MS. SUSAN PAGEThanks for joining us, I'm Susan Page of U.S.A. Today, sitting in for Diane Rehm. She'll be back on Monday. The United States accuses Iran of having a role in a plot to assassinate a Saudi diplomat and bomb embassies in Washington. Slovakia casts the deciding vote to approve a stronger rescue fund for Euro zone nations. Egypt's military rulers take control of an inquiry into deadly clashes with Christians, angering rights groups.

MS. SUSAN PAGEAnd Italy's embattled prime minister wins a confidence vote in parliament, but barely. Joining me in the studio to discuss the week's top international stories on our Friday News Roundup, Moises Naim of the El Pais, Elise Labott of CNN and Tom Gjelten of NPR. Welcome to "The Diane Rehm Show."

MR. MOISES NAIMGood morning, Susan.

MS. ELISE LABOTTThank you, good morning.

PAGEWe invite our listeners to join our conversation later in this hour. You can call our toll free number 1-800-433-8850, send us an e-mail at drshow@wamu.org or find us on Facebook or Twitter. Well, the AP is reporting, just in the past half hour, that fighting has broken out in the heart of the Libyan capital of Tripoli for the first time in two months. Tom, this is something of a surprise, isn't it? We thought that the situation in Tripoli was settled.

MR. TOM GJELTENWell, yes and no, Susan. I mean, the truth is that this is a surprise because nothing had been happening in Tripoli for the last couple of months. But there have been other enclaves in Libya where forces loyal to Moammar Gadhafi have been holding out, quite ferociously, and it raises this question because it seems that the game is over. It seems that the Gadhafi regime is finished. And if that's the case, why are people still willing to fight and die to defend what is clearly a finished regime?

MR. TOM GJELTENThere's something, kind of, curious here. Clearly, these people are fighting for some reason. It can't really be to return Gadhafi to power. I think that we just don't know yet what exactly is this situation in Libya.

PAGEMoises, What do you think?

NAIMGiven that, what Tom is right, the only answer we can give is, follow the money. Given that the regime has fallen, that there is no hope of restoring, that there's no ideology or an inspiring leader. The only explanation we can give is that the Gadhafi forces are being paid. That there is a lot of money flowing around and that there are -- these are mercenaries being sent on very specific missions, very well funded just to show that the Gadhafi regime still is alive.

PAGEAnd for -- and to what end?

NAIMBecause he's still in the country. He's still there. And -- we think and that's what all the evidence points to, that he's still there. So he needs to retain some semblance of presence, influence, power and show that he's not done and out.

LABOTTI think if you look back, I mean, we never want to make the same comparisons to Iraq. But a lot of times, we don't learn the lessons that we should learn. I mean, in Iraq, the Saddam loyalists, the Army went away immediately and then came back, you know, hid. There was an insurgency, obviously, that had a lot of foreign fighters and al-Qaida involved.

LABOTTBut certainly there were loyalists that were continuing even though they knew that Saddam Hussein would never come back. And it's the same, in some ways here, there's still heavy fighting in -- one of the last strongholds of Gadhafi loyalists. And this is not over so quick, Susan.

PAGEYou know, it reminds me of possibly another comparison with Iraq which is the Mission Accomplish banner which turned out to be quite premature. Think a lot of Americans thought this was a conflict that was over and had ended successfully and we could move on.

GJELTENWell, yeah, but, Susan, one of the things that we have learned, as Elise just mentioned, over the years, not just from Iraq, but from other wars as well, is that the aftermath of war is very messy. I mean, it's rarely that we see a conflict these days that ends cleanly and, you know, Libya is just following the example of many other conflicts in that regard.

PAGENow, the Washington Post leads the paper this morning with a story about U.S. concern about surface to air missiles that could be used by terrorists to take down passenger jets. These are missiles that Gadhafi -- the Gadhafi regime had.

LABOTTThat's right. We've been reporting on this for some time, Susan. Basically, after -- when all of this conflict started, Libya had about 20,000 surface to air missiles. These are what they call man pads, these are shoulder fired, for the most part, portable missiles that could attack NATO planes, they could attack civilians and there's been a lot of concern. This -- Libya had one of the most heavily stocked arsenals for a country that wasn't producing.

LABOTTAnd during the conflict, a lot of them were looted, a lot of them the new government, the transitional counsel lost track of them and the international community is scrambling to get a hold of what's going on right now and to find an accounting. And so the state department, the military are working, not only with the Libyan's but with the neighboring countries. They fanned out across the borders of Libya to make sure that any of these man pads that reach the border did not go to insurgents.

LABOTTThere's a, you know, a lot of concern as we talk about how this isn't done. There's a lot of concern about extremism seeping into Libya right now and perhaps, that extremists could get a hold of these missiles and it's very concerning.

PAGEMoises.

NAIMAnd in addition to all of that, there is a concern that the -- some of these weapons can go to Europe and be used for terrorist attacks. Tripoli and Libya, in general, is very close. So it's not difficult to smuggle these man pads and other weapons to Italy or anywhere else in Europe and be used inside Europe for terrorist attacks.

PAGEAnd so, Tom, what does man pad stand for?

GJELTENI don’t -- isn't it an acronym, Elise? I don't -- you know, what it means is a portable missile...

LABOTTPortable missile.

GJELTEN...that's individual -- individuals can carry on their shoulders. It's like manned portable, you know, anti-aircraft device or something like that.

LABOTTMost of them are portable. You could put them on your shoulder. There are some -- I think they have more track of these that are -- that you can drive around on a truck but those are a little bit more identifiable. But there is a concern -- and you have Yemen close by where there's a lot of concern about al-Qaida in the Arab Peninsula's. So, I mean, they really -- they don't know how many actually are missing, okay.

LABOTTThe regime -- the new government, this transitional counsel that's the recognized government, is trying to get a better handle on it. But, you know, this regime really kept a very close eye on everything. And now there's a lot of chaos in the country.

PAGEYou can see with it being so portable, how dangerous it would be...

LABOTTExactly.

GJELTENOh, yeah.

PAGE...for a terrorist. Well, let's talk about the European debt crisis. It's a story that doesn't go away, doesn’t seem to get better. What's the latest, Moises?

NAIMThe latest is the takeover of the selling of Belgium bank called Dexia. Dexia is a small bank, but yet it had a debt exposure of $700 billion to very bad loans that are in question, loans to Greece, to Italy and even to some local governments in the United States that are struggling. $700 billion is about double the economy of Greece so the bank wouldn't afford to continue. It was taken over by the Belgian government and bought a chunk of it. French banks bought the French division of the bank that was lending to the French in the French system.

NAIMAnd the Qatari royal family is purchasing the Luxembourg based part of this bank. The larger story here is that, as the debts of these countries become so difficult to pay, the banks that have those debts as assets are very weak. And so they are being asked to bring more capital. And there is a huge fight in Europe between those that say you banks need to increase your capital base.

NAIMAnd the banks that says, well, but you know, my capital base now is completely depressed because I have all these bad assets and so give us time. And so this is a big deal and it's going to be in the headlines for some time to come. And in the context, of course, of the very large need for Europe to send a strong signal to deal with the debt, the banks and the growth, economic growth. Those are the three problems that Europe needs to face.

PAGEAnd, Tom, Americans watch the situation in Europe, wondering what's going to be the impact on us. What could be the consequences for the United States?

GJELTENWell, the big fear is that we would slide back into a situation like in 2008 when -- see, the -- in order for the financial system to work smoothly, banks have to lend to each other. Inter-bank lending is very important. And when banks stop lending to each other, the whole financial system freezes. And that's the big danger right now, that banks in Europe, in particular, are so worried about their exposures that they don't dare lend to other banks. And that is a phenomenon that would spread over here and it could really, sort of, push us back into a financial crisis, just like in 2008, that's the big danger.

PAGEWe finally got a vote from Slovakia approving an enhanced European bailout. But now, you wouldn't think of Slovakia, not a very big country, as being so critical. But it had the potential, if they had not approved it, of really bollixing things up.

LABOTTWell, the first vote was, no. And the European leaders went back to the Slovakis. The government actually fell. And in order to get this passed through parliament, they had to agree with the opposition for early election. Susan, there's something much larger going on right now, here. And this is about European union and unity of the Euro zone. And some of these countries don't want to be bailing out the other.

LABOTTThey're saying you were irresponsible, why should we help out you? This is going to increase our debt. And when you talk to European diplomats, it's about the failure of the Euro, which is not an option because what does that say about the European union experiment, 60 years of patient investment. What's at stake, they feel, is not just the financial crisis which has larger global implications but the future of the European financial, social and political integration. And they're saying, listen, we all have to stick together as a European union. It's all for one and one for all.

PAGEIs this enhanced bailout fund enough? Does it come in time, Moises?

NAIMIt's about $600 billion. And speaking of acronyms, we were talking about man pads, this one is called EFSF, there's European Financial Stability Facility. And the idea is that this will be a back stop fund that will serve to give markets reassurance that there is money, there is financial firepower to fend off any speculative attacks on the currency. The Germans and the French are working on a plan. There is the announcement that there will be a plan soon, that it will be large, significant and will appease and civilize markets.

PAGEWe're going to take a short break. When we come back, we'll talk about the dispute with United States and China over its currency and we'll take some of your calls. Our phone lines are open 1-800-433-8850. Stay with us.

PAGEWelcome back. I'm Susan Page of USA Today sitting in for Diane Rehm for our international News Roundup. And with me in the studio Tom Gjelten, national security correspondent for NPR, Elise Labott, senior State Department producer for CNN and Moises Naim, chief international columnist for El Pais. And we're going to take your phone calls in a few minutes, read some of your e-mails.

PAGEFirst, let's talk about one of the weirdest stories we've ever seen in this town, which is the allegations of a plot by Iran to assassinate the Saudi ambassador to the United States by using Mexican drug cartel. Tom, almost too much to be believed.

GJELTENYeah, Susan, but let me correct you on one minor, but important, point. The administration, in talking about this plot, continually says elements of the Iranian government. And the reason that that is important is because this, as you say, is so bizarre that at least raises the question of whether this regime is fragmenting, whether there's infighting, whether the right hand knows what the left hand is doing.

GJELTENYou know, it's, as so many people have pointed out, it's very hard to believe. This doesn't make sense. What is their interest? And yet the evidence seems to be pretty firm that very senior elements of the Quds Force, which is part of the Revolutionary Guards in Iran, definitely were authorizing this. So there are a lot of questions unanswered.

PAGEHere's a posting on Facebook from Dee who writes, "Surely we will not condemn Iran as guilty without thoroughly investigating. The world has not forgotten U.S. testimony at the U.N. about Iraq's weapons of mass destruction." Elise, the skepticism that some people have felt has really forced the administration to come out. And even the President of the United States yesterday talking about the quality of the evidence that they have.

LABOTTWell, the quality of the evidence of someone who actually tried to hire someone in Mexico is obviously clear. And in the complaint that the administration released there is evidence that someone did try to launch this plot. Who was this guy? What were his ties to the Quds Force? Apparently he had a cousin that was in the Quds Force. And no one really knows. In fact, officials that I've talked to say this guy probably doesn't even know what -- who in the Quds Force, who in the Iranian government was talking about this.

LABOTTAnd now, when you talk to diplomats who have seen the evidence --the United States briefed all of the diplomatic core this week -- they say, listen, and this is what the administration is saying, the Quds Force is at the heart of the Iranian regime. We know that they have financial interests throughout the Iranian economy, very close ties to the regime. Well, if the Quds Force knew about it, then obviously the Iranian regime had to know about it.

LABOTTBut at the same time, Susan, anybody that studies the Quds Force knows, this is one of the most well-trained, meticulous, organized, elite forces in the Iranian security forces. And it was such a sloppy job and that would Iran would really have nothing to gain from going outside its backyard to the United States to assassinate an ambassador. As we said, it's so perplexing that you have to wonder, even if it was tied to the Quds Force, whether it was a stovepipe element, a freelancer, some kind of rogue element. And even officials privately say, you know what, it's very possible. The evidence just isn't clear that there's a tie to Ahmadinejad and the supreme leader himself.

PAGEMoises, what do you make of it?

MR.MOISES NAIMThe notion that this is either fabricated by the United States government or exaggerated for political reasons and electoral reasons is -- would be as reckless as the kind of plot that they were thinking. So it's just very hard to imagine that the United States government would just come up with this out of -- so there must be evidence -- they have already shown evidence and there must be more evidence.

MR.MOISES NAIMFor the Iranian regime it's clear -- so there's a lot that we still don't know, but there's some things that we do know. The tensions between Saudi Arabia and Iran are running very, very high. There's competition for hegemony for influence in the region. That's one fact we know. The other fact we know is that sanctions between President Ahmadinejad and the supreme leader Ayatollah Ali Khamenei who controls the Quds Force are also running very high.

MR.MOISES NAIMThe economic situation -- the third thing we know is the economic situation in Iran is going from bad to worst. There's a combination of bad policies with sanctions with bad decision making and all that. And there is a lot of chaos inside the government as these two forces, Khamenei and Ahmadinejad forces are clashing. In the midst of all that it's very easy to imagine that some free agent, as Elise was saying, and all the chaos can lead to people to just take the initiatives and become very entrepreneurial and come up with these crazy ideas that are very hard to imagine and believe.

GJELTENSusan, one of the things we know about Iran is that a line of fracture in that regime is between Ahmadinejad and the Iranian Revolutionary Guard Corp. So that would -- and they have been out to destroy Ahmadinejad in some of the most vicious infighting that you can imagine. So that's part of the narrative here that we have to keep in mind.

PAGEWe've learned that the U.S. Ambassador to the United Nations, Susan Rice, met yesterday with her Iranian counterpart. Why is that so notable, Elise?

LABOTTWell, it's notable because the United States doesn't have relations with Iran. U.S. and Iranian officials do not meet. Basically there were some efforts, as we know, in the beginning of the Obama Administration to engage the regime. There was discussion about whether U.S. officials could even invite Iranian diplomats, let's say, to July 4th celebrations. Or just something that would increase talks between U.S. and Iranian diplomats around the world. And that was passed over. That didn't happen.

LABOTTSo the fact that Secretary -- Ambassador Rice, Susan Rice, U.S. Ambassador of the United Nations would meet with the Iranian Permrep is pretty remarkable. But it's pretty remarkable that the United States is going full throttle and now has painted a very broad brush to the Iranians about this plot and saying, we're going after Iran wholesale. They already launched some sanctions against members of the Quds Force and individuals. They're talking about further sanctions.

LABOTTThey already sanctioned a commercial airline that helps the Quds Force. So they're going full steam ahead. The question is what did -- as Moises said, there are a lot of issues between Iran and Saudi Arabia. There are also reasons to think is this really in Iran's national security interest to do this? They do have -- they still do have a lot of influence in the region. And there's a question what they would have to gain from this.

NAIMOnce person that claims to know what went on is the supreme leader Ayatollah Ali Khamenei. For him this is not about Iran. This is about the Occupy Wall Street movement. He essentially argued that that movement is about to topple the U.S. government and the capitalist system. He says ultimately and I'm quoting "The movement will grow so that it will bring down the capitalist system and the West," said Ali Khamenei. And therefore the Obama Administration needed a distraction from all of the problems, all the financial problems and all of these protest that are going on in the United States.

PAGEWhich is all true.

NAIMAnd so Khamenei says, you know, they are making this up. He said, "Wag The Dog" kind of thing. And he's very worried about the heavy-handed treatment of the demonstrators by U.S. officials. He says -- he explained very helpfully that this is not seen even in the developed countries, the dictatorial regimes, you know, that the way in which the Occupy Wall Street protestors are being treated by the police, he has never seen and this has been brutal and unacceptable. That would have never happened in Tehran.

PAGEYeah, the -- all right. Well, we won't really leave our political analysis to him. But the "Wag The Dog," of course, the movie that had a president fomenting a fake foreign crisis in order to divert attention from his problems at home. Let's go to Joe. He's calling us from here in Washington, D.C. Joe, hi. Welcome to "The Diane Rehm Show."

JOEHi, thank you. This is just a comment in the sense that, you know, everyone keeps saying that this was a horribly bumbling by these -- this very dangerous Iranian regime. And I don't know. I just kinda think there's a whole different view here which is they reached out to somebody allegedly according to the papers who was deep in the Mexican drug trade. It's not like it was a U.S. citizen. They reached somebody who was in the trade who somehow the U.S. government had turned, thank god.

JOEAnd so, you know, they -- you know, so they reached out to somebody who might've bombed a restaurant or an embassy -- they're both in D.C. I mean, I'm thinking if it had been a D.C. restaurant who knows -- if there were 100 people in there who knows who they could've tracked it back to only because the Saudi Ambassador's in there. There could've been members of congress in there or other administration officials or who knows who…

PAGEYeah.

JOE...in such a situation. So to me if that thing had actually happened people would be singing a lot different tune than this was horribly bumbling. So I think we have to credit our people to track this down and I wouldn't call it bumbling at all. I'm just saying, thank God and we have to focus like a laser on Iran. Thank you. I'll take everything off air.

PAGEJoe, thanks so much for your call.

LABOTTWell, I think Joe makes some -- a lot of key points, which is if this were to happen, it would've been -- and just the fact that somebody was planning such a thing against Adel Al-Jubeir, the Saudi Ambassador. And not only that, but embassies, we understand Israeli and Saudi Embassies in Washington, possibly Buenos Aires. It is a completely crazy plot and it could've had a lot of damage, not just to the ambassador, but to a lot of people. And so -- and it would've had fundamental consequences.

LABOTTAnd what the U.S. officials and diplomats are saying is that this is a pattern of behavior by Iran. No matter how many sanctions that the International Community has launched against the Iranian regime, it continues to support terrorism, it continues to launch a nuclear program. And that we really have to get tough on Iran because no matter where this plot came from, this kind of behavior needs to be dealt with in the International Community.

PAGETom, we saw in Egypt this week a peaceful demonstration in Cairo by Christians turn violent and bloody, 26 people killed. What was behind this confrontation?

GJELTENWell, the Christian community in Egypt, which is about 10 percent of the population, is feeling beleaguered and is worried about the -- sort of the rising Islamist influence in Egypt and the possible role of Islamists in the government there. And they're feeling a lot of discrimination. And they held a big demonstration, a big noisy demonstration, a raucous demonstration. And the military cracked down -- cracked down is not the word -- attacked them basically. I mean, it's been described as a massacre. And, as you say, 20 some people were killed.

GJELTENAnd this really raises concerns all the more about what is going to be the fate of this Christian community in Egypt. Now the government came in for intense criticism for its treatment -- for its attacks at shooting those demonstrators. And now the government just yesterday promised that it would investigate all the disputes that the Christians have been raising. And they're desperately trying to sort of restore their image as a reformist government. But it really shows the danger of secular tensions in Egypt right now.

PAGEI'm Susan Page and you're listening to "The Diane Rehm Show." We're taking your calls at 1-800-433-8850. Well, Egypt's military yesterday, Elise, said that it will take over the investigation into what happened at this demonstration. And that has a lot of human rights groups very concerned and alarmed.

LABOTTWell, because there is evidence from human rights groups that the Iranian (sic) army plowed down protestors with their cars and created this situation. Basically the same thing that they were talking about in Tahrir Square, that, you know, protestors -- peaceful protestors were being attacked. And so obviously it was a different reason. It was for Hosni Mubarak, but this just raises question as to the direction that Egypt is going.

LABOTTI mean, obviously the army has been a trusted force during this whole Tahrir Square, the revolution. The people looked to the army. And now the fact that the army is being seen as responsible for this raises a lot of questions. The finance minister Hazem el-Beblawi -- I'm probably botching his name -- but he was also the deputy prime minister. He said, look the government failed in its responsibility to provide security. We should take responsibility, and he resigned. And, in fact, the acting prime minister tried to resign. His resignation was not accepted.

LABOTTA lot of questions now, how this government is going to handle -- and the Coptic Christians have always been persecuted, Susan. There was a hope now that in the new Egypt perhaps things would change. But the fact that Islamists are still going after them and the army is seen as not doing enough, very concerning.

PAGEAnd the military -- this is right, the military to investigate effectively bars the civilian prosecutor from continuing his own inquiry. What's the U.S. position on this or what role, Moises, is the United States trying to take?

NAIMThey're trying to steer this complex process towards what would hope to be a democracy. There will be elections. And in the process there is also all sorts of surprises and all sorts of attempts to shape the post-Mubarak Egypt. The essence of the story here is that the largest minority group in Egypt, the Coptic Christians, feel -- don't feel -- have been discriminated against forever. And also now they claim, for example, the similar demonstrations by Muslim groups were not met by the violence and by the armed forced that, you know, killed 26 protestors. That would have never happened if this were Muslims.

NAIMAnd so the story here is one of trying to create the conditions that will lead to an Egyptian -- a post-Mubarak Egypt that is more democratic, that does not discriminate against minorities and that the rule of law is essentially the rule of the land.

PAGEMoving toward elections, but when will elections be held in Egypt? Do we know, Tom?

GJELTENThey're going to be held in 2012, I believe.

LABOTTThere's a couple of different -- there's going to be parliamentary and other types of elections. And, you know, there was a concern that the Egyptians -- 'cause the army said it didn't want to hold onto power -- was going too quickly. They've kind of slowed that down, but there's also questions as to whether there will be enough political space for various people in...

NAIMAnd in this the resignation of Minister Hazem El-Beblawi is very significant. He was not only the finest minister, he was also the deputy prime minister. And that shows that inside the government that continues to be a military government led by, you know, well, the military are very important as they were during the Mubarak regime, has raised divisions and difficulties. And they're managing a situation that is turning very complicated by the day.

PAGEAnd of course, in the aftermath of the Arab Spring, lots of new issues for the United States to address.

GJELTENWell, one of the complicating issues around Egypt is what is its new role going to be regionally? I mean, under Mubarak you had a government that was extremely loyal to the United States and a firm supporter of the peace process with Israel. All of this is changing now because we have a government that's a lot more responsive to popular pressures in Egypt. And the peace treaty with Israel is not popular. So we've seen new developments all across the region. I think we're going to talk about the prisoner swap in Israel.

GJELTENBut we see Egypt playing a role -- a new regional role here, much more of an assertive role regionally than it played under Mubarak and less of a sort of loyal U.S. ally.

PAGEElise.

LABOTTWell, there's been a lot of contradictions in how Egypt is going to treat Israel going forward. I mean, over the past several weeks relations between Egypt and Israel have hit their lowest point. There was this attack in Eilat. There was the Israel's killing of eight Egyptian policemen on the Sinai border. And then you had the Egyptian mob attacking the Israeli Embassy.

PAGEElise Labott. She's senior State Department producer for CNN. And we're also talking this hour with Moises Naim from El Pais and Tom Gjelten. He's national security correspondent for NPR. We're going to take a short break. We'll come back, we'll go to the phones and we'll read some of your e-mails. Stay with us.

PAGETom Gjelten, this is a deal that was long in the making. For five years, an Israeli soldier has been held captive. Finally, a swap approved for his release. Tell us about it.

GJELTENWell, that's right, Susan. And I think the question is, why now after all these years? What's changed? And I think it goes back to what we were just talking about, that, you know, this geo-politics of the region have shifted in the last six months and from Israel's point of view they may have concluded that this is, was the best and possibly the last opportunity to get Mr. Shalit released.

GJELTENHis cause, his case has been very widely followed in Israel. He's sort of a hero. He's been held Hamas since 2006. So Israel has its own reason for doing this. Now, from Hamas' point of view, what this sort of does is it diminishes the stature of Mahmoud Abbas, the head of the Palestinian authority on the West Bank, who's been getting a lot of attention lately for his initiative in the United Nations to get recognition for Palestine.

GJELTENSo this sort of bypasses Abbas and therefore sort of lowers his profile. So you can look at all the players here and for very different they had their own interests at this particular moment to do this.

PAGEA thousand prisoners will be released in exchange.

LABOTTActually, more -- just over thousand, 1,027. I mean, that is unbelievable. It's true, what Tom said, I mean, Gilad Shalit has become part of the Israeli national consciousness. Everyone thinks of Gilad Shalit as their son and -- but it also raises a lot of questions as to, if Israel said these people were so deadly and some of them have been attacked -- have been in prison for masterminding the deadliest of attacks against Israelis. If they're so dangerous, are you letting them out to create more Gilad Shalits, more attacks.

LABOTTAnd at the same time you'd like to think -- when we in this country think, is my country going to go that far to get me out of prison. But -- so there are some Palestinians that are criticizing the deal. These are people loyal to President Abbas but also the families of some of the prisoners, about 400 -- 178 of them are not going to be allowed to return to their homes in the West Bank or Gaza. Perhaps they'll be deported because there is a concern -- there's such a concern that they're going to launch more attacks.

LABOTTSo, Hamas said this -- the leaders of Hamas said this was negotiated person by person. They did the best they can do but they're not going to satisfy everyone. Some of the most prominent ones like Marwan Barghouti, who is seen as possible a future leader of a Palestinian state, wasn't let out. So as many families are going to be happy about this, many are not going to be.

PAGEMoises, the exchange is going to take place on Egypt's soil, why there?

NAIMBecause Field Marshall, Youssef Tantawi, is the head of the armed forces -- the Egyptian Armed Forces played an important role and Egypt played an important mediating role together with Germany. But Hamas said that Germany was too biased in favor of Israel and they really looked up at the Egyptians. This is in the context of a situation where historically during the Mubarak era and before there was a close relationship or a peaceful relationship between Egypt and Israel.

NAIMAnd now there are all sorts of anxieties about what happens with that relationship in the -- now and we have seen already flares of conflict. Remember that just a few weeks ago a mob of Iran and Israel embassy in Cairo, there have been incidents in the borders and so on. So the fact that the Egyptians are now becoming part of this -- facilitating this puts them back in a different path with Israel.

NAIMIn fact, Prime Minister Netanyahu thanked publicly the interim leader of Egypt, General Tantawi, Field Marshall Tantawi, and the other thing is that people are thinking if this is the beginning of some sort of negotiations -- this can open negotiations between Israel and Hamas and most experts say no. This is -- does not signal a new way of a new peace process between Israel and Hamas. But it's just the reaction of very strong public pressure in Israel to bring back Gilad Shalit.

PAGEElise?

LABOTTWell, just the small point that actually when you talk about Egypt and Hamas, I mean, Khaled Meshaal, the head of Hamas' political wing, was the leader of Hamas was in Egypt meeting with various people in Egypt and there is talk, Hamas -- given everything that's going in Syria, Hamas wants to move its political offices from Syria to Egypt.

LABOTTNow, I don't know if Egypt would be willing to consider that but all these contacts with Hamas are concerning and now Hamas says it wants to talk with President Abbas about negotiations. So this does strengthen Hamas' role, not only in the Palestinian territories but with Egypt and in the region.

PAGEHere's an e-mail we've gotten from Marie on this situation in Egypt. She says, "I think calling the situation in Egypt clashes between is wrong. That would be like calling 1960 Birmingham clashes between Bull Connor and marching blacks. The Copts are attacked, their churches are attacked for some time, years before Mubarak fell. Perhaps you could investigate why Copts have to tattoo their children's wrist with Coptic crosses. What do you think, Tom?

GJELTENWell, I think there is a sectarian element here and one of the reasons that we -- one of the ways that we see this is in the state media in Egypt, which was sort of rallying support for the soldiers that attacked the Christians and basically putting out this idea that somehow the soldiers were themselves the victims of attacks by Christians.

GJELTENAnd that was -- clearly was an effort to sort of stir up this kind of resentment against Christians. And we talked earlier about the -- how much more outspoken and assertive Islamic groups have become in Egypt. So I certainly understand her point, that, you know, that this is a very unequal dynamic but we cannot deny that there are some serious sectarian conflicts in Egypt right now.

PAGERuss has sent us an e-mail. He writes, "The panel -- the Senate passed a bill imposing trade sanctions against China unless it stops artificially depressing the value of its currency and some warned that such measures would threaten a trade war. Well, China does keep its currency undervalued to boost its exports, its trade surplus with us stands at $270 billion. It rampantly steals our intellectually property and massively subsidizing key industries. It seems to me that China has already started a trade war with us and that we've mostly responded for years with a policy that amounts to appeasement."

PAGENow, Elise, we saw the Senate pass a bill, doesn't have a prospect to passing in the House, but passing a bill that would, in fact, target China's currency and a bipartisan vote.

LABOTTA bipartisan vote advocates for the bill say it's going to make American goods more competitive and support more than a new million jobs. And what's the big buzz word in Washington now, jobs, jobs, jobs. But others are warning that it's going to provide Chinese retaliation and hurt America in this growing market and, you know, if you go back to people like Hilary Clinton saying, China's our banker. Should we really be angering China at this time?

LABOTTAdministration not happy about this bill, didn't come out publicly against it, but has been very lukewarm about it and it's going to continue to be an issue. They've been trying to get the Chinese to raise their currency. They did it a little bit last year but not nearly enough and, you know, it'll be interesting what's going to happen at the G20 coming up next month.

PAGEMoises, what was the reaction in China to the Senate's action?

NAIMThey insist that this can unleash a trade war, that this is protectionism. Let's remember that in the Depression, when countries are depressed, there are very strong forces that want to protect the economy in order to save jobs and to stop foreign goods from entering. It used to be then that with tariffs. U.S. actually put a levy, you levied a big tax on whatever you imported.

NAIMThat's not done now, but what you do, is you do through currencies. You undervalue your currency and you make it -- your goods cheaper in international markets and make it easier for others -- for your products to compete and that's what's happening. And not only China. China is not the only one doing this. Everyone is trying to undervalue their currencies to try to compete and so there is a possibility that you can have a trade war through currencies and through other methods.

NAIMIt's -- so until now it has been muted. After the financial crisis there were widespread expectations for a huge protection -- wave of protectionism, in which every country would ring-fence their economies to protect jobs. That, fortunately, did not happen because it would have actually made the situation worse. We know that protectionism doesn't work in the long run and it hurts workers in the long run, paradoxically.

NAIMSo we have now been able to stop that. I hope that this congressional intervention will not really make things worse.

PAGETom?

GJELTENWell, it's happening in the context of election cycle, which always makes the issues much more complicated and this morning, Mitt Romney had a column in the Washington Post where he basically endorses this move or some version of it. It's very tempting for politicians to sign up for this, which is probably why it passed. Now, it will not pass the House, as Elise said, but some -- many people are predicting that some version of it will.

GJELTENI mean, House Speaker John Boehner said he has grave concerns about it. But the politics behind this, you know, make it really tempting.

PAGELet's go to New Orleans and talk to Steve. Steve, thanks for giving us a call.

STEVEHey, good morning and thank you. Listen, I wanted to comment on the Iranian drug cartel story. I just feel like so much of the media is focusing on the wrong side of that story and ignoring the fact that the drug cartels present a real, everyday threat to our national security, one that is vastly greater than anything the Iranians can ever threaten to us. And maybe this would be an opportunity to reconsider our providing them with a monopoly on the distribution of marijuana.

PAGEAll right. Steve, thanks for your call.

LABOTTWell, I don't know -- I don't know if we should get into the legalization of marijuana. We'll get a lot more calls, but he does make a -- Steve does make a very good point, that there is not enough attention being paid to this menace in Mexico, the violence that the Mexican people have had to face in these drug cartels and the violence that's creeping across the border.

LABOTTThe U.S. is increasingly concerned about the drugs that are coming into this country. The drug violence that's a result of this and, you know, it is a bit of a wake-up call that -- could drug cartels be involved nefarious activity in the United States? You bet they can.

PAGEMoises, we had release of a report by the United Nations this week on torture in detention centers being run by -- in Afghanistan. What did this report conclude?

NAIMThe report covered detainees interviewed in 47 facilities in 22 provinces across the country. It was interviews taped during last year and the central messages, that there is widespread torture and abuse and sexual violence in these facilities run by the -- in Afghanistan. The detention systems are largely funded by American taxpayers' money and in training. So that again, in the context of the United States presence there and the notion that, you know, the plans to draw down their presence, this is another issue of great concern.

PAGEI'm Susan Page and you're listening to "The Diane Rehm Show." Tom, does this -- are we implicated in this? Do we think Americans knew that torture was going in these detention centers?

GJELTENWell, Americans know a lot about what's going in those detention centers. Nevertheless, the commander -- the U.S. commander in Afghanistan, General Allen, said that he was going to order an end to transferring detainees from U.S. custody to Afghan custody in the wake of this report, in response to the allegations that are made in this report.

GJELTENI think the important point here, and the really alarming thing, is that the whole U.S. withdrawal strategy from Afghanistan depends on turning over security responsibilities to the Afghans. We already know that they are unreliable in some many other ways and this is just one more example of how deficient an ally the Afghan government is and how unprepared they are to play the security responsibility role that they need to play if the United States is going to withdraw from Afghanistan and shift these responsibilities back to the Afghans. That's the -- I think that's the really -- the worrisome issue here.

LABOTTI completely agree. I mean, it definitely has the potential to undermine the strategic partnership between the United States, NATO and the Afghans and it has a lot of issues for funding. I mean, if this is found to be true, there are provisions in U.S. law that would prevent U.S. funding, critical U.S. funding, billions of dollars, that would go to training the Afghan security forces. So, it's, you know, the issues of torture are always concerning an individual cases but the larger implications are very important.

PAGECould it complicate the U.S. plan to draw down U.S. forces?

LABOTTI think it's going to have an impact on the various areas, the various provinces, maybe the order of the provinces. I mean, the U.S. and -- has been talking about getting out by 2014. last week on the show we heard some of the panelists talk about even earlier than that so there is definite rush to get out but the more that comes out about the, as Tom said, the lack of preparedness by the Afghan security forces, leaves a lot of concern of whether we're leaving precipitously.

PAGEMoises, we saw the Italian prime minister just barely survive a vote of confidence this morning. Why is he so embattled?

NAIMYou can pick a variety, you know, there's a long list of things. He's being accused of corruption. He's also being accused of sexual crimes, of fomenting prostitution, all kinds of things. His popularity ranks amongst the lowest in the world. He's -- only 20 percent of Italians support, only exceeded by support by the U.S. Congress that is now at 13 percent, in terms of popularity in the polls.

NAIMThere is -- this is a normal situation there in which a very weak president that no one likes has managed to stay in power for a very long time, essentially due to the nature of the political system and the nature of the electoral process and the nature of the opposition.

PAGEWe have such smart listeners on "The Diane Rehm Show." We've gotten several e-mails informing us about what man pad stands for. Here's one. "I'd like you all to know that man pad is a nickname for a portable launch pad. A man can launch a missile from anywhere, turning it into a man pad." And another listener sends a note, Mike, he sends a note saying, "It stands for Man Portable Air Defense System."

PAGESo we thank our listeners for keeping us informed on that. And I want to thank our panel for joining me this hour. Moises Naim, chief international columnist El Pais. Elise Labott, senior state department producer for CNN and Tom Gjelten, National Security correspondent for NPR. Thank you all for being with us.

GJELTENThank you.

NAIMThank you, Susan.

LABOTTThank you.

PAGEI'm Susan Page of USA Today, sitting in for Diane Rehm. She'll be back on Monday. Thanks for listening.

ANNOUNCER"The Diane Rehm Show" is produced by Sandra Pinkard, Nancy Robertson, Susan Nabors, Denise Couture, Monique Nazareth, Lisa Dunn and Nikki Jecks. The engineer is Aaron Stamper. A.C. Valdez answers the phones. Visit drshow.org for audio archives, transcripts, podcasts and CD sales. Call 202-885-1200 for more information. Our e-mail address is drshow@wamu.org and we were on Facebook and Twitter. This program comes to you from American University in Washington. This is NPR.