FAREED ZAKARIA, HOST, CNN: Of course, President Obama couldn’t concentrate completely on Asia this week…as the crisis in Ukraine continued…and even heated up.  I wanted to delve into both of these issues…and how to handle them. That’s the kind of advice that Tom Donilon used to give President Obama. Until 9 months ago, Tom was President Obama’s national security adviser…and one of the architects of the Asian pivot.  Tom, a pleasure to have you on.

TOM DONILON, FORMER NATIONAL SECURITY ADVISOR:  OK, it’s nice to be here, Fareed. Thank you.

ZAKARIA: Vladimir Putin.

DONILON:  Yes.

ZAKARIA:  Do you believe that Putin really could actually, in some way, invade Eastern Ukraine at some point?

DONILON:  I think that the Russian government, led by Putin, is engaged in a destabilization effort, currently, in Ukraine.  I think that the Russian view here is that a destabilized Ukraine is superior to a stable, successful Ukraine that’s oriented to the West.  And I think you’ll see them continue to use the leverage that they have to try to destabilize the situation.  And I think the job of the United States and the West is tp support, politically and economically, the Ukrainian government, to have the elections take place in May and to move forward and to — and to — and to build a successful — a successful Ukraine.  A difficult task given the fact that I think that Putin and his — and his team and the Russians are engaged in a — an express effort to destabilize, via through a variety of covert operations.

ZAKARIA:  Anything about this surprise you?  You spent a lot of time with President Putin, to then hear him say, you know, bald-facedly, there were no Russian troops involved, these… I don’t know who these guys with black masks are?

DONILON: I think it is unusual for a leader of a country to engage in bald-faced lying.  I think that is an unusual — it’s an unusual thing to do, frankly.  And it really does obviously hurt his credibility.  And I think that’s one of the reasons that you’ve had some of the surprising tough reactions you’ve had from Europe, for example.

ZAKARIA:  How does this end? Because you say Russia seems to want an unstable Ukraine.

DONILON:  Yes.

ZAKARIA:  It would be difficult, I think, for the West to totally stabilize it, given how close it is to Russia, how deeply penetrated Ukraine already is, whether it’s, you know, Ukrainian intelligence services penetrated by Russia.  The Ukrainian Army is penetrated.  The Eastern Ukraine is a — where does this go?

DONILON:  Well, I think that — I think that where it goes in the — in the — in the short and medium-term is here.  I do think that our effort should be, support for the Ukraine government going forward here, politically and economically.  Support for and reassurance for our NATO allies and substantial increasing of the price for Russian conduct.

ZAKARIA:  So you — you would favor a third round of sanctions?

DONILON:  If there’s no change in behavior by the Russian government, if there’s no effort to meet the commitments that they made at Geneva to diffuse the situation, to have the militias stand down and leave the buildings that they’re occupying and engage in a political dialogue with the authorities in Kiev, if that doesn’t happen, I think that absolutely we need to go ahead with the — with the next, uh, with the next round of sanctions and increase the, uh, and increase the — the, uh, the price of Russian conduct.

ZAKARIA:  You know a lot of people argue that the — the pivot has been well articulated, well-conceived, but fundamentally badly implemented, that there isn’t enough energy and attention on Asia, there aren’t enough substantive pieces to it, it’s sort of good in theory, but bad in practice.  As essentially the architect of the pivot, what do you say?

DONILON:  I don’t think that’s correct, actually.  And, of course, the president, this week, is in Asia visiting four countries and if you look at all the elements, I think that actually a number of these things are moving along.  We’ve worked very hard on restoring our alliances and our alliances are in very good shape in Asia, and, indeed, tremendous demand for U.S. leadership and engagement in Asia for a lot of different reasons.

ZAKARIA: Surely one of the things that… that strikes you is this rivalry between China and Japan that has never really abated, has gotten worse in many ways now, because you have a stronger Chinese government, in a sense and a — and one that’s tougher, but also the rise of a Japanese government that is quite tough, some people would say nationalistic, wants to rearm in ways that Japan has never done since World War II.  What do you make of that?

DONILON:  Well, I — it’s a very intense situation, frankly, between them. You know, when you — when you talk to leaders in both these countries, uh, the level of emotion out here is very high.  Um, as — between China and Japan.  Uh, and this is a — this is a problem.

ZAKARIA:  They won’t even talk to each other, really.

DONILON:  Exactly, right.  They’re certainly not talking at the political level.  And these are the — this is the second and third largest economies in the world.  And it is, I think, ultimately, in region’s interest to have a — to have them lower tensions.  Uh, but it is a very — it’s — it’s — it’s not there at this point.  What the danger is here, of course, is that when you have this level of emotion, when you have this level of — of — of nationalism on both sides and you have both sides testing each other, that you can have a mistake or a miscalculation, which can really kind of spiral to places, uh, that you can’t — that you can’t predict.  That’s the real danger.  What we’ve — one encouraging note this week, uh, was that there was a naval conference that took place over –  during the last week, where the navies, including China, uh, of the region agreed on a code of conduct for unanticipated encounters.  That’s the kind of thing we really do need.  We really do need to do to avoid the kind of mistake or accident that can take place when you have situations like this.  Overall, though, all sides need to try to, uh, reduce — reduce tensions.  It’s — it’s way some of the conduct of the Chinese was so troubling last fall, when they declared this air defense notification zone unilaterally and of course pushed that very hard message as to — as to the Japanese. But that’s the kind of thing that increases tensions, it doesn’t lower it. And it can really result in really, um, unanticipated consequences.

ZAKARIA:  Tom Donilon, a pleasure to have you on.

DONILON:  OK. Nice to see you.

ZAKARIA:  To discuss just how the unanticipated accidents, miscalculations and tensions could actually lead to the next great international crisis, we will come back with some maps and two great experts to explain the next crisis in Asia and the world, when we come back.