The future of the Middle East: strategic implications for the United States.

Gause, F. Gregory, III ; Mohamedi, Fareed ; Molavi, Afshin 等

The following is an edited transcript of the forty-ninth in a series of Capitol Hill conferences convened by the Middle East Policy Council The meeting was held on June 26, 2007, in Room 1334 of the Longworth Building with Chas. W. Freeman, Jr., presiding.

CHAS. W. FREEMAN, JR.: president, Middle East Policy Council

The subject we are talking about today wasn't of interest to many people not so long ago, but, quite tragically, it has now become almost a national obsession in the United States. The Middle East is not a pretty picture for American foreign policy. On the other hand, our backing of Israel's efforts to pacify the Palestinians rather than negotiate peace with them has discredited us as peacemakers without gaining security for Israel. Our attempt to isolate the democratically elected Palestinian government has further discredited us as supporters of democratization in the region. Among other results, our policy has quite predictably left Hamas nowhere to go but deeper into the embrace of Iran.

It has also catalyzed armed conflict among Palestinians, partitioned the occupied territories, encouraged the Israeli effort to crush or starve the Gaza ghetto into submission and very likely made the prospect of a just and lasting peace based on a two-state solution between Israelis and Palestinians more remote than ever. To Israel's north, our open encouragement of its war with Lebanon last summer succeeded in installing Hezbollah as the dominant political force in that country while cementing its ties to Iran.

Our recent efforts to block peace talks between Israel and Syria ensure a state of continued proxy wars in Lebanon, continued Syrian alliance with Iran and continued stalemate in U.S.-Syrian relations. But the best is yet to come. Further to the east and north, we are locked in a stalemate with Iran, which is building a nuclear deterrent against the attacks on it that we and Israel now feel obliged to threaten in order to deter it from acquiring a deterrent.

Our relations with Turkey are unprecedently chilly, and a war between Turks and Kurds in Iraq now seems quite possible. Meanwhile, the strategic ambush in Iraq continues to pin us down strategically to the benefit of al-Qaeda and other enemies of the United States. Iraq itself is now a country occupied militarily by us and politically by Iran. Our transformative diplomacy there, to borrow a phrase, has produced a catastrophic mixture of anarchy and gang warfare, mounting civilian casualties and collapsing infrastructure, and an eruption of embittered Sunni refugees who are spreading to every corner of the mostly Sunni Arab world.

About the only way we've managed to unite Iraqis is in opposition to our plan to retain bases in Iraq from which to dominate the region for the long term. We have finally recognized, however, that Iraq requires a political, not a military, solution, something our military were telling us from the outset. But in practice, we're still trying to impose a military solution on Iraq. Ironically, by doing so, we are actually precluding political solutions in Iraq. So we're caught in a feedback loop in which we have to put ever more troops into Iraq to counter the resistance that the troops we already have there have generated. We now face the prospect that bringing in more troops may simply generate more resistance.

The terms of domestic debate about Iraq in the United States have now shifted to one topic: how to create conditions that will enable us to withdraw. When you look below the surface rhetoric, that is the topic that everybody is discussing. Many believe that we cannot withdraw without making the situation even worse, but that seems very unlikely to deter the American public from pulling the plug on this adventure.

F. GREGORY GAUSE: associate professor of Political Science, University of Vermont

I'm quite struck by this concatenation of crises that Ambassador Freeman listed in his opening remarks. I think there is a tendency both here and in the region to see these as part of one crisis, that it is not an Iraq crisis and a Lebanon crisis and a Palestine crisis. It's a Middle East crisis. I cut out the headline from al-Hayat two weeks ago, which was the day that the minarets in Samarra's Golden Mosque, the al Askari Mosque, were struck; that Walid Eido was killed in Beirut; and that Hamas-Fatah fighting really heated up. There was a banner headline that connected the three crises. It said youm fitna al-tawil, Arabic for "a long day of civil conflict." But civil conflict doesn't really capture it. Fitna is about the worst thing you can have in the Muslim world: Muslims fighting Muslims, general conflict from Samara to Gaza passing through Beirut.

So people in the region think it's one crisis. Some of them think that it's a crisis united by the fact that Iran has its fingers in every one of those things. Other people in the region think it's a crisis united by the fact that we have our fingers in each of these things. I think that we should step back and try to think about this crisis in the Middle East as a broader crisis of authority throughout the whole Muslim Middle East. Each of these three crises that we have talked about is a contest over the organizing principles of politics in a particular country. Of course, it's a fight for power as well. The details in each case differ because of the particular histories of each place. But there is an underlying conflict in each case over how and to what extent Islam will define politics.

This regional crisis is not as violent elsewhere as it is in Palestine, Lebanon and Iraq. But that doesn't make the crisis any less important in the places where it is less violent now. This crisis of authority is the defining context of political struggles across the Muslim world, but particularly in the Middle East.

This is not a binary conflict, with Islamists on one hand and secularists on the other. The Islamists are divided by sect and by strategy. And the secularists are not really secularists. They don't want to separate religion from politics, at least in our sense, but they are not in favor of the complete Islamization of politics the way their opponents are. And these secularists are divided as well. There are authoritarian leaders. There are liberals who don't like authoritarian leaders, but see the alternative as worse and thus back the regimes. There are real democrats who are fed up with the regimes and don't particularly like the Islamists but think that they can deal with them and are willing to trust alliances with moderate Islamists.

This is the context of politics: the context in which al-Qaeda has arisen and presented its challenge. It's the context of the electoral successes of Islamists across the region. It's the background of past civil conflicts in Algeria and Egypt in the 1990s and Syria in the late '70s and early '80s. And it's not always Islamists in opposition and the more secular forces in power. In Iran and Turkey, it's the other way around.

I don't think that this crisis is best understood as a clash of civilizations. It's both a clash and a dialogue within a civilization, although it's linked to us in ways that I'll get to. It's also not best understood in the Bernard Lewis framework of a centuries-long decline of Islam (what went wrong?). This is a modern struggle about ideas and power in the context of independent states, and it's fought with modern means of political mobilization. Even those Salafi groups that self-consciously look to the distant past for their models of how politics should work fight these battles with means that are more Leninist than medieval. They are modern groups even though they evoke a past model for their politics.

These ideas, I think, are wrong because they put too much emphasis on us as opposed to the real fight within this civilization. And these binary models don't appreciate the differences among the players in the region. I don't think that this crisis of authority is best understood as a Sunni-Shia conflict. It manifests itself in sectarian ways in some places, but it's never been a clear binary division.

Look at Iraq now. Sectarianism defines part of the political contest, but you have intra-Sunni and intra-Shia fights over power and also over ideas about what Iraq should look like. Who is going to win this crisis of authority? It is not inevitable that the Islamists will win, though they are the best-organized political force on the ground.

We must recall that the three crises that we have in front of us today are occurring in countries where the administrative state has been weak--either historically, as in Lebanon or Iraq, or as in the Palestinian territories, or because outside forces have worked to weaken that administrative state. But elsewhere in the region, the administrative state remains much stronger. The secular authoritarians in Egypt and Algeria won their civil wars in the '90s, as did the secular authoritarian regime in Syria in the early '80s. The Saudis have been able to put down the al-Qaeda threat to their regime. In Turkey, the administrative state--the army and the judiciary--are pushing back against Justice and Development. These states are not pushovers; they control resources, particularly in oil states. They have strong coercive apparatuses, they have built patronage networks to give them a social base, and they have strong international support.

So the Islamists will not necessarily win this crisis of authority, but where does the foreign-policy component come in? This crisis of authority does overlap with the current struggle for regional dominance, because Iran supports Islamist groups, both Shia and Sunni, in an effort to extend its influence. And regimes in Egypt, Jordan, and Lebanon, and the Saudi Fatah in the Palestinian territories see them as threats to their own domestic stability because Iran supports a notion of politics that runs counter to the organizing principle of these regimes.

Sometimes Iran actively supports groups like Hezbollah and Hamas; sometimes it doesn't, but it supports an idea that cuts at the political legitimacy of these regimes. Iran also uses the Arab-Israeli conflict to bridge the sectarian and the national gap and to mobilize support against Arab governance. Last summer's Israel-Hezbollah crisis is a perfect example. This is why these more secular governments would like to see some progress on the Arab-Israeli front, to take this issue off the agenda so that Iran cannot use it to mobilize support.

This is where we come into the picture. These more secular regimes have tied themselves to us to some degree or another. They accept our view of how the Middle East should work. The Islamists, on the other hand, do not accept American foreign-policy goals in the region. This is true of the Islamists who want to kill us, like al-Qaeda, but it is equally true of the wide spectrum of Islamist organizations, from the radicals to the moderates, from the gradualists to the violent. None of them accept our idea of what an equitable Arab-Israeli solution would look like. None of them like the idea of American military bases in the region. None of them accept that we should have the kind of influence in the Middle East that we want to have. So what is to be done?

We have tried in the post-9/11 period a policy of smashing authoritarians and encouraging popular participation. What we have gotten, as Ambassador Freeman said, is civil strife and the gains of Islamists at the polls. They are the best-organized social forces in these countries. This should be a warning to us.

Our ability to affect this crisis of authority in the region as a whole in predictable ways is extremely limited because it's not basically about us. So I would urge us to resist our impulse to immediately do something when things happen in the Middle East. The Hamas takeover of Gaza is not a threat to American interests. Israel and Egypt will handle it. We should resist the temptation to throw ourselves in the middle of this. I think we should back off our democratization push, but I think we have already done that.

I'm not advocating that we turn back democratic advances when they happen. I don't think we should be supporting the Turkish military and elements of the Turkish administrative state in their effort to in effect cut out the Justice and Development party from power in Turkey. The Justice and Development government in Turkey has basically been cooperative with American foreign-policy interests.

I think we should be concentrating more on traditional state-to-state issues of regional power, working to prevent the spread of Iranian influence through traditional diplomatic means, state craft, and working to make sure our violent enemies--al-Qaeda and its ilk--don't make any more gains. And I think we should be looking to get out of Iraq. The Arab-Israeli conflict is too complicated to solve in five seconds, so I'll leave that to later.

AMB. FREEMAN: I think we will find in the discussion two issues which I will try to frame now and hope to hear you speak to them later. The first was epitomized by an Iranian with whom I spoke several months ago, who said that, when the United States began its drive for democratization of the region, people in Iran wondered whether we knew what we were doing. Now they know we didn't know what we were doing. Every democratic experiment worked to their advantage rather than to ours. Therefore, they could understand, this man said, why we would have decided to abandon our drive for democratization. But, on reflection, Iran thought it was a pretty good idea and was prepared to pick up where we left off.

This brings me to the second point: whether Hamas does not represent more than a threat simply in the sense of being the first serious Sunni Arab ally of Iran in the region, but also because it believes that it unites political Islam with democracy and a willingness to alternate in and out of power through elections. This ultimately threatens the legitimacy of the neighboring states--whether Egypt, where you have the Muslim Brotherhood, a parent of Hamas, or Saudi Arabia, where Salafi Muslims calling themselves Wahhabis have found it necessary to ally with the Al Saud to achieve power.

What Hamas believes it is demonstrating is that you don't need to ally with a prince or a strongman or a dictator to pursue your political agenda; you can legitimize it directly at the polls. Therefore, ruling families and existing power structures no longer have the essential utility in the eyes of Islamists that they may once have had.

FAREED MOHAMEDI: partner, head of Markets and Country Strategies, PFC Energy

I have become very optimistic about the economies of the Gulf and see them as potentially a way out for the whole region. This is a sort of engine that could get us out of the development crisis that the whole Middle East is facing.

I would also like to pick up on one thing Greg said about state capacity. I have just read Charles Tilly's Democracy, and I highly recommend it. He puts state capacity on the Y axis and democracy on the X axis and then traces paths that states have taken. The basic line is that if you have weak capacity, you're not going to get democracy. Destroying states doesn't work. In fact, usually it works the other way. Increase the side of state capacity and you'll most likely get more democracy.

I see this happening in the Gulf. That is what makes me optimistic. It's not the buildings that are going up, it's not the snow mountain in Dubai. It's the public-private partnerships that the Gulf governments have discovered, and they, in a sense, discovered this in the crisis years of the '90s when Saudi Arabia effectively went bankrupt and the Gulf was in the doldrums of low energy prices.

In those days, they looked over at Asia and said, "there is a twofer in Asia; there is a model for us. We can have authoritarianism with market capitalism; we can have it both ways." That is what the Asians have taught us: we have to have a strong state; we have to invest in all of that; and we can harness private capital. To some extent, Dubai is a pioneer on this front, but certainly all of the other Gulf countries have also caught on. Clearly the Saudis have.

Of course, a lot of bad things could happen alongside of the good, and possibly bad policies could derail the process: but this process is very important, and it is deepening development. The private sector has caught on, and in a sense, you have a virtuous cycle in place: good public policy, private-sector investment, more good public policy encouraged by that, and the opening of different sectors on many levels.

Take Islamic Banking as an example of good policy making. I had always been very skeptical about Islamic banking. I thought it was just merchant banking with a new catchy name. But what I find very interesting about Islamic banking ties in with what is happening in the Gulf in terms of public-private partnerships. For example, the Central Bank of Bahrain has innovated by creating new banking regulations, completely new accounting standards, and a completely new way of rating these Islamic banks. Suddenly, you have "development" going on--a new industry being created and not just another bank trying to get you to deposit money or invest in another "snow slide." You can also see this happening with regard to the growth of the insurance industry.

The second element of the development process taking hold in the Gulf is that they have harnessed globalization. What is Dubai if not a way to create development and growth through the export of services. The Gulf is getting tied into Asian growth and to European growth. Gulf countries are exporting capital but creating new business services in a whole host of areas that link back to the region and put them at the center of that growth.

Third, the Gulf is harvesting energy in a new way. "Old energy"--upstream investments are still going on. Saudi Arabia is going to expand its oil production capacity from 10 to 12.5 million barrels per day. Qatar is going to be the new center of global gas. But there are two innovations going on in the energy area in addition to this. One is that the national oil companys' capacity have been enhanced. Remember, I said that as you enhance state capacity, you may get closer to democracy and development. In the same sense, if you enhance the most important institution in your country, the national oil company, you enhance state capacity. And there are some a really interesting things happening on that front. Secondly, energy is an area where the private sector is now allowed to invest, and the private sector has become very excited about that.

I think all these developments I have mentioned could have both a demonstration effect and a financial effect on the rest of the Middle East. You've started to see some of that in Egypt, which grew 7 percent last year. Investments are going into North Africa, possibly spreading later on into the Levant. Twenty-five years from now, possibly reconstruction funds from the region may also go into Iran and Iraq to rebuild those economies.

Just as in 1975, if you sat in Singapore and looked at the Southeast Asian region, you would never have called it "the sexiest place to invest your money," as we do today. There had just been a massive bloodletting--genocide in Cambodia, the Vietnam War, all of that. You have nothing on that scale in the Middle East today. But public-private partnerships came together in the 1970s and 1980s to create in Southeast Asia one of the most dynamic economic centers in the world.

I think the greatest potential danger to this optimistic scenario is an attack on Iran. I see that as a disaster for the region. The private capital that has come back to develop the region in will run away if there is conflict with Iran. The Iranians will light up the rest of the Gulf--they're not going to stand by and take it.

AMB. FREEMAN: On Thursday, I was in Toronto at an airport hotel meeting with various people with whom I'm trying to do business because, of course, they can't come here anymore, which raises an interesting question, Fareed, that we might get into. Yesterday, Goldman Sachs issued a report noting that the largest market capitalization now in the energy sector is no longer in companies anchored in the OECD, but increasingly companies in Brazil, Russia, India and China--the so-called BRIC countries. There's a boom going on. There is ample grounds for optimism about what money can do if allowed to do it, but who's going to benefit? Are Americans going to benefit, or is the benefit going to go elsewhere? In the end, national interest is the measure of all things in foreign policy, and we need to consider it.

AFSHIN MOLAVI: fellow and director, Middle East Global Initiative (MEGI), New America Foundation

Before I turn to Iran, I will touch on a couple of things Fareed Mohamedi said. Maybe I am on the same medication, because I have been spending a lot of time in the GCC recently, and I share Fareed's optimism. In some respects, we almost have two Middle Easts forming. When you look at the region today, you see this sort of arc of crisis or failure or potential instability from Egypt through Israel, Lebanon, Syria, Jordan, Iraq and Iran--the northern tier. Then, when you're in the GCC countries, in particular, it's almost as if you're in a different Middle East. Let me just give you an example.

I was in Muscat, Oman, a couple of years ago at a beautiful hotel which I recommend to all of you on your next trip to Muscat--the Chedi Hotel. Lying on the beach, I had a crisis of my own. I had run out of suntan lotion. So I went back to my room and turned on the television. CNN International had a headline, "Crisis in the Middle East." There was another bombing in Gaza. It didn't feel like a crisis in Muscat or in Dubai, where I had just been. At the height of the Israel-Lebanon-Hezbollah war last summer, more than 10 million Saudis were on a stock-buying frenzy. In the most highly anticipated initial public offering in Saudi Arabia, half of the adult population bought stock in the King Abdullah Economic City, the Emaar project. Yes, they watched al Jazeera and grew angry at the scenes of carnage in Lebanon, but that didn't stop them from their stock buying binge or, by any meaningful measure, halt the Kingdom's economic boom.

So, now back to Iran. When we think about a U.S. retreat from Iraq, a word that often comes up is "vacuum." And a few words from "vacuum," you often see the word "Iran" as the potential for filling that vacuum. It has also become fashionable to ask the question, "Who has won the two post-9/11 wars?" The fashionable answer has become "Iran." To some extent, you can understand this response. The strategic climate has shifted in Iran's favor as a result of the two post-9/11 wars.

The perception is that Iranian power is on the rise. The Taliban was never a serious threat to the Iranian state, but the Taliban was a foe of Iran, and they did provide Saudi Arabia and Pakistan power on Iran's border in the East. Saddam Hussein's Iraq was contained, but Iran did not have nearly the kind of influence in Mesopotamia that it does today. So the strategic climate has shifted in their favor, but I think we tend to go overboard to some extent in our assertions of Iranian power. Les Gelb at the Council on Foreign Relations said we almost attribute free power to Iran.

When you look at Iran's economy, the state of its oil industry and its lack of economic integration with the world, Iran doesn't look like a very powerful state. I'd like to make an argument to some extent puncturing the myth of Iranian power. Having said that the strategic climate has shifted in their favor, it is important to note that Iran's economy is in quite bad shape. Iran experiences anything from 15 to 20 percent inflation, widespread unemployment and underemployment, and stagnant wages. President Mahmoud Ahmadinejad has been drawing down Iran's rainy-day oil fund and there has been a massive amount of capital flight, particularly to Dubai, since Ahmadinejad came to power. Dozens of Iranian economists have written open letters to Ahmadinejad criticizing the way he is handling the economy. It's become a serious political issue domestically.

Yesterday I poked around the web and looked at the various indexes that are out there--for example, the World Bank/IFC Doing Business report, where Iran ranks very poorly at 119, just ahead of Albania and just behind Guatemala. Interestingly, when you look at the World Bank/IFC Doing Business reports for the Middle East region, the countries that come out looking very good are the GCC countries. Saudi Arabia ranks the highest in measures of the ease of doing business, followed by Kuwait, Oman and the UAE. The same goes for most of the business/economic indexes out there--the GCC states certainly benefit from oil and smaller populations, but they also organize their economies better than most of the region and exploit globalization skillfully and thus maximize their potential.

When you look at the World Economic Forum global-competitiveness rankings, Iran does not merit a ranking. In the Heritage Foundation Index of Economic Freedom, Iran ranks at number 150, below Angola, Guinnea Bissau, and Chad, and just ahead of Congo, Turkmenistan, and Burma. This is, obviously, not good company. If you go to the website called Dinar Standard, which follows business in the Muslim world, and look at the "Top 100 Muslim World Companies," you see some of these public-private partnerships doing very well. But you also see only three Iranian companies in the top 100, two of which are state-owned. You do see dozens of Turkish companies, several Saudi companies and several Malaysian companies. It is a measure of the global weakness of the Iranian private sector, a private sector that should be able to compete with the best Turkish and Saudi companies. Take a look at the telecom world. You find companies like Egypt's Orascom that are making regional and global waves. When Saudi Arabia launched its recent GSM license, you saw major telecom providers around the region bidding for it. Iran was absent from the scene. Iran also ranks poorly in the UN Human Development Index, at 96, just ahead of Georgia, the Maldives, Azerbaijan, and the Palestinian territories. In the A.T Kearney/Foreign Policy magazine globalization index, Iran ranks dead last, at 61, for five years running. This is particularly sad given the fact that Iran arguably was the world's first globalizer with the eclectic and far reaching and tolerant empire of Cyrus the Great. To go on, global ratings agencies mostly give Iran a pass, except for Fitch which gives it a BB-grade. In contrast, the GCC states all get high marks from the ratings agencies.

Of course, one might say that Iran dereives its power from ots oil and its military, not its business regulatory environment or the state of its economy. Firstly, I'd suggest that China's growth to a world power today has much more to do with its economy than its weapons. In the case of Iran's oil, its reserves are depleting fast to the tune of 200,000 barrels a year. Iran is producing 4 million barrels per day; it exports 2.5 mbd because it uses 1.5 mbd at home. As a result of lack of refineries, lack of investment in its oil infrastructure, Iran imports 40 percent of its gasoline needs, it has some of the cheapest gasoline in the world. They've been talking about a gasoline-rationing system for a long time, but they still haven't been able to put that together [they have now done so, but Iran still has some of the cheapest gas in the world and is still largely depend on imports.].

Iran's oil minister notes that Iran needs $100 billion in investment to reach its target of 5 mbd of production. Where will they get this investment? There's very little in the way of investment moving to Iran as a result of a wide variety of things, including the showdown with the US, the tense political climate, and also the way the state deals with private investment. Oil-industry analysts and consultants--people like Mehdi Varzi and Narsi Ghrban--have written often that many energy companies are willing to brave sanctions, but Iran is not providing them proper terms. They say, according to Ghorban, that "Iran is its own worst enemy" in the oil and gas world.

In terms of the military, I would highly recommend Anthony Cordesman's reports on Iran's military, particularly "Weakling or Hegemon?" But I think we overplay Iran's military abilities as well. They have about 1,600, mainly obsolete, tanks. Iran's war planes are aging, and its most sophisticated weapons systems are its defensive ones. This is not a picture of a country that has done a great deal to maximize its power. So, where does Iran derive some of the power that we're talking about?

They have a certain amount of spoiler power: their influence, as Chas. Freeman noted, with Hezbollah, their influence with Hamas, their influence in Iraq and Afghanistan. Iran has influence in places that we value. So, in a sense, we have given them their power. If Iran had militias in the Central African Republic or the Southern Philippines, perhaps we wouldn't be so worried about its power.

It is worth noting that we are experiencing this historic boom, and not only in the Persian Gulf region. There is even a new Silk Road forming of trade between the Middle East and Asia. Iran likes to talk about itself as formulating an independent foreign policy, but it's very much isolated from the region. If you compare Saudi Arabia's and Iran's relations with China, Saudi Arabia's relations seem to be more strategic, and China seems to view Saudi Arabia as more of a strategic partner. They have said as much. Iran's relations with China are more mercantile. Chinese Presidennt Hu Jintao, who globetrots regularly, has never seen fit to visit Tehran as president. What's more, Chinese oil companies are given government support if they invest in Libya, Morocco, Oman or Qatar, but not Iran.

But in the midst of this historic Gulf boom and this growing trade and investment between the Middle East and Asia, Iran is to some extent the sick man of this new Silk Road. Its economy is diseased, somewhat sclerotic. So we go back to the original question: who has won the two post-9/11 wars? Iran has won them, but not on its own. It has far more to do with what we have done in the region to empower Iran.

AMB. FREEMAN: I think that is a useful reminder that, by virtually any conventional measure, Iran is a weak state, and that perhaps we should be more concerned about the prospect of Iranian failure than Iranian success. But, even if it's not an effective competitor with others in the region or with us, we have made enough mistakes that it has been able to scavenge many advantages for itself. So I would agree with you that it is a scavenger in many respects, rather than a country on a roll.

WAYNE WHITE: former deputy director, Near East and South Asia Office, INR, State Department

Unfortunately I'm going to have to break with this optimistic theme that's been prevailing through the last two talks and take us in another direction.

Back in April, I did a week of seminars at Virginia Military Institute for award-winning ROTC second lieutenants, the new second lieutenants from around the country. This is the eighth year I have done this, about 40 miles up the road from Virginia Tech. This year's seminar began two days after the Virginia Tech massacres. I can remember driving down the Shenandoah Valley on the way from Pennsylvania to VMI seeing weeping parents headed to Virginia Tech. There was national mourning. I heard the president's speech as I was driving down there.

Two days after the massacre, my seminars opened. In that one day, almost 200 Iraqis were killed in suicide attacks--over six Virginia Techs. One fundamental tenet of grief counseling is to tell someone who is intimately involved with a certain event that it is a one-in-10-million occurrence; it will never happen again. Unfortunately, we can't tell that to Iraqis. After enduring six Virginia Techs, the next day they endured three more, and on and on and on. We have perhaps 15-20 million Iraqis who either are now refugees outside or displaced inside their country, or they're living in areas that are still very, very high risk in terms of violence. I can assure you that all are in need of grief counseling, but they will probably never receive it.

In all respects--putting aside casualties, metrics and all of that--we're dealing with a very traumatized, shattered and embittered society. Building anything in this environment is going to be terribly difficult. Only people having visited Iraq back when I did the first time, in 1981, can appreciate the sheer destruction that has been taking place in the country, all the way down to the continued looting of Iraq's heritage at scores of historic sites.

One of the big questions right now is, can the Maliki government get its act together? The Alawi government didn't; the Jaafari government didn't. And we have to point out that, like his predecessors, he presides over governmental shambles with a thick overlay of Shia militia influence, separatists and insular Kurdish governance in the North and expanding into participation in Baghdad, local government in large areas that is almost non-existent or disconnected from Baghdad, and tremendous corruption, even more so than under the sanctions regime. There should be no great expectation that he or the Iraqi parliament can get its act together or implement some of the sound policies or measures that they've been asked to produce in response to tremendous pressure from Washington.

In fact, just as in my favorite scene in David Lean's Oscar-winning 1962 classic, Lawrence of Arabia, the famous tribal sheikh played by Anthony Quinn is told that Aqaba must be taken. Who's going to take it? The Arabs, he is told. Who are the Arabs, he asks? He says all he knows are tribes. What we're confronted with often are Iraqi politicians who beat their breasts in public about the Iraqi cause and the Iraqi this and the Iraqi that, and then go back into their smoke-filled rooms and act as Shia or Sunni, people who relate more to their own tribes or their ethnic and sectarian communities than to the central government. Iraqi identity at present is very much challenged inside of Iraq, part of a greater problem.

Turning to the current surge, it should come as no surprise that it has been slower than hoped in producing results, results that are generally uneven or far less complete at this stage. As Chas. knows, I was asked to draw up a surge proposal for the Iraq Study Group as one of its experts, linked to a full withdrawal starting one year after the surge if the surge was not successful. That surge plan called for a minimum of 64,000 or more troops.

AMB. FREEMAN: By which you meant combat troops, not logistical-support troops.

MR. WHITE: Combat troops plus some training personnel. I coordinated this with someone who was working with our military out in Baghdad; I gave it a substantially less than a 50-50 chance of success, at great cost in American lives and treasure. So you can imagine what I think of a surge originally proposed at 21,500 and now just under 30,000. I don't think it has much of a chance for success at all.

There are surprises that should be no surprises at this point. Every single time there has been a major effort to stabilize the greater Baghdad area, the insurgents have cleverly shifted much of their activity to areas north and south of the capital, primarily to the north. Another non-surprise is the disappointing performance on the part of Iraqi security forces. As always, they're doing a bit better than before, but far below expectations. And their main problem isn't training. It's far deeper. It's something we've discussed before on the political side: loyalty, very basic loyalty.

First, who can expect Iraqi soldiers to police or to lay down their lives for an iffy government sheltered under American protection in the Green Zone, with very little authority extending beyond? Many soldiers have much older and more dominant loyalties in any case, whether to their ethnosectarian communities or even militias like the Kurdish Peshmerga. These soldiers often speak openly about such alternative loyalties, and who can blame them? In the chaos that is present-day Iraq, they need an anchor in their own personal world, one they can truly rely on. That is not yet the government in Baghdad.

Meanwhile, here in the States, domestic poll numbers make the issue of whether we will be departing within the next two years or so moot. At least I think so. In fact, the more the formulation of a clear exit strategy is postponed, the greater the risk of a less gradual and orderly departure down the road. Indeed, the good news from Anbar about Sunni Arabs and insurgents finally going after al-Qaeda in Iraq and other jihadists in their midst must not be taken as meaning we should stay. It should rather be a timely gift with respect to our ability to conduct a more orderly and peaceful withdrawal. In this, I'm very encouraged. But every strategy at this stage must be an exit strategy, and we must make that clear to all concerned inside and outside Iraq.

If Sunni Arabs ever manage to deal a serious blow to the jihadists in their midst, the next option on their agenda would likely be ending the occupation--in other words, turning against us once again. And something should be made crystal clear: critics of the war and the declining American domestic support for it that I've already mentioned are not to blame for the failures in Iraq. Four years of failure on the ground in Iraq, and efforts to cover up the full extent of that failure, are responsible for the declining support here at home. Let's not put the cart before the horse.

Another common theme is that those advocating withdrawal just don't understand the serious consequences of doing so. Unfortunately, most of us old Middle East hands understand all too well some of the consequences. But many critics of the critics are making a potentially even more dangerous assumption. Given the way things have been going, we could remain three, four or who knows how many more years in Iraq, losing as many as several thousand more dead, many thousands more terribly maimed, spending $400-$500 billion more, and still incur those same consequences after leaving.

Some might say leaving is the worst possible option with respect to the current situation in Iraq. But, to paraphrase Churchill's statement about democracy, withdrawal from Iraq is the worst possible option, except for all the others.

AMB. FREEMAN: We will, I think, have to come back to this question of what happens if the American people do pull the plug on this adventure, as I believe they are steeling themselves to do, regardless of the consequences in Iraq and for the region. And we also need to contemplate what happens in the United States politically thereafter. There's been much made of the analogy with Vietnam. I think the correct analogy is the Soviet experience in Afghanistan or the French experience in Algeria. I can already see people preparing the case for the theory that we would have won had the Left not stabbed the enterprise in the back. This war, in other words, in addition to diminishing our influence globally and shattering it in the region, has the potential to be the most divisive event in our history. I am not encouraged in this regard, as we turn to our military expert on the panel, by the fact that professional military men have found it necessary to break with those under whose civilian authority they previously served uncomplainingly in order to voice criticism of policy. On the one hand, one can have respect for their courage in criticizing the commander-in-chief. On the other hand, the implications of a military that feels free to break with its civilian commander are not pleasant to contemplate.

I should note that, although I mentioned Afghanistan just now, we have not spoken of Afghanistan, which began as a punitive expedition, became an occupation against rising resistance, and today has as its principal achievement making Afghanistan safe for cultivating poppies and out-competing everyone else, including Myanmar, as the supplier of heroin to the world.

ANTHONY H. CORDESMAN: Arleigh A. Burke Chair in Strategy, CSIS

First, let me stimulate people by saying I do not really associate myself with many of Chas.'s op-ed pieces in introducing us. I think that, frankly, we have made mistakes. We've always made mistakes in the Middle East. The problem, however, is not American foreign policy. The Middle East is perfectly capable of making plenty of mistakes on its own without any outside help and regularly does so.

What I was asked to do is to talk about what the U.S. strategic role should be in the Middle East, and particularly what military changes are needed. We have five key issues to deal with in one way or another. We have to adjust our military posture in Iraq, and when we do that, we have to adjust it in the Gulf as a whole. Iran is not a strong conventional power, but it is creating a significant capability to produce nuclear weapons. It is deeply engaged in producing long-range missiles. It is strengthening its asymmetric-warfare capabilities, and it is increasing its use of proxies outside Iran.

We are dealing with a war in Afghanistan that has turned out to be a much more complex exercise than we planned, not because we're occupying it, but because we are involved not in counterinsurgency or counterterrorism, but nation-building. That is a task that takes some 10 to 15 years if you wish to be successful, and if you can be successful. And these are assumptions Americans find very difficult to deal with.

We like wars that are simple, quick and easy to deal with. But there is virtually no near-term prospect of significant progress in any aspect of the Arab-Israeli peace process and you have to deal with security and the military and eight dimensions of that reality. Finally, you have to deal with the realities of neo-Salafi Islamic extremism and the Sunni and Shiite issues as they spill over into our security interests. We need to remember that these problems are endemic to the region. They will spill over onto us, and they are going to occur almost regardless of what happens in Iraq and Afghanistan because they are deep, endemic problems throughout the region, as Greg Gause has said.

How do you adjust your posture? I think we need to be very careful in Iraq. You heard a very good description of the problems there, but it isn't a matter of staying the course or leaving. One way or another, we have to figure out how to phase out of Iraq and what the consequences of doing so are. We have to figure out how we're going to treat the Kurds and the whole problem between the Kurds, the Arabs and Turkey. I am not personally deeply committed to the Kurds, but very few people as yet are willing to walk away from them if they don't serve our strategic interests. Even fewer are willing to discuss what the consequences are of actually aiding them. I think you have to leave in ways that do not aid the Shiite government in power today at the expense of Sunnis. You have to find a balance that reassures our Sunni allies and do so in the least provocative way possible. If you have an all-out bloodbath--and I do not predict that--you have to consider what kind of buffers you might or might not have to establish. It's easy to talk about leaving a civil war behind, but as Rwanda and other cases have shown, if it actually happens, it's a lot harder to leave.

One way or another, we are going to have to adjust our overall posture in the Gulf, and I'll very quickly point out a few things we'll have to deal with.

We're not going to have a grand bargain with Iran. Iran is not misunderstood; it's understood all too well. We're going to have serious problems, not with a superpower, but simply with Iranian opportunism, Iranian operations at the margin. They are not a major conventional threat, but the sheer scale of the Iranian nuclear and missile effort is something people have to take very seriously. You have to deal with the reality that the GCC is not effective--will not be--and is incapable of becoming a useful security structure, a message you will get from talking to virtually any senior defense official in the Gulf.

You are not going to shift the burden to NATO or other countries. I've been listening to out-of-area ideas since the mid-'60s; so far we have produced rhetoric, an intellectual vacuum and posturing. It hasn't helped. Above all, we need to understand that a lot of the progress in counterterrorism in this region comes from quiet, covert cooperation on a bilateral level. It is absolutely critical to maintain the access and the capability to do that and not posture about how to do it.

One key message I would give is this: when you leave, you'd better have consulted all of the Gulf countries that are friendly to us beforehand. You'd better have discussed what your aid and cooperation options are. You had better listen to them and take what they say seriously, rather than going out to lecture them.

In terms of Iranian proliferation and asymmetric capabilities, let me make a few unpopular points. It is perfectly credible to exercise a military option, and it does no one any good to say you can't do it. The problem lies in the consequences of doing it and the political and strategic impact. It is also premature to attack a country whose forces are not ready and which has not yet invested in its facilities. This is a decision we can defer.

What we can't defer is the option of talking to people in the Gulf about how best to contain this effort, how to find alternatives to a military option, whether it's missile defense, whether it's extended deterrence. These are signals we need to send to Iran. I think we need to work with the Gulf states in checking Iran's ability to use asymmetric weapons, which involves passive as well as active defense; and we need to maintain a very strong and significant air and naval capability in the Gulf as a deterrent, one which is carefully structured to send the fight signals to Iran and our allies in the Gulf, not provocative ones.

In Afghanistan, the message that you get from people like General Eikenberry and Ambassador Newman is that you need a five-to ten-year campaign to improve governance and aid, not merely a military option. That's a message that is to some extent in the new aid request, but we seem so far incapable on a bipartisan basis of caring what our longer-term policies and postures in the region are.

In the Arab-Israeli area, I don't think that you are going to move away from aid to Egypt and Israel. Preserving Israel's conventional edge is the best way to limit its military problems and, indeed, actions. You are not going to succeed in military assistance to Lebanon. It is incapable of creating effective military forces, given its confessional divisions, but you cannot avoid military assistance in trying. You do need very much to consider what you do in terms of strengthening Jordan and Egypt, and somebody needs to look very, very hard at post-Mubarak Egypt, which as a strategic and military problem is one that you simply cannot defer while talking about political solutions you're not going to achieve.

Finally, just one comment about neo-Salafi extremism. It isn't going to be halted regardless of what happens in Iraq, Chechnya or Afghanistan. The best approach to dealing with it is, as I've said, regionally through cooperation and counterterrorism that is bilateral. Anyone who seriously works this issue knows it's fine to have meetings about international institutions, but, like most dialogue in the Middle East, it is essentially purposeless in terms of altering the endgame. Talk doesn't produce results. If you are going to batch this with economic and political reform, with real change, you have to have country teams that are capable of doing so. You need to have patience. You need to have expert dialogue with both governments and reformers in these countries, and it must be done, again, on a bilateral basis.

One final comment: we keep confusing democracy with political legitimacy. The quality of governance, as was pointed out by another panelist, is far more important. So is economic development, pushing people to progress in human rights, in the rule of law, and moving towards something that can create sound, meaningful political parties. Let me note that the classic example of democracy, Athens, had about six good years as a democracy and about 150 of being either oppressive, incompetent or self-destructive. I can't think of a more dismal classic example to bear in mind. We are not a democracy. We're a republic with checks, balances, mature political parties and all the other elements. I would hope that the next administration will bear that in mind.

AMB. FREEMAN: Two themes in your remarks really strike home. One is your essential agreement with His Royal Highness Prince Turki al-Faisal, who said that the United States went into Iraq without consulting with the region, and it should not leave without consulting with the region. When Iraq is over, however it ends, we will still be in the ironic position of defending the world's access to energy without the support of the world. What we are defending is not an American interest. It is a global interest that we have assumed the responsibility for protecting, and that in turn will require consultation, as you said, with the countries in the Gulf that are the major source of the world's future energy as well as a significant part of the current supply.

It is worth noting the difficulties that our Africa Command is having in finding a welcome in Arab North Africa. The quality of relationships, the sense of confidence or the lack of it in our intentions, and our wisdom and our staying power all have a great deal to do with what we are able to achieve and who will support it.

DR. GAUSE: This larger question of the return of religion in a political context to frame politics is much larger than simply the Muslim world. It's happened in the Hindu world. It's happened here in the United States to some extent. Gilles Kepel, one of the best analysts of Muslim politics, wrote a book called La Revanche de Dieu (The Revenge of God), and I think that rather than seeing secular nationalism as the North, we should see it as a notion inherited from the former colonial powers that dissipated as the colonial powers' influence waned. That doesn't mean people aren't attached to their country. I think the most significant religious-political organizations, whether in the Islamic world or other, are the ones that can marry up Islamic themes with the national agenda.

That's why Hamas has been so successful so far. It marries up the national theme of fighting the Israelis with an Islamic vocabulary and context. Hezbollah in Lebanon consistently puts forward its program as a national Lebanese program, not as a sectarian party, although they act that way, obviously, in the struggle for power.

Let me say something about foreign workers. I think that the foreign workers' situation in the Gulf is an important social issue but not an important political issue. In places like the UAE, you rightly point out, Arabs are a tiny minority. How can you be an Arab country and have Arabs be a tiny minority and Arab children not learning Arabic because their nannies speak English or some other language? The treatment of these workers is an important social and economic issue. To the extent that these economies are going to integrate more and more into the global economy, they're going to have to accept some minimum standards of worker rights.

However, politically, these foreign workers are absolutely irrelevant. They can be sent home in a nanosecond, even if they've never been "home." As you rightly point out, many of them were born there, the second generation. The global labor market being what it is, they can be replaced relatively easily. There were two foreign labor groups that were considered to be really politically important in the Arabian Peninsula: Palestinians in Kuwait and Yemenis in Saudi Arabia. They were very large communities; they spoke Arabic. They were integrated into these societies culturally in ways that workers from South Asia and Southeast Asia cannot be. What happened after the Gulf War of 1990-91? The Yemenis were kicked out of Saudi Arabia, and the Palestinians were kicked out of Kuwait--and nothing happened. If you can kick out Yemenis from Saudi Arabia and Palestinians from Kuwait, you can kick out South Asians from the UAE.

MR. MOHAMEDI: I think Greg is absolutely right in terms of the dichotomy between the political and the social issue, but there's one thing that just dawned on me the other day. We were at the World Economic Forum, the Middle East meeting in Amman, actually at the Dead Sea. The government of Bahrain had organized a lunch and had some speakers to talk about corporate reputation.

I could see that the Gulf and Middle East corporations that were there didn't know what to talk about. It is one thing for Shell to talk about corporate governance, for example but these local companies are at an early stage of dealing with this issue. However, I raised the issue of workers' rights in the region (and the Human Rights Report that had just come out) as an issue related to corporate reputation that affects the region. It dawned on me when I started to stir the pot--and I got a lot of defensiveness--that, as this region globalizes, corporate reputation along those line will become an issue. So I agree with you that, on the social and political level, it's not important. But on the corporate level, it may start becoming so. Dubai doesn't want to look like it is exploiting little boys as camel jockeys. It wants to clean up that image, because it doesn't want to spoil its Dubai Inc. reputation.

When you think about the concentration of wealth, of course, I absolutely agree that it's one of the worst regions in terms of income distribution and family ownership. But there are two things happening that I think are causing some change. One is if you want to have large scale projects, you need to bring in lots of investors. If you want to play a world class mega-game of development, you have to break open this whole system. The merchant or ruling families themselves just cannot grow it alone. So the global capital markets have to be used as a means to open up the system. Once you bring in a million faceless investors, you need better regulations, reputation and transparency. That is changing the system of ownership and concentration of wealth in the region.

There is a division between technocrats, royals and merchants in the Gulf. The technocrats look very suspiciously at both the royals and the merchants and in fact have played a role in curbing their excesses. For example, they have kept the royals and the corruption to a certain extent out of the public business area. In areas where the royals have been given free reign in business, they've destroyed it. KPC and the whole oil-sector disaster that's taken place in Kuwait is an example of this. In sharp contrast, the national oil company of Saudi Arabia has been managed to keep the royals out of the oil sector and has created one of the premium sectors in the world. There is not one royal in Aramco. So I think that the technocrats, as long as they are allowed to maintain a certain regulatory role and a large number of investors keeps coming in, you will get some opening up of the economic landscape and less dominance by the a few big families.

MR. MOLAVI: I have done some reporting on labor issues in the United Arab Emirates. When I went to some of these labor camps, there was one group that I met that had not been paid in several months. They were the epitome of what Human Rights Watch called the less-than-human working conditions they were living in. As I probed further, I asked them what their recourse was, and they said the company they were working for was based in Sharjah and that they were trying to get the case transferred to Dubai. I asked them why, and they said they thought they would have a better chance of getting a fair hearing in the Dubai courts than in the Sharjah courts. It goes back to what Fareed was saying: Dubai is a triumph of globalization. It's not necessarily for love of the laborers that they have taken steps to improve working conditions; it is because of corporate reputation.

As to the disparities in wealth, a lot of people talk about the Shia-Sunni divide in the region. I think there's actually another divide that we need to worry about, which is more of a populist-plutocrat divide. If you look at the Islamist discourse on justice and development, from Tunisia to Algeria to Morocco, they're often weaving these narratives of economic discontent into their discourse and doing it quite skillfully. I would go to Muslim Brotherhood rallies in Egypt, and there would be chanting against the rising prices. This divide is one that we need to watch very closely. The Islamist groups are skillfully exploiting it.

Q&A

Q: What options do you see for CENTCOM?

DR. CORDESMAN: First, I think you're asking the wrong question because the problems aren't in CENTCOM; the problems are in the way that the dialogue has been handled at the top of the administration with the individual countries. One thing I think is needed is to restore the kind of engagement strategy with the individual Gulf militaries that were pursued by CENTCOM. This has, in many ways, been given a much lower priority. When I say engagement, CENTCOM people need to talk to people in the field. We need to bring people back from the Gulf militaries. We need to be much more concerned about the volume of training of Gulf military in the United States. We need to step up exercises rather than simply focus on our immediate military needs.

I think that we have also not as a country--and this is not something you can blame on CENTCOM--quite figured out that we are no longer trying to sell the equipment for conventional warfare and train people in conventional warfare. These are still issues in the Gulf, and the countries involved are going to insist on prestige and large conventional forces. But we need to do as much as possible to train them in counterterrorism operations, to deal with asymmetric warfare and to think much more about protection. CENTCOM has to be capable of addressing the issue of proliferation, not simply by having background briefings on weapons of mass destruction followed by technical briefings on ballistic-missile defense or systems that don't yet exist or which we are not yet prepared to provide systems for.

All of these are areas where we can do more, but when you talk about what really needs to be done, you need to have a set of choices at the level of the National Security Council, the presidency, as was pointed out by Chas. and Ambassador Turki, but I think it's a message you get generally. You need to have a meaningful strategic dialogue, and we've created new ways of talking to Saudi Arabia or old ways have

been revitalized.

I'd also have to say that you cannot end up sending mixed signals. You can't have one set of signals coming from the United States, another from a military in the joint staff, another from whatever operational command is in the area, from CENTCOM, from the vice president's office, from the national-security advisor. There has to be some unity of purpose, and that has been sadly lacking.

Finally, we had a pretty good posture in the Gulf before the Iraq War started. We have strikingly increased some aspects of our capabilities to rapidly deploy and operate from over the horizon and all of the new technologies and systems there. So mixing both the return to the basing and postures that we had before the Iraq War, and taking advantage of some very marked improvements in long-range strike-technology battle management, are obvious measures to move forward.

MR. WHITE: I would second what Tony said, but we have to keep in mind that this is all scenario-based. Terms like military option and surgical strike don't really apply to Iran because much of what we know about the planning from a few leaks last year suggests a very robust campaign to knock out Iran's ability to counterattack in the Gulf. That involves anti-ship missiles, submarines, rather robust asymmetric small boat naval capabilities, and all kinds of things like that. It would really be a war with Iran. I think the kinds of things that Tony's talking about--and they're very important--can only happen if you don't do that. To the extent that you adopt a containment strategy and try to provide assurances to states on the other side of the Gulf, you assume by doing so that the real reason, as Chas. said, is that Iran is seeking a nuclear weapons capability for deterrence, not in order to initiate military action. Far too much attention has been given to the statements of President Ahmadinejad. I constantly see people even equating President Bush and President Ahmadinejad, when the fit is wrong. Bush holds about the power of Supreme Leader Khamenei, not the much weaker powers of the president of Iran.

In any case, if war is initiated, it could start a massive open-ended mess in the Gulf that's going to have deep economic ramifications along with military and political ones. This is incompatible with what the United States needs to do after in some way exiting from Iraq, even to simply restore the readiness of our own forces. I think containment is the way to get to the point where you can achieve even strategic engagement and combine that with containment, which is a more enlightened way of pursuing this strategy. But everything that Tony mentions is basically posited on our not attacking Iran. AMB. FREEMAN: Containment was conceived by George Kennan as a strategy for dealing with a country that had, in his view, a severely deformed and potentially very ineffectual system. Basically the idea was to let the Soviet Union stew in its own juice until it fell apart, which it ultimately did. It's not a bad formula for dealing with the essentially failed and failing system in Iran.

I want to make one further comment, however, about one lesson that might usefully be drawn from our misadventure in Iraq. Before we posit that a country in a region abroad is a grave menace to its neighbors requiring urgent redress, as we did with Iraq, perhaps we should ask the neighbors whether they see it that way. Nobody saw Iraq in that manner other than we in 2003, and we are 8,000 miles away. In the case of Iran, the same logic ought to apply.

Going back to Tony's points, the prerequisite for cooperation on a regional level militarily is some sort of common threat perception. And that means that you have to talk to people and exchange ideas and take seriously the concerns that they have as well as trying to persuade them of yours. We face a dilemma in the Gulf, which I think will be readily apparent as we attempt the reconfiguration of forces following our withdrawal from Iraq under whatever circumstances that occurs. To a considerable extent, our presence is regarded as the threat generator, because the threat is not external but internal. It is a threat from people who regard our supportive relationship with regimes in the region as something to be swept aside, and therefore people to be attacked in the interest of driving us from the region.

Since this is the case, any government contemplating additional force presence from the United States on its territory needs to carefully balance risks and benefits. It's not a foregone conclusion that the result of that sort of analysis in this century will be the same as it was at the last part of the last century. So I think we face many reasons to do what Tony has been urging us to do, which is to elevate and deepen the dialogue with the countries in the region. If we don't, I don't think we can assume we have a free hand to do what we consider to be militarily essential.

DR. CORDESMAN: I'd like to follow up on two areas. One, I think if you go out to the Gulf and talk to people at very senior levels within the military and defense ministries and royal families, you will hear in private what none will say in public: that they very much perceive a threat from Iran, not today, but an emerging threat. I don't agree that Iran has created this force as a deterrent. From the shah on--and there has been some degree of consistency here--it has been seen in terms of leverage, not to conduct a nuclear war, but to achieve political power and political influence. I also think that one aspect of this debate over what Iran is doing has not been helped by the fact we have so many people in the Gulf, and to some extent in the United States, who may have read a great deal about strategic analysis, but they've never looked at an overhead photo or actually measured the scale of the facilities involved. We are not talking about a small effort. We are talking about, depending on how you count them, some 18 to 23 complexes that are associated with the nuclear program. We're talking about technology efforts that affect every major component of a fission weapon and in many cases have no meaningful civil side. And we are talking about Iran's putting equally large resources into the production and development of long-range missiles.

The more you look at what they are doing, the more you see this as a central focus of Iran's ambitions, which I do not believe are to get into a suicidal nuclear exchange. But when you look at the history of things, it took Europe a little over 4,000 years to finally get out of an arms race without going to war. I'm not sure Iran is as reassuring.

MR. WHITE: I just wanted to make a comment with regard to containment, which could be misinterpreted. I think what Tony brought up earlier, strategic involvement, is a better term. Containment with respect to Iran would mean taking action multilaterally in order to curb active Iranian behavior that was a threat to the region, such as its support for terrorism or some such thing. What is not containment is squeezing Iran--laying on sanctions and another level of sanctions in order to prevent a nuclear program from advancing that's going to probably advance in any case--or, more to the point, regime-change efforts, efforts to destabilize Iran by activating minorities through radio broadcasts, etc.

A lot of this, as we know, very recently has actually helped discredit many of the people fighting for reform inside Iran. If we want to look at that sort of involvement, there is a case study that's relevant--nothing's perfect--but Cuba comes to mind very readily. Just under 50 years of that sort of effort directed at Cuba and the Castro regime, instead of making meaningful progress, produced a Cuban leader who'll probably die of old age in the course of this process. This is not what is to be repeated in the case of Iran.

AMB. FREEMAN: In the case of Cuba and containment, the United States had four objectives: first, to deny it to our Soviet strategic adversaries as a base; second, to persuade it to halt the export of the revolution to neighboring countries and to Africa; third, to encourage Cuba to develop a society that was sufficiently decent that its people would not feel obliged to flee to Florida; and fourth, ultimately to unravel some of the problems caused by the revolution--property claims and other issues that continue to disturb people involved or their descendants.

The first two objectives--strategic denial and halting the export of revolution--very appropriately called for efforts to isolate Cuba. Remarkably, those efforts succeeded. Cuba is not a base for the Soviet Union, which indeed doesn't exist anymore, nor has it become a base for any other external power in the hemisphere against us. Cuba no longer exports revolution. It exports medical services. So we won.

The last two objectives--which have to do with changing the character of the regime, encouraging a more decent form of government and society, and resolving the issues of property claims and the like--require engagement and contact. Therefore, a policy of ostracism is simply lunatic and counterproductive. There are elements of containment that may be very appropriate under some circumstances, but you must always consider what it is you're trying to do. I think Wayne's distinctions in that regard are exactly right.

Q: As we thrash around in Iraq looking for an exit and debate what sort of exit we should make, what are the Arabs going to do to protect their own interests, if anything?

DR. GAUSE: For most of the past four years, the Saudis have been largely paralyzed on Iraq policy. They've been caught between fear of Iranian-supported elements--not wanting to support a government that they see as an Iranian agent--and fear of al-Qaeda elements among the Sunni insurgency and a basic desire not to support Sunni groups that are killing Americans. They still value their relationship with us, and they didn't want to deal with this so they were largely paralyzed and they didn't have a very active policy on Iraq.

That might be changing. That they've come to the conclusion, as many people at this table have, that if we're not leaving, we're going to be changing our configuration in Iraq very, very soon. On the rhetorical level, you saw the king at the summit term the occupation of Iraq illegitimate for first time, and we're starting to get some signals that the Saudis are taking a more active role in encouraging an alternative to the Maliki government. They refused to receive Maliki on his tour before he went to the summit. There seemed to be indications that they would like to help Alawi put together some kind of anti-Maliki government that would include the Sadrists and Fadillah and people like this.

Whether they can pull this off is very doubtful, given the fact that the United States has said, "Maliki's our guy and we don't think any change is particularly beneficial." But it does seem that the Saudis are reactivating on the political level efforts to find alternatives.

We've also seen in the last six months splits in the Sunni insurgency, people turning against al-Qaeda. This is not just tribal forces, but also Sunni insurgent groups like the Islamic Army in Iraq and the 1920 Brigades. I have absolutely no evidence that the Saudis were involved in this, but it also wouldn't surprise me if there were some effort by the Saudis to encourage this kind of thing as a way to make, from their perspective, a clean Sunni insurgency that, when America withdraws or reconfigures, can act as a Saudi ally in affecting the course of politics in Iraq. That's just speculation because I don't have evidence on it, but it would certainly be consistent with the way the Saudis have acted in other civil conflicts.

DR. CORDESMAN: You probably are beginning to see private money, particularly--I know this is the case in the UAE--moving into Sunni Iraqi hands. How much of it, who's giving it, is anybody's guess. But one thing is fairly clear. We have not found any tribal grouping as yet that we have been working with or know about in Iraq that shows significant amounts of major new money or new arms that we have not provided. To the extent that these groups have improved their capabilities, this has come very recently in terms of transfers which the United States--since the developments in Anbar--has made a significant issue.

One thing this is doing is shifting the impression people had at the start of the year in the Southern Gulf that the United States had effectively tilted to the Shiite government at the expense of the Sunnis. One thing it also has done is take an already heavily armed group of people and better trained and organized them, effectively substituting them in a number of areas for the regular police, which have generally failed, and leave a legacy, depending on how this plays out, where they're going to be stronger than they otherwise would have been. You've got a serious problem within the Iraqi forces, and I suspect that the end result for Saudi Arabia and a number of others is going to be that they know where the proxies are now. And those proxies are going to be potentially considerably stronger six months from now. Are they showing any visible signs of doing it? No.

There is certainly on the part of Saudi Arabia another set of actions. It is still linked to us, but it also is looking at Europe, being concerned about what's going to happen if we leave the Gulf, and that's in dealing with its neighbor to the north rather than Iraq. But we haven't seen anybody with real money and real weapons--somebody other than us. It isn't as if we didn't know what was happening in each of these movements, but we can't say there's a lot of Sunni activity on the ground.

AMB. FREEMAN: The United States has now, through the errors of judgment and commission and omission that we have carried out in the region, sufficiently threatened Saudi interests that we have jolted them out of their traditional diplomatic torpor. Saudi activism was previously an oxymoron, but it is a reality now. You see this not only in the very active engagement with Iran that the Saudis have conducted on regional issues, including the programs of support for Sunni forces in Lebanon and the effort to prevent civil strife there from spilling over. You see also it in the Mecca meeting and the effort to deal with Hamas and with Palestinians in ways that cope with this threat of the democratic legitimation of Islamism, and you see it in interesting initiatives towards Syria as well. So Saudi diplomatic activism is one response to the situation. It is not military, but it has transformed the region. Now Saudi Arabia and Iran in many ways are the principal diplomatic actors there, not the United States.

Second, in response to 9/11 and the subsequent efforts by al-Qaeda inside Saudi Arabia to destabilize the kingdom, King Abdullah has launched a truly remarkable, even revolutionary, reform effort, which has brought the Shia into national dialogue and some measure of association with the power structure; which has opened the kingdom economically through membership in the WTO; and which is now empowering women in very important ways and reforming the educational system to emphasize science and technology rather than traditional religious instruction. There are many things going on beyond that, but the interesting thing is that it is a domestic response to change in the region that should not be overlooked.

MR. MOLAVI: I just want to underscore that point. The popularity of King Abdullah in Saudi Arabia is striking, across so many of the kingdom's socioeconomic, tribal, and ethnic divides. When I was last there, I was in Qatif in the Eastern province speaking with the local Shia. Over and over again, I heard people say to me that King Abdullah has reached out to the Shia minority more than any other king in Saudi history. I think that's particularly critical at this moment.

Prince Saud Al-Faisal expressed his frustration at the Council on Foreign Relations a couple of years ago when he said that the United States essentially handed Iraq over to Iran by engaging in this war. Iran exerts both soft and hard power in Iraq. Iran also has somewhat of a structural contradiction in its policy, almost a necessary schizophrenia. On the one hand, they support the government of Nouri Al-Maliki; on the other hand, they don't want to see a resounding success that speaks well for America, which also supports the Maliki government. One of the things that people often talk about, even Iranian officials, is a certain amount of managed chaos, managed instability, in both Iraq and Afghanistan. Military guys like to say that Iran has bet on every number in the roulette wheel. To some extent, there is truth there. It is not simply a Shia militia strategy. It is an Iraq influence strategy.

It should not surprise us that Iran is seeking influence in Iraq. Persians have often done so. Iran fought a brutal eight-year war with Iraq, and now its allies, many of whom where incubated in Iran, including the Supreme Council for Islamic Revolution in Iraq, born in Iran in 1982, have significant positions of influence in Iraq. Iraq has been a source of national security concern for Iran, even under the Shah. It makes sense that they would want to make it an ally, a place where they have influence.

When Iran exerts its power in Iraq, Lebanon, and other places, we sometimes describe it as Shia sectarian power, but I think nothing could be further from the truth. Iran views itself as a pan-Islamic power, and in Iraq it is Shia groups that allow Iran to expand and exert its power. But Iran would have no problem providing support and assistance to Sunni groups as well across the theater. From Ayatollah Khomeini to Ayatollah Khamenei today, the political leadership of Iran does not use sectarian language. The language is often anti-imperialist, anti-American, anti-Israel, but they rarely use sectarian language.

MR. WHITE: I'd like to reinforce a point Greg made: when we're asked about what the surrounding states are doing, in particular, I would like to talk about Jordan and Turkey, which we haven't mentioned. They are very frightened of a civil-war scenario, particularly one in which Sunni Arabs would do poorly, dumping millions of refugees into Jordan. Turkey is also extremely concerned about suggestions that the United States might pull out of the Arab portions of Iraq and retain bases in Kurdistan, which some people have been trying to sell as a way in which the United States could actually keep better control over the situation in the north. But that is what the Turks fear most. With the United States embedded inside the Kurdish areas of Iraq, the Kurds would think that they could actually get away with a bit more because the United States would need them. Therefore, cracking down on the PKK and taking other measures, but not moving closer to anything like independence, could actually be jeopardized by a U.S. presence in Kurdistan in Iraq and not the rest.

The thing that is most striking about recent behavior is that most governments, with the exception of Iran, have been very much hoping the United States would stay. As long as the United States stays, it's an American problem. It's not something that's going to spill over into their areas. The most striking example of this would be the massive defensive barrier that the Saudis have been building along their border, almost as if one could wall the Iraqi problem in. They're coming to the conclusion now, as has been mentioned, that that doesn't work anymore. The United States, despite what it says in some contexts, will be leaving one way or another, not in the long term, but probably in the short term. We talk about the next two years or so, and they have to begin thinking about what they're doing. We're beginning to see some of that. Some of it's positive. In other cases, we're seeing a more negative side, for example, on the Turkish front, where we see the Turks very roundly threatening military intervention in Kurdistan. We should keep in mind that they mean it. They're beginning to move from the position where it's an American problem into the realization that it is becoming increasingly their problem.

Q: Is there a role for public diplomacy?

AMB. FREEMAN: I served twice with the U.S. Information Agency, once in Washington, once abroad. The participants generally get a great deal more out of the experience in terms of their understanding of foreign realities than they are able to impart to the locals. That's good; we need that feedback.

But, then we see the hermetically sealed version of diplomacy epitomized by the Green Zone, in which American diplomats are accredited not to Iraq but to the Green Zone, an enclave inside another country which they seldom visit because it's politically under Iranian occupation.

DR. CORDESMAN: It's really time to be very blunt about this. First, we had the advertising lunatic, then we had the woman who didn't want the job, and then we had the Texas political hack. What is totally dismaying is that, when you define public diplomacy as preaching an ideological line from the United States that nobody cares about, throwing large amounts of money into TV and radio stations, and putting people into the field who can't say anything meaningful, the answer is, no, public diplomacy doesn't serve any purpose. It also is not reassuring when you talk about the history of public diplomacy as conducted from Washington, as distinguished from national missions, country teams.

If you could open up the embassies and bring in people to talk frankly, and not just to the people who agree with them, fine. But when I go to Saudi Arabia, I go out to universities where people don't always master English, but they don't agree with the United States. That's one key. It's equally a key, however, to think about what it is you're trying to do. You turned the country teams into people who simply report back to Washington from within a fortress. The tours are too short; they're unaccompanied; too many people don't take risks. I knew one embassy economics officer who basically was doing absolutely nothing but reporting back what was being said by a local bank and never got out of the embassy compound. I've known others who are very different. But you need to reassess the role of the country team, how you use people in individual countries, and how to stop this idea of a broad regional dialogue and talk people-to-people in practical terms. The other thing in public diplomacy is that you get immense benefits if you pick the right people from the country to come here. That doesn't mean ones who agree with you. Those programs really do pay off.

Now I come to the key "but," and it's a point Greg talked about. If what you are trying to do is argue over the future of Islam, Islamic extremism or any of these issues, and you assume that the United States can intervene meaningfully in this dialogue, jump off a bridge, shoot yourself, do something else constructive. This aspect of public diplomacy can only be done by Islamic governments, Islamic scholars and Islamic figures. The idea that we somehow can do that as crusaders and occupiers is ridiculous.

AMB. FREEMAN: Private diplomacy is a prerequisite for public diplomacy. If you're not doing private diplomacy, you don't really have much that's useful to talk about in public. Second, I agree completely with Tony that country teams meeting in bubbles to talk to each other is a form of perversion unique to the government that resembles onanism, not diplomacy.

MR. MOLAVI: Just a brief anecdote on public diplomacy in Saudi Arabia. You may recall the Karen Hughes visit, when she was using her own walking-around money and went to an elite girls high school and mentioned that women ought to drive. She was rebuffed by several young women saying, "we're perfectly happy; we have our drivers and our chauffeurs." This is an example of talking to the wrong people. But a few days later, I was in the offices of Arab News, the leading English-language daily, talking to some of the women who worked there--mostly middle-class Saudi women--and they were quite frustrated with what those women said to Karen Hughes. They actually wanted to drive and thought it was a strain on their finances to hire a chauffeur. So, maybe we're talking to the wrong people.

DR. GAUSE: I think Saudi women want to drive, but they don't want Americans telling them about it. I think that's the bottom line. The best public diplomacy move on the U.S.-Saudi side in the last couple years has been the commitment at the top in Saudi Arabia to start sending more students back to the United States. Saudis in the '60s, '70s, sent a huge proportion of their university students to the United States. When they built their own university systems, they started keeping them at home. Post-9/11, of course, it became very difficult for Saudis to travel to the United States, and there were horror stories--some exaggerated, some true--about what happened to them at immigration and customs. But there's a commitment at the top to get more Saudi students to the United States. Does that mean they all come home pro-American? No, obviously not. But they do come home with some better understanding of us.

The Saudis are never going to do that the other way around. It's still incredibly difficult for Americans to go to Saudi Arabia. I can go and give lectures in any Gulf university, just through the permission of the chair of the department. Not in Saudi Arabia. One of the reasons that folks who go out on these embassy junkets don't get better interaction is not due to the embassy, which has its own problems. The Saudis are still extremely fearful about this kind of open exchange.

Q: I wanted to ask about local media reports of an increasing crackdown culturally on the streets of Tehran and possibly otherwise.

MR. MOLAVI: It is worth noting that the crackdown that Ambassador L. Bruce Laingen [charge d'affaires in Iran during the Iranian hostage crisis 1979-1981] talks about has included some of our beloved colleagues, including Haleh Esfandiari, the director of Woodrow Wilson International Center for Scholars, and Kian Tajbakhsh and others. There has been a very serious crackdown over the past few months. Something like 150,000 people have been swept up, mostly taken to short-term detention and released. But there have been these horrendous images of young people dragged from parties and other such places and who had bathroom devices put in their mouths. They've had bloody faces.

What was striking about this is that they were allowing people to take pictures. They knew they would appear on Persian YouTube and in the Persian blogosphere. Persian is the fourth most commonly used language on the internet. There's something like 75,000 Persian blogs. So Ahmadinejad and the group around him would like to see a purifying of the Iranian revolution. They would like to go back to 1979, and they are flexing their muscles.

The question is, is this a stable regime? It's an underperforming regime, certainly. But with oil prices being what they are, the president does have a significant amount of resources at his disposal to deliver patronage. His key constituents in the security services, and particularly in the militia, are willing to support him and are willing to crack heads. So I think the regime remains essentially stable. Resource-rich authoritarian states have an ability to muddle through, even if they don't prosper.

President Ahmadinejad is not the most powerful individual in Iran, but he's not without power either, particularly when you have a supreme leader, Ayatollah Khamenei, who is notoriously indecisive and will allow the factions to fight each other. He will allow it to play out and won't step in until he feels that there is a serious threat to the state. But right now I see the regime as essentially stable. There is no velvet revolution coming, which makes the detention of people like Haleh Esfandiari and Kian Tajbakhsh even more reprehensible.

MR. MOHAMEDI: PFC Energy did a study six months ago on the oil sector. The conclusion was that the sector is in deep trouble; you could see catastrophic declines in oil production in the next few years. Disorganization, lack of investment, and technology restriction are having a real impact on the sector, as is political disorganization and having the political hacks in power. That's an Achilles' heel for Ahmadinejad and the Islamic government.

The other thing is that U.S. Treasury's attempts at sanctions may be just pinpricks, but they are important pinpricks in terms of stopping the use of certain banks or putting pressure on Western banks and now Japanese banks and others. It is having an impact on Iran's trade and financial relations with the rest of the world. The UAE is getting very worried about the sanctions issue because of the trade with Iran, and they're coming under pressure. So I think the combination of the collapsing oil sector and these disruptive trade relations will have an economic impact that higher oil prices will not be able to offset, especially if oil volumes crash.

MR. MOLAVI: Right. And the joke is that Dubai is the best city in Iran.

DR. CORDESMAN: To put this in perspective, even toward the end of the Khatami era, when you talked to Iranians at meetings outside the United States--people who participated particularly in dialogue on nuclear or security issues or even in dialogue with the United States--you began to get warnings that it was harder and harder to talk, to leave Iran, that it was more and more a problem for them. What you were seeing towards the end of 2006, quite aside from Americans being arrested, were crackdowns on Iranians in terms of travel, increasing pressure on them as to what could be said, more monitoring when you went to meetings. Even in places like Japan, all of a sudden there'd be three Iranian officials for every supposed Iranian scholar.

I think you also see a certain hardening in the security services. Whatever is happening between the president and the leader, one real question is to what extent do the various groups within Iranian intelligence and the security structure begin to crack down on individuals? That began to tighten significantly toward the fall of last year and has continued. It has played out to some extent in public. Iranians I have known since I served in Iran, or their sons at this point, since that was back in the early '70s, are certainly finding it much more difficult and dangerous to communicate with me than it was even six to eight months ago. I don't want to generalize too much from a personal case, but I think it is disturbing to see what's happening in Iran, and Khatami's term is beginning to look a little like a Prague Spring.

Q: One of the problems is that we don't have a clue about what's really going on inside Iran because we're not there.

AMB. FREEMAN: The question arises whether, if we were there locked in the fortress, we would know a great deal more than we know by not being there. This, I am sorry to say, is a tragic consequence of the spineless capitulation of the diplomatic service to our security advisors, who have reversed the normal pattern. Many years ago, when I was in charge of the embassy in Beijing, every afternoon I would go through the embassy sections and, if I saw people reading a newspaper or sitting there drinking something or other and talking to each other, I would ask them why they had failed to make an appointment outside the building and tell them to go sit in the park and talk with someone instead of doing what they could do equally well in Washington, D.C. The question is, what is the value added? I have great respect for Ryan Crocker and his professionalism, but his recent memorandum saying that he couldn't get anything done despite all the people he had, and he needed more people to do nothing inside the Green Zone, left me a little cold.

Q: Why did the Iraq Study Group focus on the necessity of solving the Palestinian-Israeli problem? Is that really what our foreign-policy establishment believes?

MR. WHITE: Clearly that's what the foreign-policy establishment believes is a major problem in the region and one that we can't forget about in any context. Everything is part of the same latticework of problems in this region. One of the reasons there were high levels of anti-Americanism in Iraq, aside from sanctions and the '91 war was, of course, the ongoing Israeli-Palestinian impasse and American support for Israel. And, yes, I think there's a recognition across the board in the United States that it's a serious problem. There is no recognition or consensus as to how to go about solving it in a more creative way.

AMB. FREEMAN: Having also served with Wayne in an advisory capacity on the Iraq Study Group, I would comment also that, although it may not be polite to say so and certainly one doesn't in polite company in Washington, Arab willingness to cooperate with the United States on a wide range of issues, not just on an honorable and the least destructive possible extrication of the United States from Iraq, but on many other issues, is conditioned by their view of our sincerity or the lack of it in trying to find a just peace in the Holy Land. And there has been no peace process for six years anyway. Instead, we have turned to supporting Israeli unilateralism. We have thereby empowered Islamist unilateralists who match Israeli unilateralists. I would argue nobody is better off, but certainly this has deepened anti-Americanism in the Arab world.

The second point is that the Arabs are a fifth of the Islamic world, but they are in some respects a decisively influential fifth. The holy places are on their territory. It is their language that is the language of the call to prayer. And to some extent, when Arabs are injured, as they feel they have been in this case, all Muslims feel the blow. So our ability to conduct our foreign policy in many places where we have interests that are not connected directly with the Middle East--for example, in Indonesia or Malaysia--is affected by how we handle this issue of peace between Israelis and Palestinians.

Finally, just to buttress Wayne's point that anti-Americanism was once a subject of intellectual inquiry and emotional distaste, it is now sometimes fatal, because when it takes the form of terrorist action against Americans, it is no longer an abstraction. It is something very concrete that directly threatens us and, I would argue, our way of life, which has not prospered since 9/11 in many respects.

So the reason for the Iraq Study Group's suggestion that this topic needed to be addressed was not the belief that if it were, this would lead Iraqis to love Americans or to lay down their arms and cease to harm us or each other. It was the thought that this issue is very central to the question of American influence, American standing, American credibility, and the willingness of other countries to cooperate with Americans on a wide range of issues. So I didn't find the recommendation mysterious in the least. I think it was and remains a wise one.

This issue of peace between Israelis and Palestinians, in the interest of both and in the interest of the United States, needs to be addressed, not neglected and not subjected to the sorts of charades that have, in my view, characterized our recent approach.