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00:00ANTI-TERROR EFFORTS? GUEST: IT IS DIFFICULT FOR EUROPE TO DO ANYTHING AKIN TO WHAT THE AMERICANS DID POST 9/11. I THINK YOU WILL SEE MORE COOPERATION ACROSS INTELLIGENCE AGENCIES, BUT THAT'S ONLY LIKELY TO HAVE AN IMPACT AT THE MARGIN. THERE IS A LOT OF CONCERN ABOUT THE INTEGRITY OF EU FREE MOVEMENT, BUT I DON'T BELIEVE FOR NOW THAT THE TREATY OR THE BORDERS ARE AT RISK, BECAUSE FREE MOVEMENT OF PEOPLE DEMONSTRATES IMPORTANT SYMBOLIC VALUE. FUNDAMENTALLY, THIS IS WHAT THE EUROPEAN UNION IS ABOUT. I THINK THAT WE -- I THINK THERE WILL BE PRESSURE FROM GERMANY AND FRANCE TO KEEP THE COMMITMENT FOR OPEN BORDERS. I THINK YOU WILL SEE MORE AD HOC SPOTCHECKS AT THE BORDERS. THE TREATY ALLOWS FOR THAT TO TAKE PLACE BUT IT DOES VIOLATE THE SPIRIT OF THE TREATY. BUT THAT IS THE WORLD WE ARE IN FOLLOWING THE ATTACKS ON FRIDAY. ALIX: WHEN YOU LOOK AT HUNGARY AND SLOVENIA, THEY BASICALLY BUILD FENCES. WHAT DO YOU THINK THE ESCALATION MAY BE AT THE CHECK POINTS AND HOW MUCH WORSE COULD IT ACTUALLY GET? GUEST: THERE IS A RISK REGARDING THE EU'S APPROACH TO THE MIGRATION PROBLEM. THAT CONSISTS OF MANY ELEMENTS. THE MOST IMPORTANT IS A REDISTRIBUTION SCHEME TO RELOCATE 160,000 MIGRANTS THAT HAVE COME ACROSS THE BORDER FROM LIBYA, THE SEA ROUTE THROUGH LIBYA AND ACROSS TURKEY, THROUGH GREECE. THERE'S A LOT OF CONCERN IN CENTRAL AND EASTERN EUROPE ABOUT ABSORBING THESE REFUGEES AND THE FENCES ARE IN RESPONSE TO WHAT IS ESSENTIALLY A GERMAN-DRIVEN HOLOCENE TO RELOCATE AND REDISTRIBUTE THESE REFUGEES IN EUROPE. THAT IS GOING TO HARDEN IN THE AFTERMATH OF PARIS AND CARRIES FUNDAMENTAL IMPLICATIONS FOR ANGELA MERKEL WHO HAS STAKED OUT A VERY LITTLE -- A VERY LIBERAL POSITION ON THIS POLICY. SCARLET: WHAT IS THE FIRST STEP EUROPEAN COUNTRIES NEED TO DO TO PREVENT THE ATTACKS FROM DIVIDING THEM FURTHER? GUEST: VERY DIFFICULT. ONE HAS TO ADDRESS THE ROOTS OF THE PROBLEM AND THAT'S TAKING GERMANY AND FRANCE TO TURKEY AS WELL AS TO SYRIA. WITH TURKEY, THERE ARE 2 MILLION REFUGEES ON THEIR SIDE OF THE BORDER AND A LARGE AMOUNT OF CONCERN ABOUT WHAT THAT WOULD MEAN FOR EUROPE WERE THOSE 2 MILLION TO COME ACROSS THE BORDER. SYRIA REMAINS VERY UNSTABLE AND THERE'S CONCERN THAT A ADDITIONAL -- AN ADDITIONAL 3 MILLION MIGRANTS MAY COME ACROSS THE BORDER, USING TURKEY AS A TRANSIT INTO EUROPE. WHAT CAN YOU DO TO ADDRESS THAT PROBLEM? IT'S VERY DIFFICULT. THERE IS A MOVE TO CO-OPT THE PRESIDENT OF TURKEY AND GET HIM TO INTEGRATE SYRIAN REFUGEES. IT DOESN'T LOOK AS THOUGH HE'S GOING TO BE PARTICULARLY CONSTRUCTIVE. SYRIA REMAINS VERY VOLATILE AND IS MORE A FUNCTION OF WHAT HAPPENS BETWEEN THE IRANIANS OF THE RUSSIANS AND THE SAUDI'S THAN THE EUROPEANS HAVING SERIOUS AGENCY OVER THAT QUESTION NOW. THIS IS NOT TO ASSOCIATE REFUGEES WITH TERRORISTS, BUT THAT CONNECTION IS BEING MADE. YOU SAW THE HUNGARIAN PRIME MINISTER MAKE THAT CONNECTION TODAY. ALIX: YOU BROUGHT UP ANGELA MERKEL AND THE POSITION IT PLACES HER IN. THE QUOTA TO BRING IN MORE REFUGEES -- WHAT DO YOU RATE HER FORMER ABILITY AS RIGHT NOW? GUEST: RIGHT NOW, SHE IS DELIVERING HER PARTY AROUND 35%. SHE HAD BEEN DELIVERING NORTH OF 30%, SO THE EDGE HAS COME OFF A LITTLE BIT. THAT SAID, THE CHRISTIAN DEMOCRAT PARTY RECOGNIZE THEIR PERFORMANCE IN STATE ELECTIONS AND FEDERAL ELECTIONS IN 2017 IS FUNDAMENTALLY TIED TO MERKEL. THEY ARE SOMEWHAT TIED TO HER. LOYALTIES ARE BEGINNING TO BECOME MUCH MORE DIVIDED AND THE PARTIES HIERARCHY IS BEGINNING TO CHALLENGE HER A LOT MORE OVER HER POLICY AND ANYTHING TO WHAT HAPPENED IN PARIS, IF THAT WERE TO PLAY OUT IN GERMANY, THERE'S GOT TO BE A QUESTION REGARDING HER POLITICAL SURVIVABILITY AND WOULD CALL INTO QUESTION WHETHER SHE COULD REMAIN IN POWER. SCARLET: A LOT OF INCUMBENTS ARE HAVING TO LOOK OVER THEIR SHOULDER RIGHT NOW. YOU GUYS AT EURASIA GROUP LISTED THE TOP RISKS FOR 2015. EUROPEAN POLITICS WAS AT THE TOP OF THE LIST. WAS THIS HOW YOU ENVISIONED IT WOULD PLAY OUT? GUEST: POLITICS HAS BEEN VERY DIVISIVE. WE SAW THAT IN GREECE WHERE THERE WAS SOMETHING OF A NEXUS DENTAL CRISIS THAT PERMEATED THE COUNTRY IN THE EURO AREA. -- SOMETHING OF AN X ESSENTIAL CRISIS THAT PERMEATED THE COUNTRY IN THE EURO AREA. IN A VERY DIVISIVE CONVERSATION, REGARDING HOW THESE REFUGEE FLOWS SHOULD BE MANAGED, IF YOU LAYER ON TOP OF THAT THE RISK THE U.K. LEAVES THE EUROPEAN UNION NEXT YEAR AND THERE'S GOING TO BE A VOTE ON THIS COUNTRY'S MEMBERSHIP NEXT YEAR AND IF YOU LAYER ON THE CHALLENGES AND GREECE AND WHAT'S HAPPENING IN THE SOUTH WITH PORTUGAL AND THE TERRORIST ATTACKS, THIS IS NOT A ROSY PICTURE FOR EUROPE HEADING INTO 2016. YOU TAKE THE 2015 RISK AND WE ARE LAYERING ON CHALLENGE AFTER CHALLENGE WHICH, FRANKLY SPEAKING, EUROPEAN LEADERS DO NOT LOOK EQUIPPED TO BE RESOLVED. ALIX: THANK YOU VERY MUCH. SCARLET: THAT IS A CONVERSATION THAT IS JUST BEGINNING. COMING UP IN THE NEXT 20 MINUTES

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