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Week of July 9, 2002, Program 0228

Putin Speaks Transcript MP3 Related Link
NATO's Future Transcript MP3 Related Link
Chile Pension Transcript MP3 Related Link
Afghan Child Weavers Transcript MP3 Related Link
Rebuilding Afghanistan Transcript MP3 Related Link
Mid-East High Tech Transcript MP3 Related Link


July 9, 2002
Program 0228

(This text has been professionally transcribed, However, for timely distribution, it has not been edited or proofread against the tape.)

VLADIMIR PUTIN: [via a translator] There was movement on both sides. It was a two-way street and we moved towards each other.

KEITH PORTER: This week on Common Ground, Russian President Vladimir Putin, in an exclusive interview, talks about his country's new relationship with the United States.

MCHUGH: Plus, learn why Russia and NATO are forging a new friendship.

TED GALEN CARPENTER: NATO is dead. Long live the new NATO, but the new NATO is going to be little more than a regional version of the United Nations.

MCHUGH: And, hear why Chile's privatized social security system is leaving some out in the cold.

LARRAIN: Approximately one-third of the workforce in Chile are independents. They are probably not willing to make contributions to a social security system for 20 or 30 years more.

PORTER: More after this.

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Putin Speaks

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PORTER: Common Ground is radio's weekly program on world affairs. I'm Keith Porter.

MCHUGH: And I'm Kristin McHugh. Russian President Vladimir Putin was the first world leader to throw his weight behind the US war on terror. Russia has been rewarded for its support.

PORTER: The United States no longer publicly criticizes the Russian military for its controversial actions in the breakaway region of Chechnya. And US policymakers no longer protest quite as loudly over President Putin's offensive against the free media in Russia. So how does Vladimir Putin view his relationship with the West? The Russian leader doesn't often talk to Western journalists, but he's been talking to Common Ground's Simon Marks.

[A Russian announcer speaking in English at the recent Putin-Bush summmit]: As a result of the negotiations, the following joint statements by President Vladimir Putin and by President George Bush, are adopted.

[sound of applause]

SIMON MARKS: On display in Moscow this May, detente defined. President Bush and Vladimir Putin codified their new relationship by signing a new nuclear arms reduction treaty, a strategic cooperation agreement, and by generally having a good time.

PRESIDENT GEORGE BUSH: [speaking from an outdoor setting, speaking with Russian reporters] It's a beautiful, some of the most beautiful buildings I've ever seen in my life here. [after more reporters speak] It's so beautiful.

MARKS: That an American President steeped in the Republican Party should get along so well with a Russian leader who spent most of his adult life in the KGB illustrates the extraordinary shift in geopolitics that occurred immediately after September the eleventh. Vladimir Putin threw his weight behind the US war on terror, sharing intelligence data with Washington and offering advice on how to fight militarily in the inhospitable terrain of Afghanistan. In return, the Russian President has been welcomed as a modernizer by the leader of the Western family of nations, and he hears far less criticism of domestic policies that critics contend are authoritarian.

PRESIDENT BUSH: Russia is not an enemy. We don't, we don't think about how to, you know, how to deal with Russia the way they used to. Russia is a friend. And that's the new thinking. That's part of what's being codified today.

MARKS: So how does Vladimir Putin feel about the new relationship that he's forging with the US and its Western allies? I got a chance to ask him shortly after President Bush's visit to Moscow, and he told me that he genuinely sees a relationship transformed.

PRESIDENT VLADIMIR PUTIN: [via a translator] You know, when we started this work, on all the key issues of cooperation our positions were either very different or I can say they were totally opposite. And the fact that in this period of time our officials have managed to make positive progress and achieve agreement, well, I want to note that there was movement on both sides. It was a two-way street and we moved towards each other.

MARKS: The Russian leader is at pains to point out that not everything in the US-Russian relationship is rosy. He hasn't yet got everything that he wants economically from the United States. For example, there's been no alleviation from the tariffs President Bush imposed on Russian steel earlier this year. And still no graduation from the Jackson-Vanik amendment, a Cold War-era piece of legislation that used to punish the Soviet Union for restricting the emigration of Russian Jews. It remains on the statute books, and even though its practical effects are negligible, the Russians want it repealed. Nevertheless, President Putin maintains that the advances in relations outweigh the problems.

PRESIDENT PUTIN: [via a translator] The fact that we agreed on key issues and the fact that we signed those documents, I think is tremendous progress. You mentioned a few questions that are still not resolved. Namely Jackson-Vanik. Of course we're not overly thrilled about that, but we don't want to dramatize things. The most important thing is that we came to a mutual understanding of our key problems and agreed on them. The key issues are, of course, issues of security and disarmament. The nuclear arms reduction treaty is not just a good treaty which reflects modern realities, but it also sends a very clear signal and shows the direction of our future cooperation.

MARKS: President Putin is under pressure from some Russian lawmakers who accuse him of allowing Washington to trample over Moscow's former superpower status. Alexei Arbatov, for example, is an influential young reformer in the Russian Parliament, the Duma. He says President Putin is giving too much away in order to curry favor with Washington.

ALEXEI ARBATOV: It's not a relationship between equals. Certainly Americans are dominating and Russians feel that they are not getting enough in response to what Russia has been doing since September 11, making relations with the United States its highest priority, as well as relations with NATO, and going forward very far in cooperating with the United States, in anti-terrorist operation and in many other areas.

MARKS: But Vladimir Putin responds to those criticisms with a pugnacious defense of Russian interests, and an intimation that he doesn't plan to be rolled by anyone.

[Marks now questions President Putin] Do you see the relationship now with the United States as an equal relationship? There are those Russian lawmakers who say the United States dominates the relationship, the Americans are telling you what to do. Do you see it as an equal relationship?

PRESIDENT PUTIN: [via a translator] I think the fact that America is worried about issues that they think are key questions. If you remember at our news conference I mentioned the issues that we are worried about, such as rogue nations that are developing their nuclear technologies. That really worries us. In this respect I would like to hope that the US Congress, just like our Parliament, in the end will ratify the Comprehensive Test Ban Treaty. Russia signed this treaty and ratified it. The US legislature still didn't. And there are some other issues that we, on the Russian side, are putting forward as the next issues to be dealt with. I have to say that our American colleagues are treating our worries with much attention and respect. And in this regard we don't have any problems with them.

[The Putin-Marks conversation ends and Putin walks away.]

MARKS: And with that, Vladimir Putin was gone, heading into a meeting with the Prime Minister of Finland. Less than three years after he burst onto the political scene, he remains an enigmatic figure, reaching out to the West, but bringing an authoritarian style to policies at home. But even a brief encounter with him shows that he is engaged, well-versed in the issues, and able to extemporize on a variety of different subjects. And many Russians today find those aspects of their leader appealing and refreshing, compared to the latter period of Boris Yeltsin's rule that immediately preceded him. For Common Ground, I'm Simon Marks in Moscow.

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NATO's Future

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MCHUGH: Moscow plays a more prominent role in NATO's decision-making processes, following the establishment of the NATO-Russia council. And NATO is now preparing to decide on new members later this year, all of which is prompting a lively debate about the alliance's future.

PORTER: With the Soviet threat gone and the Cold War over, the world has changed dramatically in the 50-plus years since the alliance was founded. Add to that, the events of September 11th and the mission is now so different that some commentators are arguing NATO is effectively out of date. Common Ground's Jesse Brandon has more.

JESSE BRANDON: The debate comes as NATO, which was designed to be a defensive alliance, grapples with how to respond to the events of September 11th. US Defense Secretary Donald Rumsfeld is trying to persuade his NATO colleagues that offense is sometimes the best form of defense.

DONALD RUMSFELD: If a terrorist can attack at any time, at any place, using any technique and it's physically impossible to defend in every place, at every time, against every technique, then one needs to calibrate the definition of defensive.

BRANDON: It's just one of the fundamental questions being asked of an organization which, for most of its existence, prepared to fight a full-scale conventional war in Europe.

[The sound of Russian martial music and the sound of marching soldiers.]

BRANDON: The North Atlantic Treaty was signed in April 1949, when Soviet expansionism was very much on the minds of leaders in war-torn Western Europe and North America. So, 12 nations banded together, promising to treat an attack on one as an attack on all.

PRESIDENT HARRY S. TRUMAN: If there is anything inevitable in the future, it is the will of the people of the world for freedom and for peace.

[The sound of applause.]

BRANDON: Much has changed since US President Harry S. Truman made that speech.

[The sound of music at a parade.]

BRANDON: As NATO celebrated it's 40th birthday in 1989, the Cold War was coming to an end. One year later, the alliance extended the hand of friendship to its former adversaries. In 1990, NATO heads of state and government—including the first President George Bush—issued what was called the "London Declaration."

PRESIDENT GEORGE BUSH, SR.: We say to President Gorbachev, come to NATO. We say to all the members states of the Warsaw Pact, come to NATO and establish regular diplomatic liason with the alliance.

BRANDON: These days, Russia has a role—albeit limited—in the alliance's decision-making process, following the creation of a new NATO-Russia Council. Moscow also appears to have softened its opposition to the alliance's eastward expansion. A NATO summit in the Czech capital, Prague, later this year will decide which of the aspiring nations will be invited to join. The hopefuls include three former Soviet republics—Estonia, Latvia, and Lithuania—right on Russia's borders. Critics say the closer ties with Moscow and the prospect of an even larger NATO membership, are undermining the main purpose of the alliance.

[The sound of a typewriter]

BRANDON: Ted Galen Carpenter, at the Cato Institute in Washington, has written about what he calls the folly of NATO enlargement.

TED GALEN CARPENTER: NATO is dead. Long live the new NATO, but the new NATO is going to be little more than a regional version of the United Nations; kind of a political league of democracies. But as far as military coherence is concerned, I think that is going to become less and less a reality and certainly it is not going to be a reality outside the European theater.

BRANDON: That said, Mr Carpenter doesn't believe that the US really needs NATO, as it widens the war on terrorism.

CARPENTER: What we saw not just in Afghanistan, but earlier than that with the war over Kosovo and even earlier than that in the Persian Gulf War is that the United States really didn't need its European allies for military operations and, frankly, they weren't all that useful.

BRANDON: Ted Galen Carpenter also points to the existing disagreements between the US and its European allies over issues like Iraq and the Middle East. Reaching agreement, especially about operations outside Europe, might be expected to get even harder, as the alliance expands. But NATO spokesman Yves Brodeur says there's no reason to believe that the decision-making process will fail.

YVES BRODEUR: It's obvious, the more people around the table, that the more lively the discussions may be. But I don't think that you can presume that at the end it's going to be more difficult to achieve consensus.

BRANDON: And NATO supporters say that while the threats may have changed, the core mission remains the same.

ROBERT HUNTER: If it's not a military organization, it's nothing.

BRANDON: Says Robert Hunter, who served as US ambassador to NATO from 1993 to 1998. He says the alliance has already shown its continued relevance in the aftermath of 9/11.

HUNTER: When Germany sent some forces into Afghanistan, they arrived on the ground in a brand new country. Thirty-six hours later, they were in combat. Why? Because they knew how to do it with the Americans and with the others because they were all in NATO.

BRANDON: But the Afghan conflict is not a NATO operation. It's a coalition of nations, which includes members of the alliance, an approach that's widely seen as a model for future actions. For Common Ground, I'm Jesse Brandon.

MCHUGH: So, what are your thoughts on Russia's relationship with NATO? Send us your comments and we may use them on the air. Our e-mail address is commonground@commongroundradio.org.

PORTER: Chile's privatized social security system, next on Common Ground.

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Chile Pension

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MCHUGH: Common Ground's multi-part focus on the untold stories in South America continues this week with an examination of Chile's pension system.

PORTER: Chile completely privatized its social security system 21 years ago, and some in the US say it's a model for reform. But does Chile's pension system really work? Reese Erlich reports from Santiago.

[The sound of a gate opening and someone walking into a house.]

REESE ERLICH: Sixty-six-year-old retired high school teacher Olga Seguel welcomes a visitor into her modest 2 bedroom, brick house in Santiago.

[A door closes.]

ERLICH: She pulls open an envelope to reveal her monthly pension check. It's only $167, about half of what she earned as a teacher. She has no other source of income. Her husband, a retired salesmen, earns less than one-third of his old wages.

OLGA SEGUEL: [via a translator] It's miserable. The pensions are aren't enough for anything. We have a lot of expenses. There's lots of things we have to pay for and can't. Because of the low pensions, we're being evicted from our house, which we bought 20 years ago.

ERLICH: That's not how Chile's pension system is supposed to work. In 1981 dictator Gen. Augusto Pinochet completely eliminated Chile's government sponsored social security system and implemented a free market, privatized pension plan. Thirteen percent of a worker's wage is automatically deducted and sent to one of seven mutual funds. Contributions are tax deferred, similar to 401K plans in the US. If workers save enough and invest wisely, they are supposed to retire with dignity.

[A stockbroker's phone rings, and brokers type on computers.]

ERLICH: The very modern Santiago stock exchange is home to Chile's pension funds. Those funds have grown an average of 10.7 percent over the past 21 years. Luis Larrain sits on the board of directors of Habitat, Chile's second largest pension fund. He says Chile's mutual funds are better than American retirement accounts because employees can't be forced to invest in their employer's stock, as happened with Enron.

LUIS LARRAIN: It's superior to the, to the 401k system you have. Because, for example in the situations as of this famous company, Enron, the pension funds are always involved in the great problem. In this case they are completely out. The employer has nothing to do with the management of this fund.

ERLICH: Guillermo Arthur, President of the Association of Pension Funds, says Chile could serve as a model for social security reform in the US.

GUILLERMO ARTHUR: [via a translator] It would be a big advance for American workers to have a privatized, voluntary system like we have in Chile.

ERLICH: But critics say Chile's system has far too many flaws to serve as a model for anyone. For one thing, neither employers nor the government contribute to the retirement system. Arthur maintains this gives employers the flexibility to pay higher wages.

Arthur: [via a translator] Here in Chile we have a culture of liquid wages. As a consequence, the worker would rather have an increased salary than a contribution to the pension fund. That's the reason employers don't contribute. The employers don't have to pay anything for pensions. But they should negotiate with the workers to provide higher wages.

ERLICH: But unions are weak in Chile, in part because of 15 years of repression under the Pinochet dictatorship. Blue collar workers complain that employers just don't get around to raising wages voluntarily.

[The sound of a truck pulling out, followed by the loud noise of a drill.]

ERLICH: Workers at this Santiago construction site are busy building a beautiful new apartment complex. This laborer named Rich is old enough to remember Chile's previous pension system under socialist President Salvador Allende. In the early 1970s employees contributed 12.5% of their monthly wage to the government sponsored plan, and employers matched it.

RICH: [via a translator] I think the new mutual fund pension system is unjust for us, the workers. We were supposed to receive more money than under the old pension system. But it's just the opposite. It's not fair. The old system was much better. Today the rich are benefiting, not us.

[The sound of shovel digging dirt.]

ERLICH: Alejandro, another worker, says when Gen. Pinochet imposed the new system in 1981, it was aimed at reducing costs to the government, not improving pensions for workers.

ALEJANDRO: [via a translator] I don't think the system works very well. The benefits are very bad. They don't reflect the needs of ordinary people. The new system was an economic decision to benefit businessmen, not the individual. The fund companies make big profits but we, ordinary people, don't benefit. The cost of running a pension fund is very low, and they don't invest anything. But every month they're making money.

ERLICH: Alejandro has something there. Of that 13% deducted from worker's wages each month, 1.7% goes to the mutual funds for expenses and profits. So it's not surprising that the funds report shareholder profits of 20-30% every year. The funds have become so lucrative that American and European companies have bought up significant stakes. Juan Gumucio is a law professor and pension expert.

JUAN GUMUCIO: [via a translator] The administrative companies make fabulous profits. They make more money than the drug traffickers make selling white powder. They have no costs above their immediate expenses. They produce profits many times over their invested capital. There is no significant government regulation. The market is concentrated in a few companies. In reality, three big companies control the entire pension fund market.

ERLICH: Such high profits don't bother some workers, however, if they also benefit. A construction worker named Roberto is getting close to retirement age and he has voluntarily increased his monthly contributions.

ROBERTO: It's the only way we have to retire. I hope the pension will be adequate. I contribute 20% of my monthly salary. It's a lot. I haven't calculated my pension. But I have a friend who is getting a good pension. He has children who are still in school, and it's enough for his family.

ERLICH: The system does work for some higher paid workers who save a lot and invest wisely. But that only applies to regularly employed workers. Remember retiree Olga Seguel who we met at the beginning of this story? Her husband worked as a self-employed salesman for awhile, so for a time he wasn't covered by the system. In fact, 42 percent of the workforce in Chile isn't covered.

[The sound of street vendors shouting out in Spanish: "Cheap prices; good deals."]

ERLICH: Independent contractors and workers in the informal economy, such as these street vendors, aren't required to participate in the pension plan. They could voluntarily contribute money each month, but as this vendor explains, he can't afford it.

MALE STREET VENDOR: We simply don't have enough money. I have a child in school. I don't have any money left over. No street vendor I know participates in the pension plan because we have so little money. We make only $4 or $5 a day.

[The sound of street vendors shouting out in Spanish: "Cheap prices; good deals."]

ERLICH: Pension fund board member Larrain admits this lack of coverage is a serious flaw in the system. He says the government should provide special tax incentives to encourage self-employed workers to participate.

LARRAIN: They are looking for the next 20 days, not the next 20 years. And that's a problem. Approximately one-third of the workforce in Chile are independents. They are probably not willing to make contributions to a social security system for 20 or 30 years more. So it's very difficult. The only way I think that you can really increase coverage is with some special tax incentives for those people.

ERLICH: But Larrain says, on the whole, the system works well and helps promote Chile's free market economy. Because participation is mandatory, the pension system has increased the savings rate. The roughly $40 billion dollars held by the funds helps stir Chile's economic growth and helps make the country one of the most economically stable in South America, say supporters such as Fund Association President Guillermo Arthur. He says the pension system has increased employees' faith in free markets because workers earn more if they take an active role in investing.

ARTHUR: [via a translator] The old pension system was pay as you go. It was passive. The active workers paid for the pensions of the passive workers. The active workers made less and the passive ones made more by doing nothing. We changed to a individual investment system in which the worker invests month to month to pay for his pension.

ERLICH: [asking a question of Arthur] In the United States many people are worried that the fluctuation in the stock market can cause problems with their pensions. How do you deal with that problem?

ARTHUR: [via a translator] We diversify our investments. For example, it's completely wrong for the funds to be heavily invested in government bonds. In Argentina they did that. They aren't the most secure. We invest around the world, not only in Chile. The law allows up to 30% foreign investments.

ERLICH: But not everyone in Chile must contribute to the system. In fact, the very people who instituted the system shielded themselves from having to participate in it. When Gen. Pinochet imposed the free market pension plan in 1981, he specifically excluded military and police. They have maintained a traditional plan in which the government provides pensions based on rank and years of service. Law professor Juan Gumucio.

GUMUCIO: [via a translator] The pension system for the military and police is unquestionably much better than the privatized system for civilians. After 20 years on the job, they get pensions based on their most recent salaries. They have health care with their own hospitals, which have the most modern equipment. This is a significant cost for the state. When Pinochet dictatorship imposed the plan, the idea was to reduce costs to the government. Curiously enough, he didn't eliminate the high cost of military and police pensions.

ERLICH: In the US, politicians of both parties worry that the Social Security system will go bankrupt and require large government subsidies. Privatization is supposed to solve that problem by making the system pay for itself. But Chile's privatized system still requires government subsidies, a whopping 5.7 percent of gross domestic product every year between 1981 and 1998. That's because the military pensions are still subsidized, but also because the government guarantees a minimum pension to anyone who has worked 20 years or more. The minimum pension is now only $110 per month, well below the poverty level. Gumucio says within a few years, most Chileans will only collect the minimum.

GUMUCIO: [via a translator] After more than 20 years of experience with the system, we know we have serious problems. The system benefits some people but not the majority. By the year 2010, 60% of retirees will only qualify for the minimum pension. That means the state must subsidize the difference between the minimum pension and what those individuals have in their mutual fund.

ERLICH: Mutual fund official Larrain disputes those figures.

LARRAIN: I think the proportion of people with the minimum pension would be rather similar to the proportion of people that earns the minimum salary in Chile. And that proportion goes between 15 and 18 percent of the population.

ERLICH: Depending on whose figures are correct, in years to come Chile may have to subsidize some of its pension system or a whole lot of it. Jorge Millan, pension specialist with the country's largest union federation, says this kind of privatized system would never pass Chile's House and Senate today.

JORGE MILLAN: [via a translator] The pension system was created during the time of the military dictatorship when there were no parties. There was no democratic constitution and when workers had right to vote. About four military officers made the decision. We can say without doubt that the Chilean government has created a very sick child. If we don't operate, the child will die. Many people will suffer in the streets.

[The sound of someone entering a house and a door closing.]

ERLICH: At home, retirees Olga Seguel and her husband Carlos Passache express puzzlement that anyone in the US Congress would look to Chile as an example of social security reform. They tried to live on their pensions for three years. Passache drives cab six days a week to earn some extra money. But they still got evicted from their house.

CARLOS PASSACHE: [via a translator] The people running the mutual funds paint a pretty picture of our pension system, but it's not true. The profits that go to the pension funds should go to us.

ERLICH: For Common Ground, I'm Reese Erlich in Santiago, Chile.

PORTER: If you have questions or comments about today's program, visit our Web site at commongroundradio.org or e-mail us at commonground@commongroundradio.org.

[musical interlude]

ANNOUNCER: Common Ground is a Stanley Foundation production—on the Web at stanleyfoundation.org.

MCHUGH: This is Common Ground, radio's weekly program on world affairs.

[musical interlude]

PORTER: I'm Keith Porter.

MCHUGH: And I'm Kristin McHugh. Coming up this half hour, the UN's blueprint for rebuilding Afghanistan.

JULIA TAFT:The stores are starting to open up, the markets are busy, and I think all of this can be attributed to the fact that there is a great international and growing presence there from international relief agencies and the UN.

MCHUGH: Plus, economic success stories amid the on-going Middle East conflict.

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Afghan Child Weavers

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Related News Article

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PORTER: Before decades of war and strife tore Afghanistan apart, textiles were one of the countries most important exports. In Europe and America, Afghan carpets and rugs are not just decoration, but highly prized works of art that can cost thousands of dollars. But wealthy Western buyers may not realize that many of the carpets they buy are woven by children, some no older than six or seven years old. Clark Boyd reports from Washington.

CLARK BOYD: For Washington-area native Bill Seward, an Afghan carpet or rug is much more than just a product—it's a passion. As a businessman who sells Afghan textiles, Seward touts the craftsmanship and skill that goes into each piece. As a trained anthropologist, he revels in the minutia of ancient designs and dye methods. And as an employer, Seward strives to understand the difficulties faced by those who weave for him. In fact, he recently returned with a homemade videotape from a trip to Pakistan, where many of the Afghans who weave his products have been living as refugees for more than 10 years.

[The sounds of a busy Lahore street—car horns and vehicles.]

BOYD: On the tape, frenetic street scenes give way to quiet courtyards, where ethnic Turkmen refugees from Afghanistan weave on large looms.

[The sound of people working on looms.]

BOYD: Seward's video makes it clear that creating carpets is dirty, difficult work. The workers, all men in this case, can spend months just weaving the carpet. Then they get down to the dirty work of shearing the product.

[The sound of people shearing carpets.]

BOYD: Bill Seward admits that carpet weaving is a tough job, but that the workers are treated fairly.

BILL SEWARD: I wouldn't want to do it. But it is hard work but they, you know, the places that I went, which are, you know, run by various American people I know, they're not sweatshops at all. Everybody is doing good work. I mean, they're really nice people. Everyone's fed, everyone's paid and they want to do the work.

BOYD: For an Afghan refugee in Pakistan, carpet weaving can generate about one to three dollars a day in income. That doesn't seem like much, considering that these products will sell for thousands of dollars apiece in the United States and Europe. Some say it's an economic situation that can lead to serious abuses of child labor. Nina Smith is the Executive Director of Rugmark Foundation, a nonprofit working to eradicate child labor in the weaving industry worldwide.

NINA SMITH: You get situations where families are very poor, they can't afford to take care of their children, and they send their kids to the city or to a village where they're producing rugs, sometimes with an aunt or an uncle. And they go to weave carpets to help earn money for the family.

BOYD: In some cases, says Smith, children as young as five and six will be sold to carpet weavers, and used almost as slave labor. Rugmark Foundation's goal is to create market incentives that will eliminate these abuses. Nina Smith says the organization has a threefold approach.

SMITH: The first is that we inspect the looms of registered producers who are willing to participate and who want the Rugmark label on their carpets. We inspect those looms on a random basis and make sure no children are found. When children are found, we work with the manufacturers to get them into a safe place. We support schools and rehabilitation centers for children who have come out of work. And thirdly, we focus on raising consumer awareness, so that consumers can affect the problem through the purchases that they make.

BOYD: But so far, Rugmark's having a hard time selling its approach to the industry. Only 13 importers currently agree to have their looms randomly inspected by Rugmark for signs of illegal child labor. Importer Mehmet Yalchin thinks that Rugmark's approach fails to appreciate that Western answers might not be right for Eastern problems.

MEHMET YALCHIN: We immediately think, how dare can they do that? You know, who would have the heart to allow a seven, eight-year-old child to weave a carpet? We don't realize the conditions they live in. We don't realize sometimes that if it weren't for the seven-year-old weaving, his six member family could be dying of hunger.

BOYD: And moreover, says Yalchin, to an Afghan refugee in Pakistan, weaving is more than a job—it's a traditional art form and way of life.

YALCHIN: Sure you will see a four-year-old Afghan boy or girl weaving, 'cause this is when they start doing these things. Anyway, this is a part of life for them. But I don't think it's fair to call that child slave labor. I mean, it's like sending one of our kids for piano lessons. There, they're weaving carpets.

BOYD: That's why Yalchin and others in the carpet industry have started policing themselves when it comes to keeping kids off their looms. Mason Purcell, owner of the Purcell Oriental Rug Company in Charlottesville, Virginia, has been using Afghan weavers for more than 20 years. As a standard part of her contract, Purcell insists that no children work on the looms. In the past, she's made regular checks with her employees in Pakistan. And if she finds a child working, she'll void the contract. In return for her employees' compliance, Purcell says she sets up smaller looms where adult women can teach young girls the art of weaving.

MASON PURCELL: It's important that the girls do learn to weave because they don't leave the compound, all right? And a Turkomen girl who's a good weaver will bring a dowry—which is hers by the way—of in excess of $6,000 or $8,000 US, if she's a good weaver. And she's very well treated when she marries because she's considered an asset to her husband's family. And if they don't learn young, they don't learn. And I'm not gonna stand there and tell somebody's mother that they can't teach their kid the craft that's gonna make their living.

SMITH: Some of the manufacturers genuinely believe that they know what's going on in their looms, and they don't need to add another layer of bureaucracy to what they're doing.

BOYD: Again, Nina Smith of Rugmark Foundation.

SMITH: But it's impossible, being here in the United States, to know what's going on on the looms. So, so I'd like to think that more and more importers would view Rugmark as an important service to them, so that they know at any given time what's going on in their looms, and that with certainty they can, they can tell their retailers and their consumers that their rugs aren't being made by children.

BOYD: That's a goal increasingly shared by the carpet industry itself. Many importers say throughout the 1990s, their buyers grew savvier, choosing to purchase those carpets and rugs that would benefit indigenous weavers, instead of keeping children locked in a carpet factory. And in the wake of September 11th, more carpet buyers than ever before are asking serious questions about the textile products they purchase. But, the importers admit, that trend may continue only as long as attention is focused on Afghanistan, Pakistan, and other countries in the region where illegal child labor thrives. For Common Ground, this is Clark Boyd in Washington.

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Rebuilding Afghanistan

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United Nations Development Program

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MCHUGH: Programs designed to keep Afghanistan's youth in school and out of the workplace are a top priority of the country's rebuilding efforts. Julia Taft is the Assistant Administrator of the United Nation's Development Program, or UNDP. She's also the Director for the Bureau of Crisis Prevention and Recovery. I recently talked with her about the U.N.'s ongoing recovery efforts in Afghanistan.

JULIA TAFT: Within the United Nation's Development Program I lead the task force to organize the way that we can assist in the transition from crisis to recovery. Among the things that we've been involved in, it's quite broad. We're working, for instance, with the Minister of Women's Affairs, Dr. Sima Samar, to try to help her in organizing advocacy throughout the government and the country to deal with women's issues. We are providing Internet connectivity to all the ministers of the Interim Authority. We are assisting them in paying the civil service salaries. We have also been working on developing reintegration initiatives for refugees and internally displaced persons who are now starting to go back home.

MCHUGH: Now you just recently came back from Afghanistan, is that correct?

TAFT: Right.

MCHUGH: How much time did you spend there and what was your job while you were on the ground?

TAFT: Well, I was there for about a week. My principal reason for going was to attend a major international conference of all of the donors to Afghanistan, as well as the, obviously the cabinet of Afghanistan, to discuss the development program for the year and the national budget. I also had an opportunity while I was there, of course, to meet with a number of the ministers that are responsible for programs of education and women's affairs and development. And went out beyond Kabul to some of the locations where refugees have started to return and we are engaged in helping to build schools and, and help in the reintegration of the people.

MCHUGH: Can you remind our listeners how much money was pledged in the original donors conference?

TAFT: In January there was an international conference in Tokyo and the donors pledged over the course three to four years $4.3 billion. The first year amount of that was $1.8 billion, to cover all of the humanitarian and transitional assistance activities. To date, about $800 million has already been disbursed, which is good.

MCHUGH: I have heard several stories about complaints that the money isn't coming fast enough and that this is a problem in terms of stability.

TAFT: There are several reasons that some of the funds have not been distributed. One, of course, is security. The assistance that's going into Kabul is quite fulsome. In the outlying provinces, however, it's much more problematic. As we have to understand, there is a war going on. And accessibility is a constraint. So that's one of the reasons. A second reason is that there has been some criticism on the part of the Afghan authorities that they have not received the $1.8 billion. But that was never really the intent. The donors, particularly for the first year, expected most of the funds to be channeled through the United Nations organizations or through nongovernmental organizations. Not to be given directly to the government.

MCHUGH: What are conditions really like on the ground? I think it's hard sometimes for us to get a sense of that just from, you know, short video clips that we might see on the evening news.

TAFT: One sees on the highways a number of Pakistani buses, stock full with beds and, and furniture, and suitcases, and hundreds of people, virtually, trying to come back to Afghanistan. These are mostly refugees who've lived in Pakistan during the past 20 years. So there's that, that movement on the road. In Kabul itself, it's madhouse. There are more taxis, I think, in Kabul than there are in New York City. And you see lots of activity on the street. The stores are starting to open up, the markets are busy, and I think all of this can be attributed to the fact that there is a great international and growing presence there from international relief agencies and the UN. A lot of people are going to work. Eighty-five thousand people have salaries now from the civil service. And a lot of economic revitalization is taking place. So there's a lot of energy and a lot of activity.

Now, it's not quite so active and vibrant in other parts of the country—I'm told. I have not gone to Heart and, Kandahar. But my sense is that as security improves one will see the replication of this, this vibrancy throughout the country.

MCHUGH: Do you get a sense from talking with the, the local people that there's finally that will, that things are going to get better and enthusiasm for life that certainly hasn't been there for 20 years?

TAFT: I certainly did. I often get asked the question, whether women are still wearing the burkha on the street. And they are. Many of them are. The, one of the reasons they are still wearing the burkha is they're concerned about whether or not there's going to be a solid peaceful future. But my sense is that we have to be patient. It has only been five months since the new authorities took over. And one can't expect a huge change overnight. But there are, the signs are all quite good.

MCHUGH: You know, Afghanistan is actually starting to fade from our memory here state-side in terms of it's not necessarily mentioned on the nightly news every night. We don't see pictures from Kabul anymore. Are you concerned that things will fade too quickly?

TAFT: One of the most encouraging signs is that the donors consistently meet to discuss their continuing commitment. The United States, Japan, the EU, Saudia Arabia, other countries, have made a long-term, visible, public commitment that this is not going to be a short-term investment. And that is, never, that's never happened before. So while it's not on the nightly news the donors do have it very much in their, their mind.

MCHUGH: What do you see are the biggest obstacles to long-term recovery in that region?

TAFT: Whether or not the Afghan people want peace?

MCHUGH: And do you think that they really want peace? We do hear about warring factions that are still happening, even outside of Kabul. Is that hard to gauge at this point?

TAFT: The whole United Nations approach for Afghanistan has been quite refreshing and quite different. What we have basically said is that the United Nations is not running Afghanistan. We do not have our own peacekeepers there. We do not run the country as we have done in East Timor or Kosovo. In fact, everything that we have been trying to do has been to enable the Afghans themselves to make decisions about their own priorities and how they want to manage things. So the future of Afghanistan is very squarely on their shoulders.

This is also true in one of the other critical issues and that is in poppies. Poppies have fueled the warlords. That's how they get their money. Poppies have also been a huge problem for addiction in all the surrounding countries. Most of the poppies end up there or in Europe. And the attention and the dedication of the Afghan authorities to ensure eradication of poppies will be one of the key determiners as to whether or not the country is able to really assume the stature of a, a country in control of its own destiny. We'll have to wait and see.

MCHUGH: Julia Taft is the assistant administrator of the United Nation's Development Program and the Director of the Bureau of Crisis Prevention and Recovery. I spoke with her in New York.

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Mid-East High Tech

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PORTER: Israel's economy is in the midst of a recession. The boom years of the 1990s have given way to budget cuts and rising taxes and unemployment. With no natural resources, Israel's economy relies heavily on tourist visits and exports, particularly high-tech exports. And amid the gloom, reporter Alastair Wanklyn has found some exporters are weathering the crisis.

[The sound of gunfire.]

ALASTAIR WANKLYN: Uncertainty and unrest mean tourists are avoiding the Holy Land. Visits are at a quarter of their usual levels, costing Israel last year alone about half a billion dollars.

RACHEL GOLDBERG: The situation is very, very bad. People are afraid to come to Jerusalem.

WANKLYN: Rachel Goldberg of the Jerusalem Hotels Association says hotels are bearing much of the cost.

GOLDBERG: We continue on with our daily lives. The tourists who do come, the very few, tell us they're having a great time and are not afraid. But people don't come. And this means that the occupancies have fallen to very, very low levels. Prices have crashed. And so people are getting less money for less work.

[Street sounds from Jerusalem's Old City.]

WANKLYN: These dark, narrow streets in Jerusalem's Old City are empty. Normally there'd be hundreds of backpackers and pilgrims searching the tiny shops and stalls for favorite souveniers.

JERUSALEM SHOPKEEPER Maged Shahwan: At this time as, you see there's almost no tourists, you know. You can say there is no business.

WANKLYN: In this leather shop, owner Maged Shahwan picks up a pair of sandals.

SHAHWAN: As you see there's different kind, different qualities. Made in the West Bank.

WANKLYN: Shahwan says business is so bad that for several weeks some shop owners haven't even opened their stores. They are searching for work elsewhere.

Shahwan: They're looking for other job. They're looking for other business. Just to live, you know. They have a family. They want to have to pay for food for them.

[The sound of a pneumatic drill.]

WANKLYN: They might look for work on this construction site, where telephone cables are being dug along a Jerusalem street. But the foreman isn't hiring. And many construction sites elsewhere in Jerusalem are standing idle. Israeli and foreign investors are unwilling to take on new projects right now. And yet some parts of Israel's high-tech sector are enjoying success.

[The sound of a high-speed dental drill.]

WANKLYN: This computer-guided dental drill is at the cutting edge of cosmetic dental surgery.

[The sound of a high-speed dental drill.]

WANKLYN: A camera follows the drill's movement, and sounds a warning if the surgery gets too close to the bone. It's one of the world's only image-guided dental surgery tools, manufactured by a startup called Den-X, in converted chicken sheds on a former poultry farm.

ALON HAYKE: We started from, it was nothing. We took a very small chicken house. We renovated; we started with one computer and one employee. And today we have 55 employees in the company, and growing by 20 to 30 percent from quarter to quarter in the number of employees. This is something that is growing.

WANKLYN: The CEO of Den-X, Alon Hayke, says there's such demand for cosmetic surgery tools in wealthy American and European markets that the company's sales are doubling every year. Hayke says success for this Israeli company lies in having markets outside Israel.

HAYKE: The whole political issue is affecting people in their daily life. People are coming to work with sad faces. However, from our point of view, the local market is not so interesting and therefore our economical situation of the company is not really affected by the current situation in Israel.

WANKLYN: Israel's infrastructure is good for high-tech exporters, who also benefit from a weakening currency. But the outlook remains glum for other types of industry.

Yohanan Levy: I would differentiate between the high tech, the startups, and the low tech.

WANKLYN: At Israel's Ministry of Industry and Trade, Deputy Director General Yohanan Levy says the government is trying to improve the investment climate for small businesses.

LEVY: The low tech businesses are really suffering because of the fact we know that, generally speaking, that only if you have money can you get money from the banks. So that what we are doing in the government is, we are trying very hard today with the Treasury in order to establish new funds to give the answer to companies that would like to expand themselves and to invest.

WANKLYN: Helping small businesses expand could be a countermeasure against the rising unemployment. But unemployment is not the only problem here. There's the recession; tax increases; and spending on social welfare is shrinking.

[The sound of gunfire.]

WANKLYN: And until there's a brighter outlook on the political scene too, attentions are unlikely to focus on economic recovery. Alastair Wanklyn for Common Ground in Jerusalem.

PORTER: That's our show for this week. If you have questions or comments about today's program, visit our Web site at commongroundradio.org or e-mail us at commonground@commongroundradio.org. Please drop us a line. We'd love to hear from you.

MCHUGH: Transcripts and information on how to order copies of this and other Common Ground programs are also available on our Web site: commongroundradio.org. I'm Kristin McHugh.

PORTER: And I'm Keith Porter. Cliff Brockman is our Associate Producer. B.J. Leiderman created our theme music. Additional compositions provided by Wink Music.

ANNOUNCER: Common Ground is a Stanley Foundation production. The Stanley Foundation: promoting public understanding, constructive dialogue, and cooperative action on critical international issues. On the Web at stanleyfoundation.org.

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