International Periscope

July 3-10, 2006 issue —

North Korea: Diplomatic Misfire
Will North Korea launch an intercontinental ballistic missile? At the weekend, Kim Jong Il's intentions were still unclear. The capricious North Korea leader likes to attract attention periodically—usually to gain leverage in talks over his nuclear weapons program—but this time he and his government may have miscalculated. Just by raising the possibility that it might launch a Taepodong-2 missile, Pyongyang has succeeded in stiffening the resolve of its enemies and created headaches for its friends.

North Korea's best buddies, China and South Korea, joined a chorus of censure. Seoul suggested that it might cut food and fertilizer aid to the North, should it launch, and former South Korean president Kim Dae Jung, the architect of the "Sunshine Policy," canceled a planned trip to Pyongyang. Chinese Prime Minister Wen Jiabao urged North Korea to abandon the idea of a launch and to concentrate on returning to the Six-Party Talks. If they're ignored, both Seoul and Beijing may find it hard to continue their policies of engaging Kim. Bruce Klingner, a Korea analyst at Eurasia Group, points out that even before the missile reports, the North's surprise cancellation of a planned cross-border rail link with the South had led many to question the wisdom of the Sunshine Policy.

Those already more skeptical of Kim found justification for their hard line. In Japan, the threat was a gift to archconservative Shinzo Abe, who has made his career bashing North Korea and is now maneuvering to succeed Prime Minister Junichiro Koizumi in September. The ruling Liberal Democratic Party recently passed a measure allowing for economic sanctions against the North—and now has a good reason to implement them. The Bush administration will surely use this episode to reaffirm its tough diplomatic stance—and the need for a $100 billion missile defense system, whose development, with the help of Japan, is continuing.

—Christian Caryl

France: The Meltdown of Monsieur de Villepin
Perhaps it was only a matter of time before he snapped. Less than a year ago, French Prime Minister Dominique de Villepin had a 45 percent approval rating (decent by French standards) and appeared confident in his role as President Jacques Chirac's heir apparent. In recent months, however, he's been under increasing pressure: mass pro-tests against labor reform made his winter a misery, while allegations that he had tried to use a government investigation to smear rival Nicolas Sarkozy backed him even further into a corner. But still, no one expected an outburst like the one on June 20. Accusing socialist leader François Hollande of "cowardice" in the National Assembly, de Villepin drew a furious reaction from opponents—and earned calls for his resignation from within his own ranks.

Can de Villepin come back after his latest outburst? Probably not, given that his approval ratings had already fallen to 26 percent before the incident. "Villepin is sort of the anti-alchemist—if he touches gold, it will turn to lead in the public eye," says Gaël Sliman, assistant director of the Boulogne-based polling firm BVA Opinion. That's bad news for Chirac, who had handpicked de Villepin to continue his policies once he steps down. Now experts believe the president, too, is being tarred by de Villepin's collapse. France can only wonder whether a politically savvy dinosaur like Chirac will let himself be dragged down further by his protégé.

—Tracy McNicoll

A Man on a Mission
Billionaire George Soros has assigned himself a daunting mission: persuade Americans to renounce the idea of a "war on terror." NEWSWEEK's Susanna Schrobsdorff spoke to Soros—who has a new book out called "The Age of Fallibility"—about his quest.

American public opinion on Iraq has changed.
People in America now realize that the invasion of Iraq was a disaster. But we still think that the war on terror is the way to deal with the terrorist threat. But it's a counterproductive policy that has done untold damage to our standing in the world and to ourselves.

Democrats in Congress are pushing for a timetable for the withdrawal of U.S. troops from Iraq. Do you think that's wise?
It think it's probably unwise to have a specific timetable, because while we must withdraw as soon as we can, we must withdraw in an orderly fashion. We are sitting on an incipient civil war. And it could actually deteriorate into a regional war, which could then destabilize the whole Middle East.

How is the situation in the Middle East affecting the global economy?
We are facing a global energy crisis which is very complex because it has many ingredients, starting with global warming and the peaking of oil discoveries. And there's the dependence of many of the major industrial countries on sources of energy from politically unstable areas of the world and the behavior of some of the energy-rich countries, like Iran and Venezuela and Russia, exploiting the high price of oil and their control of the supply. So we are in fact in a global energy crisis. That instability has certainly added $20 to $30 to the price of oil.

World Cup: The Agony of Defeat
Passionate fans hate it when their team loses in the World Cup. And according to new research, investors are no different. After looking at 30 years of results from international tournaments involving 39 different countries, Alex Edmans at MIT and his coauthors found that on average, a first-round loss by a national team produces a drop of 0.38 percent in the value of that country's stock market the next day. For elimination games, the average loss is 0.49 percent. In a country like Britain, 0.49 percent translates to nearly $12 billion, more than the combined value of every team in the English Premier League. That doesn't mean that the lack of early upsets this year meant bullish times for the traditional powers, however. In fact, stock markets in countries like Argentina, Brazil and Italy trended down after World Cup play began on June 9, despite the teams' early success. Edmans points out that this tracks with his findings showing that the positive emotions churned up by a win don't usually move markets the way the rage unleashed by a loss does.

—John Sparks

White House: Tripping
As the U.S. Congress debates a crackdown on members' and their staffs' accepting travel paid for by outside interests, newly filed records show Capitol Hill lawmakers aren't Washington's only frequent fliers. According to filings with the Office of Government Ethics, White House staffers have accepted nearly $135,000 in free trips since November 2004. Among those picking up the tab: some of the president's top business supporters and dozens of conservative and religious groups. Records list most trips as speaking engagements or panel discussions—including White House Deputy Chief of Staff Karl Rove's $2,600 trip to Aspen last September, where he attended a two-day retreat sponsored by financier Ted Forstmann. Al Hubbard, Bush's top economic adviser, also visited Colorado, reporting a $4,276 trip in June 2005 paid for by the American Enterprise Institute. Bush aides listed trips as far away as Norway, Germany, Latvia, Sweden, the United Kingdom and Australia, where Rove aide Barry Jackson reported a $15,483 jaunt to Sydney to attend a conference on Australian-U.S. relations. The most frequent traveler: Tim Goeglein, a White House point man for conservative groups, who reported $30,000 in free travel, including five trips last year to his hometown of Fort Wayne, Indiana. White House spokeswoman Dana Perino says travel is part of "regular outreach," noting that all staffers were invited guests.

—Holly Bailey

Movies: Don't Look So Puzzled
Documentary film has always been a noble little corner of the movie industry, but it's still a business, and every business has its recipes for success. Hollywood has superheroes. Documentaries have supergeeks. The formula goes like this: find a motley crew of regular folks training for a decidedly unhip competition, then build to a "Rocky"-style showdown. The spelling-bee doc "Spellbound" set the standard in 2002. Next came "Word Wars" (Scrabble) and "Mad Hot Ballroom" (ballroom dancing). The newest entry is "Wordplay," director Patrick Creadon's genial look at New York Times crossword-puzzle editor Will Shortz and his annual puzzle tournament. "Nothing against celebrities," says Creadon, "but I'd rather watch people I don't know anything about." His film actually has a few celebs—Bill Clinton and Jon Stewart pop in to hail Shortz's handiwork—but they're sifted in with the average Joes. "Surveys show that 50 million people solve crosswords," says Shortz. "I think the movie has crossover appeal."

—Devin Gordon

Video-to-Go: Hot Tip? Get Shorty
In their bid to turn cell phones into portable cinemas, mobile phone giants Sprint, Verizon and others are summoning their inner Miramax and discovering the film-festival circuit. Cingular and its wireless-content partner HBO, for example, just scoped out the Urbanworld VIBE Film Festival in New York, in part to hunt for short films suitable for the size-challenged cell-phone screen. Cingular and HBO also arranged to reach out directly to filmmakers by participating in a panel, "Content on the Go: Opportunities in the Mobile Arena."

Meanwhile, Nokia set up a tent recently at the Los Angeles Film Festival to show off its mobile-video phones and technology. Sprint is calling on one of the most famous festivals of all—Sundance. In addition to cosponsoring the event this year, Sprint provided a cellcast of "Live@Sundance," a daily highlight of premieres, filmmaker interviews and other activities. "Because of the evolution of [wireless] Sprint TV, we are able to provide an enhanced experience for film fans," said Sprint spokeswoman Angie Read. Sprint is now studying whether to make a big splash at other festivals, she said, calling such events "an interesting universe" for pursuing the company's multimedia ambitions.

The mobile giants aren't alone in prowling film festivals for video-to-go. MTV, which operates MTV Mobile and the broadband Internet site Overdrive, will be surveying Urbanworld for abbreviated content to distribute wirelessly and online. "We are looking for short-form content just for wireless, Overdrive and video on demand," says Paul DeBenedittis, MTV top executive for multiplatform programming. Atom Films, an online site with a library of 1,500 shorts, has been at festivals since it launched in 1998. "In the last year, it's really picked up," says CEO Mika Salmi. "A lot of the major media companies and the mobile-phone companies are actively looking for video content. The real money is definitely in the game now."

—Johnnie L. Roberts

Frankie Valli

"Jersey Boys," the musical based on the lives of Frankie Valli and the Four Seasons, just won the Tony for best musical. Valli spoke with Nicki Gostin.

Was it weird seeing your life story on stage?
I'm on a cloud.

You must have dealt with a lot of mobsters.
I never had a problem. They never discussed their per-sonal business, and I never borrowed money from a loan shark or was owned by anybody.

Tell me a Frank Sinatra story—and not about what a nice guy he was. I want an a—hole story.
I don't have any a—hole stories. I was friendly with Frank for 10 years. Anybody he gave crap to deserved it.

Oh, please.
Did you ever know him?

Yeah, we were best friends. Of course I didn't know him!
He was a street kid and so was I. Both from Jersey. He always gave me good ad-vice. No one ever talks about the blank checks he gave to people. What did he ever do bad? He hung out with guys who were supposed to be Mob-connected. So what? That didn't make him a gangster.

What's your favorite pasta dish?
I do a variation of different sauces with ziti, penne, tomato, basil, some wine and some secret ingredients.

Give me the secret ingredients right now.
No way.