A Ukrainian serviceman holds a weapon as he sits in a car June 4 during fightings in the Ukrainian city of Mariinka.

A Ukrainian serviceman holds a weapon as he sits in a car June 4 during fightings in the Ukrainian city of Mariinka.

Heavy fighting flares up again in eastern Ukraine. President Petro Poroshenko warns of a full-scale Russian invasion. U.S. officials say more than 10,000 Islamic State militants have been killed by American-led airstrikes in the past nine months. Yet ISIS continues to seize territory Iraq and Syria. Greece delays loan repayments to the International Monetary Fund. FIFA President Sepp Blatter resigns as Interpol issues alerts on six other indicted soccer officials. A panel of journalists joins Diane for analysis of the week’s top international news stories.

Guests

  • Moises Naim distinguished fellow, Carnegie Endowment for International Peace, and chief international columnist, El Pais; author of "The End of Power: From Boardrooms to Battlefields and Churches to States, Why Being in Charge Isn't What It Used to Be."
  • Indira Lakshmanan diplomatic correspondent, Bloomberg News.
  • Lionel Barber editor, the Financial Times.

Transcript

  • 11:06:53

    MS. DIANE REHMThanks for joining us. I'm Diane Rehm. As violence surges in Ukraine, leaders in Kiev express fear separatists are preparing for a major assault. Debt-strapped Greece defers as scheduled payment to the IMF, holding off a crisis while it continues to negotiate with creditors. And the head of FIFA resigns as the soccer corruption scandal widens.

  • 11:07:22

    MS. DIANE REHMHere for the week's top international stories on the Friday News Roundup, Moises Naim of El Pais, Indira Lakshmanan of Bloomberg News and Lionel Barber of Financial Times. He was one of our earliest reporters on the Friday News Roundup. He's now editor of Financial Times and Lionel, we welcome you back.

  • 11:07:48

    MS. DIANE REHMYou can join us 800-433-8850. Send us an email to drshow@wamu.org. Follow us on Facebook or send us a tweet. And welcome to all of you.

  • 11:08:04

    MS. INDIRA LAKSHMANANGood morning.

  • 11:08:05

    MR. MOISES NAIMMorning, Diane.

  • 11:08:05

    REHMGood to see you again, Lionel.

  • 11:08:06

    MR. LIONEL BARBERGood morning.

  • 11:08:09

    REHMIndira, I'll start with you on this alleged Chinese hacking. We don't know if it was state-sponsored or whether it could simply have been individual, but the U.S. is saying it came from China.

  • 11:08:28

    LAKSHMANANThat's right. And for the U.S. to say that outright means they must believe that they have enough evidence to pin it on hackers in China. As you say, whether those are government-related hackers or independent hackers, we don't know. On the other hand, China is, once again, completely denying any connection to this and the Chinese foreign ministry yesterday, in their regular Thursday briefing, got up and said, we're outraged and we think this is wrong and the U.S. needs to act with more trust and not be so suspicious all the time and we had nothing to do with this.

  • 11:08:59

    LAKSHMANANNow, Bloomberg wrote the story yesterday that, in fact, this breach was connected to the breach at Anthem, the health insurer, a couple months ago. And so this is very interesting, the whole connection that, you know, someone who was trying to access the personal records -- remember, 4 million U.S. government employees, that's practically every U.S. government employee.

  • 11:09:24

    REHMBut is current and former.

  • 11:09:27

    LAKSHMANANThat's right. I mean, but that's an incredible number of people. And trying to get sensitive information, not just things like their name and their date of birth, but actual questions that they may have answer to get their security clearance, things that could be used against them to get information.

  • 11:09:43

    REHMLionel.

  • 11:09:44

    BARBERGreat to be back, Diane.

  • 11:09:46

    REHMThank you.

  • 11:09:47

    BARBERIt's important to understand that right now, even as we speak, there are dozens and dozens of cyber attacks happening in this country, in the West. And we only get to see or hear about a tiny fraction. What interests me about this particular attack is the motivation. What are they actually going for, assuming -- and I think that Indira's correct, that the Americans would never have said that it's the Chinese without having evidence.

  • 11:10:19

    BARBERIf you did a kind of hierarchy of who's really good, then the Russians are the best. The Chinese are number two. They tend to go for very broad attacks. And then the Iranians. And here, I think, as I say, I come back to, like, what were they really looking for? And we're not sure.

  • 11:10:38

    NAIMI would add to that list, which I agree with, I would add the United States. The United States is also very good at cyber sleuthing, cyber attacks and everything else. What this tells us is that this is one more. We will continue to have those cyber crime and cyber attacks and hacking are going to be part of our lives from now on.

  • 11:11:02

    REHMBut like Lionel, I, too, am interested in what they would do with this kind of information, how useful it would be for them not only economically, but politically every way imaginable.

  • 11:11:22

    NAIMWell, there are different ways of using these things. Identity theft and using identities of the individuals. They now have Social Security numbers. They have addresses. They have lots of personal information that can be easily used, either to impersonate them or to actually hack them and so on.

  • 11:11:42

    REHMI think it's interesting that the federal government itself is now offering insurance to those -- theft and identity theft insurance to those whose identities are part of this whole mass theft. Lionel, let's talk about Ukraine. We saw the worst flare-up of fighting in months. What's happening?

  • 11:12:15

    BARBERWell, there's been a low-intensity conflict in Eastern Ukraine, even since the Minsk agreement, which was signed between the European powers, Russia and Ukraine. The difference, of course, is that this was President Poroshenko's spoken today in a press conference in Kiev and talked about a storming of Maryinka, which is the town involved. And the question, again, is what is the strategy? What -- are the rebels acting under encouragement from Moscow?

  • 11:12:47

    BARBERWas this a move ahead of the group of seven industrialized nations when it is very likely, in my view, that country to expectations, the Europeans will stand firm and uphold the current level of economic sanctions against Moscow. Clearly, Mr. Putin, President Putin, is furious about that. But, you know, it's -- you do get the impression that the Russians, Moscow has not wished to dramatically escalate the conflict in Ukraine and hasn’t, for example, gone for the bridge to Crimea so that the -- it's just a question of, again, how far is he probing or is it something more serious.

  • 11:13:30

    REHMBut isn't there a certain irony here? Doesn't the U.S. want to lift the sanctions or bring an end to the sanctions because of certain engines that the U.S. actually needs from Russia?

  • 11:13:52

    BARBERWell, I don't think that the Americans want to end sanctions. It's premature. What is true is that there were supposed to be reciprocal moves between the Kiev government and the rebels in terms of the Minsk agreement with moves towards a more federalized Ukraine. The problem, of course, is that President Poroshenko, and he said that again today, he is responsible for territorial integrity and he's being constantly undermined because of the level of flow of weapons.

  • 11:14:24

    LAKSHMANANYeah, that's right. I mean, President Poroshenko has pointed out that there are 9,000 of Russia's troops deployed along his border. He says that there were all these clashes that took place really up on the Ukraine side of this buffer zone that left, apparently, 21 people dead. There's no question that this is the biggest outbreak of violence since the Minsk accords and the whole idea of the timing is kind of stunning to me because Russia wants those European sanctions lifted.

  • 11:14:53

    LAKSHMANANAnd although I completely agree with Lionel that they weren't going to lift them anyway, they're certainly not going to lift them now. So, you know, he's just solidified, you know, against any hopes of those sanctions being lifted now. Those are gonna be rolled over till late January and...

  • 11:15:09

    BARBERBut he's -- yeah, but he's constantly testing Western resolve, both within the European camp and between America and Europe.

  • 11:15:17

    LAKSHMANANI think that...

  • 11:15:18

    NAIMThat's right. And he cannot -- Putin cannot lose this one. Putin cannot let Ukraine go. For him, it's very important to have an unstable Western Ukraine, a region where he would like for it to be autonomous and where he can have great influence. He will also -- he needs to be -- that border, the borders between all these countries to be very porous because that allows him to move weapons and forces and everything else.

  • 11:15:50

    NAIMAnd then, there is the bridge to Crimea. He grabbed Crimea, but now he needs to integrate it. And for that, he needs to -- an unstable Ukraine.

  • 11:15:59

    REHMHow are the sanctions affecting Russia, Lionel?

  • 11:16:05

    BARBERThey've probably cut growth, depending on how you calculate it, 1 percent maybe in the last 12 months at least. The ruble did come back and has sort of weakened recently. That actually -- although we all thought that this was, you know, a crippling blow to the Russian economy, in fact, it's encouraged more autarchy sort of self-reliant economy in Russia. And the other thing -- the conversations that I've had with senior Russian officials in the old oligarch that drops by the London office of the Financial Times in search of succor, they kind of think, well, you know something, we can last this one out.

  • 11:16:47

    BARBERWe can take two years of pain and you guys in Western Europe, we don't think you can do that. And also, just worth pointing -- one other very important issue is Mr. Putin himself is under pressure from the extreme nationalists in Moscow. It's not to be discounted.

  • 11:17:02

    LAKSHMANANWell, the EU just circulated a paper on sanctions predicting that, in fact, Russia's economy's gonna shrink 3.8 percent this year because of sanctions. So I mean, that's huge. And so it's had an effect not only on the ruble, not only on confidence about Russia's markets in general, but on their economy. As Moises points out, though, that is not enough reason for Putin to back down and he wants a bridge not just to Crimea. He wants a bridge to Transnistria.

  • 11:17:26

    LAKSHMANANAnd I think one of the things that Ukraine just did that, in Russia's mind, provoked or may have been a provocation for this, is that Ukraine just named the former Georgian president, Saakashvili, as the governor of Odessa, which is kind of stunning considering that Georgia engaged in this war against Russia over territory. You know, one of the sort of under-noticed things about Georgia is how much it became a sort of economic destination for investment.

  • 11:17:57

    LAKSHMANANAnd so choosing him to be governor in Odessa is also an economic move in some respects.

  • 11:18:00

    REHMIndira Lakshmanan, she is with Bloomberg News. Short break here, we'll be right back.

  • 11:20:00

    REHMAnd welcome back to the international hour of our Friday News Roundup, this week with Indira Lakshmanan of Bloomberg News, Lionel Barber, editor of the Financial Times, Moises Naim, he's with the Carnegie Endowment for International Peace and chief international columnist with El Pais. He's an email from Chuck, who says, why is Mr. Putin so concerned with the FIFA corruption scandal? Is the U.S. prosecution of corrupt FIFA officials a strategy the U.S. is using against Putin? Tell me about FIFA. We know that the president, who was just re-elected, has now resigned, but tell me about the connection, Lionel, between Putin and FIFA.

  • 11:21:12

    BARBERWell, the crucial point is that Russia will host the World Cup in 2018, and Mr. Putin, who cares a lot about sports events, we remember the Winter Olympics at Sochi, where he encouraged the business community and spent billions, I mean, huge amounts of money for that because it's seen as part of Russian prestige. So he's making a connection between the spectacular raid by Swiss police arresting seven individuals on bribery charges related to the award of the World Cups both in Russia but, well, particular in Qatar in 2022.

  • 11:21:52

    BARBERAnd of course when we have these debates in Washington about whether America is the world's policeman, well, now we know it really is because nobody else wanted to touch this scandal until the American feds came in.

  • 11:22:08

    REHMVery interesting, and Moises, you wanted to bring in the concern Russia has about oil.

  • 11:22:19

    NAIMRight, when we discuss the frail economy in Russia and the difficulties that it had because of sanctions and capital flight and all of that, one should not forget that Russia is a petrol state. Russia depends on oil exports. And as the price of oil has gone down, Russia's economy suffers from that. So how long can Russia and Russia's economy and Russia's government sustain the current situation? Well, it largely depends on the price of oil. If the price of oil continues to be depressed, Russia will undergo a very difficult period.

  • 11:22:55

    LAKSHMANANAnd of course some of the most painful sanctions for Russia are those related to oil and to its energy industry in general and are those that restrict Russia's ability to extract tight oil, so-called non-conventional oil, so Arctic drilling, shale, other kinds of unconventional drilling. And that's really bad for Russia because that's its sort of long-term future. Right now it has plenty of conventional oil it can get out of the ground, although it's selling it at prices than are lower than it would wish, as Moises says. But for the longer term, for its sort of continuation, perpetuation as a petrol state, how do you do that? You have to get that more difficult oil out somehow, and you can't do that at the moment without the help of companies like Exxon, who is now forbidden from cooperating with Rosneft, the big Russian oil giant, and that's something that has caused American companies, big oil multinationals, to also try to lobby against the U.S. Treasury and the U.S. government to try to get them to lift these, but nothing is getting lifted anytime soon.

  • 11:23:53

    REHMAll right, let's move to Greece, Lionel. Greece met with European officials this week ahead of a major payment due to the IMF. So what's the latest?

  • 11:24:10

    BARBERThis is a really fluid situation, it's very dangerous. I think the first point I make is that the Greeks could have paid the 300 million euros to the IMF. They do have the money. It's not as if the coffers are utterly bare. So the fact that they chose not to, and they say they're now going to bundle the repayment back to the IMF in a month or so, means that this was a political decision?

  • 11:24:41

    BARBERWhy? Because Mr. Tsipras, who is the radical prime minister in Athens, who had indicated, and several other ministers, that they were prepared to pay up and were going to -- he's got serious opposition back in his own Syriza radical party in Athens, who are saying no deal with the creditors, no deal with the likes of the -- with the Europeans, the Germans, etcetera.

  • 11:25:08

    BARBERSo there's a huge political problem to resolve here, and the other point, I guess, is -- in other words a radical government elected on saying no deal, no more austerity, we're not going to take it anymore versus the geopolitical risk of Greece exiting. And if you look at this from the American point of view, over the last few weeks and months, the Americans have been sending desperate signals to the Europeans, saying do you realize, with the world economy so fragile, that a Greek exit is the last thing that we need. So make a deal.

  • 11:25:46

    REHMMake a deal, and how surprising was this decision on the part of the Greeks?

  • 11:25:53

    LAKSHMANANReally surprising. In fact, it's the first time that a country under IMF, you know, bailout program has delayed its payments since the 1980s, and that was Zambia, I believe, back then, so really surprising. What is interesting, though, is very much the idea that this was a political decision. I mean, certainly Greece does not have the money, and its economy is not in any shape to have made that 4.5 percent of GDP surplus that was required by the terms of the bailout, which are kind of crazy terms, okay, couldn't meet those.

  • 11:26:24

    LAKSHMANANOn the other hand, we saw Mr. Tsipras write this article, this op-ed in La Monde this week, which really was a case of finger pointing. It seemed to be laying the case for why everyone else is at fault and not Greece and how the creditors are at fault. And he even used the language about for whom the bell tolls. And I think that some people have looked at that article and thought, well, you know, the bell tolls for thee, as well, and if, you know, Greece is going to get out of the Euro Zone, that's going to be really bad for Greece, as well for the whole world economy.

  • 11:26:56

    REHMMoises?

  • 11:26:57

    NAIMThe brother story is that Mr. Tsipras and his party won an election by promising things that they now discover they cannot deliver. And as Lionel said, they are in the middle of two crushing forces, the forces of domestic politics that are -- don't want any reform and don't want to satisfy any of the conditions of the creditors, and the international financial community that is not willing to allow the Greeks to continue performing in the way they were.

  • 11:27:28

    NAIMThe situation in Greece is very, very dire. The average income has gone down by a third for the average Greek. Unemployment is at 28 percent. There is a million people lost their jobs. The GDP has gone down by 25 percent. But the reality is that that was a highly artificial, distorted economy that requires not austerity but reforms. So what Tsipras and others are saying is that they need more flexibility, and what the creditors, the IMF and the European Central Bank and the European community, are saying, well, we need more reforms.

  • 11:28:10

    NAIMOne of the central sticking points is pension reforms. That is still pending, that is very painful. That implies lowering the retirement age. We know how difficult is this conversation just by how difficult it is here in the United States. Well, imagine the same conversation in a country that has been so hard hit by this crisis.

  • 11:28:34

    BARBERDiane, Greece is, in effect, in a debtors prison. It's never going to be able to pay this money back, billions and billions, 150 percent plus of GDP is their debt ratio. And so in my view, at some point the creditors are going to have to realize that and take a write-down on the debt. But the price has to be then that the Greeks do not roll back, as they have done, despite that election result. It's true, Syriza won that election, not outright, but they still won it. They were the largest party, clearly.

  • 11:29:10

    BARBERBut they can't roll back all these reforms. They can't just continue as if nothing has happened. So there has to be a deal. At the moment, the creditors are not willing to face up to that.

  • 11:29:26

    REHMAll right, you say there has to be a deal, but what if there isn't, and what if Greece does leave the EU? Then what happens?

  • 11:29:38

    BARBERWell, it will leave the Euro Zone, not the EU. That -- it will leave the monetary union. It doesn't necessarily at all put in jeopardy its membership of the European Union, Moises is right, by the way, just in terms of context that the Greeks, the Syriza party won an election saying we will not support any more austerity, things must change, but we still want to remain in the euro.

  • 11:30:05

    BARBERNow if it goes, if Greece were to go, then the first lesson is that it's not a monetary union anymore, it's a fixed-exchange-rate regime, which means other countries could be targeted. And of course that's what makes this really difficult. People are really worried about the monetary union falling apart with all the geopolitical consequences. And also, every time you read that it's just the Germans putting the Greeks into a straightjacket, actually it's those countries who've taken really painful decisions, like the Spanish, the Portuguese, and to a degree the Italians but particularly the Spanish and Portuguese and the Irish, who say why should we let the Greeks off when we've gone through so much pain and had the same kind of adjustment, 30 percent, 25 percent adjustment in incomes, that Moises talked about with the Greeks.

  • 11:30:54

    LAKSHMANANRight, I mean, we're talking about very painful decisions for any country, and, you know, the issue here is, of course, that the party won that doesn't want to go through those reforms. But in order to make this work for Greece's economy to come back, I mean, essentially right now the reason they can't pay for these pensions is because they're bankrupt, and the reason they have this high pension bill is because of this habit of early retirement in Greece.

  • 11:31:18

    LAKSHMANANAnd so something's got to give. They've got to work on privatization. They've got to work on cutting public-sector costs. And those are things that, although Tsipras said in his La Monde op-ed that he was working on, there's no real evidence that they are working on it. And what is happening, the next big deadline looks to be, even though the IMF said okay, you can bundle, you can bundle your payments for the end of June, which makes June 30 now, on Monday we're expecting Greece to respond to an EU proposal.

  • 11:31:44

    LAKSHMANANThe Euro Area finance ministers have put together a proposal. But the problem seems to be that Greece wants their position, the Euro Area finance ministers want their proposal, and I completely agree with Lionel, the Euro Area ministers are going to have to come up with something that is closer to this compromise of 3.5 percent GDP surplus that Greece has been floating.

  • 11:32:06

    NAIMDiane, you asked what happens if Greece leaves, and there are two ways of leaving. There is an orderly leaving, in which, you know, there is all sorts of measures and precautions and agreements about how Greece leave the Euro Zone and the monetary union. And then there is the chaotic mess in which everything is improvised, surprises of all kinds. Then you end up with a run on banks. You can have a huge banking crisis. You can -- and what we have seen from these financial crises even in small places is that they travel.

  • 11:32:42

    NAIMThey move around the world in very strange, improbable, surprising trajectories. So you can end up having the banking sector in Greece affecting the banking sector elsewhere in Europe and have ripple effects and create an international crisis. That, I don't think, is going to happen. I think Europe has taken already some of the precautions. Europe is better prepared now for a messy Greek exit than it was, say, two or three years ago.

  • 11:33:13

    BARBERThere's a great story, actually, in 2012 when Angela Merkel, who is obviously a key figure in Germany, was being pressed by some of her fellow Germans and ministers to let Greece go, and she went -- came back from holiday, having gone for one of her famous mountain trips, and she said, okay, now we're going to talk about Greece. And the official said, well, you know, maybe we should let it go.

  • 11:33:35

    BARBERAnd she said, well, what will happen? And they said, it'll be okay. And she said that's what you told me when -- about Lehman Brothers.

  • 11:33:44

    REHMAnd you're listening to "The Diane Rehm Show." Indira, we heard Christine Lagarde, the IMF head, speaking this week about the U.S. economy. What'd she have to say?

  • 11:34:01

    LAKSHMANANThat's right, yeah, and just one last point on the Greece is, just ask Argentina what happens with default that's followed by populist economics. So that's not been the greatest model in terms of that. Yeah, for the IMF, it's really interesting. We saw Christine Lagarde coming out and urging the Fed to delay any short-term interest rate hike in the first half of next year. And that's certainly unusual to have the IMF talking to the Federal Reserve, basically publicly urging Janet Yellen on how she should be running U.S. economy policy.

  • 11:34:36

    REHMAnd telling her she ought to be having more press conference, both, both.

  • 11:34:39

    LAKSHMANANYes, that was interesting, telling someone else how to do their job.

  • 11:34:44

    REHMExactly.

  • 11:34:45

    LAKSHMANANIn their capital city. And, you know, I saw someone saying that bond markets didn't know whether to laugh or cry about this, so...

  • 11:34:52

    BARBERWell, it's fascinating. She's obviously, Ms. Lagarde is worried about the effect of an American interest rate rise on emerging markets, where you have countries in Southeast Asia that are very dependent -- exposed because they have dollar-denominated debt. And so if the dollar was to go up, then their debt go up, and who knows. We saw what happened nearly two years ago with the so-called taper tantrum, when there was the prospect of an American rate rise, which had a big effect on markets.

  • 11:35:24

    BARBERBut I'm tempted to quote the former Texan treasury secretary John Connelly, who said, well, the dollar is our currency and your problem.

  • 11:35:36

    REHMAnd what do you think, Moises?

  • 11:35:38

    NAIMTo give a little bit of context, the notion that the IMF tells a government what to do may come as a surprise to Americans, but that's what the IMF does every day to 193 countries around the world.

  • 11:35:50

    LAKSHMANANGood point.

  • 11:35:53

    NAIMSo this was part of a review that the IMF is obliged to do every year of every country in the world, as every country is a member of the IMF. They look...

  • 11:36:03

    REHMDo you think the fact that she is a woman and said what she said made other people say to themselves, well, who are you to tell us what to do?

  • 11:36:18

    NAIMWell, I believe that Christine Lagarde has earned the respect of a lot of players in the international financial system. I, you know, the fact that she's a woman is, of course, a great plus, I think now. I think she's respected. I think she's also admired. And she has been tough when she needs to be tough.

  • 11:36:37

    BARBERI think the fact that she is a French woman who speaks English with a perfect accent and is utterly charming goes a long way, too.

  • 11:36:43

    REHMGood.

  • 11:36:44

    NAIMSo all of that. But the point is that the U.S. economy, today we had jobs numbers, unemployment has gone down at five percent, inflation is down...

  • 11:36:57

    REHMThe percentage of unemployment, unemployed went up slightly...

  • 11:37:04

    NAIMBut as you discussed in the earlier part of the show, that probably has to do with the fact that more people now are re-entering the search for jobs.

  • 11:37:12

    REHMRight, right.

  • 11:37:13

    NAIMBut in anyway, the fact is that the IMF has decreased their estimates for growth in the United States. They originally thought that this year the U.S. would grow 3.1. They now say it's going to grow 2.5. And there is a big issue about the United States that has to do with its currency. And as Lionel said, you know, the famous words that, you know, it is our currency and your problem, well, the dollar is a problem and an issue for a lot of countries around the world.

  • 11:37:42

    REHMMoises Naim, short break here. We'll take your calls when we come back.

  • 11:40:03

    REHMAnd welcome back. We're going to take just a few calls, then get back to our discussion. First to Brian in Sarasota, Florida. You're on the air.

  • 11:40:20

    BRIANHi Diane. I'm calling about the federal employee's data breach.

  • 11:40:26

    REHMSure.

  • 11:40:27

    BRIANAt the Office of Personnel Management. And I just think that this is such a massive violation of not just US citizens' rights to privacy, but these are actual US taxpayers' personnel assets. And I think every single American should be furious that this was allowed, or that this was able to take place. And then my next question is, at what point, if any of the panel can respond, but at what point do you, do we respond at an aggressive attack like this as an act of war?

  • 11:41:11

    REHMWhat do you think, Moises?

  • 11:41:13

    NAIMThis is, what I want to stress is that this is huge and very important and is at the heart of the US government. This is the Human Resources Department of the US government. So, this is huge. But, it's one more, as we said before. Remember we have Target, the retailer, also had a massive breach. And then Sony was also hacked, allegedly, by the North Korean government. And so, what I want to stress is that this is no longer just governments. This is all kinds of players and non-state actors and it is a world that we still don't understand very well. And that is unclear how you retaliate and to whom and how. And one needs to be cautious about that.

  • 11:42:01

    REHMAll right, let's talk about the FIFA scandal. People have been talking about it all week. The President Sepp Blatter was re-elected and then decided to step down. What changed, Lionel, between last Friday and Tuesday that caused his decision to step down?

  • 11:42:27

    BARBERIt was the release of a letter from one of Mr. Blatter's closest aides or officials that appeared to show very clearly that he had authorized a 10 million dollar bribe, I believe that was the figure, to another character in the Caribbean. I believe it was the Caribbean, but the crucial point was the publication of the letter. And Mr. Blatter was therefore left exposed that, you know, what did he know, when did he know it? And his position became untenable.

  • 11:43:04

    REHMAnd what is the story regarding Ireland?

  • 11:43:10

    BARBERThis is one of the -- there's gonna be some wonderful stories, by the way, coming out in the next few weeks, about the sheer level of who was being paid off when and why. But this is -- the best one so far is Ireland, great football nation that it is, soccer, sorry, they had a really good chance of qualifying, but lost out when  Thierry Henry, a fantastic French footballer, scored a goal, but he actually handled the ball, which is not allowed in soccer.

  • 11:43:40

    BARBERAnd in order -- the referee didn't see it, but the Irish were ready to protest, but guess what? After a five or six million Euro payment, they were persuaded not to.

  • 11:43:54

    REHMAnd where did that payment come from?

  • 11:43:56

    BARBERThat came from FIFA. That came from FIFA.

  • 11:43:58

    REHMWow.

  • 11:43:59

    LAKSHMANANIt came from FIFA to the Irish Football Association. I have an Irish Football...

  • 11:44:03

    BARBERA well deserving.

  • 11:44:05

    LAKSHMANAN...yeah. I have an Irish football loving husband, so I actually know a bit about this, and the moment when Thierry Henry robbed the Irish people of their dream of getting in to that World Cup. And the Irish actually went to Sepp Blatter at the time and begged and said, can't we be the 33rd nation coming in? And he literally laughed at them. And the story is that apparently they felt they had some grounds for some kind of a lawsuit, because it was clear, certainly looking at it, that there was a hand used by Thierry Henry.

  • 11:44:34

    BARBERHand of God.

  • 11:44:35

    LAKSHMANANYeah. The hand of not Maridonna, but Thierry Henry in this case. And then the idea is that suddenly they give, you know, they laugh in his face, they say no. We're not changing this decision. Ireland's not going to the World Cup. Part of the reason, though, think about it, is because why? FIFA cares about money and advertising. And France is by far a better country to have in the World Cup than Ireland in terms of the dollars that are gonna be spent. And so that's also critical to it. It's dollars upon dollars upon dollars.

  • 11:45:01

    LAKSHMANANAnd this five million dollars "loan" that was given to the Irish Football Association, which was then written down. I mean, the people are coming out of the woodwork now. And this is just the first of many stories I think you're gonna hear about corruption at FIFA.

  • 11:45:13

    NAIMIn the midst of his election, Sepp Blatter, who by the way, was re-elected with the votes of countries like Spain and France and, you know, soccer loving countries were voting for this individual who had been at the helm of FIFA, the global soccer organization for 17 years. And everybody, you know, the rumors about corruption were swirling all the time. So he said, yes, I acknowledge that we have problems, but what we need is evolution, not revolution and I am the one that is going to fix this.

  • 11:45:45

    NAIMWell, four days later, he gave a four minute speech and he resigned and obviously revolution was being brought to FIFA by the prosecutors in the United States and other authorities.

  • 11:45:57

    REHMSo, what's going to happen to him and to FIFA?

  • 11:46:03

    BARBERWell, unlike other autocrats that have fallen in the last few years, people like Saddam Hussein, Mr. Blatter said, initially, that he wasn't going to go immediately. He was going to hang on while, to prepare the succession. Well, as more revelations have come out, and as I said, I think there are going to be a lot more. Then, his position has become really untenable. The question, though, still is, who is going to take his place? And they really need to rewrite the rules, because as Indira says, the whole system has revolved on one country, one vote.

  • 11:46:38

    BARBERSo, even the tiny countries have enormous sway. And if they're paid off, that's how you fixed where the World Cup was going.

  • 11:46:47

    REHMWell, part of that...

  • 11:46:48

    BARBERSo, you need a more of a bit of Senate system. Not a Senate, sorry, like the Congress with the bigger countries having more votes.

  • 11:46:53

    REHMBut will anybody, who's going to go to jail?

  • 11:46:58

    BARBERWell, there's seven people already in a cell in Switzerland, which is a lot harder than the luxury hotel where they were rudely interrupted at five 'o clock in the morning.

  • 11:47:07

    NAIMI believe Sepp Blatter resigned because he was told that some of his colleagues that have been arrested were singing.

  • 11:47:14

    BARBERSinging.

  • 11:47:15

    NAIMAnd telling stories about him. And the stories, as my colleagues have said, are going to come fast and furious. And are going to show that for 17 years, the modus operandi of this organization is to bribe, is to use money to solve situations, to buy votes, to distort decision making and assign, and even assign which country is going to host the World Cup. As we said before, Russia, one of the things we're going to see is how much, or if Russia and Qatar did pay and did bribe FIFA officials in order to be a -- be able to host the World Cup.

  • 11:47:56

    NAIMAnd so, there is much to come, but the essence is that this is an organization that acquired a modus operandi that was essentially criminal.

  • 11:48:05

    BARBERQatar, the soccer loving nation where you can play outside in 50 degrees of heat. Now, I know that it's of course going to be played in air conditioned stadium...

  • 11:48:15

    REHMYou're talking about Celsius.

  • 11:48:18

    LAKSHMANANCelsius. We're talking 120 degrees.

  • 11:48:19

    BARBERExactly.

  • 11:48:20

    LAKSHMANANIn which many workers, we don't know the number, but many workers have died, supposedly, in the construction of those stadiums, as well. So, the corruption goes so deep. I mean, this is stuff you just could not make up. I am waiting for the mini-series or the documentary about this with baited breath. I mean, think about two things that people love. Money and sports. And they mix together in this in a way that is just -- it's jaw dropping. I mean, we had an ex FIFA Vice President coming out today saying, Blatter knows why he fell. And if anyone else does, I do, threatening to spill the beans.

  • 11:48:50

    REHMAll right, so the question is, is Blatter himself going to jail?

  • 11:48:57

    BARBERWell, I couldn't possibly comment on that. It's no FT, no comment. We must wait to see what they've got on this man who has dominated world soccer for years. He's been the ultimate fixer, the man who could make the system work with greasing many palms.

  • 11:49:19

    LAKSHMANANRight. I mean, I think that he's got a target on his back. No question. And I think everyone else who's been rounded up, his former deputies are singing. They're not going to keep secrets anymore. And the Irish is just the first example of someone coming forward and saying, oh, well, this is what we did to try to not be blamed themselves for being involved in this.

  • 11:49:36

    REHMAll right. Let's turn to what has been happening in both Iraq and Syria. Officials from the US, more than 20 other nations met in Paris this week to talk about how to combat ISIS. What are their conclusions?

  • 11:49:59

    NAIMWell, ISIS has made steady gains, both in Iraq and Syria. It not only controls the city of Mosul that it took over on May 17, but it routed Iraqi troops in the Sunni stronghold of Ramadi. About 70 percent, 70 miles from Baghdad. In Syria, it took over the historic city of Palmyra. It has extended its reach into Libya and conducted its first terrorist attack in Saudi Arabia where it blew up a Shiite mosque in the eastern city of (word?).

  • 11:50:29

    NAIMSo, there was this meeting in Paris of the coalition, trying to contain, to defeat ISIS. And there, the Deputy Secretary of State, Anthony Blinken said that more than 10,000 ISIS fighters have been killed since the coalition started a campaign against the group in Iraq and Syria. And so, there is -- we have these different perspectives about the coalition making progress and at the same time, you know, every week, we see some kind of progress...

  • 11:51:03

    REHMISIS is advancing.

  • 11:51:05

    NAIMAdvancing.

  • 11:51:07

    LAKSHMANANYou know, I think there's a real problem with this 10,000 figure. And it's natural that the United States would want to put out that number to try to justify the gains that have been made by ISIS recently. By taking over the capital of Anbar, Ramadi and also Palmyra in Syria. But we know, from the US intelligence community, that they are not very confident about this figure, of 10,000 dead. And it could have 30 percent, you know, problem with that number.

  • 11:51:34

    LAKSHMANANSo, you know, when we talk to officials on background or off the record, what we're hearing is that that 10,000 number is not solid. The number that is solid is that this is costing 8.9 million dollars a day to the US government. Or 2.4 billion dollars so far. There have been 4,000 airstrikes that have dropped 13,000 bombs. But we don't really know who is dead, because we don't have spotters. Right? We don't have Americans at the front lines because we're trying to minimize casualties. And so, it's hard to know what we're actually hitting.

  • 11:52:06

    LAKSHMANANAnd we also know that whoever we're killing on the battlefield, these Islamic State fighters, are being replaced. This Paris conference, they also talked about how there are 25,000 foreign fighters from 100 countries. And so, you know, they still, James Clapper, the head of, you know, the Director of National Intelligence recently said on the Hill that the US still believes there are between 20,000 and 30,000 Islamic State fighters, which is no different than the figure that it was last year.

  • 11:52:35

    BARBERI echo all those points. I would just say that you're not going to win the war against ISIS from the air. You can do a lot of damage with the airstrikes, but you got to win on the ground. And that means that you need to have a credible fighting force, and the Iraqi army is not credible. The Iraqi army up sticks and left, again, massive amounts of munitions and serious military equipment when they fell, when Mosul was taken and the same is true of Ramadi. And the criticism, I think, within the administration, is severe and rightly so.

  • 11:53:09

    REHMAnd you're listening to "The Diane Rehm Show." It's my understanding that those Iraqi fighters were not even outnumbered and yet they turned and ran.

  • 11:53:24

    BARBERThat's correct. So, this is a question of morale as well as technical or military capacity. But it's also a terrible indictment of the previous Iraqi government, under Maliki, who was sectarian and going against the Sunnis. And this is where ISIS has moved into the vacuum.

  • 11:53:44

    REHMI want to ask about Syria. Is the Assad regime actually starting to help ISIS? Moises?

  • 11:53:55

    NAIMWell, if not to help ISIS, at least allowing ISIS to proceed without many obstacles, because it is worried about the opposition. The other fighters that are trying to overthrow the government. And especially the al-Nusra and several other groups that are in Syria that are fighting against the Assad government. And so, the Assad government is watching and liking the fact that they are fighting amongst each other. So, having once enemies fighting hard is something that it's part of the story here.

  • 11:54:30

    REHMSo is the US supporting any of these rebel groups?

  • 11:54:37

    LAKSHMANANYou know, the US has been standing by the side for all these several years now. Not wanting to get directly involved in the Syrian conflict because, in part, they don't know who these opposition people are. The opposition is very mixed and to talk about wanting to back this moderate Syrian opposition, there's not a lot of that moderate Syrian opposition. But Moises is right that this latest twist of Assad either colluding with or allowing Islamic State on its way towards Aleppo is just stunning.

  • 11:55:05

    LAKSHMANANAnd all of the State Department has said that they don't outright have evidence of that from the Twitter account of the now long closed US embassy in Syria. There are all sorts of messages coming out, saying that this is an outrage, that Assad is helping ISIS and you know, it certainly would give him a chance to say, I'm the savior. I'm the only one who can save Syria from this.

  • 11:55:25

    REHMAll right. And finally, Moises, the Rohingya migrants. Tell us what's happening.

  • 11:55:33

    NAIMThe Rohingya are, of course, a group of Islamic group, that it's, has its largest population is in Myanmar, in Burma. They are widely perceived as being one of the most persecuted, discriminated against populations in the world. They, some of them, are taking to the seas and they are just jumping in rickety boats and Myanmar brought ashore 727 of them in a seized vessel. It had kept at sea for days. They are leaving Myanmar and Bangladesh. They are trying to reach Thailand, Malaysia, Indonesia.

  • 11:56:13

    REHMCambodia.

  • 11:56:14

    NAIMCambodia. It's a tragedy that has a parallel in the (word?) in the seas of Andaman, which is in the Mediterranean. We also see the tragedy unfolding in the Mediterranean with illegal migrants, or migrants leaving Africa, trying to reach the shores of Italy, Spain and other places. So, it is becoming an international crisis of major proportions, a tragedy and the individual stories are just overwhelming.

  • 11:56:46

    REHMLast quick word.

  • 11:56:48

    BARBERWell, I was in Myanmar two years ago and saw some of the conditions that the Rohingya were living in, and it is appalling. They're seen as threatening for jobs. The Burmese, the Myanmarese see them very much as second class citizens. And what you're seeing playing out is a sort of reversion of the boat people. And the international outcry has actually shamed the authorities.

  • 11:57:10

    REHMLionel Barber. He's Editor of the Financial Times. Moises Naim of the Carnegie Endowment. And Indira Lakshmanan of Bloomberg News. Thank you all. So good to see you, Lionel. Thank you, Indira, for sitting in for me. And thank you, Moises. Thanks all for listening. I'm Diane Rehm.

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