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FAREED ZAKARIA GPS

Interview With Dmitry Medvedev; Interview With Malcolm Gladwell

Aired December 27, 2009 - 13:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.


FAREED ZAKARIA, HOST: This is GPS, the GLOBAL PUBLIC SQUARE. Welcome to all of you in the United States and around the world. I'm Fareed Zakaria.

This week, I want to show you something important -- an exclusive interview with the president of Russia, Dmitry Medvedev.

The interview originally aired in September, but I think it's still the most comprehensive interview he's given since assuming office a year-and-a-half ago, and it's a truly revealing look at Russia.

Also on today's show, a new interview -- a great conversation with the always fascinating writer, Malcolm Gladwell.

Let me tell you why I think my conversation with Dmitry Medvedev is important. When we try to understand what the world is going to look like in the future, whether it will be peaceful, whether there will be more international cooperation, the focus inevitably turns to Russia.

There are many new great powers emerging in the international system -- China and India, most obviously. But of all the powers in the world, Russia occupies a unique position.

No one is quite sure what Russia wants. Does it want to be part of the new global structure of power? Or does it see this new structure as too Western-dominated, too American-centric, and wish to set itself apart, to be some kind of an opponent or a spoiler in the system?

One thing is for sure. It wants power and influence. It has not reconciled itself to its diminished place on the map since 1990.

Dean Acheson once said of Britain after World War II, it has lost its empire and has not found its role. This is even more true of Russia today.

Some people look at Russia and have concluded that the picture is all bad. And certainly, in the last few years, Russia has moved backward on a number of measures of democracy and human rights, and even economics. Both overall, it still remains a much more open and free society than it was during the Soviet era. And even today, there do appear to be two Russians -- one characterized by a thuggish police state that uses its oil wealth to wield power, stifle civil society, democracy and, of course, a free press. The other is the Russia of younger people -- more modern connected to the world, aware of global trend, and perhaps hoping that Russia will participate in these trends more fully.

In some way the first Russia, the thuggish Russia, is the Russia of Vladimir Putin, the former president, current prime minister, who many believe is the true ruler of the country.

And the second Russia, I would assert, the more modern one, is the Russia of President Medvedev. And this is the central tension that exists in Russia today. And it's a tension that seems to be getting deeper.

It's recently become clear that Medvedev truly does have a different vision for the country. He probably isn't a puppet of Putin. He has said things, he has written things that are implicitly quite critical of many of the policies of Vladimir Putin. He recently described Josef Stalin's regime as criminal, and condemned the Soviet Union's existence -- all very different from Putin's pronouncements on these topics.

And Mr. Putin has been taking every opportunity to show that he's in charge, he's got power, and a signal that he might well run for Mr. Medvedev's job and become president again.

So, we might be watching a quiet power struggle begin in Russia.

In any event, listen to Dmitry Medvedev, the president of Russia.

(BEGIN VIDEO)

ZAKARIA: President Medvedev, thank you again for joining us.

I have read the constitution. And I understand the division of...

DMITRY MEDVEDEV, PRESIDENT OF RUSSIA: The constitution of Russia.

ZAKARIA: The Russian constitution. And I understand the division of roles between the president and the prime minister. And my understanding, reading it on paper, is the president is the superior office.

And so, my question to you is, are you Vladimir Putin's boss?

MEDVEDEV (voice of interpreter): Would be upset if didn't ask me this question. Our interview in this case would be considered as a failure.

(LAUGHTER)

Under the constitution in this country, there is one commander in chief, there is only one guarantor of the constitution, the head of state. And that's the president of the country whom you are now talking to.

ZAKARIA: You know why I'm asking you this, Mr. President, because lots of people say Dmitry Medvedev is a very fine lawyer, he sounds like a reformist, he says all these things about what need to happen in Russia -- except he has no power. All the power is held by Prime Minister Putin. So, he is the ceremonial facade. It doesn't really matter what he thinks.

What do you say to them?

MEDVEDEV (voice of interpreter): As for the rest of it, well, it's even useless talking about this.

In our country, where there's so much red tape, nobody can even lift a finger without me signing a paper first, even if they have different opinions about who's in charge. That's an absolutely clear thing for anyone who wants to sort out this issue.

But those who believe in those stereotypes, let them do it. Sometimes people prefer to perceive things according to those stigmas.

ZAKARIA: But you're saying that nothing happens without your signature. So, in fact, you are making all the decisions? Certainly with regard to foreign policy and...

MEDVEDEV (voice of interpreter): It's even strange to hear you saying that, in foreign policy. Only one man does it in this country -- the president.

You can see it everywhere. I'm on foreign business trips all the time. Naturally, all the directives, all the decisions are adopted by the president. All the decisions which require discussion are adopted by the security council. But again, they are signed by the president.

ZAKARIA: Do you think you are more liberal than Vladimir Putin?

MEDVEDEV (voice of interpreter): That's a good question.

Vladimir Putin, when he met with his colleagues and with political analysts, he told me that he and I have the same blood. If you understand by blood our education, then, yes, that's the case.

And I want you to know -- I'm sure you know about this already -- I want our leaders and TV viewers to know about that, too.

Putin has a degree in law. He was not raised in the KGB or intelligence. He graduated from one of the country's best universities. Therefore, we are close in our convictions.

Now, when talking about some nuances and preferences, yes, clearly, there could be differences.

I have my own views. He has his own views. For eight years he's been implementing his views quite successfully. There are no two identical persons in the world, no two identical leaders.

ZAKARIA: You think you're doing a good job as president, right?

MEDVEDEV (voice of interpreter): It's not for me to judge to the full extent whether I have succeeded in doing something or not. Though there are some objective indicators that exist, yes.

ZAKARIA: But if you are doing a good job, it would make perfect sense for you to run again in 2012. Correct?

MEDVEDEV (voice of interpreter): Yes, certainly, if the conditions are right. Why not?

ZAKARIA: Let me ask you about U.S.-Russian relations. What do you think of President Obama? You've spent a fair amount of time with him.

MEDVEDEV (voice of interpreter): I like to communicate with President Obama. We held a very serious meeting with him during his visit to Russia. I calculated that we had spent eight hours together. That's quite a lot of time for such type of contacts.

Very often, the talks between the presidents include official ceremonies, lunches that last for two, two-and-a-half hours, as it was, in fact, the case with our American colleagues previously.

But this time around, we talked for eight hours. And I'm thankful to my colleague for the fact that he wants to sort out many problems. That's important.

He has another good quality. He listens to your arguments.

He formulates his position, which may not necessarily coincide with the Russian position, but at least this is a result of a thought- out policy, a thought-out approach as to what is useful or not useful to the United States of America. In that sense, it's comfortable to deal with him.

But what people expect from us is results, not just good joint time spent together, although that is important, too.

ZAKARIA: But does it help that you're the same generation, that you're about the same age?

MEDVEDEV (voice of interpreter): I think so. I think so. But not just of the same generation, but also of a similar education.

I mentioned it to President Obama when we had our first meeting, that when he was at the helm of Yale Law Review, if I'm not mistaken -- Harvard? Or was it Yale?

ZAKARIA: Harvard Law Review.

MEDVEDEV (voice of interpreter): Harvard. OK. That was good.

ZAKARIA: He went to Harvard, Harvard Law School, yes. MEDVEDEV (voice of interpreter): Anyway, I read both the Harvard and the Yale Law Reviews when I was a post-graduate student myself. So, it's also important -- you know, we'll see. What really matters here is that we try and hear each other.

(END VIDEOTAPE)

ZAKARIA: What strikes one about an interview with President Medvedev, and what struck me about those answers was, first, he's a very bright, articulate man. He knows his mind. He speaks and thinks fast on his feet.

He understands English, by the way. He did not use the earpiece for simultaneous translation throughout the interview. He understood all my questions, and spoke to me before and after the interview in English, but clearly does not trust that in a formal interview he will say exactly what he wants to say in English.

He bristled at the suggestion that he was not in charge, though most Russia experts do believe that Prime Minister Putin wields all the power. And he was very positively inclined towards President Obama.

All in all, a good start. Then we went on to Iran and Israel and the possibility of war in the Middle East.

(COMMERCIAL BREAK)

(BEGIN VIDEOTAPE)

ZAKARIA: Russia has said that it does not want Iran to develop nuclear weapons. Prime Minister Putin has said that. You have said that.

Yet the International Atomic Energy Agency says Iran is not cooperating to give the world confidence that it has a purely civilian program. Iran says it will no longer negotiate on this issue. And yet, Russia says it will not support any further sanctions against Iran.

So, is the policy of not wanting Iran to develop nuclear weapons, on Russia's part, are these empty words? Or do you have concrete steps you are willing to take to prevent Iran from developing nuclear weapons?

MEDVEDEV (voice of interpreter): We have our own very developed relations with Iran. I truly believe that Iran needs a system of motives, of incentives with regards to its nuclear problem. No doubt about that.

On September 9th, Iran has transferred the proposals dedicated to these most complex issues, and currently, they are being analyzed. Some people are already saying that is not enough, that those proposals are too generic.

You know, I believe it is the duty of all countries involved in this matter to at least study these proposals.

ZAKARIA: Is Russia willing to step up to its responsibilities as a world power and press in the United Nations and in other ways to ensure that Iran does cooperate?

MEDVEDEV (voice of interpreter): Iran must cooperate with IAEA -- that's for sure -- if they want to develop their nuclear energy program. It is their duty, not a choice.

Otherwise, indeed, the question will always be asked, what are they up to after all? That's very clear.

ZAKARIA: And Russia is willing to exercise its responsibilities.

MEDVEDEV (voice of interpreter): Of course. Of course.

ZAKARIA: Let me ask you about another issue relating to this. Russia has agreed to sell Iran the S-300 anti-aircraft, anti-missile system. When will you deliver it to Iran?

MEDVEDEV (voice of interpreter): We have never delivered anything to Iran. We will not deliver anything to Iran which is beyond international law.

This implies that we have something to deliver. But they're always defensive systems. That's our clear-cut position. And I will adhere to that when adopting final decision on all existing contracts with Iran.

ZAKARIA: You know that there are many people in Israel who say that, if you deliver that system, the Israelis will feel they will have to strike Iran before the system is deployed, because once that system is deployed, an Israeli attack on Iran becomes much more difficult. So, by delivering the system, you open up a window or a period of considerable tension.

MEDVEDEV (voice of interpreter): In one hour, I will talk with the president of Israel, Mr. Peres, who, when originally visiting me in Sochi, told me a very important thing to all of us. He said, Israel doesn't intend to deliver any strike against Iran. He said, "We are a peaceful country. We will not deal with such a blow."

Therefore, any deliveries of systems -- defensive systems which are aimed at protecting -- cannot increase danger. They should reduce it.

Now, if there are people who still have such plans, I believe they should reflect on all of these things, our task being not to enhance Iran or to weaken Israel, or vice versa.

Our task boils down to making sure that the Middle East is a quiet, normal place for all to live in. That's the task of the day.

ZAKARIA: When Prime Minister Netanyahu was in Moscow, did you say this to him? MEDVEDEV (voice of interpreter): Well, Prime Minister Netanyahu has visited Moscow. The Israelis did it behind closed doors, which was their decision. Frankly, I don't quite understand why they did that. But that's the decision of our partners, so we accepted it.

I met with him, yes.

ZAKARIA: If Israel were to attack Iran, would Russia support Iran in such a conflict?

MEDVEDEV (voice of interpreter): Russia will not support anyone or act in such circumstances. We are a peaceful country. That's the worst thing you can imagine.

I had to explain this before. Let's try it once again.

What would follow that? First, a humanitarian catastrophe, a great number of refugees and an Iranian desire for revenge, not only to Israel -- but let's be frank about it -- but other countries, as well, followed by very unpredictable developments in the region.

I believe that the scale of such a calamity would be hard to measure. Therefore, prior to deciding on such a strike, we need to weigh the situation cautiously. That would be absolutely sensible.

But Israeli colleagues told me they don't want to do that. And I trust them.

ZAKARIA: So, you expect no Israeli strike on Iran.

MEDVEDEV (voice of interpreter): I hope that this decision will not be taken.

ZAKARIA: Let me ask you about U.S.-Russian relations. President Obama and Mrs. Clinton have talked about a reset of relations.

Your ambassador to NATO said that, after the Obama-Medvedev meetings, if a good result takes place, it could usher in a new era in Russian-American relations.

What concretely are you looking for from the American administration?

MEDVEDEV (voice of interpreter): I expect our American partners will hear us on the Ukraine and Georgia issues.

As for Ukraine, no referendum was carried out there. Two-thirds of the population do not support joining NATO in that country. But certain leaders in the Ukraine are relentless in their constant pursuit to push the state into NATO.

We do have normal, good relations with the Northern Alliance. They're now stabilized after the harsh period of last year. Now we want to develop them further.

But one needs to remember that NATO is a military bloc, and its missiles are pointed at Russia.

And if the number of countries joining NATO is getting greater and greater, and NATO is approaching Russia, it doesn't give us any satisfaction. We don't like it. We're openly stating that.

ZAKARIA: I was going to ask you, Mr. President, about the comments that Vice President Biden made about Russia. But then I found an even more critical analysis of Russia's situation. And it was an article that said that Russia was a primitive economy based on raw materials and endemic corruption, a semi-Soviet private sphere, a fragile democracy. It goes -- went on and on.

This is an article, of course, that you wrote a few days ago.

What I was wondering was, who is responsible for this condition? Because many of the things you point to have gotten worse in the last 10 years. The World Economic Forum has a competitiveness index. This year, Russia dropped 12 places on that index. It's now 63rd. It's behind Mexico and Indonesia.

Transparency International has a corruption index. Russia now ties with Bangladesh and Syria on that index. The Economist magazine says, "the government has utterly failed to create a legal and political structure to support business and enterprise."

So, isn't your article a powerful indictment of your own administration?

MEDVEDEV (voice of interpreter): It's a good question, by the way. I don't know if you trust these indexes, but I don't trust them too much.

But in what you have just laid out, there is undoubtedly reason behind it. I don't like the fact it's being geared towards raw materials, yes. The level of corruption is categorically unacceptable.

What you have cited, and what I have cited in my own article, all of that emerged not just in the past decade. It surfaced in the Soviet era and in the 1990s.

The truth of the matter is, the overall living standards and the number of people who have become much wealthier have substantially grown over the past 10 years. That's a firm fact. I have mentioned this many times.

ZAKARIA: But that's because of the price of oil. That's not because of...

MEDVEDEV (voice of interpreter): No, no, no, no, no, no. Just I should say, wait a second.

In the 1990s, there were different upheavals with the prices on oil. When I worked in the university in the 1990s, like President Obama, my salary was just $10 or $15 per month. Not much, is it. So, not all of this is the result of hikes in oil prices. We, of course, need to change the system of economy. That's absolutely clear.

As far as Mr. Biden's article is concerned, we know about our own deficiencies. But to draw quite questionable conclusions is wrong, in my opinion.

What has Mr. Biden in fact said? He said almost literally the following. "Russia agrees with us on the nuclear weapons issue, because their economy is weak, and they cannot maintain that weaponry themselves."

It's a mistake.

First, the nuclear weapons are such a sphere of influence, that any state who has it pays great attention to it. And I'm sure that even the weakest states would reduce their defense expenditures last of all.

Therefore, it is my understanding that, if this is a reflection of the opinion of one individual, then it's the question for the U.S. administration. But if it's a reflection of the policy, they will need to give it thought about what's going on in and what's about to happen.

But I've always that, at the end of the day, the U.S. foreign policy is defined by one man, the president of the United States.

(END VIDEOTAPE)

ZAKARIA: In the segment you just saw, I think President Medvedev made some news. First, he confirmed the meeting with Prime Minister Netanyahu. This was a secret meeting that took place in Moscow, and he confirmed that it did, in fact, happen.

He also sounded somewhat calm about the possibility of an Israeli strike. He seemed to have gotten some assurances -- particularly from President Peres -- that the Israelis were not going to strike.

He was also tougher on the Iranians than I've heard him or Prime Minister Putin before, insisting that they cooperate with the International Atomic Energy Agency.

And finally what I was struck by was his comments on Vice President Biden's rather disparaging set of comments about Russia. I didn't actually ask him about that. He decided to bring it up himself, and went into some length about how disappointed he was about that. So, I think those comments really rankled.

Coming up next, I talked about the fact that he is only 44 years old, and wondered what it was like to be president of Russia at that age.

(COMMERCIAL BREAK)

(BEGIN VIDEOTAPE) ZAKARIA: It has often seemed to outsiders that Russia is obsessed with some of these symbols of power -- military weaponry, planting a flag at the North Pole -- rather than really the hard work of modernizing an economy, which is much more complicated and takes a lot more effort.

Why is Russia so obsessed with issues like respect and status?

MEDVEDEV (voice of interpreter): I don't think this is all that simple. But I can tell you one thing. Of course, Russia has her own perception of her role in the world and of her achievements.

Incidentally, I have written about this in my recent article. There were incidents when Russia literally had to render assistance to humankind.

Only dishonest people can claim that World War II was won by somebody else. Russia made a decisive contribution to the victory over Nazism. That's clear to every honest observer. So, therefore, in a certain manner, it is indeed part of the country's national psyche.

You know, you shouldn't be too excited about that, thinking you are great only on the basis of your previous achievements, like going to outer space or winning this war. But on the other hand, this needs to be remembered and shouldn't be underestimated.

At the same time, we should deliver new achievements, which is really the most important thing and certainly requires the change of a mindset.

ZAKARIA: President Medvedev, I should say happy birthday. It is your 44th birthday. You are the first head of state I'm interviewing who is younger than me.

What does it feel like to be in this position? This is your first elected office. What is the biggest surprise to you about being president of Russia?

MEDVEDEV (voice of interpreter): I don't think I will disclose any secret to you by telling you that the work of the president is very interesting, but also quite difficult. It doesn't matter how old you are -- 44 or 88, for that matter -- it requires you to mobilize your forces.

But I'm about the same age as you are. So, you can imagine what emotions in this case you can have. Of course, on the other hand, to get a sense of it and to understand this, you need to really be in these shoes.

ZAKARIA: Mr. President, thank you very much for agreeing to do this.

MEDVEDEV: Thank you.

(END VIDEOTAPE) ZAKARIA: That article that President Medvedev wrote, which he has mentioned a couple of times in the interview, is really worth reading. And I recommend you all do so. It's on our Web site. It's titled, "Go Russia," and really quite a remarkable piece.

I hope this interview has been interesting and has helped you understand Russia a little bit better. I don't know that we'll ever completely understand it. It has always been a difficult country to read.

As always with these kinds of things, Winston Churchill said it best. In 1939 in a radio broadcast he said, "I cannot forecast to you the actions of Russia. It is a riddle wrapped in a mystery inside an enigma."

I hope we've unwrapped it a little bit for you.

We'll be back.

(COMMERCIAL BREAK)

ZAKARIA: First, our "What in the World?" segment.

What caught my attention was Sixth Sense. No, it's not ESP, nor is it the M. Night Shyamalan horror movie. This Sixth Sense is a high-tech device, maybe the highest tech device ever, that lets you go seamlessly between the digital world and the physical world.

For example, making a framing sign with your fingers, and the computer takes a picture. Take a look at the weather forecast printed hours ago on the back of a newspaper, and now you have the up-to-date weather forecast superimposed on it. Take out a piece of paper and play a video game on it. Dial your cell phone on your hand.

These are the ideas of this man, Pranav Mistry, one of the stars of the recent TED India.

Who's Ted, you might ask. TED is an extremely influential set of conferences held every year in the U.S. and the U.K. to talk about the future of creativity, high technology and about innovation. It's very cutting edge.

And for the first time in the organization's 25-year history, it has just held a major conference in India. It's a sign that India is becoming one of the great innovation capitals of the world, with ideas moving seamlessly from West to East.

Pranav, for example, is doing his work at MIT, and he's far from alone. A report out this week says India has more students in the U.S. than any other nation. More than 100,000 went this year alone. The vast majority of them will go back and innovate in India.

You're also seeing the rise of homegrown innovation in India, much of it targeted towards the poor. You might think that's a bad business model. Why innovate for people who can't pay for it? But when there are hundreds of millions of people, it starts to make great sense. The world's poor, it was said at the TED conference, are worth up to $13 trillion a year in revenue.

One concern trying to capitalize on that -- Anil Gupta's Honey Bee Network, which supports literal grassroots innovation by India's farmers and other rural citizens. Gupta was another of the featured speakers at the TED conference, and his organization has helped to bring to market a refrigerator made of clay which uses no electricity, but keeps things cool and fresh for days.

And there's another interesting appliance, this one invented by a 14-year-old girl, whose chores were taking her away from her studies. So she invented a pedal-powered washing machine.

The 21st century will belong to those who can command the high ground of ideas and innovation at all levels. The TED conference highlighted India's richness in that currency. The nation's teeming masses of human capital, its ease in the English language, its existing connections into the global economy -- all of these things make it well placed, despite its Third World status, to be a true leader of innovation in this century.

And we will be right back.

(COMMERCIAL BREAK)

ZAKARIA: Malcolm Gladwell is perhaps the best-selling non- fiction writer in America.

Gladwell's books are often thought-provoking explorations of seemingly simply concepts -- "Blink," "The Tipping Point."

His new one, "What the Dog Saw," is something of a departure. It is a compilation of his best and most fascinating articles from The New Yorker magazine, for which he writes. And no doubt, it will bring fans flocking back to the bookstore. In fact, it already is on the best seller list.

Malcolm Gladwell, thank you for joining.

MALCOLM GLADWELL, AUTHOR, "WHAT THE DOG SAW": Thanks, Fareed. Nice to be back here.

ZAKARIA: So, when you look at your work, do you think that there is some kind of unifying theme?

GLADWELL: My books have really all been explorations of the idea that we are heavily influenced by our environment. They're all books about exploring the extent to which we are the functions of our context, our culture, our environment, or -- well, explaining people from the outside in.

ZAKARIA: But let's talk about that idea of culture and environment and the constraints, if you will, shaping your -- you know, what we end up doing. So, you're sort of interested in the variables we can manipulate -- to put in kind of social science terms...

GLADWELL: Yes.

ZAKARIA: ... rather than the variables that are fixed and unchanging, like your DNA...

GLADWELL: Yes.

ZAKARIA: ... or something like that.

One of the pieces in The New Yorker recently had this idea of how does a bad team do well.

GLADWELL: Yes.

ZAKARIA: And your argument is basically, they should be covering all the time, they should be attacking all the time.

GLADWELL: Well, it was piece -- yes, it was a piece about the -- it was one of my favorite pieces I've written in a long time.

I found a -- there's an Indian software entrepreneur in Silicon Valley, a brilliant guy named Vivek Ranadive, who decides to coach his 12-year-old daughter's basketball team. And he doesn't know much about basketball.

And so, he goes to see basketball being played, and he can't understand the way -- he can't understand why Americans would play it this way, because he doesn't understand why you would retreat. The minute you score, you retreat back to your end, and you wait for the other team to come down the court.

He's like, well, why don't you do the full court press the whole time? Why don't you play defense the whole length of the court, because you're giving up, you know, this enormous opportunity to hold the other team in check?

And so, he takes his team of 12-year-old girls from Silicon Valley, who are the kinds of -- without indulging in stereotypes, you know -- they are the kinds of girls you would expect to grow up in Silicon Valley. They are the children of, you know, software programmers. They're not six-foot four.

And he takes this group of 12-year-olds who have never played basketball before to the national championships playing this way, right. So, it's all about -- that piece is all about a kind of -- a description of what it means to be an insurgent, how do underdogs win.

And what we know from looking at military battles -- there's been some lovely research on this -- is that underdogs win far more often than you would think. In fact -- and when underdogs -- and by underdog in a military context we mean a country or an army that has one-tenth or less of the resources of its opponent. When they adapt their tactic, change their tactics and don't do exactly, play the same game as the favorite, they win the majority of conflicts.

ZAKARIA: You talk about Enron, and you talk about the crisis. And in some ways, this is a kind of early version of the financial crisis we went through. Why?

GLADWELL: Well, I was very interested in looking at Enron in figuring out -- and this was a piece written before the crisis, but I think it does shed an interesting light on what happened -- I was interested in figuring out, what kind of a scandal was it? What exactly -- what was the nature of their wrongdoing?

Now, we're very used to the kind of scandal where the person who does the thing that we disagree with withholds information from us, right, keeps something secret. Watergate, right? Nixon is covering up valuable information that the rest of us are trying to get our hands on. And when we know that information, we make sense of the problem.

Enron, if you look very closely, there's a lot of really wonderful work that was done sort of retrospectively on Enron. They didn't withhold information from investors. They actually told investors virtually everything they needed to know about the company's financial condition.

In fact, the Enron story breaks when this really wonderful reporter for -- now for Bloomberg, then for the "Wall Street Journal," named Jonathan Weil -- not when he gets some secret source, not when he gets access to stuff that nobody knew, when he actually sits down with their own annual reports and 10-Ks and 10-Qs and reads them. He reads them and discovers, oh, my goodness. There's no cash coming in.

Had investors, had analysts on Wall Street -- who are, by the way, paid to do this -- had they bothered to do what Jonathan Weil ended up doing when the scandal broke, combed through the disclosures of Enron and read them properly, they would have realized that Enron was a house of cards.

ZAKARIA: But it raises a really interesting question, which is, in that case and in the financial crisis that happened last year, what happens is, when things are going well, all these problems get obscured, and no one wants to argue with success.

You know, I mean...

GLADWELL: Yes.

ZAKARIA: ... if you had betted -- the rating agencies could have found all these problems seven years ago, and you would have missed out on one of the great bull runs of history. And if you would have missed out -- if you were in these banks, you would have been fired, because everybody else was making lots of money leveraging up and taking on debt.

So, what do you do? I mean, there's something about human beings that you don't want to bet against a bubble, because at...

GLADWELL: Yes.

ZAKARIA: ... first (ph), everyone's in trouble. But if you are the only guy betting against it, they all get rich and you don't.

GLADWELL: You don't.

Well, there are several things. One is that we have to -- we can't do the thing that we keep doing, which is the rest of the community, who's supposed to be providing an oversight function, a gatekeeper function -- when they don't do their job, then they just turn around and blame somebody else. You have to stop doing that -- we have to recognize that we have.

Secondly, we have to -- I just read this really fascinating book -- I'm actually reviewing it for The New Yorker -- by Greg Zuckerman at the "Wall Street Journal." He wrote a big book on John Paulson, the hedge fund guy who makes $15 billion in 2007, betting against the subprime mortgage business.

And what's really interesting about him is exactly the same story as Jonathan Weil and Enron, which is that he actually is the only guy who does his homework. He starts in 2005 with this guy called Pellegrini who works for his company, and they very carefully and painstakingly, over the course of months, go through the data on the housing market and try and answer some fundamental questions.

And as far as they can tell, they're the only people doing that. Right? Or at least he's -- or one of very few. I mean, Zuckerman makes -- there's like three or four people on Wall Street who were doing that -- a guy called Lippman at Deutsche Bank, a guy named Burry out in California, and Paulson.

And it's, like, there's three people who made this kind of massive homerun bet off the subprime crisis. That's incredible.

So, there was -- and they're not geniuses. They're just people who decided to be skeptical and to take a couple of months and study a problem in depth.

So, that's -- it shows me that the cultural failing here is in the kind of level of analytic ability and motivation on the part of people on the Street.

ZAKARIA: But also the willingness to bet against the crowd.

GLADWELL: Yes, but we have...

ZAKARIA: That's the tough part.

GLADWELL: But we have a system in place that allows people who make contrary bets to make a fortune, if they're right.

I mean, who is the hero of the whole thing? It's Paulson. He made $5 billion for himself -- you know, in his own pocket -- in 2007. If that doesn't tell us that, you know, the system can't work and work really well for people who want to ask tough questions.

I mean, he should be the one that everyone is taking lessons from. So, I mean, it's all there. We just have declined to take that advantage.

ZAKARIA: All right. My favorite piece in this collection has got to be the pitchman, Ron Popeil...

GLADWELL: Yes.

ZAKARIA: ... and the conquest of the American kitchen. So, I'm going to ask you as your final question, what is the great, broad, generalizable lesson, observation about human nature. All I remember is the piece was just fascinating. The guy was fascinating.

But is there some larger point here?

GLADWELL: Well, he -- the larger point is that, you know, Ron Popeil made...

ZAKARIA: Tell who he was.

GLADWELL: Ron Popeil is the -- he is the kitchen gadget inventor and pitchman, who comes from a long family of kitchen gadget guys. And he's the guy who did -- his family did the Pocket Fisherman and the Slice-O-Matic and the Chop-O-Matic. And Ron famously did the Showtime Rotisserie, and which, I believe, and many others agree, is the greatest rotisserie ever made.

And you have to understand, he sold billions of dollars of Showtime Rotisseries -- not millions, billions -- on those late-night infomercials that everyone made fun of.

He may be one of the most successful marketers in the history of marketing, in addition to being a great inventor.

And the take-home lesson is that he is one of the first to realize -- and one of the only people to continue to realize -- that if you want to sell a transformative product, you have to take the time to explain it properly. Those infomercials are marvels of kind of explanatory clarity and persuasion. I mean, they take 15 -- he takes 15 minutes to show you how a rotisserie oven works.

Did they people who make VCRs ever take more than 15 seconds to explain how a VCR worked? No one does this. Right?

He is proof that, if you can be -- if you can simply make your case plainly and simply to the public, you can win. Right? A lesson we seem to have forgotten.

ZAKARIA: So, what Ron Popeil does for rotisserie ovens, Malcolm Gladwell does for books.

GLADWELL: I should be so lucky.

ZAKARIA: Thank you, Malcolm. And we will be back.

(COMMERCIAL BREAK)

ZAKARIA: This week we are taking a holiday break from the "Question of the Week," but I do have a book recommendation -- actually, five of them -- five of our favorite books from the past year.

I have recommended them to you before, but I just want to remind you of some of the most worthy titles.

They are, in no particular order, "Animal Spirits: How Human Psychology Drives the Economy and Why It Matters for Global Capitalism." It's by Yale economist, Robert Shiller, along with George Akerlof. Akerlof is a Nobel Prize winner.

Number two, "The Increment," by David Ignatius. A great spy thriller, really worth reading if you're interested in the CIA, spies, Iran. It has all of it.

Three, "The Geopolitics of Emotion: How Cultures of Fear, Humiliation, and Hope are Reshaping the World," by the great European intellectual, Dominique Moisi.

Number four, "The Man in the White Sharkskin Suit," by Lucette Lagnado, a wonderful memoir of Egypt in the 1930s, '40s and '50s.

And finally, "John Maynard Keynes: Economist, Philosopher, Statesman," by Robert Skidelsky. This is a one-volume abridgement of his monumental three-volume biography of Keynes.

You can go to our Web site, cnn.com/gps, for more information on these books and authors, along with other favorites of mine. And while you're out there, test yourself on the foreign affairs quiz called the Fareed Challenge.

That's it for this week. Thanks to all of you for being part of my program. I will see you next week.