JUDY WOODRUFF: Next: to Britain's new coalition government, facing issues at home and abroad that are very familiar to Americans. Margaret Warner has that story.
MARGARET WARNER: Before last spring's campaign, Liberal Party leader Nicholas Clegg was hardly a familiar face to British voters. But the debates changed all that.
NICK CLEGG, British Deputy Prime Minister: The more they attack each other, the more they sound exactly the same.
MARGARET WARNER: Forty-three-year-old Clegg stole the spotlight from the candidates of the two traditionally dominant parties: Labor's then-prime minister, Gordon Brown, and the Conservatives' David Cameron.
NICK CLEGG: We don't simply need to choose from the old choices of the past. We don't need to repeat the mistakes of the past. Don't let anyone tell you that, this time, it can't be different. It can.
MARGARET WARNER: The results of the May election were certainly different. Neither major party won a majority of seats in the House of Commons. Within days, a coalition was forged between Cameron's Conservatives and Clegg's Liberal Democrats, despite the two parties being at odds on many domestic and foreign policy issues.
DAVID CAMERON, British Prime Minister: We are announcing a new politics.
MARGARET WARNER: Cameron became prime minister and Clegg deputy prime minister. It's the first time in decades that the Liberals have been in power.
Since taking office in May, the new government has moved quickly in the face of a tough recession and a record peacetime deficit. The government presented an emergency budget in June, a dose of austerity, proposing cuts of 20 percent or more in many agencies and programs.
Meanwhile, public discontent with the Afghanistan war grows, with mounting British casualties there. The new government said it wants to start withdrawing the 9,500 British troops by next summer.
Nick Clegg is representing Britain at the U.N. General Assembly this week. I spoke to him this morning in New York.
Deputy Prime Minister Clegg, thank you for joining us.
NICK CLEGG: It's great to be here.
MARGARET WARNER: There's been a lot of speculation here in New York, based on what President Ahmadinejad has been saying all over town and at the U.N., about whether or not Tehran's interested in restarting talks on its nuclear program.
What is your government's assessment of that?
NICK CLEGG: Well, our assessment is that we need to keep up the international pressure. It's incredibly important that the group of countries, the five members of the Security Council, plus Germany, remain very united, very solid in exerting consistent pressure through economic sanctions, political pressure, diplomatic pressure, on the Iranian regime, so that they understand that we are deadly serious about dealing with the threat of a nuclear-armed Iran, but also willing to engage with Iran on civil nuclear -- on a civil nuclear ambition.
MARGARET WARNER: Now, unlike the Americans, you all did meet with the Iranians here. Your foreign secretary met with the foreign minister of Iran a couple of days ago.
NICK CLEGG: Yes.
MARGARET WARNER: What indication did you get in that meeting about whether Tehran wants to restart these talks in a serious way? Was there anything concrete?
NICK CLEGG: It wasn't -- it wasn't the best of meetings, in the sense that I think it was, in a sense, a restatement of the kind of position that we know the Iranian administration has taken.
So, I'm not going to pretend it was a breakthrough. It was a tough meeting. Our foreign secretary set out very clearly, as I say, our view that we needed to get more transparency and candor from the Iranian administration, but that we were prepared to engage with them.
MARGARET WARNER: Now, President Obama has said military action as yet another alternative can't be taken off the table.
When you ran for -- in the last campaign, your party's manifesto said, under no circumstances. What is the British, this coalition government's position now?
NICK CLEGG: Well, no one is talking about a military option. It's not something that people are pursuing.
MARGARET WARNER: Well, actually, I interviewed Tony Blair last week, and he did talk about the military option couldn't be taken off the table. There is a -- still a conversation about that.
And I -- what I'm trying to find out here is whether -- you are in this coalition government now -- you're in partnership with the United States and these other members -- whether to you it is just a non-negotiable issue or whether that's in the background.
NICK CLEGG: I don't think it serves any purpose for people to go around and start sort of saber-rattling about military action. Equally, it serves no purpose to constantly speculate about what if, what if, what if.
MARGARET WARNER: You were in Afghanistan just last month. Do you think that the counterinsurgency strategy that the U.S. and U.K. are pursuing there is the right one?
NICK CLEGG: I think we where at a vital, vital phase now in our military engagement in Afghanistan. I think the next year is really crucial. It really will tip the balance, in my view, one way or the other. All that we can do militarily is create the space, the security space, in which a political process can take place of reconciliation, of reintegration.
And I think that's what we need to look for in the next few months, is, how can you convert military momentum into political reconciliation and into a political process, which, in turn, will lead to a stable Afghanistan?
MARGARET WARNER: Well, you stated the strategy. My question is -- was your assessment when you were whether it's working.
NICK CLEGG: My assessment is that, militarily, certainly in the part of Afghanistan in Helmand, in Southern Helmand, where the United Kingdom forces are most heavily concentrated, is now -- now has a momentum and has resources and has troops because of the surge which President Obama has delivered, and, of course, has leadership, in General Petraeus, which arguably we should have had five years ago.
MARGARET WARNER: Now, at home, your coalition has embarked on this rather draconian austerity budget, which -- the details of which will be released next month.
But it is said that the defense budget will be slashed 20 or 25 percent. What are the implications of that, first of all, for the U.K.'s commitment in Afghanistan?
NICK CLEGG: Well, we're not going to do anything which will in any way weaken our commitment and our ability to fulfill our duties and obligations in Afghanistan. That is simply not going to happen.
MARGARET WARNER: So, it's off the table?
NICK CLEGG: We're not going to -- we're not -- absolutely. We're not going to do anything which in any way will undermine our effort in Afghanistan. We're there. We're there. It's not uncontroversial, for the reasons that I have explained. But we are there, and we will do the job properly that we have been asked to do.
In the wider scheme of things, of course we need to ask ourselves big questions, as we need to do across public expenditure when money is tight, which is, what kind of weapon systems can we afford? What kind of security threats do we face in the future? Are they the same as we faced in the past? Can we make any safe predictions about what kind of challenges we will have to address in the future? And what implications does that, in turn, have for what we spend our money on?
This is going to be very difficult. It's going to be extremely complex and, indeed, controversial, as are decisions in every other area of public spending, whether it's welfare, whether it's education, whether it's health, and so on.
But I'm absolutely convinced and the coalition government is absolutely convinced that we will not be able to play our part, our proud part, in the affairs of the world unless we also have a strong, sustainable economy at home.
You can't -- you can't play -- you can't stand tall in the world if you are running on empty back home. And that is what we are trying to fix. If we fix our finances at home, we will continue to play a proud and, I hope, a leading role in the affairs of the world.
MARGARET WARNER: How are you, as the Liberal in this Conservative-Liberal coalition, going to make the case to the British public about these major cuts in services that are coming, and also to your own Liberal Party base?
NICK CLEGG: Sure, sure. Well, I would say two things. Firstly, I think what's happening at the moment, partly because we haven't taken the decisions yet, is that everybody is reading in their very worst fears into a kind of vacuum. And so this kind of image is developing of these draconian cuts which are going to happen next Tuesday.
They are not. They are going to take place over five years, which is actually a more leisurely timetable than, for instance, for some European countries who have had their hand forced by bond markets to take even more dramatic action.
I think we are retaining control, if you like, over our own destiny, which is immensely important, particularly for a new incoming government. If you deny you have a problem, and you don't take action on your deficit, you know what happens? What happens is, you are asking your children, you are asking your kids and your grandchildren to carry on paying off billions of pounds of interest on your debts, on this generation's debts, money which should be used for their schools and their hospitals in the future.
So, what we're saying is, look, we have messed up as a generation. We have got to wipe the slate clean for the next generation. It's very important that we don't blight future generations because of our failings in this generation.
MARGARET WARNER: Do you think what you're doing is instructive for other countries, other mature economies, like the United States, who are dealing with ballooning deficits, or not dealing with it?
NICK CLEGG: I think it would be wrong and economically unjustified for us to start sort of, you know, developing a sort of holier-than-thou attitude towards other people's fiscal arrangements.
We have individually decided for our circumstances. We are an economy which is allied to the American economy, but we have different challenges. And we have decided it is in our best interests to do what we're doing. I don't think it would be useful to say that is a carbon copy for other people to mimic in exactly the same way.
MARGARET WARNER: Everyone has to make their own decision.
NICK CLEGG: Indeed.
MARGARET WARNER: Mr. Clegg, thank you very much.
NICK CLEGG: Thank you.