vladimir putin and the protests in russia, and the euro's chances of survival. finally, what are we bringing back from iraq? you'll be amazed. but first, here's my take. "time" magazine announced its person of the year this week -- "the protester." from the arab spring to athens, from new delhi to new york, people power is stronger than it's ever been. and now it's reached moscow with the protests there last week. the great drama of russian history has been between its state and society. put simply, russia has always had too much state and not enough society. historians have pointed out that the russian nation was literally the property of the czar, that serfs were more like slaves than simply peasant workers as they were in europe, and that the country lacked any institutions that contested the authority of the government. the communist takeover in 1917 only enhanced these features by building a soviet superstate that dominated every aspects of people's lives. when it collapsed in 1991, it turned out there was only chaos underneath. but there has always been a russian civil society, small but vibrant, espousing universal values and human rights. it is the russia of tolstoy and pasternak, sakharov and gorbachev. and it has always believed that russia's destiny and values lies with the west. this russia has not died under putin. in fact, it's been growing quietly but vigorously over the past decade. there are now more than 650,000 nongovernmental organizations in russia today. of course, the russian state is very powerful, dominant and pervasive in politics and the economy. despite all the stirrings of change, the power of the state expertly wielded by vladimir putin should give one pause. it's not just that putin has been able to reconstitute the apparatus of fear from the soviet days, it's also about money. the russian state has at its disposal the greatest natural resources of any country in the world -- oil, gas, diamonds, nickel, copper, aluminum. those riches give the government the ability to both repress and bribe its population. consider this fact -- despite the sweep and force of the arab spring, it has not produced political change in a single oil-rich country. the revolution started in the deserts of the maghreb in tunisia. morocco was quickly swept along. but next door sits algeria, more repressive than either of them, and yet untouched by protests. it might be called the arab spring but it began a year and a half earlier in a non-arab country, iran, when the green movement took to the streets. but the iranian regime which buys support with patronage and represses with its military resistance. the states have resisted the winds of change, even in bahrain where the opposition enjoys strong support. if russia's civil society can produce even modest changes against these odds, it will rewrite history. for more on this, you can read my column in this week's "time" magazine. let's get started. ♪ joining me now from kabul, the president of afghanistan, hamid karzai. president karzai, thank you very much for joining me. >> welcome. good to talk to you. >> the secretary of defense, leon panetta, recently said nato forces, the international coalition, is winning in afghanistan. do you believe that is an accurate statement? >> well, the international coalition and the afghan government have been able to provide in the past ten years political stability to afghanistan. the overall stability of afghanistan and the presence of afghanistan as a state, as a nation state, in the international community. but we have not been able, the united states and afghanistan government together, have not been able to provide the people with their individual personal security. that is yet to come. >> do you believe that you have broken some of the momentum that the taliban had gained in previous years? that 2011 has marked a shift in that regard? >> i can say that this year in terms of the overall mobility and activity of the taliban and other groups has been slower, and we have been more effective. but i'll have to wait a bit longer to confirm that we have reversed the trend and that the afghan people will see the fruits of our efforts and see peace and further security. >> now in iraq as you know, american forces are going down essentially to zero. but that is not what your plan is for the relationship between afghanistan and the united states. am i correct, you would like to see a residual american force? >> we are negotiating with the united states toward enduring partnership. that may bring about the presence of some u.s. troops in afghanistan for the duration of the agreement that we reach with support to afghanistan, with training and equipping the afghan forces, all of that will be there. but we'll have to wait for the agreement and the specifics of it. >> the one area where you have had a great deal of criticism for nato forces and for the united states has been the so-called night raids. the admiral, former admiral william mcraven says they are essential and important. you say that this is what is feeding the hostility to foreign forces. where do things stand? do you have a commitment from the united states that these night raids will end or not? >> well, this has been one of the issues between us for a long time. something that we have raised an objection to for almost eight years now. we want afghanistan's homes, afghanistan's villages, to be protected, to be safe from such attacks. that understanding is there, but the specifics of these operations have not been developed yet. but what we are asking for in very specific and clear terms, that is no foreign forces should enter afghan homes. >> let me ask you about the political settlement that needs to come it in order for some of the violence to decline. you have said that the negotiations with the taliban have essentially come to a standstill ever since the murder, the assassination of mr. rabbani, who was your negotiator. and something in an vancouver that i thought was absolutely striking, is that you said, look, we don't know whom to negotiate with, we don't know whom the right person is. we don't have contact with the taliban. the pakistani government is the only group that has contact with them. they have to tell us whom to negotiate with. is it really from your experience, is it pretty clear that at the end of the day it is the pakistani government that has that kind of connection with the taliban? >> well, our efforts for peace, our cries for peace, our understanding of peace was that we were talking to the taliban. the assassination of president rabbani brought us in a shock to the recognition that we were actually talking to nobody. that those who came in the name of the peace process were assassins, were killers, were terrorists rather than negotiators. a man who came in the name of a messenger for peace turned out to be a suicide bomber. therefore, we have now clearly said that we will welcome a taliban address, but that address must have the clarity that this representative is authorized and is representing the taliban movement as we see it. the question of pakistan is important here because we all know that the taliban have their places there. they operate from there. and a meaningful peace process cannot go well or end in satisfactory results without pakistan's participation and help. >> let me tell you, mr. president, about an interview i did with former president musharraf a few months ago. i asked him specifically about whether or not he believed that you were somebody who could be partnered with and trusted. and as you know, he is still quite influential within the pakistani military establishment. and he essentially said no. what would be your response to that? >> well, i -- i said pakistan is a twin brother, and president musharraf when he was the president had a fairly good working relationship with us. and i have respect for him. and i think the trust between the two nations is something that's the verdict of -- of history and one that we need to have among us. >> you're a better diplomat than he is, mr. president. >> oh, i'm -- he's a capable person, too. very capable. >> mr. president, if you could just hold on a minute, we will be back. and when we're back, we will have more of this conversation with president hamid karzai about afghanistan, pakistan, the american drawdown. but also a troubling case -- a woman who was raped and then sentenced to 12 years for being the victim of a rape. when we come back. there are people in afghanistan who believe this woman should marry the man who raped her. do you think that that is appropriate? 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[♪...] >> male announcer: book now, save up to 65%. call 1-800-sandals. and we are back. joining me from kabul, the president of afghanistan, hamid karzai. do you worry that you're in a new and dangerous spiral with this most recent attack on afghanistan's shia population? the terrible terrorist attack which appears again to be traced back to pakistan. in fact, the pakistani group has taken credit for it. this is new as far as i can tell -- a very marked sectarian attack on afghanistan, on the shia population in afghanistan. is this -- you know, is this a portend for something worse to come? >> the attack on our people by the group a few days ago was a clear act of terrorism against people. it was anti-islam. it was anti-human being. afghanistan has evidence in history -- this was the first time in our country that an attack of that nature took place. the taliban condemned it. but reportedly the group claimed responsible. we're not saying that this is pakistan. we say that this is the terrorist group. if it is, then perhaps it's the responsibility of pakistan and all all of us together to stop this. >> there's a woman named gulnaz who, as you know, was sentenced to prison for 12 years after it was reported that her cousin's husband raped her. she was then freed because of your personal action. the great concern of human rights activists in the west and in afghanistan i should say is that particularly once the international forces withdraw and perhaps have less of a day-to-day involvement, that these kind of events will happen day after day after day in afghanistan. why is this kind of thing happening in afghanistan? >> well, when i came to know this and upon coming to know of this, i convened a judicial meeting in which the issue was discussed in detail and the right inquiries made. we -- on advice from the chief justice and administrative justice we decided this was a case of, perhaps, misjudgment. and that it has to be resolved and resolved by giving her a pardon immediately. that's what i did. >> there are people in afghanistan -- >> to the future, i can assure -- to the future, to the future i can assure you that afghanistan has a long tradition of judicial applications. it's a country that has been troubled a lot, but it is also an old country with -- with laws and a penal code and judicial history. i can assure you that once the international forces are withdrawn and not as many as they are today, afghanistan will neither go to a trouble within the country or strive to miscarriage of justice. i can assure of that. >> there are people in afghanistan who believe this woman, gulnaz, should marry the man who raped her. do you think that that is appropriate? >> well, it's her choice. it's up to her to decide who to marry and who not to marry. >> mr. president -- >> and islam gives her that right. >> let me ask you finally, mr. president, 2014 is not just the date that is slated for the drawdown of foreign forces, it is also the date that your presidency expires. what is going to happen then to hamid karzai? will you run again? >> no, i will not run again. it is against our constitution. elections will be there, and a new president will be elected by the afghan people, and i will live as a former president and a citizen of afghanistan. >> you will live in afghanistan? >> absolutely. >> and do you believe -- >> this is my home. >> and do you believe by that time there will be some deal with the taliban? that their will be some kind of political settlement? >> i hope so. i hope so. i hope very, very much. that's what i've been working on with great dedication for the last many years. i hope that will be the case, and i hope we'll have a complete peace in this country. >> president karzai, as always, a pleasure. >> great pleasure to talk to you. all the best wishes. >> thank you. 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[ gargling ] oo-ay-ow. savings. savings. savings? progressive was the first to offer online quoting. you can do better. first to show comparison rates. ding! the "name your price" tool. oh! gosh, don't mind if i do. who was the first to offer pet injury coverage? we were. and when did you know you wanted to sell insurance? i said i wouldn't cry. um... whee! it's flo time. now, that's progressive. call or click today. last week marked exactly ten years since the term "bric" was coined. the catchy acronym for brazil, russia, india, and china used to describe the new powerhouse emerging markets. but the man who invented the moniker now says one of the four has been a great disappointment. no, not russia with all its recent troubles, not brazil whose economy contracted in the last quarter, and certainly not china which continues to power on. goldman sachs' jim o'neil says the country that has been the biggest letdown has been india. he pointed out last week that india's inability to attract foreign investment could actually lead to a balance of payments crisis. from bric to basket case, what in the world is going on? some numbers tell a troubling story. growth has dipped to 7% for the first time in two years. the indian rupee is asia's worst performing currency this year, falling to a historic low against the dollar. india's deficits are soaring, and funding is drying up. india received less than $20 billion in foreign direct investment in the first six months of 2011. china got three times that amount. even russia with the smaller gdp took in more. why is india struggling? sadly, the real problem isn't economics. india has a very dynamic private sector, probably the most dynamic in the emerging markets. but it has a government that simply doesn't work. and it's not for lack of knowledge. india has the know-how. the government is, after all, led by a reform-minded world-class economist, prime minister singh. the problem is politics. the world's largest democracy seems to be paralyzed. singh's government recently announced a plan to open up india's retail sector to foreign investors. a continuation of the reforms that jump-started the economy 20 years ago. the proposal would have made it easier for big western chains like walmart to set up shop in india. now indian agriculture is hugely inefficient. middlemen take huge cuts. and because supply chains are inefficient, up to 1/3 of farm products, vegetables for example, rot before they reach the market. so the walmart model would transform india's agriculture and its retail sectors. it would empower farmers, lower prices for consumers, and create huge gains in productivity. but it was not to be. india's opposition turned this into a story of the big guy fighting the little guy, walmart versus the mom and pop. parliament was gridlocked for days, and politicians mobilized mass demonstrations. [ chanting ] >> small stores across the country were kept closed and in protest. so what does the government do? instead of standing firm, it backtracked and canceled plans to reform the retail sector altogether. this is a depressingly familiar pattern. for two years now, india's government has done nothing, hanging on to power, presenting no plans to open up the economy, raise living standards, build infrastructure, or attract new investment. in the west, india's leaders sell the story of a dynamic, incredible india. ♪ india ♪ incredible india >> but at home, they pander to populist protectionist sentiment and dole out subsidies and do basically nothing. and that paralysis is hurting the economy. india's blessing and curse is that it has a messy, chaotic, decentralized democracy. unlike china, it has no unified sense of direction. but the prevailing view has often been that when the going gets tough, new delhi gets its act together. that's what it did 20 years ago when it was on the brink of defaulting in a balance of payments crisis. well, this time once again, it's time for urgent reform. new delhi has for years expressed pride in being part of the brics. well, if it doesn't get its act together, ten years from now, people might still be praising the brics except that the "i" in bric might stand for indonesia, not india. and we'll be back. we have an all-star panel looking at american politics, russia's protests, and europe's woes. stay with us. ♪ now i'm a geologist at chevron, and i get to help science teachers. it has four servo motors and a wireless microcontroller. over the last three years we've put nearly 100 million dollars into american education. that's thousands of kids learning to love science. ♪ isn't that cool? and that's pretty cool. ♪ ♪ ♪ mom? dad? guys? 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[ male announcer ] more people are leaving bmw, mercedes, and lexus for audi than ever before. take advantage of exceptional values during the season of audi event. there's much to talk about around the world, so let's get straight to our panel today. joining me, author, reporter, radio host, curt anderson, who wrote the cover story for this week's "time" person of the year cover. david remnick, peggy noonan, and gillian tett. welcome to all of you. we have to start with newt. >> newt who? >> peggy, you had a column. you talk about a friend of yours who devises bumper sticker for states and had a bumper sticker that said, "california: it's all true," meaning everything you hear about california is all true. your bumper sticker is "newt: it's all true." explain. >> he's a various sort of character. there's a lot going on there. you ask is this man experienced and accomplished? yes. is he intelligent? yes. is he erratic? yes. is he herky-jerky and drawn to eccentric, arguably, ideas? yes? has he had succe