MS. DIANE REHMThanks for joining us, I'm Diane Rehm. Rich countries are pledging $40 billion to Arab countries, trying to establish free democracies. Libya is calling on Russia to mediate a cease fire. And French finance minister, Christine Legarde is throwing her had in the ring to lead the IMF.

MS. DIANE REHMJoining me for the week's top international stories on the Friday News Roundup in the studio to talk about the week's top international stories, James Kitfield of National Journal Magazine, Nadia Bilbassy of the Middle East Broadcast Centre and Moises Naim of El Pais. Throughout the hour, we hope to take your calls, 800-433-8850. Send us your email to drshow@wamu.org.

MS. DIANE REHMFeel free to join us on Facebook or send us a tweet. Good morning to all of you.

MR. JAMES KITFIELDGood morning.

MS. NADIA BILBASSYGood morning, Diane.

MR. MOISES NAIMGood morning, Diane.

REHMNadia, this Arab spring seems to be topping the G8 agenda in France.

BILBASSYAbsolutely. I mean, this meeting supposed to be about financial issues, billing out for European economies as Ireland agrees and Portugal and all the topics that we talked about before. But it seems that the Arab spring is dominating the issues. Libya as well, the Middle East Peace talks. So it seems that the European countries came just before we came on air with a statement saying that, "We endorsing the Arab reforms in Tunisia and Egypt and any Arab countries that opening up to democratic reforms.

BILBASSYLike, Syria potentially or Libya or Yemen and we basically going to give them, in principal, $40 billion. But now they talking about $20 billion and I don’t even know if this money's going to materialize because that's the problem with donor countries, they don't deliver.

REHMThat's what I wondered about, James. The $40 billion and then down to $20 billion, where's the money coming from?

KITFIELDWell, that's a very good question. And, show me the money, should be our caveat with this.

REHMWhere's the beef?

KITFIELDBecause I've seen a 100 conferences where lots of money is pledged and that money doesn't show up. So we'll see but I think there is a sense that, in very much Barack Obama's leading this effort. He announced this effort in his Mid-East speech last week. Where he said, you know, basically, we have to help these economies, sort of, weather the storm if we want this democracy to take root in Egypt and Tunisia.

KITFIELDI think, that resonates with the Europeans. They have their own want from this summit though. They want us more heavily engaged in the air war in Libya. And you saw, this week also, where we, sort of, the transitional council in Libya, we let them open office in Washington. Basically, said, you are the legitimate interlocutor for the Libyan opposition. So you sense in sort of a give and take, we're asking the Europeans to step up with money for these nascent democracies in the Middle East.

KITFIELDAnd they're asking us to get more heavily engaged in Libya.

REHMBut, given the global economic problems, how likely is this to happen, Moises?

NAIMThe G8, the group of eight industrialized democracies, it was originally called, still is called, has a long history of making pledges that then don't materialize. It has done it several times with Africa. It has done it several times with other issues. And it's worth recalling who is the G8? It's France, Canada, Germany, Italy, Japan, Russia, the U.K. and the U.S. This is a group that has become obsolete and in fact was replaced by a new grouping called the G20.

NAIMThat included other countries, for example, note that the G8 does not include China or India or Brazil or the new emerging countries that may play a very important role. The G20, for example, also includes Saudi Arabia. You would expect, that if you're talking about what's going in the Middle East, Saudi Arabia would have to at least be invited.

NAIMAnd the final irony is how this meeting in Deauville, France was called by the conveners of President Sarkozy and the French, new world, new ideas. But, yet, if you look around the table, it was an old world with a lot of old ideas. You had Berlusconi and you had others that really represents a world that seems to be fading or we hope will be fading.

REHMWhat was President Obama's overall goal in visiting Europe?

KITFIELDI think he has a number of top goals. Obviously, getting backing for helping the Arab spring is number one. Number two, he wants to show that there is still solidarity within the Europe -- the NATO alliance on Libya. You know, he had a visit to the United Kingdom where he's trying to, sort of, repair a pretty frayed special relationship with that country, has not really gotten over the Iraq hangover.

KITFIELDThey are cutting their defense budgets, pretty dramatically, raising the question whether Britain can be our, you know, partner, first choice as it has traditional been. He's going to visit Poland which was kind of peeved that we scratched the Bush administration missile defense system that was going to have a major node in Poland. Last year, Obama couldn't attend a leaders funeral because of this ash cloud.

KITFIELDSo they was a little -- Eastern-Europeans are feeling neglected. So, I think, on all those fronts, he wants to, sort of, bolster their transatlantic relationship at a time when he's still sees. And I disagree with Moises on this a little bit. I think, you know, the G20, we meet -- we've had numbers in meetings and certainly the Obama administration really wanted to reach out to this very multilateral world view.

KITFIELDBut nothing gets done very much in the G20 meetings because there's still -- you have to have, you know, countries with like world views to actually cough up, you know, sums of money to do things that are proactive. And sometimes this is hard to herd all those kittens in the G20.

REHMBut he sure had a great start in Ireland, Nadia. And then, how is he received in the British Parliament?

BILBASSYWell, how can he not have a great start in Ireland, Diane? It's the most hospitable, friendly country in Europe. The welcoming him and he found, actually in 2008 during the campaign, that his great-great-great grandfather, a man by a name of Falmouth Kearney who was a shoemaker, immigrated to the United States in 1850.

BILBASSYAnd, basically, they welcome him as the son that was lost. And this little town called, Moneygall, which is, he went there, he had a pint of beer with the locals and they applied this fresh coat of paint welcoming him. They were -- he was a hero, he was a rock star. So it was a great start. It was ceremonial but also it has some kind of thinking in the future. You have 40 million Americans that they claim Irish ancestry.

BILBASSYAnd this is important for him in the next election of 2012. And the British Parliament, I think, this is the first U.S. President to address the joint session of Parliament. And...

REHMIn 900 years.

BILBASSYCan you believe it? I actually didn't know that. I thought, for a country that has a strong alliance with the United Kingdom, that you assume that an American President has been there. But he stood there, I thought his speech was excellent. He talked about this bond, the strongest one of the strongest bond that's based on values.

BILBASSYHe wanted to assure Britain that this alliance is very important, that they not irrelevant in shaping foreign policy. And they still on board in Afghanistan, in Libya, in the Middle East and was -- the most interesting thing, I think, the only clap he had when he stood among this house of Lord and house of Parliament, and he said, here I am, the grandson of a Kenyan cook who served in the British Army and stand in front of you as the President of the United States.

REHMWow.

BILBASSYAnd that resonates among the British.

NAIMIndeed. And another memorable line of that speech, he started saying, I'm told that the last three speakers here have been the Pope, her Majesty the Queen and Nelson Mandela which is either a very high bar or the beginning of a very funny joke.

REHMWhat about his -- what about President Obama's meeting with British Prime Minister David Cameron on Libya, James?

KITFIELDWell, that's what I started out saying. I think that he really, you know, the British are getting nervous about Libya. They kind of -- they took the lead along with the French in getting us involved. A lot of people warned and, I think, including us on this show, this was going to be a slippery slope because, you know, your military means didn't match your strategic goal of getting rid of Gadhafi.

KITFIELDWell, we're still sliding down that slope. This last week, France and Britain, said, they're sending attack helicopters now to Libya. They want us to send A-10 ground attack aircraft as well as AC-130 gunships. Which are very useful for, sort of, very close combat type situations. So, we are still getting down the slippery slope, trying to force Gadhafi out.

KITFIELDAnd, I think, this time -- the alliance needs a little bit bolstering from its, you know, its leader, which is us.

REHMWhy did Libya turn to Russia to mediate between the government and the rebels and what has Medvedev response been, Moises?

NAIMYeah, very important recent comment by Medvedev -- by the President of Russia, is that they too support -- they have joined the statements that Prime -- President Obama and the British Prime Minister have made about wanting Gadhafi out. And so now, even Russia says that. And that's very important. As James says, it's worth noting that this started as an operation to protect civilians.

NAIMThis was -- this started trying to stop the Gadhafi's troops of entering Benghazi and having a massacre there. Now, the conversation has shifted, at least, the statements by these leaders have shifted. We want Gadhafi out. President Obama, in Europe, says that he wanted to assure the Libyan people -- he wants to make sure that the Libyan people are finally free of 40 years of tyranny.

NAIMThis is a different goal than the goal from stopping Gadhafi troops from entering Benghazi.

REHMSo that even Medvedev urging Gadhafi to step down has said Moscow will not give Gadhafi asylum.

BILBASSYAbsolutely. And, I think, if we listen to so many indication coming from Libya. Number one, you have Jeffrey Feltman who is assistant secretary of state. He went Benghazi and he says, we have nothing to do with the Libyan regime. We don't talk to him, we don't talk to his people. So the idea from the United States and the European alliance is that, basically, Gadhafi is done.

BILBASSYThat said, the problem here, that his legitimate, we have to be relentless in foreign -- in pursuing him. We have to intensify the diplomatic efforts and hence the inviting opposition to open an office in Washington and the military led by NATO of this constant bombardment that we seen in Tripoli. The problem is, how do you expect Gadhafi to go? The rebels saying, basically, you giving us the money, but we don't have weapons.

BILBASSYAnd this balance of military power keeps shifting every day between the rebels and between the government. So there is no mechanism of how you get Gadhafi out. And that's a problem.

REHMNadia Bilbassy with Middle East Broadcast Centre. Short break and when we come back, we'll talk about these statements of Prime Minister Netanyahu and the Israeli-Palestinian situation.

REHMAnd welcome back to the international hour of our Friday News Roundup this week with Nadia Bilbassy of Middle East Broadcast Center, James Kitfield of National Journal, Moises Naim of El Pais. Talk about what Prime Minister Cameron said to President Obama, Moises, about the Israeli Palestinian conflict.

NAIMPrime Minister Cameron endorsed and supported President Obama's position that Israel has to go back to the '97 -- 1967...

REHM'67.

NAIM...borders. As we recall those are the borders before the seven -- the six days war and define in Israel that this since has expanded. And that is one of the central dilemmas and the central points of legalization. The rights of returns of Palestinians is another one. Keeping Israel safe from attacks and providing borders of neighboring nations that do not declare as their goal that is appearance of the state of Israel is a major thorn issue. Let's remember that Hamas that is now part of the Palestinian entity has that as one of its main statements.

NAIMAnd so we are once again to a situation in which we have been for many years now. It's quite amazing how despite everything that has happened the conversations that don't seem to have shifted. What has shifted is the Middle East and a lot of what we are seeing today the dynamics in the Arab Palestine -- in the Israeli Palestinian dynamic have been also are being colored by what's happening in the streets of Cairo and elsewhere.

KITFIELDI've -- you know, not since Camp David fell apart in 2000 have I seen more negative optics around the Israeli-Palestinian than I -- issue than I saw in the last week. You had George Mitchell -- a juxtaposition of President Obama in Ireland where George Mitchell helped come up with a Good Friday, you know, agreement that ended really the hostilities there. And then you have two years bumping his head up against this wall and quitting in frustration.

KITFIELDThen you have President Obama giving this really seminal Middle East speech where he says '67 borders with some land swaps. Nothing new in that, except for a president actually came out and said it publicly. That's been the negotiation's starting point for 20 years. And then you have, the next day, Netanyahu coming -- arrive, mischaracterize what the president said. He said, we can't go back to '67 borders, which is not what Obama said. They're indefensible, almost wagging his finger in the face of the president.

KITFIELDAnd then going to Congress and getting this raucous reception -- you know, approved reception, I mean, basically telling Obama in his own backyard, you cannot pressure me, you cannot twist my arm because I have power in this country politically, you know, that is very strong. And this president -- you're going into an election year. So what we see is basically this thing is going to be absolutely stalemated until after at least the 2012 presidential election.

KITFIELD'Cause no president, and certainly not Mr. Obama, is going to be able to pressure Israel to do the things that Netanyahu said he would not do in the speech. He will not leave security forces from the Palestinian territories in the long term. He will not let Jerusalem be divided for a capitol in both places. He will not even start talking to them until they recognize, you know, Israel as the Jewish state, which is something that's very difficult for Palestinians to do because there's -- 20 percent of the population of Israel is actually Arab Muslim.

KITFIELDSo for all those reasons, this thing is stuck and I don't see it coming unstuck for another year or two.

BILBASSYLet me just say why was President -- Prime Minister Netanyahu was invited to address -- join a session of Congress? This honor or privilege is always reserved for people like Winston Churchill, Nelson Mandela, (unintelligible) to talk with the Palestinians. Netanyahu leads one of the hardest line government probably in the history of state of Israel and more extremist than ever, people who advocate the transfer of Palestinians, including his own foreign minister.

BILBASSYAnd the problem now that he started with talking in Biblical terms. He talk about Judea and Samaria. And then he said, if I make concession, and James rightly said, no Palestinian will ever set a foot in Israel Proper in terms of refugees returning. Jerusalem will be always under our sovereignty. We gonna be in control of the borders. What he left (unintelligible) the issues to negotiate is nothing.

BILBASSYWorse than that, the Congress were just falling apart to congratulate him. There was a thunderous applause. There was standing ovation 55 times more than the President of the United States gets for the State of the Union. And I think it is he was invited because the Republican leadership in the Congress wanted to torpedo anything that the president might do in terms of the peace process and they want to show their support.

BILBASSYThe problem here, as one of the interesting analysis I read, as if this love fest was done between the Congress and Netanyahu, as if the Arab world is not watching on big giant screens and this ultimately will have consequences. One of which is basically the understanding of Palestinians now. And I talked to some officials that the narrative of the United States Congress and among the American public is solidly pro Israel. Is nothing you can do to change that.

BILBASSYSo America cannot be an honest broker. And therefore they have to create their own realities on the ground. One of them is they're gonna be more determined than ever to go to the U.N. And America will look isolated as they put their hands up and Susan Rice will vote against something the president endorse, which is the right to Palestinians to have their own state and Israel will be isolated even more in the international forum. And even if these people are friends of Israel, they should advise them that ultimately as we know the demography and the technology and all the reasons we heard before, it's gonna be against Israelis. It's their own interest to have a Palestinian state.

NAIMIt's obvious that the arena has shifted from the negotiating table to the public opinion. And we have now speeches instead of negotiations. And so this week, we had three speeches that are quite important for its -- each one for its own different reasons. And then soon in September actually we will have another big speech in the United Nations general assembly where there's going to be a lot of talking and debating about the creation of the Palestinian state.

NAIMAround that there is going to be, as it was obvious this week, a lot of political theater, a lot of posturing, a lot of distorting. What is the other parts position and realities? And sooner or later, that will have to evolve into moving the conversation from speeches with applause and staged -- and again, from theater to reality and negotiations.

NAIMAnd it is clear that the Palestinian strategy aided by Israel's, by Netanyahu's and other's behavior is isolating internationally -- creating the international isolation of Israel. Israel now is increasingly becoming isolated. And that is also a recipe for very bad decisions in a variety of ways.

REHMAnd...

NAIMWhat we are seeing is that extremists in all sides are gaining the upper hand. There is -- there are intermediate positions in each side that deserve more importance and become more influential. And they have been excluded by the rhetoric and the posturing and the goals of the extreme positions that are now prevalent.

REHMAnd at the same time, James, you've got Egypt saying it's going to permanently open a border crossing into Gaza. What does this say, not only about a merging Egyptian policy, but what does it say about the Israeli- Palestinian situation?

KITFIELDIt's exactly why President Obama tried to tell Prime Minister Netanyahu that, look, the tides of history right now are running against you and your occupation of the occupied West Bank. And we saw that a week ago with Palestinian crowds running up to Israel's border. The people's protest of the Middle East are going to land on Israel's doorstep. Let's get out in front of this.

KITFIELDAnd Egypt is saying -- you know, Egypt, as it becomes more democratic, will reflect the overwhelming democratic view of the Egyptian people that the blockade of Gaza is unfair. And that their treatment of the Palestinians in the West Bank is unfair. And we've seen Turkey break relations with Israel over this and they had very close relations.

KITFIELDMore and more as you get more democracy Israel's going to be more and more under isolation and pressure to get off the dime on the peace process. So that's what I think President Obama was trying to tell Prime Minister Netanyahu that, you know, let's get out in front of this instead of, you know, being one more ruler who got sort of swamped by the street, and...

REHMAnd Nadia, you grew up in Gaza.

BILBASSYI did indeed.

REHMSo what is the significance of this opening for the people of Gaza?

BILBASSYHuge significance. Let's start by the blockade itself. I mean, Israel shut down this Rafah entrance, which is -- Gaza has only two exits and entrances to the world, which is one through Erez on the northern border with Israel and one through Rafah, through Egypt. And the people are trapped. Gaza is a big jail with 1.4 million Palestinians living there with no chance of getting out.

BILBASSYWhen they blocked it and it caused some humanitarian crises, it's always in any conflict or any war the people resort to creative ways. So what they did is they dug these tunnels and they brought the goods and they brought their weapons and brought everything. And on top of that Hamas was charging people taxes. They were making money out of it. So the fact now they opened this border crossing is good psychologically and is good for other reasons.

BILBASSYNumber one, Gaza is no longer isolated. Number two, students can go and pursue their education outside. People who needs medical treatment can go out. This was a collective punishment against millions -- one-and-a-half million Palestinian living there. So this is a good thing. Second, I think it was part of the deal that the military government in Egypt signed with reconciliation process between Fatah and Hamas. That they give them this leverage, basically allowing Hamas to have some kind of say.

BILBASSYBut it's not just Hamas, but probably this coalition government or as they call them a (sounds like) technocrack government, that is not going to include Hamas, by the way. It's going to be including independents. And therefore the Palestinians arguing against that you cannot talk to us because Hamas is represented. So it's just really significant, is very important. And they going to allow women to cross with no restriction. Men between the ages of 18 and 40, they will get a visa on the border.

BILBASSYAnd the caveats were still there basically that Israel can monitor any smuggling of weapons, which is good for the Palestinians as well. And they will invite hopefully the European Unions to be observers like it used to be in 2007.

REHMAnd, Moises, what about former President Mubarak? Is he likely to be put on trial?

NAIMYeah, I think there is no doubt about that.

REHMHe's 83 years old.

NAIMHe's 83 in very frail health. And his wife also was recently accused of corruption and she had a heart attack in the middle of the process. And now the accusations against his two sons. One, Gamal was -- had been expected to be the successor and he was perceived as a reformer. He wanted to introduce economic reforms that were opposed, in fact, by the military establishment in Egypt that still controls and still continues to control a big chunk of the economic activity. And now he's being accused of corruption.

NAIMAnd his brother who used to be a businessman, a very influential businessman, a very wealthy one is also -- they are both in jail. They are both awaiting trial. And I think this is part of what happens in these kinds of revolutions.

REHMIs it possible, James, that Mubarak could even be executed?

KITFIELDThe public prosecutor said that this -- you know, if found guilty of what he's being charged with, he could face a death penalty. And I would just go on the record and say I think this is a hugely bad idea. This guy -- they're sending the message to all the other death spots who are hanging on for dear life that the -- either kill the protestors or face the gallows.

KITFIELDAnd that is not a message you wanna send to Gadhafi right now, to Assad in Syria or to Saleh in Yemen. They are absolutely sending the wrong message to the region. And they are also -- I mean, you would think that for all his faults Mubarak was a close friend of the United States for a very long time. The fact that we have absolutely no influence to help a friend like that be sort of put out to pasture is not a good signal for our influence in the region.

REHMJames Kitfield of National Journal and you're listening to "The Diane Rehm Show." Ratko Mladic was arrested yesterday. He has a long history as a Bosnian Serb military commander. He's arrested on genocide charges. How significant is this?

NAIMI think it's hugely significant. He has been hiding for 16 years. People were chasing -- he's known as the architect of massive murders in Srebrenica where 8,000 men and boys were killed -- mostly men and boys were killed. He staged the Siege of Sarajevo where about 10,000 people are thought to have been killed there and so on.

NAIMThe significance of this is to tell the world and the rest of people like him that the impunity that they had in the past is no longer. That you cannot go around...

REHMYou can run, but you can't hide.

NAIM...even in your own country. And sooner or later justice will face you. And by the way, this is international justice because he's going to be taken to the International Criminal Tribunal for the former Soviet Union in The Hague, which is an international body. And I think that's a very good sign for dictators, for generals that are criminals and for others that commit crimes like this.

REHMHow does this affect Serbia's becoming a member of the European Union, Nadia?

BILBASSYPrecisely, Diane. I think this is exactly the point because so much controversy around his arrest and some people think that actually he brought up at that time it was a coincidence that Lady Ashton of the European Union was in Belgrade on the same day. And basically Serbia wanted to speed up its application to the European Union and I think this is one of the conditions.

BILBASSYAnd the prosecutor in the ICC (unintelligible) himself has been asking them for so long, and all of a sudden, he was produced. Some people believe that actually some of the military inside Serbia has been covering up for him and that he's been living freely. And one more interesting thing is that 75 percent of some Serbia I have seen that said that basically the people in Serbia believe that he was a national hero, that he defended Serbia. So they don't really want to give him up, so they think that was the price basically to give him in so they can have membership in the European Union.

REHMAnd do you think that'll happen, James?

KITFIELDOh, yeah, I think it will happen. And I think this is really a good moment for Europe. I mean, Europe has always argued that the European Union is this sort of magnet of soft power that encourages good behavior to join it. This is another sign that that's absolutely true. And the International Criminal Court which we kept at arm's length, has now tried Milosevic, they've tried Karadzic and now they're going to try Mladic, the three butchers of Srebrenica. So I think it's a good moment for Europe and we should give them a nod for this.

REHMAnd what about the IMF? Is Christine Lagarde a good moment for the IMF?

NAIMThey -- what is not a good moment for the IMF is the way in which its leader is being selected. This is -- should be less about names and more about the process through which a leader of this very important institution that has consequences for millions of people in their lives and their economic wellbeing is being selected. The notion that we already more or less know what is the outcome of this process tells you everything you need to know about the nature of the process.

REHMSo you're saying there's no chance that...

NAIMThere is a slight chance. This is -- the way this is -- there is an unwritten agreement between the European Union and the United States that -- this holds since 1944, that says that the head of the IMF will always be a European. And the head of the World Bank will always be an American. And so in the case of the IMF, that only excludes 93 percent of humanity...

REHMExcept that...

NAIM...because if you're not European you cannot be the head of...

REHM...doesn't -- don't the Europeans and those in the United States control most of the money?

NAIMNo. They control what is called voting rights. And voting rights were assigned through a formula that reflected the realities of power and the economic size of the 1940s.

REHMAll right. And when we come back it's time to open the phones. And we'll talk further about Christine Lagarde. Stay with us.

REHMAnd here's our first e-mail from Dave in Cincinnati. He says, "The reason there's been a blockade of Gaza is that arms are being smuggled into the area, heavier and heavier missiles capable of reaching deep into Israel. Hamas has fired 10,000 missiles already. Why would Israel not think they would keep doing this? Why are the panelists failing to mention this? It's not about imprisoning Palestinians. It's about maintaining the safety of Israelis." James.

KITFIELDIt raises a good point and I didn't bring it up 'cause I thought it was an understood part of the subtext of this discussion about Gaza. There are rockets that rain down on Israel from Gaza. You know, my understanding is that even the Israelis don't think that Hamas is particularly behind those rockets at this point, but there all kinds of splinter factions within the extremist groups in Gaza. You know, and it is the reason why they had the blockade when Hamas took over. The problem is Israel hoped after it launched this blockade that they could create such a miserable condition in Gaza that Hamas would be forced out. That hasn't happened. We're years into this blockade now and so we need another way out.

KITFIELDAnd so I take the point, Israel has every right not to want weapons smuggled into Gaza, but the status quo really is not sustainable, which is why, again, I think that it was unfortunate that Prime Minister Netanyahu didn't take Mr. Obama's -- President Obama's suggestion that it's time to get out in front, find a way out of this sort of stalemate here as opposed to basically insuring that it stays stalemate for another couple years.

REHMAnd let's take a caller in Olympia, Wash. Good morning, Frank.

FRANKGood morning. Hi, I'd like to make a statement about Netanyahu and Congress and all the applause. Okay. On June the 19th of this year, Yahuda Alhani (sp?) , who is a holocaust survivor, wrote in their paper, "I believe that the Palestinians should be protected from Israel occupation as the violence is no less brutal than the Nazi occupation." Okay. And in Warsaw during World War II or before it when the Jewish resistance was against the Nazi occupation, he compares Hamas to that. Okay. And if anybody wants to read, Defense First Children International says that every three days a child is shot by the IDF or a settler.

REHMAll right. Thanks for calling, Moises.

NAIMYeah, this a part of the exceptional exaggerations and distortions in the conversations that are not helpful. A lot of what the caller said is patently not true. But it is -- I think it underlines the kinds of passions and misinformation that colors the conversation.

REHMHere's a message posted on our website from a former CIA intelligence analyst for the Middle East who says, "I'm dismayed. American politicians still do not understand the mindset. Middle East democracy will not be what we are familiar and comfortable with. We will be unhappily surprised. For example, one of the first moves by the Egyptians was repairing relations with Hamas, forging closer ties with the enemies of Israel. The opening of the Gaza border crossing is a move that sends a chilling message and is an omen not to be taken lightly." James.

KITFIELDI just respectfully disagree with that. I think long-term having democracies in this region who focus -- whose governments focus on their internal problems as opposed to focusing on, you know, waving the boogie man of anti-Americanism or anti-Israelism, anti-Semitism, I think will be a good thing. But will it cause us discomfort? Will these democratic governments reflect views that we don't share? Absolutely. But we confront that with all democratic governments around the world who have different opinions on various things. I actually think that long-term this has great hope for the Middle East. However, short-term your listener is right. It's gonna be a rocky road.

REHMAll right. To Louisville, Ky. Good morning, Kenny.

KENNYHello. I'd like to quickly say a few things. One is I spoke to someone when I was younger who traveled to Israel in the early 1900s and said they walked for days and never saw anyone at all. There was no one in Israel. So there were no Palestinians there. B, Israel's about the size of New Jersey, has about 7 million Jews and we've got how many hundreds of millions of Arabs and everybody that's anti them. I mean, they got plenty of land. Let them go get their own land somewhere. They don't own anything.

REHMNadia.

BILBASSYI don't think this argument is really helpful at all to deny the existence of Palestinians. As much as they have rights, the Israelis have rights, the Palestinian have rights. And I think it's more important to think of ways forward of how you end this conflict because ultimately you have 7 million Israelis and you have almost now 11 million Palestinians between the one living in the occupied territories and abroad. And you have to find a settlement for them. And the settlement doesn't come through the rhetoric or denial of rights, but through negotiated settlements that ultimately would be the interest of everybody, Israel's securities and Palestinian rights to exist.

REHMTo Nashville, Tenn. Good morning, Abberraheim (sp?) .

ABBERRAHEIMYes, good morning. Here's my thing. My thing is what is happening now with the Arabic Spring in the Middle East is really changing a lot and the dictators that were there in the Middle East, whether like Egypt, like Tunisian, all of them were in favor of Israel. But now, Israel needs to know that this change is really -- it's in their favor if they don't take chance that whatever President Obama was talking about. And knowing all that, Israel is still, especially like Netanyahu, don't want take the chance.

ABBERRAHEIMAnd one more thing I wanna say. Whenever the Arabs take one step forward, the Israelis take three steps backward, starting from Camp David. Can you imagine if all Arabia said we cannot (unintelligible) a nation with Israel and recognize Israel if they won't really give the Palestinians their land and, you know, and then there will be peace. But knowing all that and they come from all these things, but the Israelis don't wanna take the chance.

NAIMWhat has surprised everyone about the Arab Springs is that it's not about Israel and it's not about the United States and it's not about any external force. It's about the dictators and the governments that oppressed their people that did not have economic policies that created jobs and hope for the future. It's about these countries. And there is the -- let's remember that for too many years the Israeli conflict has been used by tyrants and dictators throughout the Middle East as a distraction for their own domestic problems and in order to get the conversation going about something else and not their misgovernment and their corruption and the fact that they cannot create a livable reality for their people.

REHMI want to go back to Christine Lagarde because it now looks as though she will emerge if not the winner, certainly a leading candidate for the IMF. What do we know about her? How effective could she be, Nadia?

BILBASSYShe is, as you said, emerging as the front runner. She's a finance minister of France. And I think if she succeeded, she'll be the first woman to head the IMF in 60 years. She has been receiving so many praise from the Chancellor Angela Merkel of Germany, saying that she's very experienced. She has been endorsed by the British, saying that she has actually assured a meeting of the (unintelligible) and did very well. She has a good reputation among all the financial circle.

REHMI love the fact that she's a longtime lawyer, former synchronized swimmer who regularly does yoga.

BILBASSYWell, I don't know if that helps. And, Diane, maybe it does now, but...

REHMSurely. Surely.

BILBASSYBut I think coming after the scandal of Strauss-Kahn, it might be something. She also is aware the fact that, Diane, it has to always be a European. And therefore she said she's willing to go to countries like China and India and Brazil to lobby them. And we will see. As I said, the process has been transparent, but I think considering the problem in Greece in particular, I think they wanted a European that will be able to deal with the debt crisis and therefore she probably will be a good candidate for it.

NAIMAnd I disagree with my friend, Nadia. The notion that in order to deal with Europe you need a European is an outrageous argument. When Asia had a crisis, no one said that the head of IMF ought to come from Asia. When Latin America have crisis, the notion never came up. In fact, there are very strong arguments that the best that can happen to Europeans is not to have a European as the head of the IMF. There are many reasons why Christine Lagarde is a very attractive candidate. And there are also many reasons why she's not.

NAIMShe has been in favor of the kinds of rescue packages and strategy for European countries that are problematic that is not working. She's part of a European view about how to deal with European troubles in Greece, in Portugal and elsewhere that is not working. And the rest of the world has been telling Europe that they will need to do it differently and Europe is resisting. So again I think what matters here and what we need to be cognizant is the fact that an organization like the IMF that preaches transparency, meritocracy, market values is picking its leader to a process that completely violates the principles it peddles and it preaches.

REHMWhat has President Obama said about all this, James?

KITFIELDWell, he met with Sarkozy today and they came out and asked him and his aides questions. And clearly Sarkozy bought up Lagarde's candidacy, strongly wants American support for it. Obama apparently will not commit on that. He wants to let the process play itself out. So I think they're sort of sensitive to both arguments here. This is a very attractive candidate. There is -- she has already dealt with a debt crisis in Europe, so she has experience there. It hasn't worked, but I don't think anyone else has a silver bullet for what will work for that quite honestly.

KITFIELDOn the other hand, you know, you can't help but notice that the world is changing, that these emerging economies like Brazil and China and India and Turkey...

REHMChina protesting loudly.

KITFIELDSure. And you would understand why. It does reek of the old boys club from World War II. So, I mean, I personally think it would be a good time to have as open and transparent a process as possible and we'll see where the cards land at the end of it.

REHMWhat does it mean to have as open and transparent a process as possible?

KITFIELDWell, anything would be better than what we've done in the past, which is a wink and a nod in the back room that, you know, American gets the World Bank and a European gets the IMF and that's that. It has really been sort of a boys club and I think, you know, actually having candidates proposed from other places like Brazil, like China, like Mexico is apparently floating one of its candidates, and have them be taken seriously and then have a vote at the end of it by the board of -- the executive to me would be an open process.

REHMHow soon will this be decided?

KITFIELDThey're talking about, like, in the next month maybe.

REHMIn the next month.

KITFIELDYeah.

REHMNow, didn't Christine Lagarde have her own minor scandal, Moises?

NAIMYes. But apparently that is not going to go anywhere. There is a case that involves a banker called Tepe (sp?) that at some point he owned Adidas, the shoe and sports garment company. There was an arbitration. She called for an arbitration that gave a sizeable amount of money to Mr. Tepe. And the opposition is accusing of having brokered the deal in a way that is inadequate.

REHMBut you don't think that's gonna...

NAIMEverything points to the fact that there is nothing illegal there and that this is just noise.

REHMMoises Naim of El Pais. You're listening to "The Diane Rehm Show." Here's an e-mail from Saidu in Cincinnati, who says, "Isn't President Obama's attempt to re-launch the peace debate a futile effort? If a man and a woman are dragged against their will to the courthouse to tie the knot, they'll inevitably divorce after the party's over." James.

KITFIELDThat's kinda been the history of Middle East peace process. When you have -- when you have inoculators on one side that's willing to pressure, one of the leaders is not willing to go there. That's happened in -- and Israel's not the only one to blame. Abbas was offered some pretty good deals by the previous two Israeli prime ministers, Olmert and Barak, and for whatever reason couldn't make it over the goal line. And now we have an Israeli leader who will not give anything like as close as good a deal as he was offered before, so he's not inclined to really negotiate with this guy. So, yes, if you can't find two leaders there who are willing to go over that goal line together, 'cause it's a huge political risk for both of them, you'll never get there.

REHMBut why did President Obama decide to do this now?

BILBASSYFor one reason, he wanted to stop the Palestinians from going to the UN general assembly in September and trying to get that board to recognize their right to have a state. And therefore, he wanted to show that he's willing to do something. The problem is, what is this something? Because so far, the two parties are not coming to the negotiation table. He tried indirect talks. He tried direct talks. He asked the Israelis to free settlements. It didn't work. He tried them even to a moratorium for like 30 days or 16 days and it didn't work. Then between now, which is end of May, beginning of June and September, I do not see anything that's happening.

BILBASSYAnd don't forget, he's coming into election and we know where the donors come from. So and this (unintelligible) some people even think that Prime Minister Netanyahu was invented to make Obama looks really bad. Although he didn't say -- as James said and Moises said, he did not come with anything new when he talked about '67 border. Even if President Obama wants to appeal to the Arab public and talk about Arab democracy and international law, international law has to be respected. 1967 border, even if you talk about mutual swaps, he means the settlement blocks in the West Bank.

BILBASSYAccording to the fourth Geneva Convention, no occupying power has the right to move its citizen to an occupied land and settle them there. As soon as Prime Minister Netanyahu -- he exaggerated the number. He talks about 600,000 Israelis. He call them no foreign occupiers in the West Bank that has to be removed. So I really honestly cannot see the process moving forward at all and this is what I'm saying that we might see new realities on the ground going to the UN or the Palestinians resort into what the Arab are doing in Damascus and in Libya and Tunisia...

REHMUprising.

BILBASSY...and Cairo which is an uprising that should be disarmed without any arms and nonviolent and peaceful. And this is gonna be the new reality as we'll see.

REHMIs that your concern as well, Moises?

NAIMWhat I think we have learned is that the US president does not have the luxury of disengaging from the Middle East process. That was attempted by President Bush during this initial few years in which he was told, you know, nothing has worked, come -- he told Colin Powell, do not get in, well, let them do it. And he did and that was in fact a bad idea. So there are many reasons and Nadia has listed them for why now, but the overarching reason is that the US and its president willingly or unwillingly gets dragged in the middle of this ugly situation. The other thing that I want to say is that it's very hard to do what we have done now which is talking about everything is going on there without talking about Iran. Iran is a player. Iran is behind Hamas and Hezbollah and plays a very important role.

REHMMoises Naim, Nadia Bilbassy, James Kitfield, thank you all so much. Have a great holiday weekend.

KITFIELDYou, too.

BILBASSYSame to you, Diane.

NAIMYou too.

REHMThanks for listening. Stay safe. I'm Diane Rehm.

ANNOUNCER"The Diane Rehm Show" is produced by Sandra Pinkard, Nancy Robertson, Susan Nabors, Denise Couture, Monique Nazareth and Sarah Ashworth. The engineer is Andrew Chadwick. Dorie Anisman answers the phones. Visit drshow.org for audio archives, transcripts, podcasts and CD sales.