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Connect the World
British Government Announces Budget Cuts; Growing Anger in France; Calls for Hanging Homosexuals in Uganda
Aired October 20, 2010 - 16:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
(BEGIN VIDEO CLIP)
GEORGE OSBORNE, BRITISH FINANCE MINISTER: The decisions we have taken today bring sanity to our public finances and stability in our economy.
(END VIDEO CLIP)
BECKY ANDERSON, HOST: Britain's deepest spending cuts in decades met with a smattering of protests from the unions.
Contrast that with France, where pensions reform is being pounded with mass strikes and rioting.
Tonight, how belt-tightening across Europe is at odds with Washington's model of stimulus and spend. We're going to explore who's right and why.
Going beyond borders on the day's biggest stories here on CNN, this is the hour we connect the world.
Well, most Western countries agree on one thing -- that they need to balance their books. What they don't agree on is how to do it. With the story and its connections, I'm Becky Anderson in London.
Also tonight, "hang them" -- how a headline in the Ugandan newspaper outing homosexuals has drawn derision around the world.
And they're essential for the workings of every Smart device we own. But if I asked you what you knew about rare earth, I bet, like me, you'd draw a blank. The fight over ownership of some of the world's most important minerals.
Plus...
(MUSIC)
ANDERSON: In the hot seat answering your questions, tonight, singer, songwriter Sheryl Crow.
And do get involved with the show. Send us your comments and questions to my Twitter account. It's @beckycnn.
All right, let's kick off tonight. Britain's finance minister says it was the day the country stepped back from the brink. But his critics claim his spending cuts are a reckless gamble that could plunge the country back into recession.
Dan Rivers has more.
(BEGIN VIDEOTAPE)
DAN RIVERS, CNN CORRESPONDENT: (voice-over): Grim-faced as he prepared to wield the ax, George Osborne entered Number Eleven Downing Street and the history books unleashing the biggest cuts in living memory. His neighbor and boss, Prime Minister David Cameron, had pledged to tame Britain's blooming debt. Now, the day had arrived for details on how the would slash about $130 billion from the budget.
OSBORNE: We have put the national interests first. We made the tough choices. We've protected health and schools and investment in growth. We've reformed welfare and cut waste. We've made sure we're all in this together and we've taken our country back from the brink of bankruptcy -- a stronger Britain starts here and I commend this statement to the House.
RIVERS: But his opponents say the savage scale of the austerity measures threatens to plunge Britain back into recession.
ALAN JOHNSON, BRITISH SHADOW FINANCE MINISTER: Today's reckless gamble with people's livelihoods runs the risk of stifling the fragile recovery.
RIVERS: Britain's cold wind of economic austerity is sending a chill through many government departments and suddenly many households. It risks making George Osborne the most unpopular chancellor since the war.
Among the announcements made, 490,000 public sector jobs will be lost. The average government department budget will be cut by 19 percent. The welfare budget will be slashed by an extra $11 billion. Health and school budgets will be untouched, but the pension age will rise to 66 by 2020, earlier than expected.
But while protests in France are rioting against the rise in pension age, in Britain, the reaction is more muted. Here, society is dividend on whether such austerity is necessary.
DOUGLAS ALEXANDER, BRITISH SHADOW PENSIONS MINISTER: It is easier to deal with your deficit if you have growth and jobs in the economy and more difficult to deal with your deficit if you hack at the roots of growth and condemn tens of thousands, or, indeed, hundreds of thousands of people to the unemployment cues.
DIGBY JONES, FORMER CBI CHAIRMAN: The British economy is under firm management and actually is providing a very good basis for investment. Its 500,000 public sector jobs over four years. This isn't all in one year.
RIVERS (on camera): There's still a lot of economic debate about the effectiveness of the measures that have been cooked up behind this door. But politically, one thing is certain -- this will be a defining moment for the coalition government when the age of austerity really starts to bite.
Dan Rivers, CNN, London.
(END VIDEO TAPE)
ANDERSON: All right, well, Osborne, then, had a -- has had to perform a delicate balancing act. Fail to tackle the deficit and you run the risk, of course, of having to default. Cut too much too soon and you could ruin the recovery.
So did he get it right?
Richard Quest has been gauging reaction and he joins me now from outside Number Eleven Downing Street, the home, of course, of the chancellor.
So, did he get it right?
RICHARD QUEST, HOST, QUEST MEANS BUSINESS: And that is the question that I'm not going to answer.
Becky, I mean I -- I wish it was a little bit clearer, because the positions of the two sides are totally and utterly opposite.
I spoke to Alistair Darling, the former chancellor, the man who's said to have gotten us into this mess in the first place, who says that it's too risky, it's dangerous, it's taking unnecessary risks with the U.K. economy.
But then you speak to people like Norman Lamont, the former chancellor. You speak to Danny Alexander, the chief secretary of the treasury, and they'll say it's just what is necessary if -- if risks are not to be overtaken.
So the longer and short of it is the experiment is now underway. We will see in the weeks and months ahead, particularly as we go into a cold, deep, dark winter.
ANDERSON: Who will hurt the most from these spending cuts, Richard?
QUEST: According to the IFS, the Institute of Fiscal Studies, these spending cuts are regressive. They came out this afternoon and said despite what the chancellor said -- that it was a progressive reform -- spending. They said, actually, those at the bottom of the -- of the -- of the heap, those on benefits, those claiming -- those most in need, those who use social services most will be worst off and, therefore, they are regressive.
But everybody is hit -- Becky, if you earn a lot of money, you're paying more tax. If you earn any money, you're going to be hit on some form of benefit. If you think -- if you spend any money, you're going to be hit by the higher V -- VAT. If you've got people at school and old age pensions, if you've got hospitals, everybody in Britain tonight, in some shape or form, in the next 12 months, will feel the effects.
ANDERSON: Well, it's not as if we didn't know it, because this is what...
QUEST: Yes.
ANDERSON: -- they were elected on back in May, of course. You and I know that very, very well.
Richard, we thank you for that.
Richard Quest is outside Number Eleven Downing Street tonight.
Well, the U.K., of course, is one of a number of Western countries struggling with budget deficits. Take a look at the -- the deficit as a percentage of GDP. The U.K. is among the worst in the industrialized world, with 13.3 percent. That's a huge number. That is according to the OECD predictions for this year.
Now, the U.S. is at 10.7 percent.
Other notable economies including Greece at 9.8 and France at 8.6.
Well, in a moment we'll find out why it's not just pension reforms that are causing the French concern.
But first, let's head to Germany to see where the cuts there are being felt the most.
(BEGIN VIDEOTAPE)
DIANA MAGNAY, CNN CORRESPONDENT: I'm Diana Magnay in Berlin.
Now, in June, the German government announced its biggest raft of austerity measures since the end of World War II. And where they're making savings is in unemployment benefits, especially for the long-term unemployed, and also reducing parental benefits amongst the unemployed and amongst higher earning families, earning a lot of criticism that this affects the socially weak in society.
They're also making cuts in the public sector. Around 40,000 jobs will go there. And also, there will be a comprehensive reform of the German armed forces, where they will be cutting $11.5 billion over the next four years and possibly as many as 80,000 jobs.
What they're not doing is raising income tax or sales tax. I said, they're reducing sub -- subsidies for business and they're levying an extra tax on the nuclear industry and on air traffic.
All of this to bring the budget deficit down from its current 5 percent to below 3 percent by the end of 2013.
JIM BITTERMANN, CNN CORRESPONDENT: I'm Jim Bittermann in Paris, where it's pension reform that's brought people out into the streets in a big way over the past few days. But that's really only the last straw, because there's been growing anger on the streets of France, perhaps unnoticed outside the country, for some time now over the government's reform plans that, in fact, have included many, many cutbacks in many, many areas.
For example, defense spending, which has required the closing of many military bases, cutbacks in subsidies for health care and unemployment and a program that's been in place some time now of only replacing one out of every two retiring civil servants.
So if it's pension reform that's brought people into the streets, it's not the only reason that people are angry.
(END VIDEO TAPE)
ANDERSON: All right, join the dots for you then on what is -- has to be one of the world's biggest stories at the moment, these deep, deep holes in our finances.
In the U.S., it's a very different picture. Instead of cutting back, the talk there is of spending and stimulus.
So which is the right path to recovery?
Well, let's ask Uri Dadush, who is former director of economic policy at the World Bank.
He's French, joining us tonight from Washington.
I say that because the French are going through all manner of troubles. To a certain extent, one can almost begin to feel sorry for the president. I mean he really is facing the wrath of the French people at the moment, because he, of course, is trying to deeply cut into what pension money they would expect in the future.
Listen, we've got deficits all over the place. You've seen what the U.K. is attempt to do. We've seen what Germany and France are up to, as well.
And then we look across the pond to the U.S., who say let's not do this. Let's continue to spend and stimulate the economy.
Who is getting it right?
URI DADUSH, FORMER ECONOMIC POLICY DIRECTOR, WORLD BANK: Well, the first point is that the U.S. actually, next year, will also see some withdrawal of stimulus, even if the Bush era tax cuts are extended into next year. Nevertheless, the effect of the government on the economy will be somewhat contractionary with respect to 2010.
So the differences are not quite as stark as -- as they might look at first sight.
ANDERSON: All right, I want to get really basic here and it's perhaps for my benefit as much as anybody else's. If you and I had this enormous credit card bill that we had to pay, how should we go about paying it?
Should we simply cut our costs, as it were?
Or should we try and sort of stimulate our way out of this?
I know you say that the -- the States will probably stop doing that, to a certain extent, next year.
But there's certainly a divide between what Europe is attempt, at present, and the path that the U.S. still seems to be on at this point.
At the end of the day the whole point is this, isn't it, the risk of default is huge for everybody.
So which is the right path?
DADUSH: Yes. I don't think there's any question that it's just a matter of time before different governments have to cut back on their deficit and rein in their very rapidly growing debt. So the question is not whether that's going to happen. The question is when that is going to happen, what is the right time.
Now, my view happens to be that it's early, early days yet, because of the slowdown that we are seeing in the global economy, to completely cut back on the stimulus and to take very Draconian measures, as are being taken in the -- in the United Kingdom.
But in the end, the issue is whether you do it now or you do it a year from now.
Now, my preference would be to wait another year...
ANDERSON: All right...
DADUSH: -- and I think countries, by and large, can afford it.
ANDERSON: And -- and you might be right, but you'll have the benefit of hindsight at that point.
Let's take -- let's go back and try and get some historical context for this. We've been here before, in situations like this, but of -- of course, some economic parameters are always very different.
You know, in the past, when we've tried to spend our way out of a recession, has it worked well?
DADUSH: Well, I think that in 2009, it was absolutely essential to have had the stimulus measures that we did have. And I think they were absolutely central to our avoiding descent into a depression.
And there are a number of other cases in history you could refer to where the stimulus measures were very important. Arguably, during the Depression, one of the reasons, in the 1930s, we had the dip that we had was that government withdrew stimulus too soon.
So this is an accepted recipe. At the same time, one cannot lose sight of the effect on the long-term government finances.
Now, in Europe today, there are very, very divergent situations. There is no possibility for Spain and Italy, for example, or Ireland and Greece, to delay any further the retrenchment -- the fiscal retrenchment...
ANDERSON: All right...
DADUSH: -- that has to happen. Countries like the U.K., countries like the U.S. and certainly Germany probably have more room.
ANDERSON: There will be people watching this show tonight who have seen what has happened in the U.K., who are watching what is happening in France and will anticipate what's going on in the U.S.
And they will say this, why is it that half a million civil servants in the U.K. will have to lose their jobs over the next four years because of what they perceive to have been a problem created by bankers?
DADUSH: Well, it's a -- it's an entirely fair question. And I think that you can understand the -- the feelings of -- of these people. And, again, I -- I say that I -- I think that the U.K. program, which is the most aggressive, by far, among the industrial countries, and also the one that, in a sense, is being embarked on upon the earliest, is a very, very aggressive program and probably should not be quite as aggressive.
But again, I repeat, the question is when these adjustments are going to have to happen. And you have to accept the fact -- or at least recognize the fact that the new British government is acting -- acting aggressively relatively early -- I think too early.
ANDERSON: Interesting.
All right, well, we appreciate your thoughts this evening.
Do join us again here on CONNECT THE WORLD.
Your expert on the subject this evening.
Well, whether to cut savagely or go the stimulus route, it will take years -- years to learn for sure which one worked, I'm afraid. Coming up next here on CONNECT THE WORLD, the article reveals names, faces, even addresses, as a banner urges, "hang them." A Ugandan newspaper has published a virtual hit list of the country's most prominent gays. The paper says it's doing society a favor. We're going to take a look at that and more.
And later, concern is growing that China could restrict access to (AUDIO GAP) to make what are the most common products that we all use. We'll get Beijing's side of the story, after this.
(COMMERCIAL BREAK)
ANDERSON: Well, they're calling for a hanging, asking people to take the law into their own hands.
Those words from one of the people recently outed by a Ugandan newspaper for being gay or lesbian. Critics are outraged, saying the article endangers lives.
But the paper's editor says it's just a public service announcement.
We're going to kick off tonight with David McKenzie and this report.
(BEGIN VIDEOTAPE)
DAVID MCKENZIE, CNN AFRICA CORRESPONDENT (voice-over): What grabs you is a bright yellow banner. "Hang them," it reads. The headline a call to action -- a hit list of what this tabloid calls 100 of Uganda's top homosexuals.
Inside, portraits and home addresses of prominent Ugandans. The editor of "Rolling Stone" -- no relation to the U.S. Magazine -- says in this deeply conservative country, his paper is doing a public good.
GILES MUHAME, MANAGING EDITOR, "ROLLING STONE": The aim of the newspaper is to expose the evils in our society. And like any other newspapers, we are writing about, this is going to affect society. And homosexuality is a big issue.
MCKENZIE: Already, gay rights groups say several people on the list have been attacked, some losing their jobs since being outed on the list. Activist Naomi Ruzindana lives in fear.
NAOMI RUZINDANA, HORIZON COMMUNITY ORGANIZATION: Every time I make a stamp like any other citizen of East African countries, I'm -- I'm implicated. And it really has a negative impact on my life. Personally, it's a threat over my life.
MCKENZIE: The government says activists are lying.
Homosexuality is illegal in Uganda and frowned upon by many. But a year ago, the Ugandan government went further by pushing for a bill that that would make some homosexual acts punishable by life in prison or even the death penalty. After a worldwide outcry, that bill was shelved.
FIKILE VILAKAZI, DIRECTOR, COALITION OF AFRICAN LESBIANS: That's an invasion of that person's privacy. And they're doing it in the context where they know where that homosexuality is illegal. You're basically perpetuating hate. You are perpetuating violence, even murder.
MCKENZIE: But activists say that the public space for gays on the continent is shrinking.
VILAKAZI: It's a feeling like somebody is cutting your throat.
MCKENZIE (on camera): Activists fear that more Ugandans could be targeted because of the newspaper campaign. The Media Council in Uganda has suspended the paper, but only because it wasn't registered. The editor says that as soon as it's relaunched, he will continue his campaign against gays.
David McKenzie, CNN, Johannesburg, South Africa.
(END VIDEO TAPE)
ANDERSON: Well, let's see how this story resonates around the world, shall we?
Some countries that do protect many rights of gay people still don't grant full equality. The United States is now a step closer toward knocking down one barrier that prevents gays from serving in the military. Openly gay recruits can now join the U.S. armed forces for the first time in history, after a federal judge struck down the "don't ask, don't tell" law.
The controversy is far from over. The Obama administration, which does support homosexuals serving in the military, filed a petition to have a ruling immediately suspended. It wants Congress to settle the issue, not the courts.
For now, though, with "don't ask, don't tell" gone, some former service members are trying to reenlist, including Daniel Choi, the Iraq War veteran who was discharged from the army in July after announcing that he was gay.
Choi told CNN's Anderson Cooper what happened when he visited a New York recruiting center.
(BEGIN VIDEO CLIP FROM "A.C. 360")
DAN CHOI, DISCHARGED UNDER "DON'T ASK, DON'T TELL" POLICY: A week ago, even with all these qualifications, I would have been turned away, if I would have said that I am gay and I intend to be honest about it. Today was -- was very different.
ANDERSON COOPER, HOST, "A.C. 360": And they handed you a pamphlet, too?
CHOI: They said -- they said, stand up, stand out and stand Army strong. I was very excited.
COOPER: So your paperwork is going through?
CHO: It's going through and -- and they're processing it. I'm very happy about it.
(END VIDEO CLIP)
ANDERSON: Well, U.S. service members are dividend on this issue, yet orders are a fact of life in the military. The new commandant -- commandant of the U.S. Marine Corps opposes changing "don't ask, don't tell." At his confirmation hearing, General James Amos was asked if he could set aside his personal feelings.
(BEGIN VIDEO CLIP)
SEN. CARL LEVIN (D), MICHIGAN: I understand that you have indicated that you have opposed the change in the policy.
However, my question is this, if such a certification by civilian and military leadership were made following receipt of that report, could you have confirmed -- implement a repeal of the "don't ask, don't tell" in the Marine Corps?
GEN. JAMES AMOS, U.S. MARINE CORPS: Mr. Chairman, the Marine Corps is probably one of the most faithful services you have in our country. And if the law is changed by Congress and signed by the president of the United States, the Marine Corps will get in step and do it smartly.
(END VIDEO CLIP)
ANDERSON: Well, gay rights supporters in the United States are showing their true colors today, wearing purple in a show of solidarity with gay teens who've taken their own lives because they could no longer endure bullying. You can read more about that on Facebook, where there is a special page devoted to the effort. Organizers call it Spirit Day and they say such awareness can save lives.
An important story for you.
CONNECT THE WORLD.
I'm Becky Anderson.
Coming up, a landmark decision by the British Supreme Court which could change the way divorces are handled in Europe forever. We're going to tell you why the business of divorce tourism could be coming to an end. That just ahead.
And later, we connect you to singer Sheryl Crow. She's answering your questions. You will not want to miss that.
Stay with us.
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(COMMERCIAL BREAK)
ANDERSON: Well, big changes may be on the horizon for divorce settlements in Britain and the ripple effects could be felt all over Europe. In a landmark decision, the British Supreme Court today ruled in favor of a German millionaire, as she fought to keep her fortune for herself.
(BEGIN VIDEO CLIP)
ANDERSON: (voice-over): A high profile marriage that disintegrated into a ferocious divorce battle over millions of dollars was finally settled Wednesday in Britain's highest court and the decision could alter the way that marriages are dissolved in England forever.
Facing off, a German heiress and a French investment banker, who signed a prenuptial agreement before marrying in 1998.
LORD PHILLIPS, BRITISH SUPREME COURT: They made an agreement in Germany that if they got divorced, neither would make any claim to the property of the other. But they married and made their home in England and got divorced in England, so English law applies.
ANDERSON: It is exactly that law that has made England so attractive to those wishing to divorce, because British courts tend to divide assets equally, even when a prenup exists. That has led to a phenomenon known as divorce tourism -- when people with tenuous links to England file for divorce there in the hopes of maximizing their settlement.
But all of that may change now that the British Supreme Court ruled on Wednesday that prenups should be considered when awarding settlements.
LORD PHILLIPS: The majority held that in this case, the agreement was freely entered into and that both husband and wife fully appreciated its implications.
ANDERSON: The bottom line in this case, the heiress keeps her fortune.
UNIDENTIFIED MALE: Are you pleased with the outcome?
UNIDENTIFIED FEMALE: Yes. I'm very relieved.
ANDERSON: British courts have handed out some massive divorce settlements in recent years, including for Heather Mills, after her divorce from former Beatle, Paul McCartney.
HEATHER MILLS, PAUL MCCARTNEY'S EX-WIFE: It was always going to be a figure between $20 million and $30 million. Paul was offering a lot less than that.
ANDERSON: Wednesday's decision brings Britain more in line with the rest of Europe and the United States, where prenuptial agreements are commonplace and widely enforced, especially among the celebrity set.
UNIDENTIFIED FEMALE: Britney!
UNIDENTIFIED FEMALE: Britney (INAUDIBLE).
UNIDENTIFIED FEMALE: Hey, Britney!
ANDERSON: When American pop star, Britney Spears, divorced Kevin Federline in 2007, she was worth about $100 million. But a prenup limited her husband's settlement to a tiny fraction of that -- just $1 million.
Compare that to what's considered the most expensive divorce of all time. In the absence of a prenup, media tycoon Rupert Murdoch forked out over $1.5 billion to his second ex-wife in 1999.
The British Law Commission must still decide whether to cement Wednesday's high court decision onto the books. But for now, it may be enough to keep divorce tourists from visiting Britain for big bucks.
(END VIDEO TAPE)
ANDERSON: And you have been warned.
Well, from Smartphones to solar powered batteries to aluminum baseball bats, many products that we use are made with minerals mined almost exclusively, it seems, in China. We're going to see how reports of a widening embargo, then, on these minerals has triggered alarm around the world.
That and your headlines right after this.
(COMMERCIAL BREAK)
ANDERSON: At just after half past the hour, you are back with me, Becky Anderson in London and CONNECT THE WORLD here on CNN. Coming up, they used to manufacture the things that we are -- we take for granted, really. But could China be holding the world to ransom over its rare earth minerals?
Plus, he's the Jordanian army's top weapon against the Taliban. We're going to meet the imam who's tackling insurgents with nothing more than his faith.
And you don't want to miss our special interview with American rocker Sheryl Crow. She'll be answering your questions tonight as your Connector of the Day.
Those stories are coming up in the next half hour. First, as ever at this point, you deserve a check of the headlines. So, here they are.
The British government has announced its biggest spending slashes in generations. They include the axing of nearly half a million public sector jobs. Banks will be hit with a permanent levy, and the state pension age will be raised from 65 to 66 over the next decade.
French police have forced open three fuel depots on orders of President Nicolas Sarkozy. They were shut down in protest strikes against government plans there to raise the retirement age. Mr. Sarkozy is vowing to push the pensions reforms through whatever.
The US State Department is confirming a $60 billion arms deal with Saudi Arabia. The deal will take place over the next 15 to 20 years and includes fighter jets and combat helicopters. One official told reporters the White House doesn't expect any objections to the sale from Israel.
Afghanistan's independent election commission has tossed out about 23 percent of the ballots from September's parliamentary vote. The group says that's due to widespread fraud. The announcement came after weeks of complaints about ballot box stuffing and bribery.
Now, listen up to this story. China is denying reports that it is expanding an embargo on rare earth minerals, saying that it will continue supplying the world with these resources critical to manufacturing. However, Beijing has been reducing the amount of rare earths it exports. Stan Grant shows us why this all matters.
(BEGIN VIDEOTAPE)
STAN GRANT, CNN CORRESPONDENT (on camera): The debate, now, about the export of rare earths has raised the question, "What exactly are they?"
Take a look in here. This is an Apple store, and what you're seeing in here comes directly from rare earths. All of our modern gadgets, all of our technology equipment. This iPhone, for instance, contains rare earth elements. They are essential to modern life, everything from this phone right through to missile systems with defense forces around the world.
The question now is, how are countries going to be able to provide the rare earth elements that they need if China is winding back its export production?
"Rare earth" is actually a bit of a misnomer. They're not as rare as the name would actually suggest. They're found in many different countries, including the United States. But the question is, where they're actually extracted from.
Now, China has monopolized the extraction of these rare earth elements, and also the refinement of them. It's not an easy process. Very, very intricate. The mines take a long time to actually get up to speed. And it's a very, very dirty process. Very hazardous to the environment. And analysts say that's why China is doing the hard work for the rest of the world.
MARTIN HENNECKE, ASSOCIATE DIRECTOR, TYCHE: The countries didn't or haven't done the dirty work of developing those mines, so that's -- it's really a time lag issue, where those commodities really haven't been developed as everyone was getting them cheap and easy from China without having to do the dirty work.
GRANT (on camera): China, in fact, has been pulling back on its rare earth exports in recent times. It has cut production over the past few years dramatically, it says, because it wants to minimize the environmental impact. However, the recent spat with Japan and blocking rare earth exports to that question has raised questions about whether China has a more sinister motive.
The Chinese government has released a statement vehemently rejecting any reports that it is targeting other countries by reducing its rare earth exports. It says the export trade will continue, but it will wind it back to comply with stronger environmental standards. It all comes down to the eye of the beholder. Stan Grant, CNN, Beijing.
(END VIDEOTAPE)
ANDERSON: All right. Well, as Stan touched on, and it's a point worth repeating, China mines about 97 percent of the world's supply of rare earth minerals. It doesn't, though, have a monopoly on deposits. The United States, Russia, Australia, all with significant reserves. But they aren't mining them, because these minerals are difficult and expensive to extract.
Concerns over China's control of the market is, of course, affecting prices. One company estimates over the last 45 days, the average price of rare earth minerals has gone up 750 percent. And that may be the low end of the estimates.
Some countries fear China may be using the minerals as political liverage -- or leverage, if I was to pronounce it correctly -- as it appeared to do after it got into the naval dispute with Japan recently. China denies any such motivations.
So, should any of us be worried? Gordon Chang is our big thinker. He's a regular guest on this show, quite likes to give China a kicking on a regular basis. So, we're having you in because it's a story that you're going to enjoy.
Listen. Should we be worried at this point? Let's just remind our viewers, these are only reports that China at this point is scaling back on its exports.
GORDON CHANG, AUTHOR, "THE COMING COLLAPSE OF CHINA": Clearly, China imposed a ban on Japan last month. These are reports against the United States and Europe, sound really the same as what happened. So, indeed, we should be concerned.
We all in the west thought that as China participated in trade, it would become benign. But instead, it just became more economically powerful, and now it's using that power to club countries it doesn't like. This has got to be a concern for everybody around the world.
ANDERSON: It might be easier for those who are finding the rare earth minerals story a little difficult to understand if we drew an analogy. For example, take us back to 1960, where most of the oil that we were consuming at that point, of course, was produced in the middle east. Not only the reserves, but all of the oil that was being produced.
Over the years, of course, things have changed. And one assumes that that will be a similar situation with the rare earths mineral story at the moment. With 97 percent of the market -- whatever the international system says, so far as trade is concerned, the Chinese can simply do what they want at this point, can't they?
CHANG: Well, they can for about three to five years. But at this point, countries and companies are looking to diversify their sources of the rare earths. That means, for instance, that mines in California are going to be opened. Mines in Australia will be opened. And what we'll see in about, basically, half decade from now, is that China's monopoly will have been gone.
ANDERSON: Let's point out that the EU today, Brussels, saying that it could not confirm a ban of exports of rare minerals to Europe. If you were to take a guess, given what you know about China, how long will it be before we find out whether they have definitively made a decision to scale back?
CHANG: We'll know in about a week or so, because people are going to talk to all of the companies that have been importing rare earths. We're going to find out what the Japanese found out last month. It's exactly the same pattern. And we found out on September 21 that China stopped the sale of all rare earths to Japan. And, so, we'll be able to do the same thing.
ANDERSON: All right. Tit for tat comes to mind. How do you believe other countries will respond?
CHANG: Other countries are going to make sure that they create their own alternative sources of supply --
(CROSSTALK)
ANDERSON: But this is long term.
CHANG: For instance, the Pentagon has been --
ANDERSON: This is long term, isn't it? We're talking about now.
CHANG: It certain -- Well, right now, what's going to happen is probably the Obama administration, along with Europe and some other countries, are going to go to the World Trade Organization to file a complaint, because this clearly is a blatant violation of China's trade obligations. Not only the ban against Japan, the United States, and Europe, but also the general export restrictions and export taxes. This isn't going to survive challenge.
ANDERSON: There'll be people watching tonight who might be thinking, "Shall I get to that Apple shop now, or will my iPad, in a week's time, be 750 percent more expensive?" We're not talking things are that bad at this point, are we?
CHANG: Eventually, prices will go up, because China is restricting supply. But yes, you don't have to go down there tomorrow.
The other thing that's going to happen is that countries are going to find alternative materials and alternative technologies, so they don't need as much rare earths. And this is going to be just general, typical commercial behavior, where countries are going to realize that they cannot depend upon China as a reliable source and reliable link in supply chains.
ANDERSON: Always a pleasure, Mr. Chang, we thank you very much, indeed. Go and have some supper and we'll speak soon. Gordon Chang, a regular guest on this show. It's complicated subject, that, but it's one that you and I ought to understand, given that we all use these smart devices, of course.
Well, after the break, we are in another mineral-rich country just across China's border, in fact, looking at how various armies are taking on the Taliban. Our theme week in Afghanistan continues tonight with a special look at this man and why, armed with only his faith, he's winning some big battles. More, after this.
(COMMERCIAL BREAK)
ANDERSON: Welcome back, you're watching CONNECT THE WORLD here on CNN. Now, the Afghanistan election commission says it's tossed out nearly a quarter of votes from September's parliamentary elections. It says around 1.3 million ballots have been pulled because of fraud. The vote was widely viewed as a key test for Afghanistan's fledgling democracy after international observers reported widespread fraud in last year's presidential elections.
All this week on the show, we've been looking at the challenges facing those trying to bring peace back to what is a troubled land. We began with a visit to a farm in the US state of Iowa, ironically, where Afghan and Pakistani ministers were hoping to learn some useful techniques that could help improve crop production back at home.
On Tuesday, we saw how US soldiers in Afghanistan are using space age technology to protect themselves from crude but deadly weapons.
And tonight, we're on patrol with Jordanian army's top gun against terrorism. He is an effective opponent against the Taliban, but he doesn't engage in combat. Barbara Starr meets the imam with a mighty mission.
(BEGIN VIDEOTAPE)
BARBARA STARR, CNN PENTAGON CORRESPONDENT (voice-over): US troops get ready for possible ambush before going on patrol in eastern Afghanistan.
UNIDENTIFIED MALE: First, if necessary, we push through the kill zone.
STARR (voice-over): A Jordanian ranger battalion is joining the patrol. They're bringing their number one weapon against the Taliban. Meet the Jordanian army's imam, Sheikh Mohammed Najem.
The imam, armed only with his Islamic faith, is a voice for moderate Islam, challenging the Taliban views that people often hear.
The imam tells us of his Islamic obligation to help those in need, to remind everyone that true Islam is a religion of moderation.
We convoy to a school compound of women and children. Elders don't want us here. While the soldiers negotiate entry, the imam gathers children close. He regularly comes to village to discuss religious matters.
An elder finally lets in a unique group of Jordanian female soldiers. I enter the compound with them. Women, who can readily enter Afghan compounds and homes in a non-threatening manner. When the men finally enter, school supplies are distributed by the Jordanian women.
AREEJ MALKAWI, LIEUTENANT, JORDANIAN ARMY: We are just six girls here working and presenting some assistance to the brother of propaganda (ph).
STARR (voice-over): But suddenly, the Afghan men here grow nervous, and we are told to get out.
STARR (on camera): We've just found out why we were asked to leave the school. Apparently, last year, when some troops brought aid here, they distributed the school supplies, but after they left, the Taliban came and killed eight schoolchildren.
STARR (voice-over): US troops tell us they don't believe the story, but the elders' anxiety underscores the very real fear of the Taliban.
UNIDENTIFED CHILD: He wants a Koran for the mosque.
STARR (on camera): He wants -- he wants --
UNIDENTIFIED CHILD: Yes, yes.
STARR: A Koran?
UNIDENTIFIED CHILD: No, yes.
STARR (voice-over): The Jordanian commander makes clear his troops' main effort is to offer help.
AREF AL-ZAHEN, COLONEL, JORDANIAN ARMY: Sometimes soft hand is better than going with hard hand.
STARR (voice-over): But if it comes to it, his men will fight.
AL-ZAHEN: But we still are soldiers. We are prepared for combat.
STARR (voice-over): Back at camp, Imam Sheikh Mohammed Najem leads Jordanian and Afghan troops at prayer time. The pause for faith and devotion before the next mission. Barbara Starr, CNN, Logar province, Afghanistan.
(END VIDEOTAPE)
ANDERSON: And tomorrow, we are looking at the children of Kabul. Most young boys there work so hard just to survive. Ten hours a day, six days a week, for less than $1 a day. Barbara back again with us tomorrow night for this revealing story on their hopes and dreams for the future.
After the break, a singer-songwriter for you. Sheryl Crow's dazzled audiences for more than a decade and, tonight, she'll be right here, answering your questions. That's your Connector of the Day in just a moment.
(MUSIC - "A Change Would Do You Good")
(COMMERCIAL BREAK)
(BEGIN VIDEOTAPE)
(MUSIC - "Love is Free")
ANDERSON (voice-over): With her soulful tunes and commanding presence, Sheryl Crow has become one of the most successful singers in rock and roll. The nine-time Grammy winner has sold more than 50 million albums worldwide, with hits such as "All I Wanna Do" and "If It Makes You Happy."
(MUSIC - "If It Makes You Happy")
ANDERSON (voice-over): A vocal Democrat, Crow was a strong musical force behind the Obama campaign, playing gigs during the election process and adding a political message to her music.
(MUSIC - "Bless This Mess")
ANDERSON (voice-over): Off the circuit, she's an avid proponent of breast cancer awareness, having survived the disease itself.
SHERYL CROW, SINGER/SONGWRITER: I think most people think that it couldn't happen to them. I mean, I was one of those people that really felt like, look, I'm healthy, I'm on the go, I treat myself pretty healthy. And yet, here I have breast cancer.
ANDERSON (voice-over): In 2006, Crow also made headlines with a brief engagement to fellow cancer survivor and Tour de France champion Lance Armstrong. Today, she's the mother of two adopted boys and has just completed her latest album, "100 Miles from Memphis." She told me what it was about this album that she enjoyed.
CROW: It's been great. I -- people ask me, "Why did you make this record now?" And I think -- I think I just got away from being so -- so emotionally steeped in the whole political environment, what was going on in America and what was going on with the environment in general. And then, I had adopted two children. This album is just more about enjoying life and vulnerability and all the things that soul music actually was indicative of.
ANDERSON (on camera): You've played with some of the greats. You're a backing singer, of course, with Sting, and Stevie Wonder, and Michael Jackson. Jose's written to us. He says, "Is there anyone that you've enjoyed performing with most?"
CROW: Well, I would say -- I would have to say Michael Jackson. That was my first gig. I'd only been in LA for about six months, and I didn't even own a passport. And the next thing I know, I'm standing in Tokyo in front of 75,000 people with the biggest star that has ever lived.
And getting to witness, really, the divinity in his brilliance was, for me, everlasting. It's left a huge mark on me as a person and as a performer.
ANDERSON: What was he like to work with?
CROW: He was very present, he was very involved in all the arrangements and the choreography, he was a perfectionist. And he was a very gentle soul. Very sweet, had a funny sense of humor, very childlike sense of humor.
We used to share a changing booth, it was just basically split by a curtain. And he would throw grapes over it, just silly things. He would rent out Tokyo Disneyland for the band at midnight, and we would run around like kids until 4:30 in the morning.
ANDERSON: I want to talk about the touring, but also about the breast cancer. You'll use a free concert in LA, I know, next month to raise awareness for breast cancer, which you survived. Lisa, one of our viewers, has written in. She says, "What's the greatest change in your life after that, do you think?"
CROW: I really met myself on the radiation table. Every morning, the only person that could be there to treat myself was my -- was me. And it really introduced me to some very bad habits that I had, one of which was taking care of everybody in my life before myself. And that really has informed the way my life looks and feels now.
There's a book called "Don't Sweat the Small Stuff." I haven't read it, but I can safely say I'm living it. So, that's probably the major, major change.
ANDERSON: You have, I know, announced that you're going to do a couple of what you call "intimate gigs" in London to thank --
CROW: Like, so intimate that you'd be able to probably see my nose hairs.
(LAUGHTER)
ANDERSON: Why? What's so special about London?
CROW: London actually -- London and France were the -- really played my record before even America did. They were so on board with "Run Baby Run," which was the first single I ever had. And for me, there's such a legacy here of musicians that I grew up loving and still try to emulate. My goal in life is to be Keith Richards, so --
(LAUGHTER)
CROW: And there is -- there's a great -- I think there's a great history of live music here, and a great love for it. I played at The Borderline, I think, in 93 or 94, so we're just going to go back and play. The new band's going to -- we're going to kind of reintroduce what I'm doing now.
ANDERSON: You said that you got a couple of years before the kids are in school, or one of the kids is in school. You're not going to give up at that stage, are you?
CROW: Oh, Lord, no. No.
(LAUGHTER)
CROW: No, because the fun of it is going out and playing the music. I live in Nashville, and the country artists have a really cool thing that they do. They tour on the weekends. They're called "weekend warriors." And they all own their own buses, and their kids go to school, and then on Thursday, Friday, Saturday, or Friday, Saturday, Sunday, they'll go out and tour. And their fan base, they stay home with their kids, and they go out and see concerts on the weekends.
So, if there's a way of doing that with the exception of summer, then that would be ideal. So, we're going to investigate that.
ANDERSON: And is the idea to bring those little ones up in the South? Is that where they're going to be?
CROW: Well, I grew up in the South. I grew -- well, technically kind of the South. I grew up south of the Mason-Dixon county line, which is southern Missouri. And now, I'm about three hours from there. And I just love it, because I have great friends there, and my whole family's down there, and there's no paparazzi. Nobody down there cares. I think they're so accustomed to having country singers walk around that it's just a part of their everyday lives.
So it's great. My kids are growing up on a farm, and they don't walk out and have a camera shoved into their face, like we get in LA and New York.
(END VIDEOTAPE)
ANDERSON: Good for them. Good for her. Sheryl Crow, there. What a joy. Who is actually right at this moment performing at an intimate gig in London, just about 250 people, basically to say thank you for everything that she's enjoyed about London in the past. So, one wishes one was there, but we're not, because we're here.
Tomorrow's Connector of the Day created quite a bit of buzz here on the CONNECT THE WORLD team with all his all-American good looks and charm. Matthew McConaughey has transformed himself into one of the most popular actors around. Don't forget to send, as ever, your questions in for our future Connectors. It's cnn.com/connect, that's the site. You'll find lots and lots and lots of things that you'll enjoy there. Tonight, we've got a couple of minutes left. We'll be right back with your Parting Shots.
(COMMERCIAL BREAK)
ANDERSON: At a couple of minutes left and just a few -- for us, at least. Just a few hours from now, Larry King will be interviewing the US talk show host Jon Stewart, the very many who started a phenomenon that's got even President Obama talking about it. Take a look at this.
(BEGIN VIDEO CLIP)
JON STEWART, HOST, "THE DAILY SHOW": Tonight, I announce the Rally to Restore Sanity.
(APPLAUSE)
STEWART: We will gather on the National Mall in Washington, DC, a million moderate march, where we take to the street to send a message to our leaders and our national media that says, "We are here! We're only here, though, until 6:00, because we have a sitter."
(LAUGHTER)
(END VIDEO CLIP)
ANDERSON: Tonight, then, we are hitting rallies worldwide in our Parting Shots. And this is the Tea Party Express rally in Las Vegas -- all in honor of Jon Stewart, of course, tonight -- part of an initiative to get conservatives elected to the House and Senate. Here they've brought in the big guns. Yes, that's a buffalo in the background, ensuring that gigantic sign does, actually, make sense.
TEXT: Don't be "buffaloed" by Harry... Vote for Sharron Angle.
ANDERSON: And just so it doesn't get lonely, an inflatable eagle is on hand for the launch of the Tea Party Express national tour in Reno, Nevada.
I Kiev, in the Ukraine, the secret to a good rally is definitely stilts, it seems. They're protesting to prevent a ban on imported clothes from western European countries.
Where's a good mariachi band when you need one? Oh, there. There it is. At a pro-immigration rally in New York.
This is how the Brits do it. A university student in Manchester protesting against those government cuts. On his own.
And the French? Well, this guy's protesting against the pension reform bill. Says it all, really, doesn't it?
And finally, this rally in the Netherlands took nine months of planning, and it certainly shows. The ladies are out to claim better circumstances for mothers worldwide.
Don't forget, Jon Stewart will be telling Larry King all about his Rally to Restore Sanity. You can watch that at 10 AM London time, right here on CNN.
I'm Becky Anderson, and that is your world connected this evening. "BackStory" up next. They have some exclusive video shot by families of the rescued Chilean miners. You're not going to want to miss that.
END
