our Asian allies, our Asian partners, and allow them to shoulder a greater part of the burden in what has been called a hedging strategy, although, again, many people don't like that term.  But I think as long as China remains relatively opaque, as long as the future of China remains an unknown, largely I think we have to hedge our bets.

And to that extent, I guess, you know, a gradual development of Japan's own military capacity I think is not the wrong way to go with this.  At the same time I think, you know, it bears acknowledging that Japan and China are improving their own relationship and that over the past year or two we have seen a warming of a relationship, and I think, you know, that's even better than sort of having Japan move toward a greater military -- sort of in a potential military -- challenging role with China.

So my feeling is that, you know, the United States needs to expand and to strengthen its ties with our Asian allies, but at the same time, obviously, we welcome the kind of warming of relations between China and Japan because we're not interested in seeing some kind of military conflict erupt there.

MR. HAASS:  In order to maximize the number of the questions, I'm going to try to limit it to one response from up here unless someone's dying.  And I don't sense that anyone's dying.  Sir --

(Ms. Economy has side conversation with colleague.)

MR. VIET NEMBA:  I'm Viet Nemba.  (ph) I teach international law.  I'm an international lawyer.  My question is assume that the current Congress is unable to or is unwilling to address the nuclear peace accord with India, U.S.-India peace accord.  What should the next President do to provide leadership on that issue and to look at that dichotomy between non-proliferation and at the same time U.S.-India relations and the role of India in that part of the world?

MR. HAASS:  Well, I've got strong views on it, but I'll turn to Mr. Levy.

MR. LEVI:  I was not a huge fan of the U.S.-India nuclear deal when it was made.  We differ a bit on this.  And just for those who aren't familiar, this was a deal made a few years ago now where the United States would open up civil-nuclear commerce with India in exchange for some fairly limited commitments on the non-proliferation front.  It wasn't something that the United States could put through by itself, and it's got hung up in particular in Indian domestic politics and is now in a bit of a mess with international institutions that govern nuclear trade.  So there are some big challenges there.

Now, I wasn't a big fan of it.  It did not get all that much from India in the way of commitments on proliferation.  With that said, I don't think there's much in the way of going back.  What damage has been done on the non-proliferation front from the agreement has been done.  And all we can do by trying to push it aside in another Administration, another Congress, really is to do more damage on the U.S.-India relations front.

So if India can keep it together on domestic politics and if we can get sensible rules for nuclear trade -- we don't really want to be caving in anymore.  We want to hold the line on that deal.  If we can get those rules and we can get that agreement, then the next Congress should move forward in the same way that this Congress has.

MR. HAASS:  (Agree ?)  There seems to be discrimination against people in the front of the room, but yes, ma'am, in the -- with the microphone.

Q     My name is Anne Imzy. (ph) I'm a writer and a former foreign correspondent.  The question about whether or not -- if it's okay for the United States to make a preemptive attack if it feels threatened -- doesn't that mean that Iran can then attack Israel and the United States because it's clearly been threatened by those entities now, and doesn't anybody in Washington think about these counter -- (laughter, applause)

MR. HAASS:  Sure.  Tom, you want to take that, or do you want me to -- you want to take that?

MR. FARER:  (Inaudible) International lawyers are doomed to believe in the importance of precedent.  Kosovo has something to do with Georgia maybe.  Probably what one great power does, even a hegemonic power, but not an omnipotent power does -- does create an environment in which other states that are able to project force across frontiers feel freer to project it.  Now, that's a guess.  It's an intuition.  It's not a certainty.  If we claim the power to preempt through our other countries, more likely than not claim such a power.  My guess is they will.

I might distinguish two cases, and then I'll stop.

MR. HAASS:  Please also be a little bit careful on the use of the word preempt versus prevent.

MR. FARER:  Yeah, I was going to get to that actually.

MR. HAASS:  Okay.

MR. FARER:  Yeah, that was exactly the point, Richard, a very important point.

MR. HAASS:  Thank you.  Okay.

MR. FARER:  If you take the case of Al Qaida and Afghanistan, some would say, well, this was a case which doesn't fit within the U.N. charter.  But, of course, in my view, it did fit within the U.N. charter, and we didn't need any new legal doctrine or a trans-legal doctrine in order to do it because we were engaged in what amounted to a war with Al Qaida.  They had attacked us.  There had been a number of battles.  You have an actual war.  Once the war begins, there may be lulls, but the war is still going on.  And as long as Afghanistan was providing support for Al Qaida, we had a right to attack within the framework of the existing charter.

Now, if we're talking about out of the blue attacking a country without consulting with the government, without any evidence that the government is colluding, you had supposedly discovered that Osama bin Laden was wintering on the Riviera -- (laughter) -- I presume we'd consult with the French before we dropped a missile in.  That's preemption.  That's uber preemption.  I hope we're not moving in that direction.

MR. HAASS:  I would actually give just a slightly different -- (inaudible).  I think the question raises a profound issue; prevention, which again, is when you deal militarily with what you would call a gathering threat, but not an imminent threat, is a very controversial notion.  In a world in which preventive strikes happen with some regulatory, we'd begin to get -- become an extremely messy world.

Preemptive strikes, which are when you use military force -- when you have in hand an imminent threat -- someone's about to attack you -- is not a wild controversial notion.  Michael Walshier (ph) and his book on international law calls it a form of self defense.  So I think there is an important distinction, but the kind of strike being contemplated by Israel and the United States against Iran would fall into the first category of preventive strikes, so it would be more legally questionable and more politically controversial, just to lay it out.

Sure, with the microphone here -- and again, I'm trying to get microphones up here 'cause Ambassador Gardner's been extraordinarily patient.

Q     Hi.  Benjamin Barber.  Is this on?

MR. HAASS:  Ben, I'm sorry.  I don't have my glasses on.  I can't see that well.  (laughs)

MR. BARBER:  Oh, that's okay.  Member of the Council on Foreign Relations, a senior fellow at Demos in New York.  I have a different kind of question.  I followed the deliberations this morning and here at lunch and with great interest at the subtlety of the discussions.  I've also followed with similar interest -- the proceedings over in Pepsi Hall last night and the night before.

And these two sets of discussions have happened in the same city at the same time, but on two different planets, (laughter) which is to say this discussion is utterly absent over there and for "good" -- in quotes -- reasons, and the reasons are, of course, that the American media fiercely oppose any kind of genuine international discussion, and the political process punishes this kind of a discussion.  We have for the first time in history a democratic nominee who is probably the most multicultural and internationalist candidate we have ever had.  And I guarantee you, following his debacle -- and I call it that intentionally -- in Berlin he will spend the next three months running away from that background waving the American flag and proving what a good American he is, which is to say, not interested.

Question -- how can we get this debate to take place in prime time at the convention and on the American media, and if we don't, won't it be the case that whatever solutions the next President chooses are bound to fail because the American people and the American media simply won't be there?  (Applause.)

MR.    :  I have two answers tot hat.  One, I actually think this debate is maybe more there than you're acknowledging.  The question of America's image in the world, how others see us, how we uphold or do not uphold our values -- those are the central things that we're discussing here, and we're discussing them in specific terms having to do with specific policies, and I'll acknowledge that debate is not taking place over there.

But the debate of how to bring America back, how to stand proud again in the world, is central to the Obama campaign.  It is.  I mean, that's a lot of what's being talked about over there.  So I do think it's there more.

The other way I think you bring it back is somehow -- you know, we -- and it's small.  We saw from the polls this morning -- it isn't an overwhelming number of people who say, you know, that the world is more a cost for us than it is a benefit.  But you do have to deal with these underlying domestic economic issues.  If people do not feel confident at home, if they don't feel like their lives are improving economically, if they don't feel a greater security, then there's going to be a reluctance to engage in the world at the level we're talking about.

So I think that in a way the Pepsi Center really has the priority right.  I mean, we do need to address those issues first out of the box to build a foundation where we can go forward more solidly with popular support for the kinds of things that are being talked about here.

MR. HAASS:  We have it -- where is that going?

MS.    :  We have -- (inaudible).

MR. HAASS:  I want it to go to Ambassador Gardner and then to this young lady here in red, whose name -- I apologize -- I do not know.

MS.    :  (Inaudible)

MR.    :  No, you know -- (inaudible).

MR. HAASS:  I can't -- I don't have glasses on, so I am slightly disadvantaged.  I apologize.

MR.    :  Thank you, Richard.  The democratic platform on foreign policy, which is one of the best I have seen in many years because of its specificity and coherence, contains the following two crucial sentences.  I quote, "The greatest threat to the security of the Afghan people and the American people lies in the tribal regions of Pakistan where terrorists train, plot attacks, and strike into Afghanistan and move back across the border.  We cannot tolerate a sanctuary for Al Qaida.  We must take out the terrorist camps."  We propose to do this in cooperation with the government of Pakistan, but my question is this:  In view of the weakness of that government, the difficulty of the terrain, the support the terrorists enjoy from the local population -- what are the practicalities of carrying out this important objective?

MR. HAASS:  If I had known you were going to ask that question, I would've had one of our other fellows (laughter), Dan Markey --

MR.    :  Get Dan Markey.

MR. HAASS:  -- make the trip.  If Dan were here, what I think he would point out is -- you're right.  It is preferable to do it in collaboration with the government of Pakistan.  And he is worried that if you don't, you risk exacerbating the problem of relations with that government and the relationship between the government and its own citizenry, and you would create a context in which further cooperation with the United States would be even that much more difficult.

On the other hand -- and you're an international lawyer -- Tom Farer is -- sovereign states have responsibilities, and sovereign states have responsibilities to essentially police their own territory to make sure that among other things their territory is not used to wage war against other governments or to house terrorists.  And if you face a situation where a government such as Pakistan is either unable or unwilling to fulfill its sovereign obligations -- which is quite possible given the unraveling that we are seeing in Pakistan.  It's quite possible the next Administration will have to decide whether to undertake certain unilateral actions.

And I think they will have to do just that.  And I would simply say do it only after you've tried the other, tried to limit collateral damage, do it on high percentage missions.  You don't want to do that sort of thing with all the political costs it would incur for something that's a long shot.  No pun intended.  So I think you'd want to set up a number of guidelines.  You'd almost want to have a template for decision making.

But at the end of the day I can imagine a scenario where the U.S. would have to act with the realization that it's quite possible that it could make a bad situation worse.  The word dilemma is overused in my experience, but this could be a dilemma.  This genuinely could be a dilemma for the next Administration.  There's so much talk about Iraq, Iran, and all that.  It's quite possible that the Pakistan-Afghanistan -- you always have to speak of them as one now.  It's not really two separate places.  But that issue could find its way at the top of the foreign policy inbox for 44.

In the back.

MR.    :  Thank you.

MR. HAASS:  Oh, I'm sorry.  I apologize.  I apologize.  Sir.  I apologize.

MR.    :  Yes.

Q     Thank you, Mr. Haass.

MR. HAASS:  Okay, we'll --

Q     My name is Mona Macramabed. (ph) I come from Egypt, and I'm a former member of Parliament, and I know you very well, Mr. Haass.

MR.  HAASS:  (Inaudible, laughter.)


Q     (Laughs.)  You said you didn't know me, but I know you very well.


MR. HAASS:  I apologize.  Leading blindly.

Q     And, in fact, you are the one who's written one of the most incisive articles on the Middle East, and this is where I come from.  What would I say?  Region of crisis today, not to say anything more.  But what I want to start with is a question that I have.  I've heard all over these three days a very optimistic sentence that says the world is ready to embrace America.  I think I have a lot of doubt about that.  (Laughter. ) Now, let us start with what the respected dean has talked about, democracy.  Democracy today has a very bad interpretation in our countries, thanks to the imposition and the patronizing that we have received two years ago.  So the message was fine for liberal activists like myself, but the problem was with the messenger.

And what we have today is -- when some of the countries have tried to implement democracy, this present Administration didn't like them.  They didn't like their faces.  So retraction.  What do we have?  More repressive authoritarian governments in the region.  This is more important than terrorism.  You have to go to the roots of why there is terrorism or violence.

So let me say to the next President, whom I hope will be President Obama, what this region needs is a voice and a job.  That's it.  Thank you.


MR. HAASS:  Thank you.  (Laughter, applause)

MR. HAASS:  Does anyone want to go?  That sounded more like a statement than a question, but I thank you for it.  In the back.

Q     Yes, thank you.  Hi, my name is Isaac Lieberman.  I'm a political chair with the Sierra Club.  I do appreciate all the discussions about the nuclear enrichment going on in Iran, but my question has more to do with energy security and climate change, so I would address it primarily I guess to Mr. Levy.  My concern is that with all of the move -- the positive actions we're seeing in California and around the country towards addressing climate change.  There seems to be this unstoppable movement towards increasing the use of nuclear energy in our country.  And I personally think that's a grave error and would appreciate your comments on that, as well as how we can help to push back against that unstoppable force.  Thank you.

MR. LEVI:  I'm unfortunately not going to give you an answer to the second part.  I have to respectfully disagree with the assessment of the situation.  I don't think there is a problem with, at a minimum, sustaining the fraction of energy generated in this country, of power, I should say, generated in this country from nuclear sources.  We can do it in the United States in a safe way if we don't go at breakneck pace without the right engineers, without the right equipment, without the right training.  If we do it properly and prudently, it can be one of many pieces of a solution to the puzzle, not really on energy security, because nuclear -- until we're looking at plug-in hybrid electric vehicles -- is not a substitute for oil, but on the emissions front, on climate change.

So I don't see it as a particular problem domestically.  I don't see it as a particular problem in countries that already have -- and in particular, in large countries that already have it.  I do see it as a substantial problem in countries that don't already have it.  And we shouldn't be pushing for an expansion there at a minimum until we can sort out how to separate the most sensitive parts of the nuclear fuel cycle, nuclear fuel production, and recycling at the backend after fuel has been burned to make sure that we have a sharp line between power and the ability to use these assets to make weapons.

MR. HAASS:  (Karina ?), you have the microphone for somebody there?  Right here.  I'm sorry.  Yes, ma'am.

Q     Libby Bordes (ph) of Littleton, Colorado.  Is this on?

MR. HAASS:  I think it is if you speak closer to it.

Q     Okay.  Libby Bordes of Littleton, Colorado.  I'm wondering if there's any reason to be concerned, and if so, what are the implications of the amount of foreign ownership of U.S. -- part of the U.S. economy.

MR. HAASS:  It just so happens that I'm sitting next to one of the experts on this question of sovereign wealth.  So, sir, over to you.

MR.    :  Well, we've recently done actually a rather large council special report looking at this topic.  You know, the history of this is that the concerns tend to be overblown.  Foreigners very often come in and they over pay for our assets, and then the assets go down in value, and they regret it -- (laughter) -- and we make out like bandits.  (laughs) What's slightly different now is that you've got these huge -- what they call sovereign wealth funds, which are government controlled funds, a lot of them in the oil producing states because they're generating so much revenue.

So that raises different questions from a security perspective.  And I'm going to give you a really wishy-washy answer, which I hate, and the answer is it depends.  It depends on what it is that they are buying.  There are things in the United States with security implications that -- we do not want entities controlled by certain foreign governments.  We don't want them to have control over it.  If what they're doing is putting money into investment banks and Wall Street because our investment banks are in desperate need of capital because we're in the midst of a financial crisis that may be the worst financial crisis we've seen in 70-80 years, then that's in our interests, and it doesn't make a lot of sense to go out of our way to discourage that.

So I think we're going to have to deal with this on a case-by-case basis.  And sadly, I think at times we overreact.  I mean, there may be a lot of difference in this room, but I think the Dubai Ports World thing was a horrible fiasco.  I don't think there was any genuine evidence of a security threat there, and yet it became a huge cause within the Democratic Party.  And I think it damaged our interests in the world.  So that's not one that I would put out there as an example of where we behave properly in terms of protecting our real security interests.

MR. HAASS:  I'll just highlight two things.  Not sure if it's that study or another one, but it shows that the world -- we now have almost a competitive process around the world where various governments are establishing their own procedures for whether to accept investment from abroad.  And the likely result is a world in which it's much more difficult to place investment with all the consequences that would have for economic growth and for development.  So it's not clear to me -- this story has a happy ending.

Secondly, there's a difference between the funds and sovereign wealth -- (inaudible).  These enormous accumulations of dollars by central banks -- and while a lot of people are sanguine that this will give others a stake in behaving responsibly, there is the possibility that others might also see it as leverage.  And the United States is placing itself in positions of vulnerability because others are accumulating massive holdings of dollars.  And again, it links to the energy issue.  More than half of our trade deficit every day is energy related.  And again, it's one of these issues that has impact on the environment, on our national security, and on our economic stability.  And I think that's a debate we haven't yet heard all of.

Where?  I'm sorry.

MS.    :  Right in front.

MR. HAASS:  I don't see --

MR.    :  (Inaudible)

MR. HAASS:  Oh, excuse me.  Lieutenant Governor Fisher.

MS.    :  Nope, he's not it.

Q     If you hadn't identified me, I would've have more credibility in what I'm about to say.  (Laughter.)

MR. HAASS:  Lieutenant governor of Ohio.  Let me be clear on that.

Q     It's --

MR. HAASS:  And an Oberlin graduate, more importantly. (Laughter.)

Q     It's my experience, limited as it may be, that governors have a much different view of trade and the necessity for global engagement than do members of Congress, either the House or the Senate, because they're involved in the day-to-day transactional work of economic competitiveness and development.  My question is have any of you given some thought to doing more outreach to governors to try to change the nature of the debate, going back to the question before, that -- what's happening -- the discussion here is very different than what's going -- over in the hall in the Pepsi Center.

I would suggest if you want to begin to change the climate of the debate in both parties, but particularly Democratic Party, you need to do a much better job of engaging the states and particularly the governors of the states.  It's both a comment and I guess a question.

MR. HAASS:  As you answer Lee's question, let me add to it.  Can you engage and win this debate on the merits where you basically have to go in there with a checkbook and say here's how we are going to protect those who believe they have been adversely affected by some aspect of globalization?

MR.    :  Sorry.  I mean, are you talking about this in terms of engagement with government officials who are working on this, or the sort of bigger political question of trying to rebuild public -- 'cause those are -- I mean, they're both important questions, but --

MR.    :  Well, for example, these days states are very heavily dependent on their exports --

MR.    :  Right.

MR.    :  -- and therefore much more open to the subject of free trade than would a senator or a congressman who's not so much focused on their own state's exports.

MR.    :  Yeah.

MR.    :  That's an example.

MR. HAASS:  I mean, we did one effort at it that Irena, who's been responsible for a lot of this event, set up for me last year where I went to talk to the council and state governments at their meeting in Oklahoma City, and I was talking to state investment and trade promotion officials, so the officials who were trying to attract foreign investors to come to their states and are also looking overseas for export opportunities for their companies.

And there was a lot of interest in that context, you know, particularly about what the falling dollar would mean and whether -- I mean, I'm sure you've seen that in your state, that opportunities that weren't there a year ago are suddenly there again, and how do you seize on those?  So I agree with you.  I see a lot of that at the political level in state governments, and I think organizations like ours are trying to do outreach on this, and I think we could probably do more.

But the bigger political question is a harder one.  I mean, you know, the political mood in Ohio -- and you can correct me if I'm wrong -- but it's not what you describe.  It's not, you know, people saying yes, we need to support our governors' export promotion efforts.  It's, you know, NAFTA has screwed our state, destroyed our manufacturing base, and what are we going to do about this?  So it's operating at two levels, and the former I think is easier to deal with than the latter.

Yes, sir.

Q     My question go to --

MR. HAASS:  You have to introduce yourself.

Q     Oh, Arturo Lopez-Levy.  (ph) I am a doctoral student at the Josef Korbel School of International Relations --

MR. HAASS:  Great.

Q     -- International Studies.  My question goes to Mr. Alden and deal with the relation between the United States and Latin America.  If we look at the immigration issue, most of the immigrants are coming from countries with whom the United States have already signed free trade agreement with the exception of Chili.  Can the immigration problem be ameliorated by bilateral or multilateral immigration agreement between the United States and those countries?

MR. ALDEN:  We are right in the middle now.  We've put together a task force on immigration, which is high-level council members grappling with questions like this.  And I don't want to pre-judge where we're going to go, but that's one of the issues we're going to have to deal with.  I mean, of course, that was something that President Bush did right out of the blocks, and that was one of his first major initiatives, was to try to negotiate a bilateral migration accord with Mexico, and that fell apart partly as a result of the September 11th attacks.  I think there are -- evidence that the talks were not going tremendously well anyway.

I think it's going to have to be part of the mix.  In the United States there's been this wall that we've built up between trade and immigration.  You see this in the WTO.  We'll talk about every aspect of free trade, including things like intellectual property rights, which are only very kind of vaguely and tangentially related to free trade, and we insist on talking about that.  But when India wants to talk about temporary movement of skilled workers to the United States, which is every bit, it seems to me, as much part of trade as intellectual property, we won't talk about it.

And so this is something the U.S. is going to have to grapple with.  Free trade creates dislocations in countries.  People, you know, move from the farms to the cities.  They lose work.  They often end up looking abroad for new job opportunities.  And it seems to me we're going to have to find some way to put this on the agenda.  I think bilateral accords are certainly more likely to be successful than any big multilateral effort, which I just don't see as politically realistic.

MR. HAASS:  We've got time for a couple more.  Yes, ma'am.

Q     Hi, I'm Kate McQue (sp).  I'm a recent graduate of the University of Colorado, and my question is during this campaign a theme of Senator Obama that Michelle Obama spoke on -- is the world as it is compared to the world as it should be?  So my question is how do we inspire a shared vision around the world rather than try to impose a unilateral vision?

MR. HAASS:  Tom, you've thought about that.

MR. FARER:  Well, my opening remarks -- I meant to say that with respect to the issue of democracy promotion, we should take the flat position that we're not going to impose democracy by force, that we're still going to champion it.  We're still going to promote it.  We still think it is most consistent with the human interest, as well as with effective governance, an argument we've made to the Chinese, I believe, that they'd have a -- they'd be more effective.  They'd have a more flexible system.  They'd be more successful if they had a more open system.

But I think we should flatly say as part of this going back to the future that we're going to respect "territorial integrity and political independence" -- words from the U.N. charter -- but that's going to be a theme of the new Administration.  It hasn't been a theme of this present Administration.  And we're going to promote democracy.  We're going to promote our values by other means.  I think that's an important part of a new statement of our position as a country.

MR. HAASS:  Somewhere in the back.  Yes, ma'am.

Q     I wondered what advice the panelists would give to the new President on managing the Cuban situation -- (off mike) -- can you hear me?  Yes.  Not just in isolation, but in tandem with the Venezuelan situation, since it appears that there has been a strategic alliance between Cuba and Venezuela.  My name is Elena Brown.  I am the (regional Lewis ?) fellow at Harvard Law School.

MR. HAASS:  Well, I don't know that we have any Latin -- Do you want to take that?

MR.    :  I have worked on Latin American issues, and most experts have been saying for, what, 50 years that our Cuban policy has been a failure, that we have been collaborators, unintentionally -- Fidel Castro -- that it would be impossible to have the authoritarian government -- what is it -- 19 miles off our coast in a country deeply infiltrated by American values and interests.  It would be impossible for Castro to have maintained his power all this time if we had not isolated Cuba and played into his hands.

And this is also consistent with Obama's position that we should be open to talking to any country.  Cuba's already beginning to move a little bit.  I think, finally, if we get an Obama presidency, that we will begin talks and we'll begin to move toward -- not necessarily friendly or intimate relations, but normal relations.  That's the first step, normalization of relations.  That's the way we should go.

MR. HAASS:  (Inaudible) -- 'cause you also asked about Venezuela.  That's another area where energy policy is national security policy.  And quite honestly, so long as oil's $125 a barrel, someone like Mr. Chavez is going to have options he would not have if oil were one third that price.  And it's very hard as a result to distinguish between, again, energy and national security.

We've got time I think for one more, and how many -- Mr. Abernathy.  I apologize.  I wanted to call on others, and it was the panelists here who prevented me.


MR.    :  (laughs) Far too verbose.

MR. HAASS:  I've got one last question for them then.

Q     Thank you, Richard.  Bob Abernathy from Los Angeles.  Over half the people that have ever been born on this planet were born after I was born.  What role does population control have in solving our energy problems and in solving the climate control change problems?

MR. HAASS:  Liz, you want to -- (inaudible) -- on population control?


MS. ECONOMY:  (laughs) Well, since China is champion of population control -- they've used this argument, in fact, to talk about why -- they've tried to make population control an element of their climate change policy, but I think that's sort of fallen by the wayside.  Of course it's important, but it doesn't tell the full story, so -- I'm sure most of you know China has a one child policy.

Nonetheless, it has now surpassed the United States as the, you know, largest contributor of carbon emissions in the world, and, you know, it's looking -- it just increased its carbon emissions from power generation by a third this past year, wants to quadruple its economy between 2020 -- sees the coal as the dominant source of energy by 2050, you know, that 1.3 billion people -- they imagine 1.6 billion by 2050.  My guess is it'll be beyond that.  I think it's beyond 1.3 now anyway.

So it's an important element, but it -- you know, they have the potential within the next 25 years basically to wipe out anything that the advanced industrialized countries would do under Kyoto, even if the United States were included if they continue on their current trajectory of economic development.

A part of it is -- it's not just the population.  It's what the population is doing.  So China is moving, you know, 400 million people -- is urbanizing 400 million people between 2000 and 2030.  Urban residents in China use three and a half times more energy than their rural counterparts.  So it's not just keeping the population under control.  It's how that population develops in the forms of their energy use.  But it's an important contribution they've made, but there's a long way to go.

MR. HAASS:  Tom Brokaw ended the earlier panel by asking each of us what was the nightmare that got us up at night?  And people then talked about Pakistan or flu pandemics, or Iran or what have you.  So I want to leave you all feeling good -- (laughter) -- when you leave this room.  So I'm going to reverse the question, 'cause so much of talk about foreign policy this day is enough to drive anyone to drink -- (laughter) -- which is what is it you feel most optimistic about?  Where do you see either the greatest opportunity or the most promising development over the next four years?  Where is that fruit to be picked?  We'll start with Mike.

MR. LEVI:  We have a lot of potential -- and I'll stick to the energy and climate area in answering that question.  I think we have a lot of potential in focused cooperation in smaller groupers, on really focusing on action on the ground, on working intensively between countries to deal with these issues, but at the same time to use that to really build stronger relationships.  That will pay off across the foreign policy spectrum, and that's actually something I think we should be looking at across the board.  We're not going to improve the American standing in the world just by saying we're back in by speaking well and by going out and consulting nicely.  We're going to do it by working constructively on concrete issues, and that's going to pay off and compound on itself over the next four years.

MR. HAASS:  Dean Farer?

MR. FARER:  It's hard to be optimistic, but since you insist, Richard -- (laughter) --

MR. HAASS:  I do.  I promised people here -- to end on a good note.

MR. FARER:  I think that just changing our policy, even our declarative policies, given the baggage that's accumulated over the past eight years, will have a very significant effect on international relations, a sense that the last eight yeas were an anomaly and that the United States is returning to the role of architect of collaboration and cooperation, which it had in the early years after the second World War.

In addition, I think that the President of the United States has an enormous opportunity if policy is, in fact, moving in the direction I suggested, to reach out to peoples in the glove and to begin to communicate.  Just one example, which I think is an easy one.  The President should as early in his term say something about our relationship with the Islamic world, should do it through every medium at the same time, should admit our mistakes, and should reaffirm the consistency of our values, that is, restate democratic and liberal values, but make it clear that we don't seek to impose them because we believe that they are part of the future and that without U.S. intervention these values will gradually come to the fore in the Islamic world and other parts of the world.  I think that kind of a statement itself would significantly affect international relations.

MR. HAASS:  Elizabeth?

MS. ECONOMY:  Great.  I think looking at both the United States and China, what gives me greatest optimism is the force from change from the ground up so that if we look at our climate change policy and we look at the states taking a leader, you look at individuals buying bags and groceries in New York City rather than, you know, using the plastic bags -- it's that kind of citizen action in the United States that gives me hope, and similarly in China with the rise of environmental activists.  They are the greatest force for change, the most positive force for change in China, not only on the environment, but on a whole array of issues, like the Rule of Law and broader political reform.  So for me, when I look, it's the rise of the people in both countries to push the governments forward in the right direction.

MR. HAASS:  Some optimism, Mr. Alden.

MR. ALDEN:  What gives me optimism is -- and it's certainly -- this is another question that's not reflected in the -- and other comments -- not reflected in the debate over in the Pepsi Center, but in the last decade we have seen more progress than any other comparable period in modern human history in lifting people out of poverty.  We've made tremendous progress around the world in countries like China, India, Thailand, Vietnam, even in Africa to some extent, raising people up.

Some of the problems we're grappling with -- you know, global warming, high energy prices, high food prices -- are the problems of prosperity.  We have richer people, and their demands for goods have gone up.  I would rather have that problem than the opposite problem of poverty and stagnation, and that makes me optimistic going forward.

MR. HAASS:  Well, what I want to do is a couple things.  One is I want to again thank our supporters and our partners here who have really I think made for some extraordinarily interesting and useful conversation.  I want to thank you all for giving us your time and your attention.  I want to really compliment both he University of Denver and NDI for doing this, and NDI in particular for the imagination of bringing to this country so many people from other countries to see what we do close up.  I think it says great things about you, that you're willing to invest the time.  I also think it says some nice things about us, that we're willing to show ourselves before you, warts and all.

And last but not least, let me thank the four individuals on my left for being so smart.  So again, thank you all.  (Laughter.)















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