MR. KOJO NNAMDIReports today that the families of two men killed in Pakistan were paid blood money in exchange for the release of a CIA contractor have sent ripples through the diplomatic community and Pakistanis to the streets in protest. Relations between Pakistan and the United States had been simmering over the case of Raymond Davis, who Pakistan jailed after his role on a January shooting. Yesterday, Davis was freed after relatives of the Pakistani victims said they received as much as $2.3 million in compensation. The U.S. government officially says that no blood money was paid for Davis' release, but the very public diplomatic deal has focused an unsavory spotlight on what usually happens in secret.

MR. KOJO NNAMDIIt also raises questions about how international diplomatic and intelligence communities work for and against each other, and whether the rules of the diplomatic shell game are changing. Joining us now by telephone from Montreal is Christine Fair, a professor at the Center for Peace and Security Studies at Georgetown University School of Foreign Service. Christine Fair, thank you for joining us.

PROF. CHRISTINE FAIRThank you for having me. It's always a pleasure.

NNAMDILahore's High Court in Pakistan was about to rule on whether Raymond Davis would -- should be granted diplomatic immunity, so the timing of this deal was particularly important. Will this deal cool off tensions between Pakistan and the U.S. despite crowds of Pakistanis protesting today?

FAIRWell, I'm actually quite skeptical about this. You know, my read on the Raymond Davis affair is not that this was simply some rogue contractor that happen to shoot two young men in the prime of their life, bringing about a diplomatic crisis. It's actually -- it's more symptomatic, frankly, than it is causal. The United States has been, for several years now, very concerned about a Pakistani militant group known as Lashkar-e-Taiba.

NNAMDIYup.

FAIRYour listeners will know them from the Mumbai outrage in 2008 over Thanksgiving weekend.

NNAMDIYup.

FAIRWe've been increasingly worried about the international abilities of this organization and increasingly concerned about their ability to attack us here in the United States. They've been attacking us and Afghanistan since 2004, and obviously 2008 demonstrated their ability to attack us in India. We've been increasingly insisting upon Pakistan to do something about this group. They've been increasingly demonstrating to us that they have no intention of doing so. In fact, the Punjab provincial government even manages some of the assets of this organization. That's kind of a weird thing for a country to do that, you know, they have a state government managing the assets of a terrorist organization. That's quite bizarre.

FAIRSo what the United States CIA has been doing the last year or so is really building up a fairly robust set of numbers of CIA operatives in Pakistan. And it appears as if in Lahore itself, they set up a cell dedicated to among other things tracking Lashkar-e-Taiba, and Mr. Davis was the CIA contractor protecting the safe house where presumably the case officers worked. And he did the surveillance and other security duties that one would expect of that sort of role. And so my read of this is that this is really about the CIA and the ISI. The ISI knew...

NNAMDIISI being Pakistani's intelligence service.

FAIRPakistan's intelligence, of course. Yeah, sorry about that. Whether or not they knew about this in entirety or the timelines of when they came to know, my sources in Pakistan are a little, you know, they debate that somewhat. It's really clear they did come to know about this. And my Pakistani sources...

NNAMDIIt is clear that the ISI did come to know about what the CIA was doing.

FAIRExactly. And the two fellows that were shot, according to very reliable Pakistani sources, were in fact on the ISI payroll. So this -- my read of the Raymond Davis affair was not, you know, two young miscreant shot down by this, you know, deadly CIA contractor gone wild. But rather this was about Pakistan's intelligence, the ISI really trying to send a very firm signal to the CIA, and obviously it worked. So there's really much more to this case than meets the eye. And once the shooting happened, that was very much a -- the signaling, a CIA, ISI, as I'd like to say, spy for a spy showdown.

FAIRIt then became a pawn in Pakistani politics between the very weak President Zardari and his party, the PPP, and his rival in the Punjab, which is the party of Nawaz Sharif...

NNAMDIYup.

FAIR...the chief minister, which is Shahbaz Sharif. So it has multiple layers. It's (laugh) like a really smelly onion.

NNAMDIWell, allow me to try to peel back the layers one at a time.

FAIRYeah.

NNAMDIIf in fact the two individuals who Raymond Davis is accused of shooting were part of an ISI intelligence detail assigned to Raymond Davis and the two of them, I guess, were considered expendable?

FAIRWell, I don't think there's any other way of seeing it in any other term. Now, if you look at some of the reporters based in Pakistan, like my colleague, Omar Waraich, who's written about this, most likely they were not ISI officers, but rather, you know, basically contractors, miscreants for hire, because anyone that knew of Mr. Davis' background had to have known that, if adequately menaced, he would shoot, and that he would shoot effectively. So whether or not the two gentlemen that were reportedly purchased by the ISI or had their services purchased had any expectation of this outcome is a different question. But what actually did happen is pretty clear.

FAIRAnd if you look at the background of Mr. David -- Mr. Davis, or whatever his real name is -- it turns out that might not actually be his name -- he's what's known as white SOF, white special operations forces. So he's not the kind of guy that is quick to draw the gun. That would be the black SOF, the guys that go out and hunt down terrorists and do so ruthlessly and don't appear in newspapers. So there -- I have all reason to suspect that Mr. Davis was not irrational. (laugh) Someone with his background simply doesn't fire into a crowd in a dangerous part of a city, in a place like Pakistan where anti-American sentiments run high. There must have been a pretty significant inducement for him to feel as if he was or his principals were in mortal harm.

NNAMDIChristine Fair is a professor at the Center for Peace and Security Studies at Georgetown University School of Foreign Service. She joins us by phone from Montreal, indulging in some informed speculation, if you will, about what took place in Pakistan. So what did the killing of these two individuals -- what leverage did that provide and to whom?

FAIROh, it provided the Pakistan intelligence enormous leverage. I mean, you can only imagine how infuriating it must have been for them to realize that the CIA, which is operating with Pakistan intelligence on issues like al-Qaida, is also operating against Pakistani intelligence on issues like Lashkar-e-Taiba. I mean, it's an enormous blow to national sovereignty to have an intelligence agency running operations like that in a city like Lahore under the noses of the ISI.

NNAMDISo you put the United States and the CIA in this very defensive position. And the ISA -- ISI then says to them, what, we have to know more about what you're doing here? You have to work more closely with us?

FAIRYeah. I think this is an opportunity for them to sort of regain the initiative and to get some control. This is certainly going to be an occasion for the Pakistan embassy to be able to scrutinize much more rigorously and vigorously all of the applications. Now, point of fact, his diplomatic immunity was never really -- was never really a question. Even the foreign office eventually conceded last week that, yes, he had a diplomatic passport. Yes, he had an official visa. So, I mean, that was always sort of a ruse that was kicked around in Pakistani media to generate outrage.

FAIRSo, you know, and as I'm sure you know, embassies are always dens of espionage, right? Most of the operatives of intelligence agencies are based in embassies, and they operate under official cover. That's just sort of the gentlemen and gentleladies rule of the game. But they're certainly gonna want to have more scrutiny, and they're gonna wanna have more visibility into what we're doing.

NNAMDIWell, The New York Times reports that a Pakistani official said that the CIA had agreed to scale back the number of Pakistan operations it conducted without the ISI's consent.

FAIROh, I'm sure that's the case. It had to have been the goal of this whole thing from the beginning.

NNAMDIBut the U.S. has denied that. The U.S. said -- has said, we haven't given them any more information. We haven't really made any concessions at all.

FAIRWell, why the -- now, both -- I mean, obviously both countries have incentives to say, on the hand of Pakistan, yes, we got a lot out of this. On the U.S. side, no, we didn't really give up anything. The truth is gonna be somewhere in the middle. This episode, from ISI's point of view, put the CIA on notice, that we can get very nasty. Now, the Pakistanis were also put on notice. The Pakistanis really misjudged the timing of this. Our country, as you know, and you have covered, we are officially broke.

FAIRAnd if the Pakistanis thought that our Congress is gonna prioritize funding the Kerry-Lugar-Berman legislation over, say, funding education in our country, they were sadly mistaken. So I think the message was also delivered, listen, you've already counted on this $1.5 billion in your current budget. You're really...

NNAMDIYou don't release this guy, the Congress of the United States probably won't vote to give you this money, and you are going to be in trouble. On the issue of blood money, though, let's go to Gary in Washington, D.C. Gary, you're on the air. Go ahead, please.

GARYOh, Kojo, I just wanted to correct what you said earlier. You said that U.S. officials said money was not paid. However, Secretary of State Clinton said the United States did not pay money.

NNAMDICorrect. And now we can ask Christine Fair, how do these blood money deals typically work? Because it has been reported, I think, in The New York Times, that even though the United States hasn't paid money that somebody in Pakistan probably paid it, and that, at some point, the U.S. is probably going to pay that person or institution.

FAIRWell, there -- so there is no typical with this. This is so atypical for so many reasons. And I suspect very strongly that, at some point, when the two countries decided to resolve this, that this was the way that it was gonna be resolved. No -- I mean, obviously these guys are on ISI payroll. So, clearly, the ISI had a hand in massaging this. And money is tangible. And we've given Pakistan over $18 billion. (laugh) So out of 18 billion, plus or minus, you know, what's a few million here and there? So there's nothing typical about this. For example, when I was in Afghanistan in 2008...

NNAMDIYou witnessed an exchange of so-called blood money, right?

FAIRWell, witnessed -- I won't say that. I was in Kunar, and I was meeting with some officials there at our base in Kunar, which is in Asadabad, in the province of Kunar, in the northern part of Pakistan -- northern part of Afghanistan. And the -- one of the military convoys that went out in the morning came back, and they had hit a young girl. And those vehicles, at any speed, aren't safe. And the young girl was brought back to the base alive, but she ultimately died.

FAIRI met with some of the people that came back from that convoy, and they were absolutely devastated. You know, they were there. They were part of the convoy that killed her. And what had happened was the tribe and the family, members of the tribe, as well as the family, obviously came to the PRT. They tried to save her. I mean, they -- that was the first effort, was trying to save her. But ultimately she succumbed. The amount that was eventually settled on was in the range of a thousand or a couple thousand of dollars.

FAIRSo, I mean, this idea of paying folks millions is really quite extraordinary. I'm a little bit dubious, to be completely frank. And it probably -- this is, again, way in the realm of speculation. This is much more, in my view, ISI-CIA than some family being paid with blood money.

NNAMDIWell, there are two groups of people that I'm interested and how this would affect. First, the Pakistanis in -- on the streets today who are upset about this.

FAIRWell, the problem, unfortunately, is that, from the beginning, from the moment this happened, it became a media spectacle. Let me give you -- let me compare this...

NNAMDIWe only have about a minute left.

FAIRYeah. Very briefly. This could have been resolved in 12 hours. When I was in Islamabad in the summer of 2010, a drunk diplomat, American, hit this Pakistani, dragged the fellow to death, literally, never bothered stopping to get him health care 'cause he wanted to get to the embassy to be taken out of the country. That was a callous, devastating disregard of Pakistani life. That guy was out before dawn. So when these countries want to resolve something, they do. Unfortunately, the Pakistanis were fed a very steady stream of truth, with a very healthy dose of nonsense mixed in. And they are very rightly confused about what happened. They were totally -- didn't have diplomatic immunity when he did. So it's gonna be hard for Pakistanis to understand...

NNAMDIIt may therefore have been resolved between government...

FAIRAbsolutely.

NNAMDI...but it certainly has not been resolved among people in Pakistan. And I'm sure there a lot of American people who still have questions about it also. Christine Fair is a professor at the Center for Peace and Security Studies at Georgetown University School of Foreign Service. Thank you so much for joining us.

FAIRThank you so much for having me. Have a fabulous day.

NNAMDIAnd thank you all for listening. I'm Kojo Nnamdi.