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Fareed Zakaria GPS

The Middle East Crisis; Interview with Carl Bildt

Aired July 13, 2014 - 10:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

FAREED ZAKARIA, HOST: This is GPS, the GLOBAL PUBLIC SQUARE. Welcome to all of you in the United States and around the world. I'm Fareed Zakaria.

The escalation of violence between Israel and its enemies has made many wonder, is this the dawn of the third intifada? And how does it relate to the other fires now burning in the Middle East?

I have a terrific panel to talk about that and the inevitable question, how is President Obama handling these and other foreign policy challenges?

And the crisis that hasn't gone away between Russia and the west over Ukraine. It may not be atop the headlines, but it is far from over says my guest Sweden's foreign minister, Carl Bildt.

And why was a French bank fined $9 billion by the U.S. government? I'll tell you how America is wielding a unique weapon that is the economic equivalent of a killer drone.

Also, Washington is dysfunctional and can't fix the student debt problem, but I will take you up a mile high to a place in America that has figured out a fix.

UNIDENTIFIED MALE: So you have seen that there are two different approaches, right?

ZAKARIA: But first here's my take. The Obama administration's decision to seek $500 million to train and fund moderate elements of the Syrian opposition has been greeted with bipartisan support in Washington. The general consensus is that if the administration had done three years ago what it is doing now, the situation in Syria would not have turned into a bloody sectarian civil war.

But almost all elements of this conventional wisdom are wrong. The administration is caving in to the classic Washington desire to do something in the face of a term tragedy without any clear sense as to whether it has the ability to improve things or to make matters worse.

Senator Lindsey Graham said, "The Syrian people started this revolution through peaceful demonstrations." He's just one of many to make the case that it only turned sectarian and violent because we allowed things to deteriorate.

Graham explained, "Radical Islamists are hijacking the revolution." In fact, radical Islamists have been the core of the opposition to the

Assad regime from the very beginning decades ago. Bashar al-Assad's father, Hafez al-Assad came to power in a coup in 1970s and was the first non-Sunni to rule that country.

By the late 1970s, he faced an armed Islamist insurgency that spread across the country's major cities. Between 1979 and '81 it killed more than 300 supporters of the regime in Aleppo alone. Assad in turn ordered crackdowns that killed some 2,000 Islamist opponents.

The Islamist terror campaign spread, even moving to Damascus, the capital city, where in November 1981 they exploded a car bomb in the city's center that killed 200 people and wounded 500. Then in 1982 came the uprising and the gruesome massacre in the town of Hama where between 10,000 and 20,000 people including women and children were slaughtered by government troops.

Since then the regime has organized itself for war against the Islamists and they, in turn, have been preparing for opportunities to war against the regime.

Today, according to James Clapper, the director of national intelligence, there are more than 1500 separatist insurgent groups in Syria with between 75,000 and 115,000 insurgents. In addition there are 7,500 foreign fighters from neighboring countries.

The most effective groups are all radical Islamist groups -- ISIS, Ahrar ash-Sham and Jahbat al-Nusra. But now Washington is going to vet this vast disperse opposition of 1500 groups when it is not even on the battlefield and find moderates.

Good luck.

The complexity of Washington's tasks can be seen in the American attitude towards ISIS. When the group battles the Maliki government in Iraq, it is deadly for the United States and must be ruthlessly attacked, but when it crosses the now nonexistent border between Iraq and Syria, embattles the Assad regime, it is a line with America's stated goal of regime change in Damascus.

With this whole history of sectarian conflict in mind, it's difficult to believe that three years ago a modest American intervention of arms in training which is all that was being advocated would have changed the trajectory of events in Syria.

But the past is the past. Can anyone really believe that now a modest American intervention of arms and training is going to find genuine Democrats in the make to help them win against Assad and also against the radials and also stabilize Syria? Or is Washington's new activism more likely to throw fuel on to a raging fire.

For go to CNN.com.fareed and read my Washington Post Column this week. And let's get started.

ZAKARIA: What started with the kidnapping of three Israeli teenagers one month and one day ago has erupted into something that looks this week like the prelude to war.

I want to talk about the conflict and how it relates to the other things happening in the Middle East so I have impaneled a very smart group.

Richard Haass is the president of the Council on Relations. He was a top official in the George W. Bush administration. Shibley Telhami is the Anwar Saddat professor of Peace Development at the University of Maryland and served as a senior advisor to George Mitchell, President Obama's former envoy for Middle East peace.

Bret Stephens is the Pulitzer Prize-winning foreign affairs columnist for the "Wall Street Journal" and Chrystia Freeland was the top writer and editor at Thomson Reuters and the "Financial Times." She is now a member of parliament in Canada.

Shibley, very simply, why is this happening? I mean, people have thought certainly in Israel that, you know, there's the wall that had prevented terrorism, the economy was doing well. From the outside world it seemed as though the peace process wasn't going well, but things were stable.

SHIBLEY TELHAMI, PROFESSOR, UNIVERSITY OF MARYLAND: Well, of course, if we start with the killings, the abduction, the killings of the Israel and the Palestinian youth, that could happen any time. The question is why hasn't it erupted into what it is now? And I think that's because we had a very charged environment that very much reminds me of 1987 and some ways worse.

And part of it is that if you look at the majority of Palestinians and Israelis, the majority has now believed a two-state solution will never happen again. And the Palestinians don't see a way out especially after the end of the -- the negotiation with Israel. So when you add all of this together and you add to it on the Israeli side a fear that if there is no two state, there's a demographic danger to Israel's Jewish majority, you have a charged up environment that was bound to explode.

ZAKARIA: So in a sense, you're saying they might have been able to keep a lid on it but underneath the pot was boiling?

Bret Stevens of "Wall Street Journal" editorial page for which you write has an editorial this week that says the only solution here is to completely destroy Hamas and you advocate actually or the "Journal" advocates a land campaign, Israel to go back into Gaza, with troops which would inevitably mean some kind of temporary occupation of Gaza.

BRET STEPHENS, DEPUTY EDITOR PAGE EDITOR, THE WALL STREET JOURNAL: Well, not a full occupation of the Gaza Strip, but what I do -- what I do think is right is that Israel has to occupy the territory that separates Gaza from Egypt. Because what we found out is that Hamas is firing much more sophisticated rockets into Jerusalem and ranges that are extending beyond Tel Aviv up to Jerusalem and Haifa, and that's unacceptable for any state to deal with that whether these missiles are accurate at hitting their targets or not. And the problem you had, Fareed, is that this is now the third time

Israel has gone to war since it withdrew all of its settlements and all of its settlers from the Gaza strip in 2005. You have this pattern of recurring violence. I don't think in the long run that's a smart and acceptable strategy to allow Hamas to remain -- to remain in Gaza with a power base. Obviously you can't eradicate it entirely, but you can eradicate it as an effective fighting force and as a political entity.

And by the way, one of the beneficiaries of that kind of action would be Fattah, would be Mahmoud Abbas because what I think Hamas is trying to do, I think the strategy here is to gain the upper hand in intra- Palestinian politics by attempting to start a third intifada.

ZAKARIA: Smart strategy to start a land campaign? I mean, it would cause a lot of international consternation instead of --

RICHARD HAASS, PRESIDENT, COUNCIL ON FOREIGN RELATIONS: You can do some things militarily against Hamas but there's no way you can destroy it either politically or militarily. Hamas is sitting on 10,000 to 12,000 rockets that can now reach more and more inside Israel. So just say you get rid of 25 percent that still leaves 8,000 or 9,000 missiles. You can't destroy them militarily. Politically that would probably strengthen Hamas. They would then -- we're the real source of resistance.

What you've got to do more than anything else then I think is think about how do you weaken them. The only way I know of weakening them is to strengthen Fattah. And that's the opportunity of reaching out. If Bibi Netanyahu wants to do something, I would say put out some big ideas on the table. Give something for Mahmoud Abbas and Fattah to work with, split Hamas away. Break the coalition between Hamas and Fattah and basically say only these people can deliver. You, Hamas, can only bring misery down on the Palestinian people.

Be tough with them but put forward a serious diplomatic alternative. That is the only hope.

ZAKARIA: What do you think?

CHRYSTIA FREELAND, MEMBER OF PARLIAMENT, CANADA: Well, I'm really with Richard and with Shibley. Look, I think that what we have learned here is that what seems like a tolerable status quo normal wasn't really a normal status quo. And what I think is really important but what Shibley said is this concern now that you have on both sides that actually there isn't a solution. There's not something tenable for us to reach for. And that's a situation in which the extremists are going to triumph, which is why I'm with Richard.

Like what you need right now is for the mature players to come up and say, look, geography means we are destined to live together. Here's a solution that we can all live with and we can work towards.

(CROSSTALK) STEPHENS: What I like to hear from Richard, though, is what are the big ideas? Because the Israelis and the Palestinians were negotiating intensively with the mediation of John Kerry and the State Department and it failed. So, I mean, obviously you'd like to say, OK, let's pull a rabbit out of the hat and have a great idea. But these ideas have been well explored. And what Israel finds is a tremendous amount of resistance from Abbas and from Fattah. And then of course this kind of activity, very opportunistic activity from Hamas.

I think the real problem here is that Hamas cannot be allowed to emerge from this war looking like the hero of the resistance, looking like it got away for a third time with at least in a certain kind of context a propagandistically and politically successful action against Israel.

(CROSSTALK)

HAASS: It's just what's going to happen because there's no way that Israel can do anything more than hurt them, and when they survive, which is what they're going to do. They're going to get exactly --

STEPHENS: But what is the idea?

(CROSSTALK)

ZAKARIA: We are going to talk about big ideas in foreign policy when we come back.

Stay with us. I will ask the panel to come up with big ideas but also to tell us about President Obama and his big ideas. How is he handling all these crises, when we come back.

(COMMERCIAL BREAK)

ZAKARIA: And we are back with Bret Stephens, Richard Haass, Shibley Telhami and Chrystia Freeland talking about the whole world, but I want to move from Israel/Palestine one step further, which is the Arab world.

The "Economists" had a cover story this last week called "The Tragedy of the Arab World" or something like that. And the basic point was if you looked at 2011 there was all this hope with the Arab spring. Basically it has been completely dashed. Libya is a mess. Iraq is a mess. Syria is a mess. Israel/Palestine has flared up again.

Their argument is this is a very deep rooted culture that is resistant to modernity for all kinds of reasons, the Arab culture, Islam, oil, you know, it's not going to change. Are you that pessimistic?

TELHAMI: It's a silly argument. In part because I think the whole expectation that the public empowerment that emerged with the Arab uprisings was going to transform the region overnight into a democracy is a silly one. What do we have that happened with the Arab uprising? We've had an empowered individual on a new scale, empowered by the information revolution. What that means is you've got a new force. It doesn't mean it's the only force, the determining force. And in the short term it was bound to be more problematic because once

you weaken the state and you empower everybody, everybody doesn't agree with each other, the left and the right, the religious and the secular, that's a recipe for much more conflict and competition for power within. The old bureaucracies don't go away. The deep state, the militaries, the governments. They're all going to vie for power and setting up new rules in the game. And then you open it up for international intervention because the weak state allows international intervention.

So in the short term it's going to be messy. In the long term, the optimism isn't for the short term. The optimism is that this public empowerment that's with us to stay at some port, at some point is going to force more and more participation. That's what we see today.

ZAKARIA: Let me ask you to move to Obama. How is Obama handling these -- you know, I think everyone agrees these are deep structural changes that will be difficult to predict but given that.

HAASS: Deep structural changes, the only thing I disagree on is I actually think things are going to have to get -- they're going to get worse before they get better. I think they're going to get worse before they get even worse. I don't buy into this Middle Eastern optimism.

The president of the United States, there's actually been over two administrations, though, had made it worse. What we have done is disrupted the old order, a flawed old order. When there was an Iraq under Saddam Hussein, in Egypt under Mubarak, the Assads in Syria. What have you. We have essentially knocked the skids out from under the old order and we've been unable or unwilling to put anything better in its place.

American commitment to, quote, unquote, "regime change," from Iraq through Libya has taken this old order and has helped destroy it. It's not ready for something better. It's not ready for something, so we have contributed --

ZAKARIA: But was it inevitable? Look at Libya. What could we have done? The -- the place was in chaos. It didn't seem as though Gadhafi could survive. The question is --

HAASS: We did not have --

ZAKARIA: -- civil war or regime change?

HAASS: Well, two things. I disagree. We did not have to -- things had actually begun to calm down before the United States and Europe got involved. Gadhafi was really -- was I think on the verge of re- establishing something of consolidating his authority. And again, even if you disagree with me, then where was the aftermath? It's not enough for the United States and Europe to say Gadhafi is evil. He has to get out. OK. But where -- where was any follow-up?

It's irresponsible, it's reckless to destroy orders and not rebuild something better. ZAKARIA: Chrystia.

FREELAND: Look, I think setting aside the morality and the ethics, it's actually absolutely unrealistic. It's not a position of foreign policy realism to -- to yearn for the stability of the old authoritarian regimes. The world has changed. And we shouldn't be overstating our own western agency in other parts of the world. Sure, we can act, we can push things at the margins, but really what is happening is you are seeing these young cohorts absolutely empowered by the digital age and by globalization and they are saying, we do not want these old corrupt authoritarian regimes.

They're not equipped, it's absolutely right. And Richard is right that, you know, the revolutionaries don't have the follow through and the West doesn't have the follow through plan, but it is really a false hope to -- a false nostalgia to say things were so great when authoritarians were in charged.

And just quickly, the long term I think is a lot more hopeful. You know, you had the Prague spring, you had the Hungarian uprising. Things didn't immediately get better but the people who were leaders of those revolutions and (INAUDIBLE) turned out in 1989 to be ready for primetime.

ZAKARIA: OK. Here's something I have to ask you, guys, about before we go because it is something the United States has control over. President Obama said in a famous speech in Germany, America has to listen to Europe more carefully. It turns out he was --

(CROSSTALK)

(LAUGHTER)

ZAKARIA: It was listening very carefully to the Germans in particular. How serious is this, that Germany would expel the head of the CIA? I can't remember anything comparable happening.

HAASS: It is very serious. And what it tells you is that increasingly Germany is dominated by a society that doesn't think of the United States as the great protector of the Cold War or the liberator. But they had asked the United States as the invader of Iraq, they see the United States through NSA. We have got a serious problem on our hands. There's nothing more sensitive. I can say this from my time in government. Than the question of what you do in terms of espionage vis-a-vis your friends and allies. You should only contemplate it in extremists.

(CROSSTALK)

ZAKARIA: And you've always said that tapping Chancellor Merkel's phone was idiotic.

HAASS: Beyond it. Where's the adult supervision on that? It was a big -- it was a sloppy costly, consequential error.

STEPHENS: But you just put your finger on it. Sloppiness seems to be the order of the day with the administration. And it's one thing after the other. No idea that Mosul was about to fall into the hands of ISIS. No real forward planning about what to do with Bergdahl which they felt was just going to be a good news story.

Again, the president after the NSA, what's remarkable about this is after the NSA scandal it turns out there is ongoing spying in Germany. So you have an administration that is constantly surprised not only by events but by its own actions. You don't have a sense of adult responsibility coming out of the White House.

ZAKARIA: Shibley.

TELHAMI: Well, just on this, I think you know obviously this is a bad episode but it's not going to be strategically problematic for the president. But I just want to go back one minute on Obama's Middle East policy. I think they got two things right which is the solution is not in the hands of the U.S. and military intervention certainly is not going to fix things for the U.S. That thing they got right.

What they didn't get right is they were lured by the romance of public empowerment which is very luring. And they forgot who writes the checks and who wheels the guns and that's a really big problem.

ZAKARIA: Final thought, Chrystia.

FREELAND: Final thought on Germany. I don't think this is about Germany turning against the U.S., I think this is about a fundamental U.S. own goal. And this is the age whether you like it or not when the U.S. needs more multilateralism. It wants to do more nation building at home. The world is a complicated and dangerous place, and you guys need other countries to help you out so when you spy on your friends, it makes them less friendly, especially after the president has said to Chancellor Merkel, I'm not going to do it anymore.

ZAKARIA: And now you're saying this as a Canadian, a member of Parliament.

FREELAND: I'm saying it as a Canadian politician. We love you guys but please don't spy on us.

ZAKARIA: That said, you know your phone is probably tapped.

FREELAND: I'm not important.

ZAKARIA: Chrystia Freeland, Shibley Telhami, Bret Stephens, Richard Haass, thank you all. Fantastic conversation.

When we come back, did the United States bully a French bank into paying a $9 billion fine? Was it smart? We will explore the case of BNP Paribas when we come back. We'll learn something new.

(COMMERCIAL BREAK)

ZAKARIA: Now for our "What in the World" segment.

I'm sure you heard about the Paris-based bank, BNP Paribas which fell afoul of Washington's regulators and agreed to plead to guilty to a felony and pay a staggering $8.9 billion fine, larger that its annual profits. So it must have violated a slew of laws, right?

Actually, no. It hadn't violated French law or E.U. law or any of its obligations under the WTO or the U.N. It hadn't even violated a French/American treaty.

What in the world?

BNP Paribas violated a set of unilateral American sanctions passed by Congress that were never affirmed or followed by the European Union or France and neither the buyers nor the sellers in any of the transactions BNP was involved in were Americans.

(BEGIN VIDEO CLIP)

ERIC HOLDER, ATTORNEY GENERAL: BNP went to really elaborate lengths to conceal prohibited transactions.

(END VIDEO CLIP)

ZAKARIA: So what was Washington's hold on BNP? It all centers on the central role that the dollar plays in today's globalized economy. You see, even if two foreign companies want to do a deal, assuming it is a large transaction, the deal is likely to be denominated in dollars. The currency that everyone has access to is available in available in ample supply, is a symbol of stability, and as a result, remains the world's reserve currency.

But here's the catch. If the deal is denominated in dollars, at some point it has to go through an institution with an American banking license, which gives it access to the Federal Reserve system. Without this access no bank can really function in the global economy today.

Welcome to America's economic nuclear weapon. In fact, it's even more lethal because unlike nukes, only America has this weapon. And in some ways this power has grown as economies have become more globalized and trade and capital flow faster around the world.

It is this weapon that is the real force behind the Iranian sanctions, the reason that Iran simply cannot conduct much international trade anymore. It is this weapon that lies behind the threats to ramp up sanctions against Russia, that if acted upon would ensure that Russian banks, companies, and businessmen named would lose access to the dollar window and, thus, make all their transactions more difficult and expensive.

Now this might seem a good thing when you consider what BNP has pled guilty to. Aiding and abetting the tyrannical, murderous, even genocidal regime in Sudan. And it has been brought Iran to the negotiating table. And Russia should worry about the cost of its actions in Ukraine.

But, but, but the problem is that this is a unilateral American power that is prone to abuse. Right now in wielding this weapon, a handful of American officials are prosecutors, judges, jurors and hang men. They accuse a company, determine that it is guilty, threaten to withdraw access to the dollar and then levy fines.

The "Economist" says that the legal process used against BNP Paribas with no agreed upon rules, no checks and balances, no appeals process was, quote, closer to an extortion racket than justice, end quote. And in America's usual chaotic and entrepreneurial system, this means that local regulators can pursue their own agendas for self-serving motives. In the BNP case, New York's regulator got a portion of the fine. That if four times the size of his agency's annual budget. The capriciousness, with which the U.S. has sometimes used its authority has led to growing resentment around the world from France, to Moscow, to Beijing. For now the dollar reigns supreme, but if these actions proliferate, it will fuel the search for some alternative system that does not place countries at the mercy of any and every American regulator.

This dollar window is somewhat like another favorite American weapon, the killer drone. When used in a carefully controlled set of circumstances for vital and justifiable reasons against truly nefarious people, it serves a powerful purpose, but if used too often or loosely, carelessly and arrogantly, it can produce a backlash that undermines the basic objective. BNP got what it deserved, but perhaps it is time for the United States to set up a proper system with checks and balances that determines when this exorbitant privilege of having the world's reserve currency can be used as a deadly weapon of economic war.

Next on "GPS," my guest, Sweden's foreign minister Carl Bildt said this week that Putin's invasion of Crimea is comparable to Saddam Hussein's invasion of Kuwait, so why no international military response this time? I will ask him.

(COMMERCIAL BREAK)

ZAKARIA: As things heat up in Israel and elsewhere, at least we can take some solace that Russia has been easing up on Ukraine, right? Wrong. On Tuesday after leaving a meeting with President Obama, NATO's Secretary General Anders Fogh Rasmussen told reporters that Russia was playing a double game. Despite parliament revoking President Putin's authority to invade Ukraine, despite an on again, off again cease fire, Russia continues to mass troops on the border and aid the pro-Russian separatists in Ukraine, according to Rasmussen. Another voice speaking out loudly, publicly and damningly about Russia this week was my next guest, Carl Bildt was Sweden's prime minister. He is now the Scandinavian Nations' foreign minister.

Carl Bildt, thank you for joining me.

CARL BILDT, SCANDINAVIAN NATIONS FOREIGN MINISTER: Thank you.

ZAKARIA: You gave a very tough speech at the Atlantic Council this week, in which you said that Russia's annexation of Crimea has only one parallel in modern history in the last 30, 40 years, and that was Iraq, Saddam Hussein's annexation of Kuwait. That was, of course, met with a massive international coalition that repulsed that intervention. What is one to conclude from the fact that there is no such -- no such forceful countermeasure in this case? BILDT: Well, I mean, in the case of Saddam Hussein and Kuwait, of

course, there was a resolution by the U.N. Security Council. Now Russia is a member of the Security Council, so that's never going to happen. I mean they are going to block everything that is related to this, but I think it is important that we are extremely firm on how grave the violation of international law is that Russia has undertaken in the case of Crimea and that we make very clear to Russia that the invasion, the occupation and the annexation of Crimea will have consequences. We'll never accept it and it will be burden on our bilateral relationship for as long as it lasts. We're not going to undo the occupation immediately, but we must be very clear that it is not acceptable. It was not acceptable in the Kuwait case. It is not acceptable in the Crimea case. It is not acceptable in any future other cases either.

ZAKARIA: Do you believe that the West has responded with enough in terms of putting costs on Russia for this? There have been some sanctions from the United States, even fewer from the E.U. It seems not a lot compared with the gravity of the situation you describe.

BILDT: No, but I think there has been other indirect costs to Russia that has been and has got to be even more substantial. It's true that the formal sanctions or restricted measures have not been that extensive, but there is no question it has unsettled Russia. And it has also made and that is made by President Putin, he has made Russia an unpredictable country. And if there's anything that a businessman wants to have is predictability. I think virtually all decisions to invest in Russia are on hold for quite some time to come. And Russia desperately needs technology and capital, and trade with the West in order to undertake the modernization that Russia needs beyond just the military sphere.

ZAKARIA: I was in Sweden, your country, last week, and I was struck by the fact that in Sweden, and in Finland even more so, there is a conversation taking place that would have been unthinkable two years ago, which is should Sweden be a part of NATO? Should Finland be a part of NATO? These are conversations being had, of course, because of various Russian statements and actions which have made people worry about their security in that region.

BILDT: That's true. I mean, there's no doubt that we are facing strategic environment, is not only in Northern Europe, we see it all over, that is more fragile, perhaps even more threatening, perhaps even more dangerous. And that has led to debate also about eventual membership of NATO, or Finland or Sweden. I don't think that's going to happen imminently. It requires a wide consensus in our countries. That is not there at the moment. But the very fact that the debate is there is a significant sign.

ZAKARIA: Do you think President Obama has handled the Ukrainian situation well?

BILDT: I think so. I think there has been leadership coming out of Washington on these issues. I mean the perspective of the world from Washington is, of course, a fairly complex one at the moment. Everything is very, very complex at the moment, but the Ukraine/Russia situation is one where it's fairly clear-cut what's happening, it's fairly clear-cut what our policy should be and id also being fairly clear-cut that we can only be successful if we act together. The Europeans staying united and acting together with the United States. And nothing is perfect, but I think it's been better than it's given credit for.

ZAKARIA: Tell us where you think this will go two years from now. Where will we be?

BILDT: I don't know, but I think the number one thing that we need to do is to concentrate to help Ukraine. They have a very difficult security situation with the destabilization that's going on in the eastern most part. We need to support their peace efforts. We need to try to engage the Russians in that. We need to have the economy which is in the miserable shape, both because of the corruption on the President Yanukovich and because of mistakes during a long period of time. I think there is a readiness among the people of Ukraine who are more united now than ever to accept the very deep and comprehensive and painful reforms that have got to be necessary. And I think two years from now there's a realistic possibility of us having turned the corner with Ukraine in terms of the economy, in terms of political stability and I hope that one would then see in Moscow as well that this as a matter of fact is invaluable (ph) to this world.

ZAKARIA: Carl, Pleasure to have you on as always.

BILDT: Always a pleasure.

ZAKARIA: Next on "GPS" the great burden of student debt in America. Washington hasn't been able to figure out a way to fix the problem, but I will take you to a place that has found a novel solution, that gives kids a jumpstart on college as well when we come back.

(COMMERCIAL BREAK)

ZAKARIA: When it comes to student debt in America, the numbers are truly staggering. In 2012, 71 percent of new bachelor's degree graduates had debt averaging over $29,000. Over the last ten years, student debt has quadrupled topping 1 trillion dollars. Congress crafted legislation last month that would have allowed for refinancing of student loans at a lower rate, but it went nowhere. And President Obama's recent executive action doesn't fully solve the problem either. We wondered if there was a solution for this problem outside of Washington and found an interesting one in the Denver metro area. It's the next installment in our multi-part series, "Where America Works," looking at local leaders getting things done despite the dysfunctions in Washington.

Like millions of students across the country, Salamasina Fifita celebrated her high school graduation this spring. But Fifita is not your average high school graduate. In the same month she also graduated from college with an associate's degree.

(BEGIN VIDEOTAPE)

SALAMASINA FIFITA: I think it's definitely life changing. All of this hard work, it seems like it's paid off.

ZAKARIA: Fifita has 13 brothers and sisters so money in the family doesn't come easily.

FIFITA: So even something as simple as ...

ZAKARIA: But the courses she took at the community college of Aurora were completely free. She and her three sisters, who have also taken free college classes while in high school saved over $70,000 on tuition. Fifita and her sister Melinita are the first college graduates in the family.

FIFITA: If my parents had to pay for college for all of us, I don't know if it would be possible so concurrent enrollment has definitely helped my family financially.

ZAKARIA: Concurrent enrollment is a program that allows high school students to take college classes for credit. The program has exploded in the Denver metro area where courses are being offered free of charge. In Denver's public schools and the nearby Aurora public school district, one in three high school seniors took college classes the last year.

UNIDENTIFIED MALE: You have the general themes down, but you still need to be able to pull specific details.

ZAKARIA: That's a big deal because students who take college courses in high school are known to vastly outperform their peers. One study showed that such students were more than twice as likely to go on to college than those who didn't take college courses.

JOHN BARRY: You know, we've had some visitors from outside the country, too.

ZAKARIA: The Denver area's success was fancied (INAUDIBEL) to a collaboration between John Barry, the former superintendent of Aurora Public Schools and Dr. Linda Bowman, former president of the Community College of Aurora. Barry was an iconic last of former Air Force wing commander who flew combat machines over Iraq and served with Secretary of Defense Dick Cheney, retiring as a two star general. He and Bowman faced big challenges in Aurora. Less than half of students were going on to college when Barry signed on in 2006.

LINDA BOWMAN: We were losing way too many people when it came to realizing their potential, and we brainstormed.

ZAKARIA: Bowman and Barry decided to get Aurora students of all stripes into free college classes.

BARRY: Sometimes it's one of those things where it's so high, in the college, knocking them to go to college. Why don't you just take this one course? And they - once they get past that and they can pass it, they now realize that this is not a mountain they can't climb.

ZAKARIA: But at the time Colorado state law allowed only juniors and seniors in high school to take just two college classes per semester. So Bowman and others advised then Governor Bill Ritter to change the laws, a new measure sailed through the state legislature 100-0.

Still, Bowman and Barry faced a huge challenge, integrating two massive bureaucracies with tens of thousands of faculty and students.

BARRY: It was kind of, you know, let's try this. Let's see how this works out.

UNIDENTIFIED MALE: So you have seen that there are two different approaches, right?

ZAKARIA: One idea, develop qualified high school teachers to become adjunct community college professors so they could teach college courses in the high schools allowing the schools to share costs.

UNIDENTIFIED MALE: ESP plus C.

ZAKARIA: Bowman and Barry saw dozens of high school teachers become college professors.

UNIDENTIFIED MALE: Because? A little louder please.

ZAKARIA: And thanks to their strong partnership, concurrent enrollment has grown dramatically.

In 2006-2007 there were only 26 students taking college classes in Aurora public schools. During the last academic year there were over 1200. At the Community College of Aurora, one in four students is now a high school student.

UF: Psychology tells us that --

ZAKARIA: In fact, concurrent enrollment became so widespread in Aurora's high schools, that a college accreditation body paid a visit declaring four of the schools to be official locations of the community college. They said what's happening here in Aurora needs to be done around the country.

ZAKARIA: Statewide in Colorado, around one in five of all juniors and seniors took college classes last year thanks to changes in the law that Bowman helped bring about.

BOWMAN: This program actually changed lives.

ZAKARIA: In Aurora, Salamasina Fafita actually got her college degree before her high school diploma because her college graduation ceremony was nine days earlier than high school graduation.

FAFITA: I'm just in debt to this program for everything that it's done for me and for the people who have made it possible.

ZAKARIA: Stay tuned. We'll have two more installments of "Where America Works" in coming weeks.

Up next, a Russian coverup, but this one isn't about spies or scandals, this one is about skin. I will explain when we come back.

(COMMERCIAL BREAK)

ZAKARIA: President Obama visited Texas this week and addressed the problem of unaccompanied minors crossing into the United States. Authorities estimate that between 60,000 and 80,000 of them will cross the border this year. It brings me to my question this week, which country received the most new asylum claims last year? France? Germany? Turkey? Or the United States? Stay tuned and we'll tell you the correct answer.

This week's book is beach reading for nerds. John Brockman's "The Universe" is a collection of essays by the world's leading scientists that explain the major fascinating debates and advances in understanding, well, the universe. It deals with cosmic inflation, the big bang, the aftermath of the big bang. Basically some of the most fundamental questions of physics all elegantly lucidly written. I have to confess, I didn't always understand everything, but I learned an awful lot.

And now for the last look. This is the world famous Bolshoi Theater in Moscow. A statue of Apollo, the Greek god of music riding his chariot has sat atop the Bolshoi's portico for more than 150 years. In the 1990s the statue joined the ranks of princes and emperors when it was added to the nation's currency. It now decorates the front of the 100 ruble note. Last week a Russian lawmaker Roman Khudyakov requested that the Central Bank remove this iconic image. It seems he is offended by the Greek god's clothing or lack thereof. You see, following a recent theater restoration a more modest version of the Bolshoi statue was unveiled with a strategically placed fig leaf. Khudyakov noted that the bills do not match the restored statue and finds them unsuitable for children. This request, unusual as it may be, echoes a growing conservatism in the Russian government. The parliament unanimously passed antigay legislation last year banning propaganda of nontraditional sexual relations to youth. Who knows what the law means, but what we do know is that the fine for a person breaking it is steep, up to 100,000 rubles to be paid in denominations other than hundreds, I guess. That's about $3,000.

President Putin has strongly supported this antigay legislation. Something tells me, however, that Mr. Putin will not be as offended by the lack of clothes. Remember this famous image of the bare-chested macho man of the Euros.

The correct answer to our "GPS" challenge question was, B, Germany, which had 109,600 new asylum claims last year. The United States was second with 88,400. A large percentage of Germany's population is also foreign born. 13.1 percent compared to the United States' 13 percent. Only a third of Germany's foreign born population is from the European Union. Thanks to all of you for being part of my program this week. I will see you next week.

ERIN MCPIKE, CNN ANCHOR: Good morning. I'm Erin McPike. And here are the big stories we're following this hour.

Israel is warning people in Gaza that more airstrikes are coming aimed at Hamas sites. The Israel Defense Forces dropped leaflets in Gaza today warning people to leave. And some are now heading for U.N. facilities. Prime Minister Benjamin Netanyahu said the IDF is ready for all possibilities echoing what a spokesman told Wolf Blitzer Friday.

(BEGIN VIDEO CLIP)

WOLF BLITZER, CNN ANCHOR: What about tanks, armored personnel carriers, formal invasion of Gaza as has occurred in the past?

BENJAMIN NETANYAHU, ISRAELI PRIME MINISTER: But we're preparing that possibility. It's not something we wanted to do, but we've in the past five or six days we have brought up the forces and indeed there is a substantial force on the border with Gaza. And if the order is given, we are prepared for that type of activity.

(END VIDEO CLIP)

MCPIKE: The Gaza health ministry says 168 people have died. Israel says today it intercepted two rockets over Tel Aviv that were fired from Gaza. One rocket that hit the city of Ashkelon severely injured an Israeli teenager.

A scary crash in Indiana this morning as a Greyhound bus and a car collide. Officials say at least one person is dead and more than a dozen were hurt. It's not clear how the crash happened, but according to an official at the hospital, the bus had just left Indianapolis.

Mexican police may have found the body of an American missing for the last six months. Harry Devert disappeared in a violent part of Mexico during a motorcycle trip. His mother's attorney says Devert's motorcycle and some remains were found in a shallow grave. His mother is in Mexico to try to identify his body. Police are also running DNA tests.

I'm Erin McPike in Washington. "Reliable Sources" starts right now.