then pakistan which had its own mini-scandal a year ago leading to the ouster of its famous ambassador to washington. we have the first exclusive interview with ambassador akani since then. he will tell us what happened to him and what's happening in pakistan. also, why in the world has immigration from mexico to the united states stopped in its tracks? we'll take a look. next up, the american elder statesman brent scowcroft on syria, iran, and the middle east, and how he feels today about the republican party which he served for decades. >> do you prost krast nature, waste money, over indulge. what to do with your bad hakts and how transforming them could help you, your company, your country. first, here's my take. after months of meander,ing it seems that president barack obama's re-election campaign has settled on a theme. the problem is it's the wrong one. the buffett rule tax on millionaires has become obama's bumper sticker. the proposal is reasonable, but it does not deserve the attention obama is showering on it. it raises a trivial sum of money, $47 billion over the next ten years, during which period the federal government will spend $45 trillion. it adds one more layer to a tax code that is already the most complex and corrupt in the industrialized world. the focus on the buffett rule is also bad politics in the long run for obama. while polls might momentarily show that it works, americans are generally aspirational, not envious. over the years voters tend to support a government that focuses on creating opportunity rather than one that just tries to reduce inequality. bill clinton and tony blair's great feat was to position themselves as pro-market, pro-growth, pro-opportunity progress sifz. obama should not friter away that asset. ironically, obama has been pivoting at the very moment that events in the real world are providing him with the perfect campaign issue. we are four years into the financial crisis. in the united states the government acted speedily and massively to stimulate the economy using monetary and fiscal measures. in europe by contrast governments quickly turned towards austerity programs, cutting spending across the board to reduce budget deficits. well, the results are in. the u.s. economy is expected to grow 2% to 3% this year. the euro zone is expected to contract, to shrink by .3% this year. spain and britain have officially entered a double dip recession. the first time major economies have done so in 40 years. imf projections show that even germany's average growth rate over the next five years will only be 40% of america's. president obama started the year speaking about an economy built to last. he should return to the theme and frame this campaign as a choice between public investments on the one hand versus budget cuts on the other. he has substance behind his rhetoric. obama has proposed several important investment initiatives. a $476 billion enfrom a structure plan. a 5% hike in research and development spending. a job training program to help dislocated workers. incentives for manufacturing, funds to expand the pool of college graduates. also to increase science and engineering students so he should ask americans to choose between these investments to spur long run growth versus massive budget cuts. in the midst of the economic crisis, warren buffett said his strategy was to invest in america. that's the buffett rule obama should follow. let's get started. >> this is a year of wholesale change in china. most of the country's all powerful standing committee will be replaced, but these are the planned changes. what beijing did not account for in 2012 was an all-out scandal. until a few months ago lee was a name known for few westerners, but in china he was a prince ling and the powerful head of the party. his campaign against organized crime had made him a champion of the new left, a throwback to the days of mao in some ways. and then all of a sudden this powerful figure had a stunning fall. every day this fall has been chronicled on newspaper front pages around the world. it turns out he was corrupt. his wife had been detained in connection with the murder of a british businessman, and now he is said to have been wiretapping the most powerful man in china, the chinese president. it's not just one man's story, but the inner workings of china, which we rarely see. i'm joined by a journalist who follows these inner workings very closely. evan is the new york es's china correspondent, but he is here this week in new york. welcome. >> thanks. glad to be here. >> so this sounds like something out of a murder mystery. how do you think most chinese people are reacting. the news of this guy who was really one of the most admired people in china from what we could tell has suddenly been now revealed to be a corrupt hack or is being kind of painted as a corrupt hack by officials. >> we're talking about the world's second largest economy, the most powerful men in charge. xli was going to be perhaps one of the nine people running the country this fall, and now he has been -- he has fallen from grace, and, of course, in the course of just a few weeks, and this has really left people's head spinning because in the chinese protester press they're being told every day this man was a criminal. this man who had been celebrated just a couple of months ago, and this is very hard for the party to explain to people. this is a problem that's hard to reconcile. >> and what is the -- in the chinese press he has been portrayed as a criminal and kind of awe bad apple, but this is also about a power struggle. >> this is the part that's especially awkward for the leadership because they have a case in which the details themselves are so spectacular. we've got a police chief fleeing to the u.s. consulate in chungdo seeking protection from the americans saying that his boss's wife has murdered an english businessman, poisoned him in a hotel. we've then got rumors coming up on the internet and then eventually being confirmed by western reporters that show that, in fact, the family had assembled an enormous fortune. perhaps into the millions -- or hundreds of millions of dollars. they were trying to move out of the country. the party has tried very carefully to say this is a criminal matter. regard this as one bad apple, but what we now know, in fact, is this is just the outward expression of what is a deep and intense political contest going on at the highest ranks of the communist party. >> but what we now have from the "new york times" in this extraordinary piece of reporting that -- i mean, if it doesn't win the pulitzer prize, i will be stunned -- is that xhli was actually wiretapping senior chinese officials in beijing, including the president of china. i mean, this tells us of a level of intrigue that literally looks bizantine. >> this moves us from an agatha christy case to a watergate style of case. what you have is one part of the government using the full force and tools and apparatus of the state on another part of the government. that to a chinese reader and a chinese listener is alarming because this goes back to the very origins of the factional, very bitter fights that shape the communist party over the 1960s and 1970s. the communist party has succeeded in projecting the idea of unity, discipline, competence, professionalism. that's what it stood for three, four years ago. growth of 8%, 10% a year. it's now begun to look as chaotic, frankly, as it did in the late 1980s, and to a chinese citizen, that's distressing, and i think that's a problem for the party because the party has sold itself to people over the last few years by saying we know communism is no longer a part of your life. we know it no longer means anything, but what we can do is deliver competence and stability. this begins to pull that into doubt. >> and if you look at the levels of corruption that seem to, again, be surrounding this, we pointed out to me off camera a fascinating report from the chinese central bank that talked about the numbers. tell that. >> 180 billion with a b. u.s. dollars that had gone from chinese treasury from essentially public money that had been taken overseas by corrupt officials. when that happened at the time -- frankly, a lot of us thought this can't be right. the did hes mat place is off. something is off. what we're now starting to think is that, in fact, it's plausible. that if there were -- if there are enough people who have assembled thesis economic empires for themselves in the system, that quantity of money begins to be plausible, and what that means is a certain level of chaos beneath the surface of -- what we see on the sir fas is the ritual of everybody banding together, the system doing well. these are technocrats. what we are seeing is there is a disorderly layer to the chinese political system. >> so the leadership is going to try to present this as one very bad, corrupt, power-hungry guy, and it may well be, from thin their point of view, that they dodged a bullet here. he was clearly power hungry. he clearly was going to be a very difficult and unruly member of the nine-member standing committee. he seems to have been willing to use power in ways that certainly the chinese have not for 20 years. you know, wiretapping his superiors. they'll try to shut it down and say we got rid of the bad egg. will it work? >> i think for the moment they are succeeding in containing the damage in the sense that this has not started a campaign of purges. the signal to us that this is going to become a larger political problem and it may, in fact, throw off the transition of leadership this fall is if we begin to see high level purges of either side of these idealogical debates, so, for instance, if other members of the bureau get into the crosshairs, if they start to go down, then we really need to be concerned about whether the political system at its highest level is stable. for the moment they have succ d succeeded in saying that xhli is a problem. we've rooted him out, and let's go back to business. i'm reasonably confident that they certainly will be making every effort to do it, and, remember, this is a dictatorship that does not have a dictator, and that is an unusual thing. it's something we have not really encountered before, and as a result, it's hard to predict whatsoever political animal it is. >> a dictatorship without a dictator and where the leaders transition out every ten years. >> a dictatorship with term limits is something we've never encountered before. the last time we had a political crisis like this in china was 1989. you have to remember, that was i time when china's economy was smaller than spain's. there was no internet. what happened in beijing was interpreted and broadcast to the public around china in whatever way the party wanted it to, and at the time it was still a crisis. after all, 1989 was teen man square. right now china is stable. the streets are quiet. but this is a hugely volatile moment because you've got the internet, which has a way of interpreting things in all kinds of unpredictable ways. china so far is still growing fast. the economy is still growing. people are reasonably satisfied. it cannot afford, frankly, to have political disarray because it doesn't have that kind of cushion and protection. >> evan, thanks very much. it will be fascinating to see what you write about on all this for "the new yorker." up next, a scandal that's shaken the core of america's relations with pakistan. i'm going to speak to the man at the center of it, the man who lost his job as pakistan's ambassador to washington. the first interview exclusive to us. >> fareed, it's such a liberating feeling not to be the ambassador right now so i can actually say what i feel. 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>> first, let me say that i was not formally arrested. yes, my movement was restricted, but i was never arrested. i was never charged. there is no legal or fom charge against me. what happened was it's not just the military, by the way. it's unfair to just blame the military. pakistan society is extremely polarized, and that polarization includes judges, journalists, generals, politicians, all people who have adopted a world view, and i happen to have the different world view. the president of pakistan and the elected leadership of pakistan embraces that world view, but did not have the strength at that time to assert the world view. then, there was this whole media trial which kept on saying this is treason, this is treason, you asked the americans to intervene in pakistan's domestic politics. a, there was no threat of going after bin laden and being found in pakistan. in fact, the military was very embarrassed by that fact that he was found there. so there was no coo that we needed to avert. the so-called claim that i actually sent or asked somebody to send a memo to admiral mueller has already been set right by general jones who was the intermediary. he says, yes, he sent me an e-mail, and i forwarded it to mueller. mueller didn't take it seriously, and jones says but i was never told it was from hakani or from anybody else, and the individual concerned who was at the heart of all of this , he has changed his story several times, and he has a long history. >> when we look at u.s.-pakistani relations, it does not seem that things are on the right track. it fields as if there is deep distrust between the pakistani military and the u.s. military. there is deep distrust at the level of the civilian government in the sense that there's a sense that they cannot actually govern, they don't have any power, and if you look at sfw like the drone attacks, for example, the number of drone attacks have dropped dramatically, in part because of very strong objections from the pakistani side, retaliation of various kinds. where is this relationship going? >> fareed, let's be clear. the mistrust is not just between american institutions and pakistani institutions or american government and pakistani government. the mistrust is between the pakistani people and the american people. pakistani people have a narrative in which the united states has repeatedly betrayed pakistan, have left it in the lurch. it came to fight the soviets in afghanistan, and then left in a hurry without caring about the fall-out for pakistan. it promised assistance and withdrew it. the american narrative is that pakistanis cannot be trusted and that pakistan pursues a nuclear weapons program which they promised at one time that they wouldn't do, that pakistan is involved in supporting militants and terrorists. >> is that fair? in other words, from what you can see, from what you saw, isn't it true that the pakistani military wants to retain ties with the taliban because it wants to have influence in a post-american afghanistan? >> fareed, it's such a liberating feeling not to be the ambassador right now so i can actually say what i feel, but even then i will say something that i said on your show once before. pakistan does have security concerns in afghanistan. it would not be appropriate for pakistan to not respond to the reality that afghanistan should not be used as a staging ground for any kind of military or covert operations against pakistan. the u.s. would not have accepted a soviet base in mexico during the cold war. that said, i think that there is a paranoid mindset 234 in pakistan that does not allow rationale discourse, and if the matter is discussed in a rationale manner in which the paranoia is set aside, and by the way, the paranoia runs wild in pakistan. i don't know how much to follow the pakistani media, but in everything there's a conspiracy theory. >> directed by the cia? >> directed by the ceo and directed by the american government. there's an conspiracy to take over the world, a term that nobody in america follows. i know there are many people in america who are zionists and many people of indian origin, but i have never heard of the indo-zionist lobby here. there are things that are fed there. you know that even in the most free media environment, people believe what they're told and then their opinions are shaped by that. so in case of afghanistan also, pakistan and the united states can come to terms with an arrangement that can work for both. we are not there yet. we are not there yet. and i think to get there it's important that those groups can pose a threat to american security. they need to be -- >> and that means going into north waziristan and taking on the hakani faction and other groups like it. >> >> dealing with all those factions that pose a security threat to the united stat