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Analysis of U.S./China Relationship, Post-Press Conference

Aired January 19, 2011 - 14:35   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: We appreciate the dialogue, and we are looking forward to having dinner with you later this evening.

UNIDENTIFIED MALE: (SPEAKING CHINESE)

OBAMA: Thank you, everybody.

ALI VELSHI, CNN ANCHOR: OK. You've just watched the end of the press conference. Very long press conference, hampered by a very strange technical snafu. It can't have been intentional that they did not have simultaneous translation. Both the president looked a bit troubled by that, and Hu Jintao actually commented he didn't quite know that was going to happen. So, it ended up taking a lot longer than expected.

I want to talk to my guest, Mary Brown Bullock, about what stood out to you, other than that technical snafu? What stood out to you from what you heard at that press conference?

MARY BROWN BULLOCK, PROFESSOR OF CHINA STUDIES, EMORY UNIVERSITY: Well, I think two things. One, certainly President Obama hit the high points in U.S./China relations. I don't think there's anything he missed.

I thought it was very interesting. It was late in his talk, but he did get to the human rights and even brought in the issue of Tibet, recognizing sovereignty of China over Tibet but calling for dialogue with the Dalai Lama.

Certainly he can't be accused in this presentation of not addressing human rights. I thought President Hu -- it was too bad about the translation issue. I thought he also acquitted himself well but probably more generally. His comments were definitely more general natured.

VELSHI: So, in fact, at one point he talked about promoting denuclearizing in North Asia. He was sort of using very general --

BULLOCK: Very general. But early on he did signal one of the messages that will go to a Chinese audience, and that is mutual respect including sovereignty -- including respect for China's sovereignty and territorial --

VELSHI: Right. He said they're willing to engage with Washington on the basis of mutual respect and the principal of noninterference in domestic affairs.

BULLOCK: That is code for noninterference in human rights, noninterference in minority issues, noninterference in Tibet or even Taiwan. So, he didn't spell that out in detail, but certainly everyone hearing him knew what he meant.

VELSHI: Any surprises, then, in what they both did? So, putting aside their performance, and they probably both equipped themselves well for their domestic audiences -- anything you didn't expect to hear? There certainly was no announcement of deals or understandings that we didn't go into this knowing about.

BULLOCK: I don't think there were any surprises. I think Obama said briefly that the U.S. had to maintain its forward position in Asia. He didn't elaborate that, but that is certainly signaling that the U.S. is in Asia to stay, and I think that was important that he get that in.

I think President Hu, in at least finally addressing the human rights issue --

VELSHI: He, by the way, just so our audience knows -- it was asked by a reporter, he didn't answer it and he later said it was because of the translation issue. Which having watched this, it's entirely possible.

BULLOCK: It appears it was not translated and that Obama's response was not initially translated.

VELSHI: And before you answer that, the next Chinese questioner actually said, "I would like my question accurately translated."

BULLOCK: That was fascinating. Right!

VELSHI: There was something going on behind the scenes. But that said, your thoughts.

BULLOCK: He did finally address the human rights issue, and I think he said what is a standard line. But he said it with some force, that we do respect universality of human rights, that we're a developing country, we're at this particular stage. We have something to learn from other countries and pledged continued dialogue. I don't think anyone expected anything else from President Hu.

VELSHI: OK. You hit on something that I think is the big confusing thing about China. It is, on many levels, a developing country. There are parts of China which are decidedly impoverished and going through difficult times, high rates of illiteracy. And at the same time, it is the fastest growing economy in the world, largest country in the world. It is the largest consumer and the fastest growing consumer of so many raw materials in the world.

So, it is at the same time a developing country as a major competititor to the only superpower in the world. How do they reconcile that?

BULLOCK: It boggles the mind. I would think if I was Chinese, I would feel somewhat schizophrenic -

VELSHI: We've never had this before, right? Anywhere in the world. We've never seen something like this.

BULLOCK: No, no. And of course, their per capita income, as President Obama said, is so much lower than America's. They do have a long way to go.

But I think what you do sense is the momentum and the scale. You have to remember that 1.3 billion people and the education that they are now receiving, which is getting better every year, and also the determination. You know, when you're in China, you feel that energy, you feel that commitment --

VELSHI: Sure.

BULLOCK: -- to the people to really excel and to regain the position they had in an earlier era. So, I don't know how you quantify that.

VELSHI: Right.

BULLOCK: But you certainly do feel a civilization on the move.

VELSHI: The question, of course, is whether that move -- because when China moves just a little bit, it shakes the entire world. So, whether that move continues to go in the right directions -- in your evaluation and the time you spent studying China, where is it going? Is it going into a place where it is going to be productive for Chinese and for the rest of the world? Are there areas in which it's headed that we should be worried about?

BULLOCK: I think the last two years China certainly has been more aggressive in northeast Asia, and I think that has worried Americans in a geopolitical sense. And the continued acceleration of its military program, even though it's way below ours. So I think you worry about that.

I think there have been concerns that, particularly under President Hu, we have had a more oppressive regime. There has not been a fast movement toward democracy, which was really a false hope. So we haven't seen that political movement in China. I think I would feel better, I think many people in this country would feel better, if you saw these reforms moving to continue the opening and more freedoms that Chinese people have. My first trip was in 1974.

VELSHI: Wow.

BULLOCK: China is a different country. The people have so many more opportunities now, so much more freedom. They do talk about politics. They write. So, it's not like it's a closed country, but the issue of political reform is still out there.

VELSHI: Right. One last question that you and I discussed earlier in a break. That is, for people who are watching us who are workers, who are businesspeople, what are our opportunities here in the United States out of this growing economy and this growing consumer base over the next decade or so?

BULLOCK: You know, I tell students -- high school students graduating, I say, go to Shanghai for one week. There was flight, a Delta flight to Shanghai. Just go and feel Shanghai.

VELSHI: Right. And when you say electric, this is a city that's building more buildings than our biggest cities in the United States actually already have.

BULLOCK: Exactly. And I think it actually gives people both something -- well, it helps give us a competitive spirit. I think we need more of that old American kind of competitive know-how. Yes, we can improve our education system, we can transform our technology.

I think mom-and-pop stores, that's tough. How do you do that? How do you change to a service industry if you've been a manufacturing industry?

VELSHI: Right.

BULLOCK: You know, those are the hard questions for American politics, and we do have to worry about those protections.

I thought Obama was very eloquent in his repeated talking about jobs. You could say this press release - press conference for President Obama was selling America to China.

VELSHI: Right.

BULLOCK: He even said, we have so much to sell.

VELSHI: Right. We want to keep selling, we want to sell you planes, we want to sell you --

BULLOCK: He's really trying to educate the United States as he is talking, whether that's sufficient for Congress, I don't know.

VELSHI: Mary, great to talk to you. Thanks so much for being with us.

BULLOCK: Thank you.

VELSHI: Mary Brown Bullock is the professor -- the president emeritus of the (INAUDIBLE) Scott College and distinguished visiting professor of China Studies at Emory.

Let's go to Ed Henry who was in that room - with us. Ed, boy, that was an interesting press conference. What did you and the press corps take away from how candid or transparent President Hu was?

ED HENRY, CNN SENIOR WHITE HOUSE CORRESPONDENT: Well, I think President Hu --maybe because of the technical glitch, he just didn't hear the human rights question the first time. It had raised my eyebrows when he skipped over that. Maybe it was literally lost in translation. But when he got the follow-up question, he did answer pretty straightforward, at least on the surface saying, look, I've talked about this with President Obama many times. We've essentially agreed to disagree, but we've had candid conversations. He said what you might call the right things about look, China is always concerned about the promotion and protection of human rights. China is a developing country interested in democracy and the rule of law. All of that sounds wonderful in theory.

But in practice, it seems far from the reality of what's really happening in China today. So there seemed to be a deep, deep divide in what President Hu was trying to sell the world and what's really going on in China.

VELSHI: All right, Ed, was there anything there -- you have been saying very clearly to us in the lead-up to this -- the same question I asked Mary, there was nothing there that you did not expect to hear, there were no surprises, putting aside the delivery of the two leaders and what they emphasized? There were no deals, there was nothing in there that they discussed that you didn't know was going to happen?

HENRY: No. I really think it was, as we expected. Both sides kind of laid out their markers and their points. I thought you were right to highlight what was essentially the salesman in chief. I thought it was fascinating the president just said, we want to sell you all kinds of things: planes, cars, software, you name it.

The fact of the matter is, he realizes, this president on the American side, that he's got to do everything he can to not just try to sell U.S. products abroad, to try to help dig us out of this awful unemployment and difficult economic situation, but he also has to sell the American people on the idea that Chinese investment here at home, U.S. trade with China is not a bad thing.

It is a very, very tough sell. With we knew that going into the news conference. But I thought it was interesting that the president was candid about trying to address that head-on.

VELSHI: All right, Ed. Good, thanks very much for covering us. I think you probably brushed up on your Mandarin as a result of that press conference. Our senior White House correspondent, Ed Henry.

Our coverage, of course, continues later on today with the state dinner that will be held in Washington. We've got more news for you, by the way. There's other stuff is going on, not just China. I'll bring it to you right after this break. Stay with me.

(COMMERCIAL BREAK)

VELSHI: Some developing stories that we're following for you in the CNN NEWSROOM. According to an e-mail from her mother, Congresswoman Gabrielle Giffords is doing well enough to be transferred to a rehab facility in Houston on Friday.

It's a week-and-a-half since she was shot through the brain at a public event. Giffords has surprised doctor was her physical and mental capabilities. Her mom's e-mail says Giffords will begin aggressive rehab and be treated by surgeons who specialize in bullet wounds to the head. I do want to note this development has not been confirmed by the University Medical Center in Tucson where Giffords remains in serious condition.

Meantime, new details on some of the security videos that captured the January 8th shooting tragedy. The Pima County Sheriff's Department chief investigator tells us about the key moment.

(BEGIN AUDIO CLIP)

RICHARD KASTIGR, CHIEF INVESTIGATOR, PIMA CO. SHERIFF'S DEPT.: There's a portion of the tape where you can see very clearly that Jared, the suspect, comes out of one of the doors. He walks around a table, a collapsible-- perhaps a six-foot table. And when he does so with very significant purpose, he walks up to the congresswoman, points a gun at her face, and shoots.

(END AUDIO CLIP)

VELSHI: Jared Loughner, by the way, the suspect, will be in court again on Monday for a hearing.

All right. A 50-foot fireball lights up a Philadelphia neighborhood, killing one person and badly injuring several others. Residents had reported the strong smell of gas, so a utilities crew rushed to the scene. They found a break in a high-pressure gas main, and they got to work.

And then a bad sign. Gas started bubbling up through the pavement, the whole thing just went up. That explosion was so strong that folks felt it across the Delaware River in New Jersey. Later, fire crews found the body of a 19-year-old Philadelphia Gas Works employee in the blast zone. The cause is still under investigation.

Well, classes are back in session at Gardena High School a day after two students were wounded in an apparently accidental shooting. A boy shot through the neck is expected to be fine, but a 15-year-old girl who was struck in the head by the same bullet is in critical condition. Los Angeles police say the student who brought the gun to school faces charges of assault with a deadly weapon.

And a day after reconvening on Capitol Hill, the House -- these are live pictures at the House -- the House is about to vote on a measure that would undo last year's sweeping health care reforms. The measure is likely to pass the new Republican-led House, and that's about it. Since Democrats retain the majority in the Senate, they don't even plan to bring this measure to the floor.

While doing business in China, I'm going to talk with the CEO of a company - the CEO who is part of an important meeting at the White House between the president and President Hu Jintao. We're going to talk to him after the break.

(COMMERCIAL BREAK) VELSHI: Well, the business side of the Chinese president's state visit to Washington is pretty much complete. Tonight comes the hoopla. The menu and guests for this evening's state dinner, the third of the Obama presidency still haven't been released. How do we know House speaker John Boehner and Senate majority leader Harry Reid were among the invitees but declined? Well, we do know that. They and others leaders of Congress will meet with President Hu tomorrow on Capitol Hill.

Later tomorrow, President Hu travels to the only other U.S. city on his itinerary, Chicago. A Chicago businessman from Motorola is among the chief executives who met with President Obama and President Hu at the White House today. I'm joined now by the CEO of Motorola Solutions, Greg Brown. He's also on the executive committee of the U.S./China Business Council.

Greg, thanks for being with us. I hope the translation you had in your meeting was more effective than the one we had at the press conference. But tell me what happened in your meeting with President Obama and President Hu and a whole lot of CEOs from the U.S. and China.

GREG BROWN, CEO, MOTOROLA SOLUTIONS: I think it was a relatively abbreviated meeting but a constructive one, Ali, and good one. We talked about mutual opportunities in creating a bilateral investment climate, a win-win. And that irrespective of the political ebb and flows, one of the constants has been U.S. business investment in China. Motorola has been in China for two-and-a-half decades. So, we talked about some of the things we both could do together.

VELSHI: And you have been -- Motorola has been there for a long time. There have been a number of American companies. We talked about General Motors, which sold more cars in China last year than the United States.

What are the issues for companies like yours and others that are well entrenched in China? What would you like to see done differently? What evolution in that business relationship that will help you be more profitable here and employ more people in the United States could you want to see?

BROWN: So, I think the relationship and the experience in China to date has been very positive, but that said, we did talk about areas for improvement. One would be leveling the playing field, so making sure that U.S. companies like Motorola Solutions and others have equal access and a level playing field to compete for Chinese government contracts as we go against indigenous providers within the country.

The second was intellectual property. A lot of U.S. multinational companies develop R & D, develop a very sophisticated patent process, and it's fundamental that the respect and adherence to intellecutal property laws and rules an regulations is very key. Those are two areas we talked about. President Hu acknowledged IPR in one of his comments. He said it's a high property, it's evolving and he has every intention of ensuring equal treatment between U.S. companies and Chinese companies as we compete in China. VELSHI: And the preferential treatment that Chinese companies gets in China has less to do with U.S. companies. It's basically -- the tier is traditionally Chinese companies have had a certain treatment, and companies based in other countries have had a different treatment. And you're trying to level that playing field.

BROWN: That's right. That's right. So, whether it be subsidies or, if a U.S. mulitnational company like Motorola Solutions comes in to compete for business in China, making sure that the requirements and the opportunity to win the business is equal to a U.S. company or any other company. Those are some of the things we talked about.

VELSHI: For our viewer, Greg, who doesn't run a big business, what's the bigger issue in China? Is it greater access to being able to manufacture more, or is it getting access to their growing middle class, which is going to buy more?

BROWN: I think it's open market access and getting access for U.S. product and services to the evolving middle class. So, China's growing at nine percent or 10 percent GDP growth a year. The U.S. economy is recovering. But we want to make sure we have ample opportunity to sell all U.S. products and services into that enormous market that's growing rapidly.

VELSHI: And, Greg, do you believe that that will help employ more people in the United States?

BROWN: Absolutely. I think for every billion of exports, it supports 5,000 jobs here in the U.S. I do think it's a misperception that exports takes jobs away. Actually, if companies thrive and export more, it creates and protections more U.S.-based jobs. So, I know it will be good for the U.S.

VELSHI: Greg Brown, good to talk to you. Thanks very much for telling us what went on in that meeting. Greg Brown is the CEO of Motorola Solutions, joining us from the White House.

You were just looking at live pictures of President Hu with -- accompanied by the vice president of the United States. Our coverage of this and all the other news continues right now with Brooke Baldwin.

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