Thank you all so much. I am Andrea Mitchell from nbc news and from msnbc, and you know tom donelan and steve. We are so happy to have two former National Security advisers who have had long experience in Public Policy and before and since their roles in government. I, of course, knew tom all the way back when i was first going to the state department and you were working with warren christopher, and steve from all the years in the white house, and of course, with National Security adviser role when secretary rice was secretary of state. So, thank you all so much. Weve had a great kickoff to this from jack lew. First, lets talk about, since he raised the questions of sanctions, and it is so top of mind right now with russia and with ukraine, steve, first to you. How effective have we been in mobilizing europe against russia . Weve seen the effects, the economic effects with the ruble, but how is ha translated into effecting Vladimir Putins behavior . Well, you dont know. One of the Great Questions is what makes Vladimir Putin tick, and i think its really hard to say. He on these kinds of issues runs that system, you know, out of his hip pocket. I mean, its really what is in his mind really is what matters. I think the administration was able to put together International Support for a sanctions regime. It has been limited. It is focused on individuals and institutions that have been associated with the regime and associated with this effort. Asset freezes, visa bans, those kinds of things. Threatened more institutional sanctions that would go after elements of the russian economy in the event russia would have intervened to upset the upcoming election, would have moved across the border with their own forces, rather than with money and personnel and weapons, which is what theyre doing every day. So, i think its been a useful element, but i think one of the problems is these sanctions are so visible and so public that they become sort of, in some sense the thing you reach for. And they are a useful tool, but they are only one of a series of tools, and that can be more useful in some context and in others. And i think in ukraine, one of the risks is if we focus only on the sanctions and dont look at other things we could be doing to over time reduce russias leverage on europe and to move forward with our vision of a europe whole and free. I think those things over the long term are going to be more important in deterring activity by putin. So, one of the risks you know, sanctions in some sense are a prisoner of their own success. Theyve been so visible, theyve been effective. People seem to turn what is a tactic into a strategy and not realize they work more effectively when theyre part of a whole series of u. S. Tools, including, quite frankly, backed up by the use of force. One of the things that got the sanctions together against iran was that both the Bush Administration and the Obama Administration said to countries, help us with sanctions on iran because the alternative to sanctions, bringing iran to the negotiating table, is the use of force, and nobody was enthusiastic for that. So, i think we have to not get seduced by sanctions and their visibility and their effectiveness and embed them in an overall strategy using all elements of power in order to achieve our objectives. Well, and to that point, tom donil donilon, youre the National Security adviser, or the secretary of state, and every the effective tool of sanctions, theyve been tried and tested. But in this instance with ukraine, there is no military threat, because i dont think anyone would suggest the use of force. There have been various criticisms that perhaps we should have done more in terms of military backup for the nato allies. But nobody has suggested that we would go up against the Russian Military over ukraine. No, well, i think i agree with stephen. First of all, its great to be here for the tenth anniversary of the terrorism and Financial Intelligence group at this Treasury Department. This, by the way, and well get back to this, i think this discussion underscores the fact that the name is currently inadequate, because you do a lot more than what is in your name, and i think this is an example of that. I agree with steve that the sanctions effort to impose a cost on putin and russia for their conduct here is one element of the strategy, and the other element to the strategy we do need to include, a number of things that weve been doing, which is the support to the ukraine government politically, to support the ukrainians in terms of getting their economic footing through the imf, through european support and our own support, absolutely critical going forward, reassuring our nato allies, especially those frontline states and nato, taking concrete steps to indicate our support through our Nato Alliance for those countri countri countries, and the president will be underscoring that in europe this week, but also imposing a cost here through sanctions. So, its one element of a comprehensive strategy here to address russias aggression and illegal activity in europe. In addition, i think there are a number of longterm things we need too do, including focusing with europe on diversifying their Energy Supply and having strategies for insuring theyre not as dependent on russian gas as they are today, and i also think its part of also moving forward, frankly, with our economic negotiations and getting the tea tip agreement done with europe. That said, with respect to the sanctions, i actually think theyve had an effect. If you look at the facts, as secretary lew laid out, in fact, most of the assessments right now with respect to the Growth Prospects for russia for this year and next year have been dropped substantially, probably into a contraction. Youve had capital flow. Secretary lew indicated that the estimates would be maybe 100 billion of outflow this year. I think it may be higher than that. We had 60 billion of outflow just in the first quarter. And the former finance minister said maybe as much as 150 billion. You had lots of investments in russia, so i think its had an effect. I think its had an effect on some decisionmaking and its been a deterrent from some of the worst kinds of conduct that putin might have engaged in. Last in respect with putin. My judgment is the same as steves. It would be inaccurate to describe this as a system decision because it really is an autocratic system with putin making the decisions. Thats certainly my observation from spending part of my time with him and in that system. So, hard to know which pressures get which results, but my own judgment is that, in fact, russias actually more and its not a simple calculation because there are costs as well but i think russias actually quite vulnerable to a target of sanctions. Last thing ill say on this is that putin can say that i think i said that three times, but thats okay. No, no, its all good. Youre doing fine. That you know, the Foreign Policy that president putin seems to be pursuing right now is a turn away from integration of russia into, with the west politically and the security, which is something, two administrations have been many administrations, the Clinton Administration had been pursuing. Hes turned away from that, right, and has a Foreign Policy now defined i think, steve, youd agree by negative opposition to the west and in counterdistinction to the west at this point with russia taking the unique stance, pull back, well, in terms of political cooperation. That said, you cant pull back economically. He can stand defiantly politically, but at the end of the day, the russian economy cant stand defiantly in the economic realm, and they really are vulnerable, i think, to this, and i think its made a difference, frankly, in terms of his decision. I think the decision hes trying to make is balance his conduct versus causing the west to put the most aggressive secretatori sanctions on him. I want to follow up with the west, but steve, if his option is to make, pardon the phrase, a pivot to asia, can russia counterbalance his losses in europe by what weve seen recently in his negotiations in china . He can help, certainly on the energy side, to have additional sources of export for his oil and gas. My understanding, though, is that the expectation is that the oil and gas that will go to china is largely from the western part of russia. So, he will continue to be dependent on having supply sorry in the eastern part of russia, he will continue to need to have supply to europe and beyond, the western part. You know, putins interesting, and i think one of the ways to think about putin, and we saw this when he went into georgia in 2005 hes very he has a longterm strategic view. He believes in russian greatness. He believes that he has a historical role to restore russian greatness, not the soviet empire, but a russian empire, if you will, through this Eurasian Union that is contradistinction to europe and to the west and to china and asia. And i think he will go as far as he can in pursuing that agenda, depending on how much he succeeds and how much resistance he gets. When he went into georgia, we were concerned that today georgia, tomorrow the crimea, and the day after the baltic states. Well, putins twothirds of the way there. And if he were to try against the baltic states, particularly latvia, for example, what hes doing against ukraine, and call into question the article 5 guarantee of nato, that is really an effort to split nato. And its very interesting that he has been currying favor with the extremist parties in europe of both the right and the left that did so well in the European Parliamentary election. Those parties are all unified by one thing and one thing only, they dont like the eu. So, in some sense, if youre putin, youre playing an interesting hand, you know. You can take advantage of these opportunities, disarray, as occurred in kiev. And how far he goes depends on how well he does and how much resistance he gets. But the stakes are very high. The stakes really are about the kind of europe were going to have in the future, whether its going to be a europe whole, free and at peace, based on our values, or is it going to be a russiancentric europe with a kind of regime that putin is imposing in russia . Because its interesting, and ill stop, its interesting that his activities in ukraine have been paralleled by even greater crackdown internally on political and civil rights. That hasnt gotten, by the way, i think, the kind of attention in the west that it deserves. The internal level of repression and activity against opponents inside russia is at a level we havent seen. And through the propaganda efforts that we havent seen and against the media. Absolutely. We havent seen really since the fall of since the crack of the soviet union, and this is all a piece, i think, with respect to china. Putin was clearly trying to indicate that he has alternatives through trying to negotiate this longterm gas deal in china. You know, but in kind of an irrelevant time frame here, remember that, i think the total trade relationship, economic relationship between russia and china right now is about 80 billion, which is a small portion of trade relations with the United States, particularly with europe. So, its and i think a lot of competition historically, a lot of competition in central asia. So, well have to see how this ultimately develops, but i do believe in medium term here, theres a lot of pressure that can be put on russia. You know, here treasury has these enormous tools with sanctions. And as have been described to me, the targeted sanctions you refer to are to try to not make any of our european allies bear the full brunt of the pressure. So, we know frances vulnerability on arms exports and the uk on finance and germany, obviously, on energy, but the attempt to try to spread the pain . The leaders have been remarkably supportive, given how hard it was to bring them around. But as we see in the european elections and as we hear anecdotally, i was just in italy and was speaking to the people in the media there, leading figures in italy, from france, speaking to people from germany. The populations are not really where we are regarding putin. People were questioning me, why are you americans so upset about Vladimir Putin . Now we see hollande inviting him to normandy. What would you as National Security adviser, either, both of you, what would you advise the president of the United States to do going to europe this week and having what will obviously be some sidebar conversations with putin. How do you try to hold the coalition together when they are under such pressure from their business interests and their populations . Well, one of the problems europe has, and tom and i were talking just before, and he can pile on to this because hes just been back to europe, but europe is in a bit of a crisis. Theyve now had close to a third of the voters in the European Parliament elections opt for people that are antieu. They are in some sense a crisis of leadership. Its still the question of who speaks for europe. And they will now have a head of the eu council, a new Foreign Policy spokesman. Who are those people going to be and how much are european leaders willing to let them actually speak for europe and take decisions for europe, which the individual countries will back up and support . So, there is a problem. The eu project has always been an elite product. It never has really been sold to the european people. Youve seen that in the referendums over europe in the last four, five, six years. And now there is a question of is europe going to move forward to have speaking more with a single voice in Foreign Policy or is it going to continue to be the voices of the many . So, one of the problems is that the president doesnt really have a solid partner, and it has a solid partner that is internally focused and in crisis. I think its good that hes going. I think its very good that hes going to poland, and i think his speech there will be very important, because he is going to have to show the vision of the future and to try to, in some sense over the heads of the leaders, rekindle some excitement in europe for the vision of a europe whole and free and at peace, something that we kind of stopped doing in 2008 when the expansion of nato stopped, the expansion of the eu stopped, and we kind of left countries like ukraine in the middle between the west on one side and russia on the other. Thats a bad place to be. And i hope the message he will send is its time for us to get back into our vision of what a europe should be and not by default leave space for putin to pursue his. I couldnt agree more. I think its well, whats happened, of course, is in the recent parliamentary elections you had a strong indication that a segment of the european population thinks that theyre not delivering for them, and there really is a lot of effort thats going to have to take place here in order to bring leadership more in line with the expectations of the people and actually deliver. I think the president s role will be to underscore the stakes, andrea, here, and to underscore the importance of solidarity and in the u. S. europe relationship, to underscore the obligations that we have to our partners here. And by the way, i know theres some debate about the wisdom of nato expansion, and theres been some commentary that, somehow, that the United States pursue the nato expansion through the Clinton Administration and into the Bush Administration was somehow responsible for the direction russia had gone in here. Well, i dont think you can really make an argument that, in fact, the direction in which Vladimir Putins taken russia internally has much to do with nato expansion. And number two, through those years, the United States repeatedly reached out to try to work on integration efforts with russia. And number three, i think as we sit here today and you look at the conduct of russia since 2008 and again now in 2014, we should be very happy we engaged in nato expansion. If you sit in a baltic state or you sit in poland today, you are very happy that youre a member of nato, and it makes a huge difference with respect to what putin can consider, what russia can consider that it might do and what is off the table. So, i do think this has been a very important strategic initiati initiative, and i think it needs to be underscored and embraced during the course of the president s trip. And its been pursued by three administrations, because there has been an enlargement of nato under clinton, bush and the Obama Administrations. This has been a bipartisan policy, and its served our country well, and it served europe well. And the argument that somehow this is forced russia to take the direction it has domestically or in terms of its Foreign Policy i dont think holds water. If you are at treasury and you are negotiating and working with the allies on sanctions, how much is your leverage undercut by the snowden leaks and the postsnowden era and its effect, if not personally on Angela Merkel she can get over it but on the Political Sentiment in europe against the United States . Steve . Well, its difficult. And i want to make a plug here for my colleague, juan zerade, who has written a wonderful book that tells the story, and its a great tale about how treasury got into this business and really developed these new tools. Certainly and one of the things thats very important, and tom will talk about this, is the importance of treasury as a source of intelligence and inf