Global Challenges and Opportunities in U.S. Foreign Policy: A Conversation with R. Nicholas Burns

DOYLE MCMANUS:  (In progress) -- this evening, but my sole function is to get a good conversation going.

Before we get started, please remember to turn off your cell phone, your BlackBerry, anything else that may make noise or distract you from our proceedings.  I'd like to remind all of you that the presence of the cameras indicates that this meeting is on the record.  And there are journalists present working as journalists and not just as council members. 

Nick and I are going to start this evening with a little bit of conversation, but we want to open it up to you as soon as we can.

Nick Burns really requires no introduction to this audience.  He's had an extraordinarily distinguished and successful career of 26 years in the Foreign Service.  Many of us have known him in many different guises, in all of which he has been impossibly smart, impossibly unruffled and I may add impossibly young.  (Laughter.)  His official biography notes that he is a lifelong member of Red Sox Nation.  Unaccountably, his official biography does not include the remarkable encomium he received from the columnist Robert Novak who described him as the Svengali of the State Department -- (laughter) -- the diplomat who had mesmerized Condoleezza Rice and turned her from a robust unilateralist into the rather conventional multilateralist we see today.

Well, in the next hour, we're going to see -- (laughter) --

R. NICHOLAS BURNS:  Thank you very much, Doyle.

MCMANUS:  In the next hour we're going to see whether Nick's hypnotic powers work only one-on-one or whether they're effective in large groups as well.

Nick, I want to start this way.  There's only 10 months left in this administration.  We're going to have a new president shortly.  If you were in a briefing for that new president, whoever he or she turns out to be, what are you going to propose?  What are you going to tell that new president that she ought to focus on and get to work on right away?

BURNS:  She or he, I imagine.

MCMANUS:  She or he.

BURNS:  Yeah, good.  (Laughter.) 

Well, Doyle, thank you very much. 

And it's nice to be here with everyone at the council.  And I want to thank the council for inviting me and giving me this opportunity to speak to all the members.  I'm also a member of the council, so it's nice to be among friends.  And I just wanted to thank all of you for coming. 

A lot of friends in the audience and a lot of distinguished ambassadors in the audience, including the ambassador of Pakistan, Ambassador Durrani.  And Ambassador Patriota of Brazil is here who is a great friend of mine.  And if I've missed any other ambassadors, I apologize.  The rules of etiquette and diplomacy are that we must recognize each other, and these are two great friends of mine.  So thank you very much for coming and taking time from your busy schedules.

Doyle, it's nice to be with you.  I would answer your very good question -- I don't know who's going to be elected president among the remaining candidates, but I do think this is a critical time for America and for our role in the world, particularly our leadership role.

And so what I believe is that Americans need to situate themselves in the world and recognize our power.  And it's obvious probably to a council audience.  But it does, I think, bear reminding that we are, by any metric of power -- political, economic or military -- the leading power in the world.  But that doesn't mean that we can act alone in the world or should want to act alone in the world.  And I think the most important thing that I could say based on my 26 years as a Foreign Service officer, as a career diplomat is that Americans need to be mindful of the fact that we've had somewhat of a checkered 230-year history in the world.  There have been times of intense engagement by our country in the world going back over the last two centuries and in times of relative isolation from the world. 

And I do think that if 9/11 taught us anything, it is that we cannot fall under the illusion that isolationism is a way forward for our country.  And that might have been a logical policy in the 18th and 19th century.  You could even, I guess, have made a theoretical case for it before the First or Second World War.  But in a globalized world where America is the dominant power but where so much is at stake for our country and so much is riding on our ability to be an effective leader and to rebuild international institutions, I think we've got to reject unilateralism.

And there's no question that we cannot act alone in the world, either.  And if there are remaining people who think that we can be unilateralists, I don't see many of them in the Bush administration.  And I think you've seen over the last many years both President Bush and Secretary Rice say that we've got to be engaged in the world with the rest of the world.

We are making a great effort to turn back towards the United Nations and to help not just literally rebuild that great building in Manhattan but figuratively as well.  And we know that there are wide swaths of the world where the United Nations is absolutely critical.  And I would say that peacekeeping in Africa is one of those places, and the U.N. deserves our support.

And we know that on a regional basis, whether it's working, say, on this U.S.-Brazil strategic partnership that Ambassador Patriota and I have been very much involved in together, or a new strategic priority of relations with India and the incredible strength that we now find in our relationship with India, or in a multilateral sense working with the African Union on the question of Darfur, or trying to prevent further war and instability in Somalia, or trying to attend to the problems of the Congo, the United States cannot and should not want to go it alone in the world.  And so I think that as Americans, we need to reflect on this, the hand that we've been dealt as a global power, and understand that our power is really a function of our ability to work collectively with others, whether it's in our priority relationships, our alliances with NATO, Japan, South Korea and Australia -- and Secretary Rice is in Japan and South Korea this week to build up those alliances -- or whether it's looking at the international institutions that form the basis of the global picture right now.  So I do think that's important for Americans -- principled, purposeful engagement, working with other institutions and other countries around the world.

And very quickly, I would also say that our strategic focus has changed quite dramatically just in the last 10 years.  I was overseas for the last eight years before I took my present job.  And I was reflecting when I came back from Europe after four years in Greece and four at NATO how much the strategic view from Washington had changed.  It's not all about the Middle East and South Asia in a lot of ways.  You know, for most of the 20th century, we had to have our strategic focus firmly on Europe, because that's where the great challenges were to us in terms of war and peace and our national security, it was on the line in Europe.

There's no question, especially after 9/11 with the Cold War past now 15 years, 20 years ago, that the mortal challenges for us are in the Middle East, they're in South Asia, and that we are now much more active in both of those regions than we ever have been before.  And I don't want any European here to think that Europe is no longer important, because it is.  But our European policy is now a function of what we're trying to do with Europe in the Middle East, in South Asia, in defining a new relationship with China, in our programs in Africa.  For instance, the malaria and HIV/AIDS programs and the conflict prevention programs we're involved in.  And that's a very different strategic view for our country than we've ever had before. 

And it does mean that we have to play on all fields.  We can't choose to be active in three or four areas of the world and inactive in others.  We have to be in fifth gear and purposeful and working hard in all parts of the world but particularly in the Middle East and South Asia where we're fighting two wars in Iraq and Afghanistan.  And where we have these huge, strategic, positive opportunities, like the relationship with India but also trying to figure out some of the larger problems in these areas, like the Israeli-Palestinian conflict which is now close to its 60th year, May 14th being the 60th anniversary, May 14th, 2008 of the creation of the state of Israel and the dispersal of the Palestinians from the land of Palestine throughout the Middle East.  And so I do think that's another trend that we need to be mindful of.

And last I'd say we play a lot of attention to our hard power in the United States, and we should.  We're proud of our military.  It's a principal asset for this country in terms of our ability to project power and defend the country.  But we know that we have a great source of strength in the government as well as in the private sector as a soft power.  And there's no question that our diplomatic corps is just too small.  We're about 6,500 people, 6,500 American diplomats in the world today.  Our aid mission is down to about 2,000 -- a little less than 2,000 -- professionals, and we're being asked to do so much to project American interests, commitment, power and to work with countries and organizations.  We have more musicians in the Pentagon than we have diplomats in the State Department -- (laughter) -- and that's true.  Isn't that a great example? 

And that's why Secretary Rice publicly two weeks ago said she wants to add 1,100 diplomats to the State Department and another 300 aid officers to USAID.  Because we can't contract everything out.  And we can't have a foreign policy that is heavy on one side, the ability to project hard power, but doesn't have the ability to harness the incredible strength of our business sector, of our NGO community, of the academic community to make the kind of impact that we can make around the world using all of the talents and resources of our society.  So I'm really convinced of that.

I noticed CSIS has done a great study called Smart Power that Joe Nye and Rich Armitage led.  I read it, and I was really attracted to the central message of that piece of work by CSIS.  And that is that a country's power is a function of all the talents of a society not just one part of a society.

So as I near the end of my -- very quickly -- diplomatic career, that's something that's very much on my mind as well.

MCMANUS:  Let me continue the metaphor of briefing the next president for just one question at a slightly lower altitude.  Those are all good starting points.  I think it's striking that in this presidential race, there is no isolationist candidate.  All the candidates are talking about engagement in the world.  They've got different ways of going about it, okay.

BURNS:  There had been some candidates --

MCMANUS:  There had been but they have --

BURNS:  -- very much for a closed America, but those candidates are no longer here.

MCMANUS:  Fair enough.  When George W. Bush came to office, Sandy Berger, the outgoing president's national security adviser, had a briefing for his aides and said there's a problem that you may not have focused on enough, you're going to focus on it more than you expect, and you should pay attention to it right away, and that problem was terrorism.  Obviously, we're seized with the problem of terrorism now.  No incoming president needs that reminder or should need that reminder.  But are there any issues that analogous now that you think the next president needs to spend more time on than he or she may anticipate?

BURNS:  Well, I guess if I could look for a 2008 equivalent of what Sandy mentioned to the incoming administration in 2001, it might be energy, energy as an all-encompassing, international issue.  It's amazing, if you sit back and reflect on the array of challenges that our country faces, that we face at the State Department every day, both positive and negative, the common denominator of many of them these days is energy.  Now, energy as an issue for the United States, both production and looking for sources of energy, has been around for several decades.  But think about it in a couple of different ways.

Think about the distorting power where some countries in the world, who we think are playing negative roles in the world, have a much greater capacity to be powerful and to act and be influential in the world because of their energy resources.  Venezuela in our hemisphere.  We have a famously difficult relationship with Hugo Chavez.  Think of the distorting power that energy has given Iran and President Ahmadinejad. 

In another way, think of the distorting power that energy has given Burma in Southeast Asia.  Think of the crucial fact that if we're going to deal with what I think is probably the most pressing international problem of our time, global climate change.  That's my personal view.  Think of the role that energy plays in the right decisions we need to make about energy, about carbon and reducing our carbon footprint as societies and globally that energy has on that issue.  Think of the price of oil, over $100 again today, and the impact that has on our society, our economy, our power base in the world.  And so I'm continually amazed at how often on issues where you might not think that energy is a central factor is a central factor.

I'll give you one more example where Antonio and I have been working together and that's the search for alternative energy.  Brazil and the United States represent about 75 percent of the world's biofuels market as producers of ethanol -- Brazil sugar-based, America corn-based ethanol.  We've tried to turn that in a positive direction to be a positive force not only in our hemisphere but globally.  And so when President Lula and President Bush met in San Paulo about a year ago when President Bush traveled to Brazil, they agreed on three things that Antonio and I have been charged to work on together, Ambassador Patriota and I together. 

One is that we ought to be looking for a way to be more efficient in the production of biofuels, looking at cellulosic production.  Two, that we ought to try to help more of the poorer countries in our hemisphere in Central America, in the Caribbean become producers of biofuel, because many of them do have a comparative advantage.  And three, can we think about biofuels as a global commodity to be traded worldwide?  And can we think about the creation of a global market for biofuels?  We think that biofuels make sense for countries that have to import a lot of their energy.  And we know that biofuels can be a tremendously positive source of income for poorer countries in our hemisphere and in countries in South Asia like Sri Lanka or India.

And so this is a connection point between President Lula and President Bush, between our two governments.  And I think that's a more positive example instead of some of the negative ones that I gave at the beginning about Iran and Burma and Venezuela.

MCMANUS:  I think a lot of people in this audience are wondering, Nick, why you're leaving the department now.  Ten months to go -- (laughter) -- you have had some of the most important issues on your plate of anyone there.  A cynic would look at this picture and say, ah, 10 months to go, the talks with Iran aren't really getting anywhere, the chances for success are nil.  Nick Burns is a smart guy, that must be why he's getting out.  Now, a pessimist might look at this picture and say, 10 months to go --

BURNS:  I (think that ?) my point of view expressed today, too.

MCMANUS:  You do?  Good.  I just want to set up a choice for you.  (Laughter.)  A pessimist would look and say, Iran and the West appear to be on a collision course, and this can have no good end.  Something terrible may happen, and that smart guy Nick Burns is getting out before it does.  So I want to know which of those two camps you're in.

BURNS:  Neither.  (Laughter.)  But thanks for giving me the choice, Doyle, I really appreciate that softball.  The reality is that I've had a wonderful career.  And I only ever wanted to be in public service from the time I was in high school and college.  And I've had a great career.  I've enjoyed the State Department.  I've had a chance to work in Africa, the Middle East, Europe, a chance to work in the White House for President Clinton and President Bush 41, and so I'm very grateful for the opportunity I've had.  I think every Foreign Service officer who's held my position as undersecretary has retired in that job, because you really can't go much further in the State Department.  And so I always knew this would be my last job in the Foreign Service.

I intended to leave about a year ago.  I stayed because we had an exodus after the mid-term elections in 2006 from many of our senior positions.  And I am such a great believer in our secretary of State and have so much personal loyalty to her that I didn't want to leave when so many others were leaving, and so I stayed an extra year.  And she and I have talked about this for quite a long time, and it's really a good decision for my family and for me to get on and do something different.  Whether that's in academia or in the nonprofit sector or in the for-profit sector, I don't know yet.

But it's a logical decision for someone like me to make.  And I'm going to miss not being part of this, certainly, over the next 10 months.  I think this administration will sprint to the finish, as the Clinton administration did in 2000.  There's this truism about campaigns and election years in the United States and foreign policy, which I don't see much truth in, and that is that somehow the United States can't both conduct an election and conduct a foreign policy by an outgoing administration at the same time.  The world's not stopping.  It's still spinning on its axis.  Events happen every day in which we have to be engaged.  And as we saw with President Clinton in 2000 when he went right up to the end of the administration trying, I thought, with great, great conviction to reach a peace between the Israelis and Palestinians, Secretary Rice is bound and determined to keep the Annapolis process going.

She is in Seoul today and will be in Beijing tomorrow to push forward on the North Korea talks where we have a chance to convince North Korea to make this declaration, to complete this process of denuclearization, which would be historic and a great, great boon to stability in North Asia.  We certainly have an opportunity to keep working on constructing these very important partnerships with the rising powers in the world, with Brazil in our hemisphere, with Nigeria and South Africa in Africa, with India in South Asia, to be very much involved with our friend Pakistan -- Ambassador Durrani is here -- and to put our best foot forward to try to contribute to peace and stability in Pakistan and on the border with Afghanistan.

And on Iran, I don't think that conflict with Iran is inevitable.  I think there's plenty of space for diplomacy.  I hosted a meeting today of Russia, China, Britain, France and Germany, the Perm Five countries.  We are working on a third sanctions resolution that we hope to be voted on the next 10 days in New York.  But we're also working to try to reaffirm our willingness to negotiate with Iran and sit down.  And Secretary Rice has said if Iran would just finally accept this offer from the P-5, she'll be there personally. 

So the world's not going to stop.  America has national interests that'll be engaged until noon on January 20th, 2009.  This administration will hand the baton to the next, whoever that next administration whoever those people are, and I think there's a lot that can be done.  And so I think that this administration, I'm going to leave it, but I think this administration is going to make a great effort to work for the country on all those issues.

MCMANUS:  Let's talk a little more deeply about Iran.  At an earlier stage, some people in this administration hoped at least that the Iranian nuclear issue could be resolved before this administration left office.  Is that a realistic hope?

BURNS:  I don't think so.  I think that this is going to be a drama that plays out well into 2009 and beyond.  And I say that because where we are is that I think the world has spoken.  The Security Council, the International Atomic Energy Board of Governors, nobody wants Iran to become a nuclear weapons power.  Everyone is asking Iran to suspend its scientific research and development into enrichment and reprocessing.  That's what this third Security Council resolution which is going to be voted positively is going to say.  That's what Dr. Mohamed ElBaradei said in his report that he issued on Friday afternoon.

I can count on one hand the countries that support Iran continuing this nuclear research -- Syria, Belarus, Venezuela and Cuba.  And with those four countries as allies, I mean, Iran could have them as allies.  But when you have the Perm Five countries, India, Egypt, Indonesia and most of the other leaders of the non-aligned movement voting for sanctions and implementing the sanctions, Iran's in a very tight spot.  So what I think will happen is, given the fact that Iran is not monolithic, it has a great variety of views within its own government, you're going to see this push and pull of the international community continuing to sanction Iran.  After the Security Council passes its third resolution, the EU, I'm quite sure, will pass a much tougher sanctions resolution.

Can Japan, South Korea and the major Arab trading partners of Iran then begin to drawdown their own economic relations?  Can we begin to pressure the Iranians more effectively?  Can the financial sanctions that Secretary Paulson has engineered so adroitly, can they continue?  So the Iranians get the message if you don't stop your nuclear research, if you continue the drive to enrich and reprocess, we are going to tighten the circle around you, the economic circle.

And at the same time, can we put out the prospect of negotiations so that the Iranians know there's something positive for which to negotiate.  We said in 2006, the Perm Five countries -- we reaffirmed today, by the way, in our meeting -- that President Putin's idea that the Perm Five countries should form a consortium and create a civil nuclear power sector in Iran, that's still on the table.  We think that's the way forward without giving Iran access to the fuel cycle.

So I would imagine, Doyle, there's plenty of room for this type of diplomacy, both the sanctions as well as the positive offer to negotiate.  That will continue, I'm quite sure, into the next administration.

We Americans have a clear national interest in preventing Iran from going nuclear.  But in trying to draw them into a set of negotiations that would allow us to achieve a resolution of this very difficult problem by diplomacy peacefully, I don't know it will end that way, but I sure hope it does, and I know we have time to exhaust those diplomatic options.

MCMANUS:  Now, of course, as you know, some of the critics of this policy say, well, your track of sanctions and diplomacy is proceeding at this pace, and the Iranian enrichment program is proceeding at a faster pace.  This new round of sanctions presumably has to be qualitatively tougher, not just incrementally tougher, to change Iran's behavior.  Is that premise correct, and is that realistic?

BURNS:  I think the premise is correct that the pace of Iran's nuclear research at Natanz at their enrichment and reprocessing facility -- just read the ElBaradei report of Friday -- that's outpacing right now the sanctions.  And that's why in 2008 we're very hopeful that there will be a third sanctions resolution, as I said, in the next two weeks or so.  And then we'll see other countries that are trading partners begin to say to the Iranians we're not going to treat this as business as usual.  I think the European Union will be up first.  I think they will meet that challenge knowing the Europeans, knowing how concerned they are about the Iranian problem. 

But the world needs to get more serious.  If the international community does not want to have a military solution to this problem, and we all want to avoid that, then diplomacy and sanctions need to become more effective.  And that means that countries need to give something up.  It means that countries like China, now the leading trade partner of Iran, need to restrict those relations, those economic relations, in some fashion to send that message to the Iranian government.

And what we hope, over time, is that the Iranians will see that they are completely isolated internationally on this issue with the exception of those four countries.  It is incredible to think that in that huge country, very talented country that does not have one nuclear power plant operating, Iran is putting billions of dollars into the enrichment and reprocessing of uranium.  Why are they doing that if they don't have a single nuclear power plant operating?  If the only nuclear power plant that is going to operate in the next decade is being built by the Russians, the Iranians will not have access to the fuel cycle.  The Russians will ship in the nuclear fuel and take out the spent fuel.

And so you really have to question the motives of this current Iranian leadership.  And that's why the world needs to get more serious about the problem and why we need this third resolution New York, which I think will be qualitatively stronger, maybe not in the way you suggest, Doyle.  I think this resolution will be perhaps incrementally stronger in some areas, qualitatively in others.  But we've got to get more serious, and we've got to put both the carrots and sticks both have to be in alignment. 

MCMANUS:  I'm glad you mentioned China.  Is China getting any closer to sanctions tougher than those the Security Council will vote?  And has China's modern leadership ever subordinated its commercial interests to this kind of strategic issue?

BURNS:  I hesitate to be a spokesman for the Chinese government with Secretary Rice arriving in Beijing, I think, as we speak.  I think I'm going to avoid the first part of your question.  But I will say this.  One of the things that we've tried to focus on in our relationship with China and this administration is to say we want a close relationship, we want to work with China on a global basis.  China is most certainly a rising power in the world in every dimension.

I think Bob Zoellick when he was deputy secretary of State, now World Bank president, really said it best.  Can China be a stakeholder in the international system?  And if you think about the virtual global governing board of the world -- the virtual global governing board -- certainly we're on it, and the EU's on it, and Japan and South Africa's on it, and Brazil's on it and India.  Can China be part of that virtual board and think of itself as not just a country that is pursuing its own interests in the world but sometimes has to help all the others manage our collective interests?  And so that means on North Korea, China has been a leader.  On Burma, I think we've seen less leadership.  We'd like China to send a tougher signal to the Burmese military dictatorship.  On Darfur, we certainly want China to help the United Nations get a peacekeeping force in there that will be able to protect the civilians who continue to be affected by raids from the Janjawid militia and others.

And in Iran, it means that all of us have to give something up.  If we were to conduct an international policy that's effective on Iran, all of us have to sacrifice.  We've had 30 years nearly of American economic sanctions on Iran.  It's time now for Russia and China to contribute as well and to give something up so that Iran gets the message that we're not going to have full-throated relationships with it economically as long as they're trying to achieve a nuclear capability.

MCMANUS:  The time has come to open questions from the floor.  I think there are microphones that are going to make their way forward.  And so I would ask you first to wait for a microphone and to stand, identify yourself and your affiliation if you would, and please try and make your questions as direct and brief as possible.

QUESTIONER:  Thank you.  Hope Harrison, George Washington University, at the NSC 2000 to 2001.

My question is about Russia since you have a lot of experience dealing with Russia.  Obviously, we need Russia for so many things.  And I'm just wondering what the best way you think to deal with sort of the severe backsliding on the issue of democracy, lack of free elections.  Is the only thing to deal with this quietly with the Russians?  You know, what's sort of the balance between the public versus the private way of dealing with that?

BURNS:  Hope, thank you.  I think it's a very, very pertinent question, and it's a difficult one.  I'll try to do justice to it.  I'm not sure the Russians have elected to have a very quiet relationship with us over the last year since President Putin's speech in Munich a year ago February and all the way through to the present day, including a very shrill press statement that they issued yesterday on Kosovo.

But I would say this.  We have to keep our cool as Americans, and we have to balance these interests that we have with Russia, and we have to be honest about the differences that we have on the one hand and where we work well on the other.  Where we work well, clearly, if you're an American these days, you look out in the world and you say, well, we've got two great, compelling, global interests -- counterterrorism globally and counterproliferation.  And Russia's a partner, a very strong and effective partner, on both of them.  On the Six-Party talks and on Iran, Russia and the United States have worked quite well together to limit the proliferation risks of both those countries.

On terrorism, from September 12th, 2001 when President Putin was the first world leader to call President Bush until the present day, we've worked very effectively together to try to limit the spread of al Qaeda and some of the other terrorist groups that threaten both of our countries.

On the other hand, we have to be clear when we disagree, and we shouldn't be shy about it.  And I think the relationship should be strong enough that it can withstand open disagreement.  And the Russians haven't shrunk from that.  They've given us lots of public advice over the last year, and we've listened to a lot of it.  We have not seen President Bush and Secretary Rice and Secretary Gates kind of respond to that tit for tat.  We thought that would be unproductive.  We didn't think that was the right way to carry forward a relationship.

But there's no secret that we've been disappointed by the centralization of power in the Kremlin, disappointed to see that some of the promise of democracy from the '90s has not withstood this decade.  We certainly do not appreciate the fact that Russia has often been unnecessarily aggressive in what they've said about Georgia, for instance, about Moldova, about our NATO ally Estonia a year ago during that extraordinary period of cyber attacks on Estonia itself. 

And then just in the last week, we've seen a quite public divergence between Russia and the United States on Kosovo.  You know, we're the ones who have been in Kosovo for the last nine years -- our troops, our money with Europe.  Russia left four years ago.  We're the ones that asked the United Nations to appoint an emissary to figure out the future of Kosovo.  And when President Martti Ahtisaari a year ago this month said the future should be supervised independence, the great majority of countries that live in Europe and are involved in Kosovo said we support that.  We then delayed recognition of Kosovo by nearly a year at Russia's request.  We engaged in 130 days of negotiations alongside the Russians, tried to bring the Serbs and Kosovar Albanians together.  They didn't succeed, those negotiations.

And so we took the logical decision a week ago today.  We recognized an independent Kosovo as have 30 other countries in Europe, and now we're seeing lots of the Muslim and Islamic world begin to recognize Kosovo as well.  I think Russia's quite isolated.  And when the Russian ambassador to NATO last Friday morning threatened brute force -- brute military force -- if this situation didn't go Russia's way, I assume he made a mistake.  I assume, because he's not a professional diplomat, he's new in his job, he probably misspoke.  But I thought it was logical of our country to say to the Russian government you might want to be responsible, at least have your ambassador to NATO be responsible in its public statements.  And you might actually want to repudiate that public statement, which has not happened.

And so here's an issue over the last week where we have quite different views where we know we are acting in the interests of peace and stability and where our troops and European troops are on the ground and will continue to be to keep the peace there.  So we can have an open relationship, but I think it's important for Americans to not think that because we have these disagreements somehow there aren't areas where Russia and the United States can work together, because we certainly can, and we ought to balance those interests for the future.

MCMANUS:  Here in the third row, sir.

QUESTIONER:  Lloyd Hand, King & Spalding.

Mr. Secretary, my question is about NATO.  You just made reference to it.  Listening to Secretary Gates' comments, both publicly and privately recently, it appears that we're not being as successful as we might like to encourage participation by NATO countries, particularly in Afghanistan.  Given the fact that many think that Afghanistan is a test for NATO and its future role, what do you see as the leverage that we have to make it successful? 

And just squeezing in a little twofer here, going back to another comment you made, I heard Congressman Murtha say the other day that he offered to put $1 billion in the appropriations bill last year to make it more possible for Defense and State to work together in the objective that you articulated.  I'd appreciate your comments on that, too, please.

BURNS:  Thank you very much.  I'll try to do justice, very briefly.  Well, as you can imagine, I'm a former ambassador to NATO.  I quite strongly support of this transformed alliance.  It really doesn't look and act much like the alliance that won the Cold War, because we live in a different world now.  And in a lot of ways, NATO has become the most effective peacekeeping organization in the world.  We went into Bosnia in '95 and stopped the war, NATO, and have kept the peace there now since November 21st, 1995.  We went into Kosovo in 1999, stopped that war and have kept the peace in Kosovo.

We now have the most challenging mission we've ever had.  It's the first ground mission, if you will, fighting mission, in the history of NATO going back to April, 1949.  We never had to fire a shot during the Cold War, mercifully.  And now we're engaged in this very, very difficult counterinsurgency campaign against the Taliban and al Qaeda in one of the most difficult countries in the world in which to conduct a campaign, mountainous with very little infrastructure, very far from the base of NATO in Western and Central Europe.

And so I think Secretary Gates has been absolutely right to press the point that we need all hands on deck.  We need every ally to be committed.  And what we have is we've got every ally in Afghanistan, thankfully, and we're grateful for all those contributions.  But in the south and east of the country which is where 98 percent of the fighting is we have nine allies of the 26, including the United States.  And some of those allies are Estonia and Denmark and Romania and Bulgaria and Canada and Britain and the Netherlands, and they all put their soldiers on the front line, they've all taken casualties.  But some of our larger continental allies, Italy and Spain and Germany and France, are in the north and west where there's no fighting or relatively little fighting.

So we've been suggesting, looking forward to the NATO summit in the first week of April, is that all of us need to be willing, on a rotational basis, to serve in the toughest part of Afghanistan.  All of us have to be willing to engage in a counterinsurgency campaign where you try to marry your military tactics with civilian assistance and humanitarian aid and job creations as we go into towns to liberate them as we did in Musa Qala in 2007.  But we're not doing that effectively enough.  And so that's the challenge for NATO and Afghanistan.

I do think the alliance can meet the challenge.  We have to meet it if NATO's going to stay central in this fight on the war on terrorism.

And very quickly, one of the more positive stories that has receive very little press coverage in Washington has been the willingness of the Defense Department, of Secretary Gates and of the Joint Chiefs to try to work more intensively with the State Department on this issue of humanitarian stabilization after a conflict is over.  As we've intervened in Bosnia, Kosovo, Macedonia, Afghanistan and Iraq over the last 10 or 12 years, we've found one thing, one central truth.  We have an extraordinary military.  And when they apply themselves to offensive warfare, there is no other military in the world that can do what our military can.

Unfortunately, what we've found is that our capacity on the civilian side of the government in the State Department and USAID is rather limited to go into a conflict area just after hostilities have ceased and to try to be involved in civil affairs, rule of law promotion, delivery of humanitarian aid, to assist refugees.  And what we've had to do because of the paltry resources on the civilian side of the government, it's been the young captains and lieutenants and majors in the military who have had to do this when they've been trained to do other jobs.

And so Senator Lugar and Senator Biden said, in 2004, let's give the State Department money and personnel to build up a capacity to do that job so the military doesn't have to do it.  We've got a great Ambassador John Herbst leading the effort.  He's creating an in-house capacity of several hundred people who will be able to deploy if we have to deploy again to a hot spot and, more importantly, trying to create a reserve corps of civilians in our society who would be willing, much as Reservists do for the military, to come work for the State Department and USAID in a difficult place, you know, to run electricity grid or to give advice on a sewerage problem or to give advice on establishing democratic elections, all the things that we didn't do so well in a civilian side of the government over the last 10, 12 years.

So I find this to be heading in the right direction.  We need to give it a lot more support.  And Congress has been very much ready to see us do this.  They've given us the right budgetary allocations for the next fiscal year.  And what's really worked well is the Pentagon-State relations.  In a town where we all know that there have been episodes over the last 30 or 40 years where State and DOD have not gotten along, I think what's worked best, certainly since I've been undersecretary, is out relationship with DOD, the two secretaries, Gates and Rice, but also all of us below that, and we do see our missions as very much intertwined. 

QUESTIONER:  Is that the --

BURNS:  I wish the press would write about this more.  (Laughter.)

QUESTIONER:  Well, give us some more detail here, Nick.  Is that a function of the two Cabinet members at the top or what?

BURNS:  I think it's -- well, first of all, I think you have to give credit to Senator Biden and Senator Lugar, a bipartisan basis, I think it was 2004 at the end of the first term said this is a big problem.  The State Department needs to develop this capacity.  We will help you and give you the money to do it, and they've done that.  So Congress has done its share.

Secondly --

QUESTIONER:  But I mean in terms of the cooperation between the two, the timing.

BURNS:  Right.  The uniform military recognized this early on.  Vice Chair Ed Giambastiani certainly did, and certainly the new chairman and vice chairman have done so as well.  Admiral Mullen and General Cartwright have been just terrific partners and supporters of us, and they tell people on Capitol Hill you ought to give the State Department more support.

And think, finally, what's worked very well is that Secretary Rice and Secretary Gates are close personally.  In fact, Secretary Rice and I worked for Secretary Gates back in 1990 and '91 at the White House.  And they work together very closely as two secretaries, and that's helped relations between our two departments as well.

MCMANUS:  Let's go a little farther back on this side of the room.  I see a hand -- yes -- right back there.

QUESTIONER:  Avis Bolland (ph), formerly State Department.

Nick, I have a question about Kosovo which you talked about the last time you appeared before the council, as I remember.  Obviously, the Serbs have reacted even more strongly than we might have expected to the independence of Kosovo.  And it seems equally clear that the three provinces north of the Ibar, Mitrovica and so on, will be sort of de facto partitioned and remain under Serb control.  What are the arguments for not formalizing this relationship and giving the Serbs at least some bone in this rather complex and difficult situation?

BURNS:  Avis, thank you very much for your question.  And I'm going to decline the opportunity to support the Serb position here for a moment and just say that, from our perspective, Serbia lost Kosovo between March and June of 1999.  They went in and tried to drive 1 million people out of that country.  And they were all Kosovar-Albanian Muslims.  And we went to war against Serbia to stop that, and we did it successfully.

And when Resolution 1244 was passed on June 9th, 1999 it effectively wrested control of Kosovo.  The United Nations took Kosovo away from Serbia.  And the United Nations has administered Kosovo every day since June 9th of 1999.  Serbia was never going to get this province back.  And it was clear as a bell when I was working in the Clinton administration in June 1999 that was the case.

And the only question has been since '99 to the present day is, what kind of final status would Kosovo have?  Would it be independent?  Would it be autonomous?  And the U.N. would run that process, and when would that happen?  It took us nine years to answer that question.  And we made a fundamental assumption about a year ago in our government, if we delayed any further the independence of Kosovo, it would be more likely to provoke violence and instability in the Balkans than if we ceded to the wish of the Serbs and kept Kosovo as part of sovereign Serbia.  We made that calculation, all of Europe made that calculation.  And independence has been clear as the ultimate answer for Kosovo for the last year since President Ahtisaari made his proposal a year ago next month for supervised independence.

What have we seen over the last week, the last eight days?  Since we all recognized Kosovo a week ago today, we've seen a remarkable leadership in Pristina resist the thousand provocations that they've been presented with.  And they have protected the Kosovar-Serb population, the churches and the patrimonial sites.  They've not risen to debate in Mitrovica north of the Ibar, as the Serbs and the Kosovar Serbs wanted them to.  And they've been restrained.

What else have we seen?  We've seen the worst kind of vituperative rhetoric from Belgrade reminiscent of a different era in Serbia, I'm sorry to say.  We saw a mob attack our embassy in Belgrade last Thursday.  We saw the police vanish.  And we had a horrible situation where we had American diplomats trapped inside that embassy for several hours, and we didn't know what their fate was going to be.  And frankly, I had to get on the phone and call the prime minister of Serbia and say, turn on CNN and look what's happening to our embassy, and you have to get security down there.  And they finally did. 

But the Serbs need to understand, the Serbs need to face forward and understand that Europe and the United States want a trade relationship, a political relationship, we want them to be part of NATO and the European Union.  But the Serbs who attacked eight embassies last week, including our own, and the Serbs who were saying over the weekend, like Mr. Samardzic who's the minister for Kosovo in the Serb government, that the United States created this problem, they're exactly wrong. 

And so I can tell you this.  We're not going to accept a partition in Kosovo.  The United Nations won't accept it, the European Union won't accept it, and NATO won't accept it.  Kosovo is going to be free and independent in its present borders.  That's what we recognized.  And if the Kosovar Serbs or the Serbs in Belgrade think that they can partition the province, they're mistaken.  That's not going to happen.

MCMANUS:  That's not a principle that would hold --

(Off mike commentary.)

Yeah.

BURNS:  I think what you're going to see in this extraordinarily complex and difficult environment is we understand that there's a symbiotic relationship in some spheres between Serbia and Kosovo, in the school systems, in some of the municipal services, in the electricity grid.  And we didn't say to the Serbs last week and the United Nations did not say you have to leave Serbia.  We said, let's work out, on a transitional basis between the United Nations and then the EU and NATO, a gradual period of time where some of these services can be taken over by the new Kosovar government.  That government in Pristina did not demand that it have its hand on all the instruments of power or the power grid or the civil services from day one.  They've been remarkably restrained.

But we would like to see a more measured and more productive attitude on the part of the Serb government.  Kosovo is not going to come back.  Ninety-five percent of the people there are Kosovar-Albanian Muslims.  The Serbs left in great numbers in the last 1990s and the early part of this decade.  And that's just the way things are.

MCMANUS:  Here in the front.

QUESTIONER:  Thank you, sir.  (Name inaudible.)

Mr. Secretary, you have worked very hard where U.S.-India civil nuclear (regulations ?) are concerned.  And you are leaving now without a final deal and (lapse ?) in India blocking the deal.  And recently, U.S. senators were there, met with the prime minister, and they have given a final ultimatum that now or never means by July. 

And number two, sir, as far as elections in Pakistan, what do you think is for the U.S.?  And what would you advise to this administration and the new administration?  Because the people of Pakistan have spoken as far as democracy in Pakistan is concerned.

BURNS:  Well, thank you.  First, I would say that we're still hopeful that the civil nuclear accord between the United States and India will move forward.  As you know, they have to have an agreement with the IAEA, a safeguards agreement, then the Nuclear Suppliers Group, (they want ?) a final vote in the Congress.  We're very pleased that Senator Biden, Senator Kerry and Senator Hagel were there.  And I think they spoke.  What I heard Senator Biden say is pretty much the views of our administration.  This is a very substantial deal.  It's going to be good for India and good for the United States.  We want to see it go forward.  But as Senator Biden said, the reality is that we have a calendar this year.  We are in an election.  And Senator Biden said that agreement needs to come back to the Congress by May, June of this year so that it could be passed in the Congress before the summer recess.  That was Senator Biden's quote, and I thought that was the right thing to say, because that's our appreciation of the timeline as well.

So at some point, India will need to decide to go forward, and we hope a decision will be yes.  Because this will be the symbolic centerpiece of our new relationship with India.  It's also India's way to emerge from its 35 years of isolation in the civil nuclear field and to be treated fairly and equitably by the international community.

And I think two things.  We still have a bipartisan majority in Congress in favor, bipartisan.  And we also have a, I think, a very strong majority of countries in favor internationally.  Russia and Britain and France and Germany and the United States are all strong supporters of the Nuclear Suppliers Group making an exception for India so that we can all sell nuclear fuel and help India build nuclear power plants so India can go from 3 percent nuclear energy to perhaps 25 to 30 percent and thereby help to deal with the problem of global climate change and carbon emissions by India and to bring a clean source of energy to the Indian people as your population expands.

So we know what we think, we think this is a good deal.  And now it's up to India, and we trust that the Indian government will make the best decision for India.

Quickly, on Pakistan, I would just say -- and Ambassador Durrani is here, he's free to speak as well, obviously -- Pakistan is a great friend of the United States, both the government and the people.  And they've been through an historic election.  The last thing that we should want to do is interfere publicly at a very delicate time when the various political parties are trying to find their way to form a coalition government.

But what we should do is say to the people of Pakistan we're going to keep the American economic aid flowing, because it's in our interest to try to help the people of Pakistan.  We certainly want to see Pakistan become more effective in dealing with al Qaeda and the Taliban and the safe havens inside Pakistan.  And we certainly want to see Pakistan contribute to stability in Afghanistan.  And we ought to want to see the very positive movement between India and Pakistan in the composite dialogue and on Kashmir continue. 

So America has real strategic interests.  But I think the best thing for us is to be relatively quiet on the sensitive issue of how the government's going to be formed and relatively straightforward in assuring the people of Pakistan that we are their friend and that we intend to remain engaged to help in the areas that I mentioned.

MCMANUS:  Sir.

QUESTIONER:  Jim Moody.  I just returned from being an election monitor in Pakistan.  And it was indeed a very historic moment for Pakistan. 

You said we should keep the economic aid flowing, Mr. Secretary, but as CSIS has documented in a carefully documented, yearlong report, over 90 percent of our aid to Pakistan is military with barely a trickle for anything in the education and health area.  So when you say we should keep the economic aid flowing, there's very little that has been flowing.  And I think anyone who has looked at it objectively wonders why it's been so disproportionate and can that be changed.  I would hope after this election we could reconfigure our whole approach to Pakistan.  And Joe Biden, I think, strongly agrees and others who were just there that we should.  Do you have any comment on that and how we can achieve -- well, maybe do you agree that we should try to strive for a different balance?

BURNS:  Yes, thank you very much.  And I would just say quickly in answer that you've made a very good point that obviously a central American interest will continue to be the effectiveness of the Pakistani state and military in limiting the operations of the terrorist organizations, principally those that are aligned against us, the Taliban and al Qaeda.  So we would defend the military assistance to Pakistan.  And I would say that on a global basis there's probably no more important country to the United States than Pakistan in the global struggle to contain and then defeat the major terrorist groups.

You're right to suggest that economic aid should be forthcoming.  We have proposed to the Congress a $750 million, five-year plan of economic assistance to Pakistan, principally in those parts of the country where the Pakistani government had felt that job creation was important in north and south Waziristan, for instance.  And so we want to go forward with that with the support of Congress.

And we also have suggested that we would, at the request of the Pakistani authorities, try to put together a reconstruction opportunity zone, so an area on both sides of the Pakistani-Afghan border where businesses that produce products that were important for employment generation might come into the United States either duty free or at very low tariff levels.  Now, that has not advanced yet.  We've introduced this in our discussions with the Congress.  It hasn't been decided upon yet.  That's a second economic area where we might be helpful both to Pakistan and Afghanistan.

MCMANUS:  I fear I've been unfair to the northeast quadrant of the room, so I'm going to go way back close to the aisle here.

Yes, sir.

QUESTIONER:  Mr. Secretary, I wish the best for you for the future.

BURNS:  Thank you.

QUESTIONER:  The other day, Secretary Gates said that Turkey would be unable to resolve its problem with the PKK through only military methods and that complementary political and economic initiatives were also needed.  Now, in the U.S. view, what do you mean by the political element?  Would you want Turkey to sit at a negotiating table with the PKK or its proxies and parliaments?  Thanks.

BURNS:  Thank you very much.  We consider the PKK to be a terrorist group.  We don't deal with the PKK.  We have great sympathy for the fact that the PKK for Turkey because the PKK has been attacking and killing Turkish civilians and military officers for a great number of years.  And we have been very closely aligned with Turkey over the last three or four months in Turkey's effort to try to limit the ability of the PKK to attack into Turkey itself and to attack Turkish civilians and soldiers.

We also, of course, since the PKK takes refuge in Iraq, would like to see a process where the Kurdish leaders of Iraq take some responsibility to try to limit the effectiveness of the PKK.  And we obviously want to see in Kurdish-Turkish relations an improvement of those relations.  So it was important to see the other day that Prime Minister Erdogan has invited President Talabani to visit Turkey.  We thought that was positive.  And we'd like to see more interchange between the Kurdish Regional Government in northern Iraq as well as the Iraqi government on this question of Kurdish-Turkish relations.

But I do want to separate out the PKK and say that it's a terrorist group.  We don't deal with it, and we have great sympathy with Turkey in its fight against the PKK.

MCMANUS:  We have time for one last question.  We're going to go the aisle here.

Ma'am.

QUESTIONER:  Gail Maddox from the Naval Academy.

Can I shift regions a little and ask you about Cuba and your thoughts on where we should go from here?  And isn't it time to start thinking about learning a little bit from our success with Eastern Europe and opening up, flooding them with tourists and hoping that we bring about some change rather than the sort of isolationist policy we've had up until now of isolating them?  Thank you.

BURNS:  I think -- I'm just trying to remember back to 1989 and '90 and '91.  I think, for the most part, you saw an increase of the American presence in Eastern Europe, trade, tourism, civil society engagement, once most of those countries had shifted gears politically -- for the most part, with some exceptions.  I'm thinking of the Baltic countries, and I'm thinking of Hungary, for instance, and Poland, maybe not so much for some of the others.  And so I do think there has to be a receptivity within the country itself to a more open relationship with the United States. 

And I'm not sure.  I can't speak for Raul Castro, I wouldn't try, he having just been named to replace his brother yesterday.  But I don't know if we've seen from the Castro regime, from the Castro brothers and from the leadership in Cuba a willingness to turn the page with the United States.  So I think I would just, obviously, associate myself with and support what President Bush and Secretary Rice have been saying about Cuba over the last couple of days.

I would say this.  Ambassador Patriota is here.  I think it's maybe not so much understood that over the last two years especially, the United States has had a quite dramatic change in the way we've thought and talked about Latin America.  When President Bush was on his trip a year ago, he talked about the overriding emphasis that we place on poverty alleviation and social justice in Latin America, in both Central America and the Americas themselves.  And I think we're in a good period now where we have close relations with Brazil and with Chile and certainly with Colombia and Peru and Ecuador and Panama and with nearly all the countries of Central America.  And we even have had our director of the Millennium Challenge Corporation visit Nicaragua and have had a series of visits exchanged of American officials meeting with President Ortega there.  Not that we see things eye-to-eye with him, we don't, but we have a capacity to talk across ideological boundaries.

And I think that maybe it's not so much appreciated or it hasn't been written about, but I do see this as a new day in our relations in our own hemisphere.  And while not knowing what's going to happen in Cuba, there's a lot positive that's happening in other parts of Central America, the Caribbean and South America that we should feel good about.  And we should want to see, whoever's elected next, want to see this carried forward. 

Every president takes office -- Doyle asked me to give some advice to the person we don't know who's going to be president yet.  Every president takes office saying we'll pay more attention to our own backyard.  And I think we must do that.  We must have a focus on our own hemisphere, because so much of our own stability and prosperity depends on good relations with Canada and Mexico and with Brazil and Chile and every country in between. 

And I do think we've got a policy that's going to withstand the test of time in the Americas, knowing that there will be leaders like Chavez and Raul Castro or Fidel Castro who are, in our view, very much marginalized.  Nearly everybody in the hemisphere is a democracy, a full-fledged democracy with the exception of Cuba and a couple of other countries.  And nearly every country wants to have a relationship with the United States despite the fact they may not always agree with us.  Venezuela doesn't want much of one, and Cuba doesn't want much of one, but everyone else does.

And so I think we just need to accentuate the positive.  And I'm sure it was disconcerting to President Chavez that when President Bush visited Latin America last year, he didn't utter President Chavez' name once.  And when Secretary Rice made her last visit, she didn't do that either.  So we're not really focused on Chavez.  We're more focused on the positive relationships that we've built up in the hemisphere.  And I think this is an area for growth for our country, and we ought to build on this change as much as we can as we go through a presidential transition next year.

MCMANUS:  I'm sorry to say that we have run out of time.  I want to apologize to those of you who I did not call on and thank you for your attention.  I hope you'll join me in thanking Nick Burns for the time he's given us.  (Applause.)

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