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British Prime Minister Calls For Referendum On EU Membership; Hillary Clinton Testifies Today On Benghazi Attacks

Aired January 23, 2013 - 16:00   ET


BECKY ANDERSON, HOST: Tonight, a testy testimony.


HILLARY CLINTON, U.S. SECRETARY OF STATE: The fact is we have four dead Americans. Was it because of a protest or was it because of guys out for a walk one night who decided they'd go kill some Americans?


ANDERSON: Hillary Clinton comes under fire for what she knew or didn't know about the Benghazi embassy attacks.

ANNOUNCER: Live from CNN London, this is Connect the World with Becky Anderson.

ANDERSON: This hour, a look at the questions Clinton took and the impact of her answers.

Also ahead, decision time for Britain.


DAVID CAMERON, PRIME MINISTER OF BRITAIN: I am not a British isolationist, but I do want a better deal for Britain.

ANDERSON: Prime Minister David Cameron promises a referendum on Britain's membership of the EU if he's reelected in 2015. But the political fallout is already appearing. Britain's foreign ambassador to Washington tells me the UK's role as a gateway to Europe is now under threat.


RICHARD QUEST, CNN INTERNATIONAL CORRESPONDENT: And negative at best: that's how one global business leader described it. I'm Richard Quest at the World Economic Forum in Davos with reaction from business leaders around the world.

ANDERSON: And FIFA's secretary general talks exclusively to CNN about the growing problem of match fixing.

Well, Hillary Clinton is just finished her second grilling of the day over the terror attack on the U.S. consulate in Benghazi on September 11 last year. The U.S. secretary of state began the day testifying before the Senate foreign relations committee. While taking responsibility for some failings, she also came out fighting.


CLINTON: We have no doubt they were terrorists. They were militants. They attacked us. They killed our people. But what was going on and why they were doing what they were doing is still...

SEN. RON JOHNSON, (R) WISCONSIN: Again, we were mislead. There was supposedly protests and then something sprang out of that, an assault sprang out of that. And that was easily ascertained that that was not the fact. And the American people could have known that within days. And they didn't know that.

CLINTON: With all due respect, the fact is we had foul dead Americans. Was it because of a protest or was it because of guys out for a walk one night who decided they'd go kill some Americans. What difference at this point does it make? It is our job to figure out what happened and do everything we can to prevent it from ever happening again, senator.


ANDERSON: All right. Well, three-and-a-half hours later she was back again, this time to answer to House lawmakers. Now that testimony is still taking place.

For some reaction now I'm joined by CNN world affairs reporter Elise Labott in Washington. And Arwa Damon also live for us tonight from Beirut.

Let's start with you, Elise. It was certainly pretty fiery stuff on the Hill today. What did we actually learn?

ELISE LABOTT, CNN CORRESPONDENT: Well, Becky, it was far more contentious on the Senate side. We thought it would be much more contentious on the House side. I mean, the general tone was respectful, but a lot of Republican senators say they don't buy Clinton's Answers about what she knew when, specifically about whether she read a cable from Ambassador Stevens that warned that the U.S. diplomatic post in Benghazi could not have sustained a real assault, which ended up what happening.

Listening to what he said to Secretary Clinton about what he would have done had he were president.


SEN. RAND PAUL, (R) KENTUCKY: I'm glad that you're accepting responsibility. I think that ultimately with your leaving you accept the culpability for the worst tragedy since 9/11. And I really mean that. Had I been president at the time and I found that you did not read the cables from Benghazi, you did not read the cables from Ambassador Stevens, I would have relieved you of your post. I think it's inexcusable.


LABOTT: And Becky, Senator John McCain from Arizona, one of the toughest critics of the administration on the Benghazi issue he was very close to Ambassador Stevens also taking the secretary to task for her comments that the U.S. never really called the survivors after the attack to find out whether there was a protest or whether there wasn't. This was a real issue that came up from Republican Senators about whether there was a protest.

And here Clinton, as you heard, in that comment before saying it really doesn't matter. We need to look forward and find out what happened.

Now Secretary Clinton did get very emotional when she talked about the night that Chris Stevens died and the aftermath. Let's take a listen to Secretary Clinton.


CLINTON: I stood next to President Obama as the marines carried those flag draped caskets off the plane at Andrews. I put my arms around the mothers and fathers, the sisters and brothers, the sons and daughters and the wives left alone to raise their children.


LABOTT: Choking back tears there. But also, Becky, there was a lot today at the hearing about the threat in North Africa emanating from neighboring Mali and Algeria that site of the attack of that BP facility last week where three Americans were killed, secretary said there were weapons in Algeria and in neighboring Mali that came from Libya and that's why the U.S. has to keep its presence in these areas to fight off the growing Islamist threat there. There's still a very big threat coming from Libya and the region in North Africa, Becky.

ANDERSON: Yeah, I want to talk more about that with you shortly. Stand by, though, just for the moment. I want to remind our viewers exactly what did happen in last year's attack. We're talking four months ago, of course, now. The U.S. diplomatic compound in Benghazi, in Libya, was overrun by heavily armed militants and set on fire on September 11. Four Americans, including the U.S. ambassador to Libya were killed in the violence. Now U.S. authorities are still investigating, but it's widely suspected al Qaeda linked militants may have been behind the attack.

Well, last month four State Department officials were disciplined following an independent review. The report revealed, and I quote, systemic failures and leadership management deficiencies at the State Department, the department, of course, that Hillary Clinton has been running for the last four years.

Senior international correspondent Arwa Damon also with us tonight. She was at the consulate compound in Benghazi shortly after the attack and has been following the investigation. She joins us now live tonight from Beirut in Lebanon.

As you listened to what was hours of testimony from Hillary Clinton today, your thoughts.

ARWA DAMON, CNN INTERNATIONAL CORRESPONDENT: Well, Becky, what was interesting is that there was not much talk at all about the ongoing investigation whether it was from the American side or the Libyan side. And this is very important, because at this point in time the Libyan government has effectively done just about nothing to bring those responsible for this attack to justice.

Following the attack and the days afterwards, senior government officials told us they had detained dozens of individuals for interrogation, that they had a number of significant leads. And after that they've been fairly tight lipped. And this most certainly creates a very dangerous precedent. One would have assumed or thought that people would be questioning Secretary Clinton about what the U.S. was doing to try to pressure the Libyans to effectively end the impunity with which these extremist al Qaeda linked groups are able to operate in Libya.

Many Libyans we were speaking to at the time were quite fearful that their own government would be incapable of reigning in these various militias. Right now, by all counts, they are even more powerful than they were back then, capable of intimidating witnesses, carrying out ongoing attacks against western interest. The Italian consulate general, for example, attacks against the Libyan security forces. And yet we've not seen any sort of real pressure by the U.S. to try to either force the Libyan government to go after these various groups or some sort of action themselves.

At the end of the day, the question also has to be is the U.S. going to allow these al Qaeda affiliated extremist groups to operate with impunity in Libya given what we heard Secretary Clinton speaking about, what Elise was referencing right there is the link that exists between these groups and other al Qaeda affiliated groups in Algeria, for example, in Mali, and of course their affiliation with al Qaeda in the Maghreb, Becky.

ANDERSON: Yeah. All right. Thank you for that. Arwa Damon for you out of Beirut.

Now let's get Elise back up. And Arwa there referencing what you had talked about towards the end of that last chat. When you talked about Clinton's warning of more threats.

LABOTT: Well, basically she's saying, Becky, this is the new threat. And that's why the U.S. needs to be working with international campaign, French troops right now, as we know, are helping the Malians and ECOWAS, the African groups trying to battle these Islamic fighters which are associated with al Qaeda in the Maghreb.

U.S., she says, can't allow Mali to become another safe haven for terrorists like you had in Somalia, like you seem to be having in Libya, like you had in Afghanistan. This, she said, is the greatest threat to U.S. interests. And that's why the U.S. cannot retreat. Chris Stevens knew that, that's why he was in Libya. He knew that even though it was dangerous, she said that while Chris Stevens was ambassador, there was a bomb that blew up in the parking lot of his hotel. He knew that even though there were these great risks, the importance of the U.S. being there at this difficult time can't be underestimated, because if not there would be a greater threat down the road, Becky.

ANDERSON: All right. Elise out of Washington for you this evening, always a pleasure.

You're watching Connect the World live from London. Our top story tonight, Hillary Clinton finally facing the tough questions on what she knew before, during and after the attack on the U.S. embassy in Benghazi in Libya in what was a testy enough time -- emotional testimony in Washington. She took responsibility for her department's handling of the crisis, but not much more leaving in many minds as many questions as answers.

Up next here on the show, talk about attention getting. Britain's prime minister stirs up global reaction with an EU exit strategy. For analysis from a top diplomat. And we're checking the response from the world economy forum in Davos.

Also, Israel's rising star. We'll see how this centrist politician shocked the pundits and could influence the agenda of the next coalition government there.

And the almost perfect performance of a lip sync. We look at the fallout over Beyonce's rendition of the American National Anthem. All that and much more after this.


ANDERSON: Right. You're watching CNN. This is Connect the World. I'm Becky Anderson for you in London.

Now is Britain heading for the exits of the European Union. Well, in more than half a century, no country has given up membership of the club. Could the UK be the first? Well, British Prime Minister David Cameron says that is up to the voters to decide.

We're looking at the reasons behind Mr. Cameron's strategy and its risks tonight. Plus, in a moment we'll bring you the reaction from Davos when Richard Quest joins us live from the World Economic Forum.

First, though, our senior international correspondent Matthew Chance looks at the nuances of David Cameron's landmark speech.


MATTHEW CHANCE, CNN INTERNATIONAL CORRESPONDENT: It is an extraordinary move, a prime minister raising the possibility of Britain, a key European power, leaving the European Union.

DAVID CAMERON, PRIME MINISTER OF BRITAIN: I am in favor of having a referendum. I believe in confronting this issue, shaping it, leading the debate, not simply hoping that a difficult situation will go away.

Thank you, Mr. Speaker.

CHANCE: His speech laid open one of the biggest divisions in British politics. Prime Minister Cameron may have placated euro skeptics, but europhiles across the political spectrum are alarmed, not least that Britain's economy may be damaged by years of uncertainty.

Years, because the referendum won't come until at least after the next British election in 2015. Until then, the prime minister says he wants to try and negotiate a new settlement with Europe, clawing back powers currently wielded by Brussels, like the authority to decide employment law, or environmental policy when other European states are moving closer to political and economic union.

It will be on that still to be negotiated relationship with Europe that the people of Britain will have their say.

CAMERON: I never want us to pull up the drawbridge and retreat from the world. I am not a British isolationist, but I do want a better deal for Britain. But not just a better deal for Britain, I want a better deal for Europe too.

CHANCE: Reaction from the consulate has been lukewarm, if not hostile. The French foreign minister calling the speech dangerous, saying it would be difficult for Britain outside of Europe. His German counterpart says he shares the vision of a better Europe, but the cherry picking by Britain is not an option.

The key reaction, though, may be this one from the German Chancellor Angela Merkel. Being in Europe, she says, means finding a fair compromise. In this framework, we are prepared to talk about British wishes.

Traditionally, Britain has been one of Europe's most skeptical countries, refusing to adopt the single currency, the euro, and opting out of various other European treaties. Now, a long awaited debate about the future of Europe and Britain's part of it is getting underway.

Matthew Chance, CNN, London.


ANDERSON: All right, let's bring in Richard Quest who is joining us live from the World Economic Forum in Davos where, Richard, you've been getting the business reaction to Mr. Cameron's speech. What have you got?

QUEST: Well, first of all, the speech has been very much an undercurrent here at Davos. I don't think people have quite cottoned on to the size and magnitude of what the prime minister said. He will be in Davos tomorrow when of course it will move to the center stage.

So far, Mario Monti, the Italian prime minister, has given the most official reaction of European leaders basically saying that whatever happens, Britain needs to stay within Europe.


MARIO MONTI, ITALIAN PRIME MINISTER: I am confident that if there is to be a referendum one day, the UK citizens will decide to stay in the European union and contribute to shape its future. I think the European Union does not need unwilling Europeans. We desperately need willing Europeans.



QUEST: If Mario Monti was slightly diffident one way, then Sir Martin Sorrell chief executive of WPP, which is the largest advertising and media company in the world, Sir Martin has already written previously to the Financial Times saying that the UK must stay in Europe. And now as the threat of a referendum becomes real, he believes that will be damaging and certainly not in Britain's interest.


MARTIN SORRELL, CEO, WPP: This is a political decision. It's not an economic decision. If I'm looking at it from the point of WPP it's not good news. It's at best neutral and at worst negative. So it can't be positive. So you just added another reason why people are going to postpone investment decisions. And the last thing we need is people postponing more.


QUEST: So I think just the view here is not so much whether there is a referendum or not, it's the fact that it is three to five years out minimum and that creates the uncertainty which as you know only too well, Becky, is the one thing markets and business loathe.

ANDERSON: It's the nemesis of those market traders and businessmen. Well, all right, at present the EU accounts for nearly 50 percent of Britain's total goods and services for exports. Is it clear, Richard, yet, how that figure would change if the UK were to pull out?

QUEST: No. By no means is it clear, because several things have to be understood. Firstly, there's no guarantee that the other European nations would have a full-scale negotiation. Secondly, the Norway option, or thirdly the Swiss option where I am is probably not available to the UK. So not only does David Cameron have to negotiate and get the others to go with him on that, that is the precursor to the referendum. Only after all that's been done could you have any idea what the effect, the real effect on trade would be.

ANDERSON: Yeah, and that's where the uncertainty comes in.

All right, Richard, thank you for that. And you're going to be with us later on in the show. So look forward to that.

Richard with the business view for you.

What do British voters think about all of this, then? Well, the latest UGov (ph) poll shows that for the first time in the current parliament more people would vote for the UK to stay in the European Union than to leave. 40 percent of those surveyed say they are pro-membership. 34 percent are keen for Britain to withdraw. Now UGov (ph) took this survey last week just days before Mr. Cameron's big speech.

Well, in the United States, Washington is watching Downing Street's every move. U.S. President Barack Obama told the British prime minister just last week that, quote, "the United States values a strong UK in a strong European Union." So I sat down with the former UK ambassador to the U.S. and asked him what today's big speech means for the special relationship. Have a listen to this.


NIGEL SHEINWALD, FORMER UK AMBASSADOR TO U.S.: And I think the prime minister actually, one of the things I welcome back his speech today was at the end he recognized that if Britain is strong in Europe it's also strong in Washington, in Beijing and elsewhere and actually vice versa. So if our stock goes down in Europe, then we have less influence elsewhere in the world. And I think that's ultimately the point that American interlocutors have been making to the UK government over the past few weeks is watch out, you're debate here does have wider ramifications. The UK on the sidelines of Europe, or even worse outside Europe altogether, is much less useful as a business partner and as a strategy partner than the rest of the world.

ANDERSON: Be that as it may, Cameron is elected to represent a constituency called the British public. And if they vote to get out that's the way it's going to be surely.

SHEINWALD: If they do ultimately, then Britain will have to forge a new path for itself outside the European Union of course. And that's why what -- that's the reason why what he said today is risky, because referendums not only deal with the issue on the table, which would be Europe, but there are obviously going to be subject to whatever the politics of the day happens to be alighting on...

ANDERSON: Britain out of the EU would most likely affect the pace of economic recovery in the European space. Is that -- is that ultimately what the Americans are worried about?

SHEINWALD: Actually a number of things. I think first of all, they worry about the fact that there will be a period of uncertainty in Europe now. There's a period of uncertainty anyway, because the EuroZone is still in crisis. But this adds another layer of uncertainty to all that. The second thing is Britain were to decide to get out, that would mean a period of huge disruption, not only for Britain, but for the rest of the European Union after that, because that's never happened in the EU. And obviously untangling all those relationships will be very difficult.

But I think American business looking at this is going to be worried. America is Britain's largest investor. There are nearly a million jobs here in Britain which rely on American companies. So any new American company thinking about Britain, looking for Britain as the gateway to the rest of Europe, is going to be thinking actually is it still going to be in, in four or five years time.

ANDERSON: How much pressure can Washington these days put on an administration in London? How special is that relationship these days?

SHEINWALD: It's still a very, very important relationship to us. It's our most important single bilateral relationship. I think that would be what, you know, all three major parties in the UK would say. I don't think it's pressure. I don't think it's a crude as that. And I don't think it's interfering in the detail of our politics. It's just saying there are lots of people out here who are watching and who want -- and for our own interests, for the American interests, what we want is the UK active and centrally involved in Europe.

ANDERSON: Why wouldn't a Britain in the EU, but with renegotiated terms, be a stronger partner for Washington, not a weaker one?

SHEINWALD: I don't think Washington is taking a position on that. What it's saying is that it doesn't want Britain, through a series of miscalculations, to end up on the sidelines or to end up -- or to end up out. And I don't think any of us who have a direct experience of negotiating in Europe are saying that it's unreasonable for Britain to put demands down on the table. We've done that for decades. And usually our European partners are prepared to accommodate us.

But I think the situation today is when we're there in crisis themselves, so they'll want to meet us but not at any cost, not at the cost of destabilizing the EuroZone itself, not at the cost of actually ripping up the core rules of the single market.


ANDERSON: Talking a possible exit for Britain from the European Union some years from now, I hasten to add.

Live from London, this is Connect the World. I'm Becky Anderson. Coming up, polls have now closed in Jordan in that country's first ever election monitored by outside observers. We'll just what is at stake after this.


ANDERSON: You're watching Connect the World. We're out of London for you this hour. I'm Becky Anderson. Here's a look at some of the other stories that are making news.

And in the line of fire, U.S. Defense Secretary Leon Panetta is lifting the military's ban on women serving in front line combat roles. Sources tell CNN his decision will be announced formally on Thursday. A senior U.S. defense official says the move could open thousands of front line jobs to females.

Well, ballots are now being counted in Jordan after the first election there since the Arab Spring. Voters are choosing a new parliament, but Islamists boycotted the vote, calling it a sham that won't bring about true democratic reform. They say King Abdullah hasn't ceded power or hasn't ceded enough power.

The Jordanian officials disagree saying the election is a milestone on the long gradual road to change.


NASSER JUDEH, JORDANIAN FOREIGN MINISTER: The winds of change were a gentle breeze, because we had anticipated the Arab Spring and his majesty the king had started a process of political, economic, and social reforms many years ago.


ANDERSON: Well, Japan is confirming the death of two more of its citizens in Algeria. It now says a total of nine Japanese were killed after Islamists overran a gas plant and seized hostages. Now Japan wants more answers about the attack, so it sent a senior official to Algiers today to speak with the prime minister. A four day standoff in the desert ended over the weekend, you'll remember, when government forces stormed the plant. Algeria has said 37 foreign hostages were killed.

Nigerian authorities are investigating a grizzly attack. They say three people were found beheaded in the northeastern city of Maiduguri. Residents say the victims were attacked in their homes overnight. Authorities blaming Boko Haram an Islamic extremist group that's fighting to create an Islamic state in northern Nigeria.

All right. The latest world news headlines are just ahead, plus Benjamin Netanyahu says the voters sent him a clear message for change. An update on Israel's surprising election results after this short break.

And an exclusive interview with one of the titans of football. Jerome Valcke talks to CNN about the biggest threat to sport. That after this.


ANDERSON: These are your headlines this hour. Two grillings in one day. Hillary Clinton testified before US Senate and House committees about last year's fatal attack on the US consulate in Benghazi in Libya. The secretary of state said the attack did not happen in a vacuum and is part of a broader strategic challenge in North Africa.

The US House of Representatives has passed a bill to quash the debt ceiling threat, for a few months at least. The Republican-backed bill suspends debate on the issue until mid-May. That allows the Treasury Department to continue borrowing the money it needs to pay government bills until then. At that point, it falls on Congress to pass a budget resolution. The bill now moves the Senate, where it's also expected to pass.

A change in policy for the United States military. Officials confirmed to CNN that Defense Secretary Leon Panetta is set to announce that women will no longer be excluded from combat. Jobs will opened to women. The announcement is expected on Thursday.

And European leaders are warning the UK that it can't choose which part of the European Union policy it wants to adopt. The reaction comes after British prime minister David Cameron announced that UK voters should have a chance to decide whether the country should indeed stay in the European Union.

Is well -- let me start that again. Israel's elections were widely expected to return Prime Minister Benjamin Netanyahu to office, and it appears that they will. But virtually no one predicted such a surge by centrist parties. With 99 percent of the ballots now counted, the seats in parliament are deadlocked between center left and rightist blocks. Mr. Netanyahu says he hears the call for change.

Let's get an update on coalition talks now underway. We're joined by Sara Sidner in Jerusalem on the day after the night before. And what a night it was for Yesh Atid, a new party to the bloc and a new leader to the bloc. Is it any clearer how this coalition's going to look at this point?

SARA SIDNER, CNN SENIOR INTERNATIONAL CORRESPONDENT: It isn't, and that's the disappointing thing, because today is kind of a quiet day where everybody's trying to get their rest, knowing that when the president goes ahead and decides OK, this is the party that we think can form a coalition and makes that announcement, then things get complicated.

And the reason why they'll be complicated this time is because of that party you just mentioned. That party did not exist in the last election. It did not exist until 2012, just last year, headed by a very popular former anchorman who was on one of the local Israeli networks here. A lot of people know his face. His father actually was a well-known politician.

But he brought this party to the fore, and he really focused on issues that Netanyahu did not focus on so much. Netanyahu focusing mostly on things such as security, talking a lot about some of the things that threaten Israel from the outside. This Yair Lapid saying look, we have issues we need to fix on the inside.

And one of the things he has really gone after and said that he will not concede on is he wants the ultra-orthodox to serve in the military just like everyone else has to. Men have to serve for three years, women for two. He says that's one of those issues that he's not going to let drop.

And so, it'll be interesting to see because of course you have the Netanyahu government who has plenty of people that usually join his coalition, such as Shas, who are a very high number of ultra-orthodox. And so, it'll be a bit of a difficulty to try to bring all these parties together.

But definitely, Yesh Atid, this Yair Lapid, this very popular former anchorman, he is the kingmaker right now, I think, Becky.

ANDERSON: All right. Thank you for that. That's the story out of Jerusalem, then. Our Richard Quest got some reaction to the election from the Israeli defense minister, former prime minister himself, of course. He spoke to him on the sidelines of Davos, and Richard back with us now.

Security around the stalled Mid East peace process, you and I know all of that will be discussed at Davos. But firstly, we've got to get some reaction from delegates as they arrive to what has been a surprising result in this election, what will be a different coalition going forward, Richard.

RICHARD QUEST, CNN INTERNATIONAL CORRESPONDENT: And what was really interesting when I spoke to the defense minister Ehud Barak was the way in which he was -- I suppose the only word is, he said he was fascinated by this election result. It was something completely different.

It had been a remarkable result simply because it was so different. And this from a politician who's not standing -- was not standing for election and has made it clear that he doesn't want a role in any new coalition or government. So I asked Ehud Barak, the Israeli defense minister, I asked him quite simply why did he think Benjamin Netanyahu had lost so much support?


EHUD BARAK, ISRAELI DEFENSE MINISTER: I think that what we call the social protest. The people who went in hundreds of thousands to the streets last year and basically ignored by the government part. They came to the ballots yesterday to say for us, we want our share of what happens in Israel.

It was a kind of telling the government that there is a limit to what you can expect us, we -- there is a famous joke that we say in Israel, once shirt waking up to work, one shirt is paying taxes, one shirt is serving in the reserve armed forces, but that's the same one. This one shirt told yesterday the government that it -- we want to be part of it or else.

QUEST: But nobody really expected -- everybody expected the prime minister to win, but nobody expected this backlash.

BARAK: Yes, he probably will establish a new government, but it's very close, extremely close. His people were not social, didn't come to the battle. The center and left camp came to the ballot en masse and created this new situation, very interesting one.

QUEST: Would you -- so you say it is a new situation, it's a very interesting situation, where does the politics in Israel go now?

BARAK: It's not sure. It's still kind of interim, I cannot pass judgment. I think that there will be a government probably still led by Netanyahu but much more limited in pushing its ideology.

It will be much more balanced, probably limited, cannot do whatever it wants, and will have to take into account the growing pressure from within to focus on many issues, which internally is interesting for the mainstream Israelis.

QUEST: After the election, does the -- does the peace process remain on ice because there's simply now not either political will in Israel or political ability to do a deal with anybody?

BARAK: It's -- there is a challenge here. I personally believe in -- I believe the people in my generation strongly believe that we have to find a way to continue the political process, but there is a lot of frustration in Israel as a result of what happened in the Arab world, what happened with our Palestinian partners.

I still believe it's not a zero-sum game. We have to find a way to strengthen the moderate part of the Palestinians, namely Fatah, that were not in trouble, to help their future entity.

QUEST: But did yesterday help or hinder that goal, in your view?

BARAK: I don't know. It's too early to tell. There is strong feeling in the right wing that they are capable of shaping it this way, and there is now not enough courage of conviction on the left side that we have to impose it upon reality, upon the -- some kind of -- I don't know how to call it -- indifference of the public.


QUEST: An energized and enthusiastic Ehud Barak, defense minister. Perhaps, Becky, because he's looking forward to handing over the reins of office when a new cabinet is installed.

ANDERSON: Yes, I was fascinated to hear him saying that Israel will probably be led by Netanyahu going forward.


ANDERSON: Good, though, to hear that he's talking about finding a peaceful way forward in the Middle East.

All right, stick with me. If you need to tweet me, if you want to tweet me, get in touch, @BeckyCNN, we always want to hear from you on the issue of Israel and Palestine, on the issue of the EU, on the issue of Britain potentially pulling out of the EU, tweet me @BeckyCNN.

You're live from London watching CONNECT THE WORLD. We're back in Davos next, where Richard sits down with the chairman of Switzerland's largest bank, who says the worst is not yet over for Europe. We're going to discuss that. What is next for Europe? Richard and I on that after this.


ANDERSON: Well, let's just get you some of the news just coming in: Apple has just posted its quarterly results. It means a lot when this company puts out its numbers these days. Investors not impressed. Have a listen to this.

The tech giant posted record fourth quarter revenue of $54.5 billion. Much of that came from selling 48 million iPhones. But that missed expectations, and let me tell you, shares are down in after-hours trade. Watch this space when those markets open tomorrow.

Of course, this trade happens electronically and in other markets, but do watch that space, because that's a -- that's a big number and a big stock.

Let's bring Richard back, at the World Economic Forum in Davos. I'm sure there'll be people there who've got stakes in Apple who might be a little bit worried tonight. But let's not talk about that. Let's talk about what those that you've been chatting to say about the future for Europe.

QUEST: Right.

ANDERSON: I'm fascinated to hear what the great and the good feel this year.

QUEST: Right. Funny, you know, I was just looking at that Apple number and I'm just thinking wow, that that's going to be an interesting one in the hours ahead.

But let's talk -- look. They call it the World Economic Forum, so let's talk economics. In 2013, where is the risk, and what happens to the European eurozone versus the United States? I was joined by Axel Weber, the chairman of -- the new chairman of UBS. And quite simply, was Europe out of danger?


AXEL WEBER, CHAIRMAN, UBS: We've had plenty of solutions now where we basically postponed the real solution. We bought some more time, and what is happening now is fiscal policy is exactly the same thing.

If you have a debt ceiling, the Europeans will talk about how you can make that binding. In the US, the concern is much more whether you can lift it in time in order not to put to much brake on the economy.

Now, the US economy has bottomed out, it's coming back. And I think sooner or later, the US has to face the fiscal issue, not just in the sense of delaying adjustment, but really making a credible adjustment.

QUEST: But they seemingly don't have to face it, because we have -- we seem to go over the fences. Whether it's Simpson-Bowles, whether it's the debt commission last year, the deficit commission, whether it's the fiscal cliff, it gets pushed further down. When will the markets finally say enough?

WEBER: Well, I think you can only repeat this exercise several times, and in Europe, we've clearly seen that there was a lot of complacency around debt, and market access was given and actually refunding costs were low.

But when the market turned against Europe, that market access was lot for a few countries. So, I'm quite concerned that what we're leaving future generations is just a lot of debt rather than a better future.

QUEST: Are you concerned that at some point the markets start to hiccup and say enough, US? You won't -- the politicians won't do your work, we will do it for you.

WEBER: I think the US is the center currency country of the world, they're the renumerare of all exchange rates. So, they have a lot more market access than you would get for a European country. So, they can kick the can down the road a lot longer than us might be able to.

But there is -- at the end, you've got to have a credible solution of how you bring down debt, and at some point, you've got to face it. I'm not saying it needs to be now, I'm not saying it needs to be anytime soon, but it needs to be part of the policy framework.

QUEST: Are you of the school that says the worst is over in the eurozone crisis?

WEBER: I'm not of that school, because I really feel that major progress is only done under pressure of markets. What we have is, we have, I would say, in interim plateau. Things have improved. Clearly, the trend going forward is better than it was last year.

But there are many political issues around that are unresolved, and we'll have the Italian election, we'll have a German election. So, political risks might come to the fore again that might spooks markets a lot more than the current more benign environment. And as investors will take a more risk-off attitude and refrain from investment, that might challenge European countries again.

QUEST: So the message from Europe, if I'm reading you right, is you dare not take your foot off the gas. Or fall.

WEBER: No, my -- my view is more tackle the deep, underlying issues that need to be tackled. Do the reforms that are needed to get back to growth, because even if you fix the debt issues, where will growth come from in Europe? So, Europe needs to do credible reforms and tighten fiscal policy down somewhere down the road.


QUEST: Axel Weber, the chairman of UBS on Europe and the United States. Becky, while we've been talking, I've just been looking at Apple shares, they're down --


QUEST: -- around 4 percent in after-hours trading. And I can tell you from just talking to people in the congress center here, everybody now is starting to question, having seen the heights of the Apple share price of over $500, the view's seeming to be -- who knows whether they're right or wrong -- the risk is on the downside.

ANDERSON: Yes. Interesting, isn't it? Well, watch this space, because that's going to be a really good story tomorrow, and I know you'll be on it, as you'll be on everything else --

QUEST: We will.

ANDERSON: -- because you are there at Davos, and it's all important stuff. Thank you, sir. Look after yourself --

QUEST: Thank you.

ANDERSON: -- keep warm. You're watching CONNECT THE WORLD. Still to come: found out. After stealing the show at Obama's inauguration, Beyonce plays it safe with a lip-synch. Why? After this.


ANDERSON: All right, now. One of football's -- global football's most senior figures has called match-fixing in football a "disease," and he's repeated UEFA president Michel Platini's claim that it's the biggest problem facing the sport.

Don's with me. He's got more, now. The FIFA general secretary didn't mince his words when speaking with our colleague, Pedro Pinto, did he?

DON RIDDELL, CNN SPORTS CORRESPONDENT: Absolutely right, Becky. Football could do a few things to improve itself and improve its image. Racism within the game is one of them that the authorities are often accused of really not taking seriously enough.

But if you ask any of them, they will all say that match-fixing is the biggest threat to the credibility of the world game, and earlier on, Jerome Valcke, in an exclusive interview with Pedro Pinto, said exactly that.


JEROME VALCKE, FIFA GENERAL SECRETARY (via telephone): I really think that it's a -- it's a, if I may say, a disease, a threat which is on a worldwide basis. It's not just about Africa. It is in Asia, it is in Europe, it is in North America, it is in Canada, it is in South America. It's all around the world that this match-fixing or match manipulation is active.

PEDRO PINTO, CNN SPORTS CORRESPONDENT: You heard what UEFA president Michel Platini had to say in an interview with a French radio station, in which he said about match-fixing: "If tomorrow we go watch a game already knowing the outcome, football is dead."

When you heard him say that, what were you thinking? What was your reaction?

VALCKE: I would say that is perfectly right. The beauty of football is that, yes, it's a bit of theater where you play in one place, you have a defined time, 90 minutes, you know exactly what will happen except for the result. So, if you would know what's the end of the party -- I mean of the game, definitely football is dead.

PINTO: Is it a fight you can win, though, Jerome, considering how underground many of these dealings are?

VALCKE: It's -- I'm not sure that we'll win it tomorrow morning. I have been -- when I was in Roma, where we had this meeting with Interpol and 50 of the 53 of the European Association, I heard that the business of match manipulation per year is around 100 billion. I don't know if it's in euro or US, but whatever. It's 100 billion. It's an amazing number, a figure.

So again, I think it will be a very, very long fight, and it will be - - it will be very difficult to win. And if we want to win, again, it's all together. But it will not be a fight of one day. As we have other fights, which have been there for years, and match manipulation will be one of them for the next decade.

PINTO: Regarding the head of security, Ralf Mutschke, Jerome, how much power does he have? How much support does he have at FIFA?

VALCKE: If your question is, if there is any limit to what FIFA would do against match-fixing, no, there is no limit. And that's why I fully agree with Michel. There is no limit in what we have to do in order to make sure that we can eradicate match-fixing one day in our game, or at least to make sure that match-fixing is not a threat anymore to our game.


RIDDELL: Jerome Valcke there on the biggest threat to the beautiful game all around the world, Becky. We'll have more on that in "World Sport" in 35 minutes. I can also tell you that within the last few minutes, Chelsea have been knocked out of the English League Cup. Swansea will play in the final against Bradford City.

The real story, though, is that Chelsea's Belgian midfielder, Eden Hazard, has been sent off in that game. It was for violent conduct, but it was not against one of the players. Find out who in 35 minutes' time.

ANDERSON: Wow! What a tease! Good for you!


RIDDELL: Got you.

ANDERSON: Thirty-five minutes, can't wait! I'm going to zoom home to watch it. Good stuff, mate, thank you for that.

Well, she may have stolen the show, but it has emerged that Beyonce was apparently miming her stunning rendition of the American national anthem at Barack Obama's inauguration on Monday. Let's see if you can pick it.


BEYONCE (singing): Say does that star-spangled banner yet wave, o'er the land of the free! And the --


ANDERSON: I couldn't. I couldn't see it. If it's any consolation for the pop diva, she's not alone in the business of lip-synching, but as you're about to see, she's been one of the most convincing.


ANDERSON (voice-over): As Beyonce knows only too well, the stage, well, it can bring you fame, it can bring you fortune, and it can bring you a whole lot of trouble.


ANDERSON: Here's Lindsay Lohan singing without, well, singing. (VIDEO CLIP - LINDSAY LOHAN LIP-SYNCHING)

ANDERSON: And in this clip, this band's very talented front man can sing, can fall, can sing and fall.

And here is good old Milli Vanilli doing their thing, which famously did not include much singing.


ANDERSON: But at the top of our list, the best of the best is Ashley Simpson, missing her cue on "Saturday Night Live."

The lesson's clear: If you want to be a singer, make sure you like singing.



ANDERSON: Well, earlier, I spoke to Grammy award-winning producer Prince Charles Alexander about lip-synching and about the furor. He's worked with the likes of Usher, Puff Daddy, Aretha Franklin, so he knows a thing or two about mastering a performance. Take a listen to what he had to say about all of this.


PRINCE CHARLES ALEXANDER, GRAMMY-WINNING PRODUCER: It's cold out, it's windy out, you don't know what the weather's going to be, so you want to be prepared. And you want perfection. And somebody like Beyonce, who is a perfectionist, wants to be well-prepared for that perfection.


ANDERSON: What do you think there? Is miming acceptable, or should performers always sing live? That's what we've been asking on our Facebook page. Just head to that, Join the conversation. Or, of course, you can tweet me @BeckyCNN. That is @BeckyCNN.

I am Becky Anderson, that was CONNECT THE WORLD. Thank you for watching. From London, it is a very good evening.