Problems with indirect reciprocity

Two problems with indirect reciprocity. B has defected in previous rounds and therefore has a low reputation.

Evolution of indirect reciprocity
Nature, 27 October 2005, 437, 1291-1298
http://www.nature.com/nature/journal/v437/n7063/full/nature04131.html
Martin A. Nowak & Karl Sigmund

Natural selection is conventionally assumed to favour the strong and selfish who maximize their own resources at the expense of others. But many biological systems, and especially human societies, are organized around altruistic, cooperative interactions.
How can natural selection promote unselfish behaviour?
Various mechanisms have been proposed, and a rich analysis of indirect reciprocity has recently emerged: I help you and somebody else helps me.
The evolution of cooperation by indirect reciprocity leads to reputation building, morality judgement and complex social interactions with ever-increasing cognitive demands.

see also:
Game theory: How to treat those of ill repute
Nature 457, 39-40(1 January 2009
Bettina Rockenbach & Manfred Milinski
http://www.nature.com/nature/journal/v457/n7225/full/457039a.html