FAREED ZAKARIA, HOST: This is GPS, the GLOBAL PUBLIC SQUARE. Welcome to our viewers in the United States and around the world. I'm Fareed Zakaria.

We're thrilled to be airing at a new time in the U.S., 10 a.m. Eastern, as well as our regular time, 1 p.m. Eastern.

Now, today, we have an exclusive, an in-depth conversation with one of the pivotal figures on the world stage, King Abdullah of Jordan.

If you think back to President Obama's State of the Union speech, it was one of the longest in years. And yet, he did not find time to mention a staple of such addresses, the Arab-Israeli peace process -- not once.

This is unusual, especially for President Obama. He came into office promising to place much greater attention on this problem, appointed a special envoy to the region, and spoke about his commitment to broker a peace in his speeches in Istanbul and Cairo, to very warm receptions.

But negotiations between the Palestinians and Israelis, which were suspended one year ago, have not resumed. And people in the region are beginning to wonder.

George Mitchell, the president's special envoy, still believes it will be possible to get things moving soon and actually complete negotiations for a two-state solutions -- and, by the way, peace between Israel and all the Arab states -- within two years.

Yes. But few people share this optimism.

The Israelis have refused to freeze settlements. The Palestinians remain divided between the Palestinian Authority and Hamas. And the United States -- historically the engine behind these negotiations -- is now clearly distracted, and perhaps lacks the kind of muscle to force any kind of concessions from either party.

And yet, many observers are worried about the situation on the ground -- no one more so than King Abdullah of Jordan, who presides over a country with a Palestinian majority, and lives right at the center of these countries and all their pent-up frustrations. The king rarely does interviews, but he sat down with me in Davos, Switzerland, and talked frankly of his near-desperation to solve a problem that he believes is at the heart of the two biggest crises America and the world face: Iran's nuclear ambitions and Islamic terrorism. It's an important interview.

And then, John Yoo, the man who wrote the infamous torture memo for President Bush.

(BEGIN VIDEO CLIP)

ZAKARIA: How is an American soldier or official -- what framework of law are you giving him if you say, well, the Geneva Conventions don't apply? Does it mean you can kind of just do whatever you want?

JOHN YOO: Well, let me say, it doesn't mean you can do whatever you want. I think what we're...

ZAKARIA: Why not?

(END VIDEO CLIP)

ZAKARIA: A fascinating discussion on terrorism, Guantanamo, Khalid Sheikh Mohammed and presidential power.

Let's get started.

(BEGIN VIDEO)

ZAKARIA: Your Majesty, you live in one of the most consequential parts of the world, one of the most dangerous parts of the world, and a place that has caused great frustration for the rest of the world.

I mean, there's a saying in New York, nobody has ever lost money betting against the Israeli-Palestinian peace process. And there's a sense, I think, that it's almost like a bad joke. We just keep discussing it. And yet, nothing seems to change.

KING ABDULLAH II OF JORDAN: We are waiting for the United States to hopefully give us their undivided attention on this issue.

So, if we don't get a clear mandate over the next month or so, then I'm not convinced that we're going to move the process forward.

What we have to keep in mind is...

ZAKARIA: Let's stay on that, though. You're saying, if in the next month you don't get a clear sense from the United States that it is pushing hard on this, you feel like things are going to stall.

HM KING ABDULLAH: People are disheartened. People are not convinced. I think the credibility of the U.S. is under question now.

So, we really have to be able to move the process forward in the next month or so, especially leading to the Arab summit, so that we don't have any confusion coming out of there.

ZAKARIA: But the Obama administration has tried to appoint a special envoy. It has called on the Israelis to freeze settlements.

Do you feel that the Obama administration -- I mean, what you're saying is pretty significant. You're saying there's a loss of credibility, a potential loss of America's image if it doesn't do something.

What can the Obama administration do?

HM KING ABDULLAH:: Well, I personally believe that the president is extremely committed to it. But we also know that America is dealing with many other issues internally -- health plan, other issues. Massachusetts was, I think, something that hit the news.

Do we have the undivided attention of the United States, which is something that we desperately need in the next month or so, to set the right tone for negotiations with the Israelis and Palestinians.

And the only other thing I just want to clarify is, sooner or later, there is an invisible line in the sand that we will cross, that will be clear to everybody, whether or not the viability of a two- state solution is there. And I hope we haven't crossed that yet. But when, God forbid, we do cross that line, then I think we doom the Middle East and the region to many decades of instability.

So, the more time we spend talking, as you say, and not solving this problem, we all pay the price.

ZAKARIA: And there are already voices in Israel saying that the two-state solution is the wrong way to think about this; we need to go back to thinking that Jordan is the Palestinian state, because, of course, a majority of Jordanians are Palestinians.

HM KING ABDULLAH:: What sense does that make? I mean, the two-state solution is the only solution that's out there. There are voices that every now and then say that there's going to be a Jordan option. A Jordanian option on what?

There's a -- there's pushes by certain elements of the Israeli government to say, Jordan takes a role in the West Bank. That is never going to work. And we have to be very clear that Jordan absolutely does not want to have anything to do with the West Bank. All we will be doing is replacing Israeli military with Jordanian military.

The Palestinians don't want that. They want to have their own statehood.

And again, what type of West Bank are we talking about? You know, we're talking about a viable entity.

And what I think these people are offering to try and pull Jordan in, is really nothing that would create enough statehood or make the Palestinians feel that they have something that's called their home. So, Jordan -- I'm on the record, we've said this so many times -- we will not have any role in the West Bank. By trying to make Jordan Palestine doesn't make any sense to me. That's not going to happen.

There are other certain people in Israel that are saying, well, if there's not going to be a Jordan option, the only other option out there is the one-state solution, which terrifies more Israelis than the two-state solution.

And so, I think that the only credible, viable way of solving this problem is the two-state solution, giving the Israelis and the Palestinians the ability to live together -- more importantly, allowing Arabs and Muslims to then have a peace treaty with Israel.

Fifty-seven nations, a third of the United Nations, do not recognize Israel today. So, they're isolated in the neighborhood and further afield.

ZAKARIA: You have some contacts with Israel. What is your sense of what is going on in Israel? What is the mood in Israel? Are they in the mood to negotiate?

Because my own sense is, the building of the wall has ended the problem of terrorism to a large extent in Israel, and it has made a lot of Israelis think, we can live with this. You know, what's the problem with just continuing as things are?

HM KING ABDULLAH:: Well, this is the challenge. I met with President Shimon Peres yesterday, who has always believed in the two- state solution and the importance of it, because he is looking at the future of his country.

There are those -- I still think that the overwhelming percentage of Israelis and Palestinians do want a two-state solution, and as quickly as possible.

The challenge that we have -- in Israel, in particular -- is to get beyond the politician to the Israeli people themselves, because they are so disheartened, that they don't believe it's ever going to happen.

And trying to wrap our minds on how to deal with the Israeli mentality. Many occasions I've sat down with Israelis to say, where do you see your country in 10 years time, and work me back, so we can figure out the synergies and the connections between Israel and the rest of the Arab world. No Israeli has ever been able to answer that question.

Because of the security threat, they think in the here-and-now. They can only think of today. When is the next attack? When is the next bomb?

And so, this is the challenge that Jordan has, and the international community has, reaching out to the Israeli public and saying, do you want to continue to be Fortress Israel? What a dismal place that would be. And how it continues to affect the whole region. The challenge is to reach the Israeli people and say, we basically want the two-state solution to happen, so that you can be integrated into the neighborhood. And that's actually a lot harder than people might imagine.

ZAKARIA: You said the core issue is the Israeli-Palestinian issue in the region.

I'm hearing people in the region -- particularly in Saudi Arabia -- say to me quietly, the core issue in the region is now the rise of Iran, and what to do about an Iran that is interfering in Lebanon, interfering in the Palestinian territories, challenging us at every corner.

How do you see the rise of Iran?

HM KING ABDULLAH:: I still go back to saying the core issue is the Israeli-Palestinian problem, because all roads in our part of the world, all the conflicts lead to Jerusalem.

Today, Iran is putting itself as the defenders of the Palestinian cause. Several days ago, Osama bin Laden in his taped message to the United States again underlined the suffering of the Palestinians. It is the injustice felt towards the Palestinian people that allow other states actors and non-state actors to take the role of being the defenders of the Palestinians.

If we solve this problem, then I believe we start to unwind all the other pressure points inside of the Middle East.

ZAKARIA: But could you in Jordan live with an Iran with a nuclear weapon?

HM KING ABDULLAH: If we solve the Israeli-Palestinian problem, why would Iranians want to spend so much money on a military program? It makes no sense.

I mean, the country has social challenges. It has economic challenges. Why push the envelope in getting to a military program? For what cause? If you solve the problem, you don't need to pursue that path.

ZAKARIA: People in Washington who listen to this are going to say, "He's soft on Iran."

HM KING ABDULLAH: President Obama said something that was very, very critical about the future of the Middle East. He said that, for the first time -- and I think it should have happened many, many decades ago -- America wants to see a resolution to the Israeli- Palestinian conflict, because it is in the vital national security interests of the United States.

Because he understands, that as long as this conflict continues -- as you say, if we keep just pushing this ball down the road for the next couple of years -- we are all affected by that instability. We're all going to pay that price. And how often can we continue? Instability in our region will affect the economy. It will affect trade, energy. How long do we want to continue living under that atmosphere?

ZAKARIA: We're going to have to take a break. We will be right back.

(END VIDEO)

(BEGIN VIDEO CLIP)

ZAKARIA: Do you really believe, if you solve the Israeli- Palestinian issue, you wouldn't have some Nigerian fanatic...

HM KING ABDULLAH: Look. You're always going to have...

ZAKARIA: ... who believes in jihad and gets onto a plane?

HM KING ABDULLAH: You're always going to have extremists in every religion. We're never going to be able to get rid of terrorism, because there is always going to be evil in the world.

What I'm saying is, for evil to succeed is for good men to do nothing.

(END VIDEO CLIP)

(COMMERCIAL BREAK)

(BEGIN VIDEO)

ZAKARIA: Your Majesty, a Jordanian man blew himself up in Afghanistan, killing CIA officers. And it led to a great deal of speculation about Jordan's role in trying to take on al Qaeda.

Do you have an active role in combating al Qaeda in Afghanistan and Pakistan?

HM KING ABDULLAH: Well, you have to understand that, not only were Americans killed, there was a Jordanian officer that was killed there in that particular attack.

What people fail to remember is that we have been battling al Qaeda way before America had its 9/11. And we stand for tolerance, acceptance, humanity. And these people, who call themselves Muslims, are trying to hijack our religion. And this is not just a Jordanian problem; it is a problem throughout the Arab and Islamic world. And we will continue to fight.

We had our own 9/11, the 9th of November, 2005, where three bombs were set off in hotels. We lost 60 people and over 100 wounded. If you compare that to the figures of America's 9/11, it was almost double the casualties for a country of our size.

And, you know, I made my mind up then that we were not going to be defensive. If we felt that people were going to target Jordan, we would target them.

We're working in our part of the world, in Asia and in the West. We're also looking at the educational aspect of this.

But again, I think I have to continue to underline that, you know, where do the disenfranchised youth move to? I mean, the Israeli-Palestinian issue is such an emotional issue inside of Islam, that everybody tries to hijack it for very destructive ends.

This is why it is so imperative for all of us to solve this problem. Otherwise, we will always live under the shadow of terror. And terror is not something, as you well know, that Israelis are having to deal with; Arabs, Muslims, the West are dealing with -- all because of the core issue of the Middle East, which is the Israeli- Palestinian one.

ZAKARIA: You really believe...

HM KING ABDULLAH:: We (ph) need (ph) to solve that.

ZAKARIA: You really believe, if you solved the Israeli- Palestinian issue, you wouldn't have some Nigerian fanatic...

HM KING ABDULLAH: Look. You always will have...

ZAKARIA: ... who believes in jihad, who gets onto a plane...

HM KING ABDULLAH:: You're always going to have extremists in every religion. You're never going to be able to get rid of terrorism, because there is always going to be evil in the world.

What I'm saying is, for evil to succeed is for good men to do nothing. And I think that's the challenge that we have.

There is no magic wand that solves that problem. But it's not specific to Islam or Christianity or Judaism, or any other religion. Evil is always going to be out there.

But it allows us to create a new future of the people that are living in the region. And it allows us the tools to be able to bring our religion back onto focus and strengthen the role of the silent majority, that those extremists that have hijacked our religion have nothing to do with Islam.

ZAKARIA: You know there are many people who have an alternate theory of what is fueling terror. And that is actually one that was loosely associated with President Bush and his administration, expounded by people like Bernard Lewis, the Princeton scholar, which is that it is the lack of any kind of political openness in the Arab world that produces extreme opposition movements, that produces the desire for jihad, that al Qaeda began as a group that wanted to topple the governments of Saudi Arabia and Egypt. It only later on latched itself to the Palestinian cause, and that unless you have openness in the Arab world, you will not be able to find a way to avoid these extreme political movements. KING ABDULLAH: We have the largest youth cohort in history. We have 200 million young men and women that need jobs in the next several years. If we don't create a positive future where they have a role and a say in their future, definitely, we are going to have a major problem.

I think the issues are interconnected. But on the political emotional issue, don't discount the Israeli-Palestinian one.

Having said that, there is a moral responsibility for all of us in the Arab world to move reform in the right direction.

ZAKARIA: But talk specifically about your country, because, you know, Jordan is often characterized as a benign or an enlightened dictatorship, but it is still a pretty tough set of controls that you have in the country.

Are you going to -- will your son, when he succeeds you, be a constitutional monarch?

HM KING ABDULLAH: I think, when I look back at the past 10 years, the reform aspect of our country, in many cases, sometimes you take two steps forward, one step back. There is resistance to change. There's a resistance to ideas.

When we try to push the envelope, there are certain sectors of society that say this is a Zionist plot to sort of destabilize our country, or this is an American agenda. So, it's very difficult to convince people to move forward.

I believe that...

ZAKARIA: What's the end goal? Let me repeat my final point or question, which was, will your son be a constitutional monarch?

Now, of course, given your age...

HM KING ABDULLAH: (UNINTELLIGIBLE) aspects of...

ZAKARIA: Given your age, he's going to wait for a long time. But at some point -- I mean, you know, Prince Charles hasn't seen anything yet. It's going to take a while.

(LAUGHTER)

But at the point he ascends the throne, what will Jordan look like?

HM KING ABDULLAH: I know exactly what you're saying. And what I'm trying to say is that, the way Jordan is today is not going to be the Jordan of tomorrow.

Ten years ago I said, you know, my goal is to be able to get food on the table. What I'm trying to say by that is trying to create a vibrant, capable and effective middle class. The quicker and stronger that we can be able to do this, the easier it is for political reform to move forward.

ZAKARIA: A final question. This is 10th year of your ascending the throne. Am I correct?

In this period, you have really, dramatically transformed Jordan's economy. It's a country that has no natural resources and has been growing steadily and strongly.

What did you do, and what has been most effective? What is the lesson in terms of creating growth in countries like Jordan?

HM KING ABDULLAH: Well, first, don't give up, I think is the major (ph). Don't take "no" for an answer. There are members of my society that, you know, when I say, let's do something, there's a -- I wish I could translate it into English, but it's (UNINTELLIGIBLE).

(LAUGHTER)

The Arabs will know what I mean. You know, when I say, you know, let's move this sector of society (UNINTELLIGIBLE) that's never going to happen.

(LAUGHTER)

We can't find the money.

And I think that has been the major challenge that I've had over the past 10 years, is not to be intimidated by the (UNINTELLIGIBLE) that I get from society.

And it takes -- you know, we move forward. Sometimes we get knocked down. And you have to dust yourself off and just keep trying.

I'm not -- we as Jordan are not where I wanted it to be. But again, there's been a lot of regional issues. But I'm the type of person that wants everything today and not tomorrow.

If I can put it down to a single, maybe, way of -- and I think this is relevant to the rest of the Middle East -- is, if you want to move Jordan and your countries forward, it comes down to education, education, education. The incentive that you give to your youth is going to be the make-or-break future of the country.

And I've got my good friend, the Crown Prince of Bahrain here. He's moving his country -- understanding, I think, the same language that we speak. There's a core group of young countries that believe in that vision and the ability to move their countries forward.

I'm optimistic about the future. But we just can't accept defeat and "no" as an answer.

ZAKARIA: Your Majesty, thank you very much.

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