A stable, democratic, prosperous Pakistan actively combating religious militancy is considered vital to U.S. interests. Pakistan is at the locus of several top-tier policy areas of urgent concern, including regional and global terrorism; efforts to stabilize neighboring Afghanistan; nuclear weapons proliferation; the Kashmir problem and Pakistan-India tensions; democratization and human rights protection; and economic development. Today Pakistan is identified as a haven for numerous Islamist extremist and terrorist groups, and is the world's most rapid proliferator of nuclear weapons, a combination that places it at the top of the international security agenda. Pakistan has been praised by U.S. leaders for its post-2001 cooperation with U.S.-led counterterrorism and counterinsurgency efforts, although long-held doubts about Islamabad's commitment to some core U.S. interests deepened dramatically in 2011 and may be altering the nature of the relationship in 2012. A mixed record on battling Islamist extremism includes ongoing apparent tolerance of Afghan insurgents and anti-India militants operating from its territory. Pakistan's troubled economic conditions and precarious political setting combine with perilous security circumstances and a history of difficult relations with neighbors to present serious challenges to U.S. decision makers. The Pakistani people have paid a heavy price as Islamist radicalism has spread in the country and as its border region near Afghanistan has become a haven for local insurgents, as well as Arab and Uzbek jihadists. Islamabad claims that the "war on extremism" has cost the country more than 37,000 civilian lives, nearly 6,300 security forces, and $78 billion in financial losses. The U.S. National Counterterrorism Center reports there was an average of more than 26 terrorist attacks each week in Pakistan in 2011; only Afghanistan and Iraq suffered a higher number of incidents. Pakistani officials regularly seek to remind the American audience of the country's sacrifices. May 2011 revelations that Al Qaeda founder Osama bin Laden (OBL) had found apparently years-long refuge inside Pakistan marked a new era of intensive U.S. government scrutiny of a now tense and even adversarial relationship. In September that year, the then-top U.S. military officer, Admiral Mike Mullen, issued unprecedentedly strong and public accusations that Pakistan was providing support to Afghan insurgents who attack U.S. interests. Given Mullen's strenuous efforts to develop a close working relationship with his Pakistan counterpart, General Ashfaq Pervez Kayani, the pronouncement was taken as a supreme expression of U.S. frustration. To bookend 2011's bilateral turbulence of historic scale, in late November NATO troops in Afghanistan came under fire from two Pakistani army outposts just across the shared border at Salala. Retaliatory airstrikes left 24 Pakistani soldiers dead. A Pentagon investigation determined poor coordination and miscommunication were to blame, and that NATO troops had responded appropriately. Pakistan's government and people alike have expressed fury at what some suspect was an intentional strike. Following the incident, Pakistani officials moved to scrap and renegotiate all existing bilateral agreements with the United States related to supply lines into Afghanistan and any covert American activities inside (or over) Pakistani territory, primarily those generated early in the 2000s by the governments of President George W. Bush and President-General Pervez Musharraf. Islamabad has continuously demanded a full apology from Washington as requisite for restored cooperation. Yet of the several ways Islamabad's anger was expressed, the most contentious has been its closure of the Pakistani ground lines of communication (GLOCs) that allow NATO supplies to transit into Afghanistan. Despite much anticipation of an imminent deal to reopen them, the GLOCs remain closed to date and the issue was blamed for overshadowing a May 2012 NATO summit in Chicago. Media reports have the Pakistani negotiators seeking as much as $5,000 per truck, or what would be a 20-30-fold increase over last year—and senior U.S. officials refusing to entertain such a fee hike while railing at perceived "extortion" and "price gouging." Only days after the failure to strike a deal on the GLOCs in Chicago, a Pakistani doctor who reportedly had participated in a CIA operation to identify bin Laden family DNA received a 33-year prison sentence for treason, perplexing an American audience and angering many, including senior Members of Congress. The Senate Appropriations Committee responded within hours by attaching a unanimously approved provision to dock $1 million from U.S. aid funding in the FY2013 State and Foreign Operations appropriation for each year of the sentence unless the doctor is freed. The Administration has stated that it saw no reason for the conviction. In many practical respects, the cooperative aspects of bilateral relations have remained frozen in 2012, even before this most mutual exasperation in May. The two governments—and, at a lower level, the diplomatic and security agencies within them—seem at loggerheads after a grueling series of crises. Anti-American sentiments and xenophobic conspiracy theories remain rife among ordinary Pakistanis; opinion surveys find that the United States has of late replaced India as the nation least favored by Pakistanis (a significant development, given the visceral, decades-old Pakistan-India rivalry). Meanwhile, Americans tend to have increasingly poor views of Pakistan. The State Department warns Americans on the high risks of travel in Pakistan, and its own diplomats face travel restrictions there. American civilians have been abducted in Pakistan over the past decade. One, Daniel Pearl, was executed. Islamist extremism and militancy in Pakistan is a central U.S. foreign policy concern. Its arguably growing influence hinders progress toward key U.S. goals, including the defeat of Al Qaeda and other anti-U.S. terrorist groups, Afghan stabilization, and resolution of the historic Pakistan-India rivalry that threatens the entire region's stability and that has a nuclear dimension. Long-standing worries that American citizens have been recruited and employed in Islamist terrorism by Pakistan-based elements have become more acute. Several most-wanted enemies of the United States are widely believed to reside in Pakistan, among them Al Qaeda chief Ayman al-Zawahiri, Taliban chief Mullah Omar, and Haqqani Network leader Sirajuddin Haqqani. Some American intelligence officials reportedly suspect that Zawahiri may be receiving protection from elements of the Pakistani government. Over the past year, increasing numbers in Congress have more forcefully questioned the effectiveness of current U.S. policy and the wisdom of large-scale U.S. aid. Some openly call for the curtailment of all U.S. foreign assistance to Pakistan, and legislation significantly undercutting the Administration's FY2013 aid request, as well as placing new conditionality on both aid and military reimbursements, is moving through Congress in May 2012 (see Appendix ). Congress appropriated about $2 billion in direct aid for Pakistan in FY2012, placing it among the world's leading recipients of U.S. foreign assistance (see Table 1 ). Pakistan's Ambassador to the United States has told U.S. lawmakers that "onerous" restrictions being placed on U.S. aid will be counterproductive to the goal of restoring cooperation and trust. It seems clear that the closure of Pakistani GLOCs to Afghanistan has not been the logistical catastrophe that many pundits in both the United States and Pakistan had expected. In this respect, by keeping the routes closed, Islamabad has "played its trump card" in relations with Washington and not realized the hoped-for gains. Pakistan now risks finding itself increasingly isolated diplomatically, and working positively with the United States and NATO may be the only way to change this course. By bowing to domestic political pressures, the civilian government's negotiating strategy could see the country lose billions of dollars in foreign assistance, as well as its ability to influence post-war Afghanistan. In his June 2011 announcement of a U.S. military drawdown from Afghanistan in 2014, President Obama said the United States "will continue to press Pakistan to expand its participation in securing a more peaceful future for this war-torn region" and "will insist that it keep its commitments" to neutralize terrorist safe havens in its territory. In August, Secretary of Defense Leon Panetta openly acknowledged the complicating factors of Pakistan's ties to anti-Afghan and anti-India terrorist groups, but still insisted that the United States "has no choice but to maintain a relationship with Pakistan." Until the potential bilateral breakdown in 2012, many, if not most, independent observers concurred that continued engagement with Pakistan is the only realistic option for the United States, although some high-visibility analysts counsel taking an increasingly confrontational posture toward Islamabad. As part of the Administration's strategy for stabilizing Afghanistan, its Pakistan policy has included a tripling of nonmilitary aid to improve the lives of the Pakistani people, as well as the conditioning of U.S. military aid to Islamabad on that government's progress in combating militancy and in further fostering democratic institutions. However, in July 2011, the Administration suspended up to $800 million in planned security assistance to Pakistan and appears to be more rigorously evaluating Pakistan's cooperation and progress before releasing further aid. At least $1 billion in approved "coalition support fund" (CSF) reimbursements to Pakistan also remains undisbursed due to bilateral disagreements and acrimony. Developments in 2011 have seemed to validate a preexisting view of many observers that Pakistani behavior is unlikely to change given the long-held geostrategic perspectives of decision makers in Islamabad and Rawalpindi, home of the Pakistan Army's GHQ. If true, this means Pakistan will continue to tolerate safe havens for "friendly" militant groups regardless of U.S. aid levels or overt threats. By many accounts, Pakistan's apparently schizophrenic foreign policy behavior is a direct outcome of the Pakistan military's perceived strategic interests.