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President Obama Talks Budget, Tax Cuts; Whitney Houston Funeral Set for Saturday; 10-Day Onslaught by Syrian Forces; U.S. Spying on Assad Regime in Syria; Fans Remember Whitney Houston on YouTube; Romney Trails Santorum in Michigan; Obama Speaks with Chinese Vice President on U.S/China Relations

Aired February 14, 2012 - 11:00   ET

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

CHRISTINE ROMANS, CNN ANCHOR: All right. Let's bring in our Dan Lothian and Kate Bolduan.

You guys, this is the president doing a victory lap, I think, on a fight he's been having with House Republicans about whether the payroll tax holiday should be extended. I mean, if it isn't, it's effectively less money in the paychecks of 160 million Americans.

Dan, House Republicans have signaled that they are going to let the president have this one, but he's telling people to still keep the pressure on.

DAN LOTHIAN, CNN WHITE HOUSE CORRESPONDENT: That's right. I mean, you heard the president talk about how he sees some hopeful signs that this is good news, but that nothing is done until it's done, telling those in the audience that when they see him actually putting the pen to the document and signing it, then it will be done at that point.

So he's calling on those in the room and Americans to continue putting pressure on members of Congress to extend that payroll tax cut, using the people in the room much like he did at the end of last year as an example of what $40 every two weeks in their paycheck will mean to them. Not having that $40, you have to make the decision as to whether or not you can continue your Internet service or pay for the fuel to take you to your day job, as the president was recounting a personal story.

And so, again, it worked for this administration taking on Congress by raising the voices of the public, and the president hopeful it will work again this time.

ROMANS: And let's bring in Kate Bolduan, too.

Because, Kate, one of the issues here is that all of the things the president wants, you know, are good for the middle class. But what Republicans say is you've got to find a way to pay for it, like you have to find a way to pay for extension of jobless benefits. We can't continue living beyond our means. So you have an election year impasse setting up here.

KATE BOLDUAN, CNN CONGRESSIONAL CORRESPONDENT: And the election year element is really a very significant thing at play here. What we're seeing, what was announced by House Republican leaders yesterday, is a sharp reversal from their position.

As you mentioned, Christine, all along Republicans have insisted that the payroll tax cut extension be matched or offset, as they talk about up here, by cutting spending elsewhere in the budget. And here, Republicans are now saying they can move forward without paying for this payroll tax extension.

That's a sharp reversal. Republican aides say they are trying to regain some leverage, or at least reduce the leverage the Democrats have in this very political fight, which was a very bruising battle at the end of last year. And many Republicans acknowledged that they were really thrown off message.

But Democrats very quickly, they say that this is, in their view, a major cave by Republicans. And honestly, Republicans are not denying or disputing the fact that this is a cave.

Clearly, Republicans in the political sense, they want to get this fight behind them, to move on to other issues that they really want to care about. But still, House Republican leaders need to bring this proposal, if you will, this backup plan, to their members.

They are meeting with their members this evening. And this could be very tough for many conservative members, as this has been a pillar of their negotiating position for months now.

But one key person is speaking out, and I must acknowledge and tell you about this. My congressional producer, my colleague, Deirdre Walsh, she spoke with a spokesman for Congressman Jim Jordan, a key House Republican conservative. And his spokesman says that he is supportive of this move by House Republican leaders, a very important signal. But still, we have to see where rank and file members stand on this position.

Regardless, you can probably anticipate that House Democrats will help push this through. And then, if it gets to the Senate, if it gets to that point -- it's not a foregone conclusion that they are going to move on this backup plan. The conference committee could still eke out some sort of deal. But this is a key signal, a breakthrough, as Democrats are calling it. It is definitely some movement in a negotiation that has been all but stalled to this point -- Christine.

ROMANS: All right.

Kate Bolduan.

Thanks so much, Kate.

(NEWSBREAK)

ROMANS: As the world remembers a superstar, the family of Whitney Houston is now preparing for her funeral.

Deb Feyerick, live in Newark, New Jersey, and Don Lemon is reporting from Los Angeles. I want to start with you, Deb. Now we know that the funeral is set for Saturday. A lot of new details about that this morning. What do we know about right now?

DEBORAH FEYERICK, CNN CORRESPONDENT: Well, what we know is that the family opted for a much more intimate setting. There had been talk that it was going to be held at a local arena, but instead they're going to do it at the New Hope Baptist Church.

That is a church that was very dear to Whitney Houston, a church that she visited often, even at the height of her celebrity. It's where she grew up, where she sang in the teen choir. And it's appropriate. It's an appropriate venue.

The family was here until 2:00 this morning. Then they were on the phone making the arrangements just a short time ago.

We know it's going to be taking place at 12:00 noon on Saturday at the New Hope Baptist Church. It is by invitation only. So they're going to keep it private, and they are also, we assume, going to have a lot of singing there.

We stepped into the church very briefly on Sunday just after the news broke, and there was just a great joy and lots of gospel. And her mother, Cissy Houston, was the choir director there. So you can bet that there's just going to be a great sendoff for Whitney Houston.

Right now we're being told that there's not going to be any sort of a public wake here at the funeral home, but again, all plans are very fluid. So that could change. But the funeral itself, about a thousand people, invitation only. You can bet it's going to be very well attended -- Christine.

ROMANS: Yes, marking a celebration of her life where she found her voice inside of the walls of that church just as a young girl.

I want to bring in Don Lemon, who's in L.A.

You know, Don, authorities still don't know what killed Whitney Houston. I mean, this is the mystery. People who loved her, her fans want to know what happened here. And the rumors are swirling.

I want to play a bit of what a TMZ reporter told our sister network, HLN, about those last hours of Whitney Houston.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: I can tell you that the family was told by the coroner's office what they should expect. And that is that some sort of mix of alcohol and prescription medication led to her being submerged in that bathtub. And I can tell you that there was some water found in her lungs, but not connecting to something like a drowning. There was not enough in the lungs.

(END VIDEO CLIP)

ROMANS: Don, are you hearing anything from authorities there to can confirm that, that drugs and alcohol played a role here?

DON LEMON, CNN CORRESPONDENT: No. And, you know, I will say what I said yesterday, and what I have been really preaching on the air. And I agree with investigators and with the coroner that we all need to step back as reporters, take a deep breath, and let the investigation play out, because many times we think it's one thing and it turns out to be another.

Listen, it could be drug use. It could be prescription drugs. Who knows? It could be a drowning. We don't know at this point.

And that's according to the coroner, who, yesterday, by the way, Christine downplayed that notion, saying by the time they got there, Whitney Houston was already out of the bathtub. When the EMTs got there, when the fire department got there -- and the fire department was in the building because they were there for the Grammys, so they got there pretty quickly. But by the time they got upstairs, Whitney Houston had been removed from the bathtub.

So they are waiting for the toxicology reports to try to figure all of it out and then we'll get the final answers. They say six to eight weeks. Actually, it doesn't really take that long. They are just giving themselves some leeway in case there has to be some other investigation opened up.

But here's the thing. As we were talking about that -- and again, they said there were prescription drugs found in the room, but downplaying the amount, ,saying it's not out of the ordinary.

A family source tells CNN that she was found by someone that they call "Aunt Mary." Her name is Mary Jones.

She's Whitney Houston's assistant. She's not an actual family member, but they think of her that way because she's very close with the family.

That's who found the body, and that's probably who saw Whitney Houston in the hotel room about an hour before alive and well. Comes back an hour later, she's unconscious in the bathtub.

ROMANS: All right. Don Lemon, thanks so much.

Deborah Feyerick, also, in Newark.

Thanks to both of you.

(NEWSBREAK)

(COMMERCIAL BREAK)

ROMANS: These are new images coming in of huge explosions, heavy shelling in the Syrian city of Homs. Many residents say they are bracing for a full-blown war in Syria as government forces, they launched attacks for yet another day.

Our Nick Paton Walsh is in neighboring Lebanon. Nick, one activist telling us that you have to be lucky to stay safe in the city of Homs, only luck is what keeps your family safe.

What are you hearing about the situation today?

NICK PATON WALSH, CNN INTERNATIONAL CORRESPONDENT: Well, the 10th day in a row now of heavy shelling, described by residents as the worst for five days. And that takes quite a lot, really, in Homs, where 400 people have been killed in that 10-day onslaught by Syrian forces.

One activist, Omar, we spoke to, tried to have a conversation with him in which he talked about how even four pregnant women had lost their children over the past three weeks because of the sheer -- the fear of living there. But our conversation kept being interrupted by the thud of artillery shells landing around his house.

As I say, he's deeply concerned for their own safety. Nowhere in that particular area of Baba Amr is considered safe.

But let's just point out these civilians really living under such terror at the moment. A video which emerged from four days ago from Daraa shows the impact that had on one child simply trying to flee away from the bullets being shot in his neighborhood.

ROMANS: Yes, those pictures are just amazing. We're showing them right now of the man swooping up to grab the child as those bullets are coming by. I mean, it's just terrifying for the child and for all the people who are watching. And they're chanting, "God is great!" in the end.

Let me ask you, Nick, is full-fledged war inevitable here? Because, clearly, the opposition isn't prepared to take on the Syrian military. And give me a little history lesson. You know, Homs -- why has this been such a fierce site? Is this the headquarters of the opposition, such that it is?

WALSH: I mean, really, at this point, many feel we're already in a full-fledged war between these opposition groups and the Syrian military, deeply unmatched here. The Syrian army, billions of dollars -- millions of dollars worth of Russian hardware backing them up. They haven't even used the full extent of that, but they have endless resources, more or less, at their disposal depending on how well the Syrian budget is doing at the moment.

And on the other side, we have this ragtag army called the Free Syrian Army. Many of them Sunni, many from this area of Homs, explaining why this is a particular stronghold because of that particular religious group they belong to, the Sunnis.

That, effectively, is where the two sides are at the moment, facing each other down over 11 months now, frankly, with no real particular end in sight, though many asking, how long can this opposition group hold out with these limited resources and this huge pressure around them? But at the same time, the international condemnation growing on the Syrian regime, sanctions biting, and surely somewhere within that inner sanctuary of the Syrian regime, people beginning to question how long President Bashar al-Assad can really hold out -- Christine.

ROMANS: Nick Paton Walsh.

Thank you so much, Nick.

Back here, live pictures at the White House. At any moment, President Obama meets the man set to become China's next leader. Xi Jinping is expected to take over when the current president, Hu Jintao, when his term ends later this year.

Next hour, we're going to break down the love-hate relationship between these two very important nations. But just take a quick look at how closely our two economies are intertwined.

Second only to Canada, China is our second-largest trading partner. China is also the world's second-largest economy. And economists predict China will beat the U.S. out for that top spot perhaps within the next decade.

And China is also our second-biggest creditor. The Chinese fund a good part of our Social Security and Medicare checks, and then they own roughly 7 percent of all government debt. We own most of it ourselves. They are our biggest foreign creditor.

And another way China is having an impact on our economy -- well, sort of -- Linsanity. Have you heard about this Cinderella story?

In the last week, American basketball star Jeremy Lin of Chinese descent, he has gone from an unknown basketball player sleeping on his brother's couch to a sports and media sensation.

Check out this clip from last night's "Colbert Report."

(BEGIN VIDEO CLIP)

STEPHEN COLBERT, "THE COLBERT REPORT": Folks, there is a name for what we're all feeling.

UNIDENTIFIED MALE: Linsanity continues.

UNIDENTIFIED MALE: It essentially become Linsanity in New York.

UNIDENTIFIED MALE: New York basketball fans have a raging case of Linsanity.

COLBERT: Yes! I've got a raging case of Linsanity. I have been declared legally Linsane.

My symptoms? Linsomnia, restless Lin syndrome, and lintestinal blocking.

Folks, it's an exciting time. Fans have not come down with a basketball-borne disease this intense since the mid-70s outbreak of Karim Abdul Jabotulism.

(END VIDEO CLIP) ROMANS: Alison Kosik joins me from the New York Stock Exchange.

Alison --

ALISON KOSIK, CNN BUSINESS CORRESPONDENT: I love Colbert.

ROMANS: -- what's going on here? I know. He's so funny, except when you're the target of Colbert. It's much more fun when you're not.

KOSIK: Exactly.

ROMANS: How is Lin causing Linflation on Wall Street?

KOSIK: Yes, you're talking about right in the stock price, Christine.

We're watching shares of MSG. You know, they've really just been on a tear since Jeremy Lin took to the court. The stock hit a record high above $33 yesterday.

Now, remember, MSG, that's the stock ticker, but it stands for Madison Square Garden. And it's not just a place where you see sports games played or see concerts. It's also a publicly-traded company.

And just over the past month, take a look at how the stock has done. Yes, it began a little flat, but then, pop, bam, up 10 percent since February 4th. You know what? Not such a huge coincidence.

I would like to call it skill here, because the stock really shot up when Lin made his first start. He scored 25 points in one game. And with Lin, gosh, the Knicks have now won five games in a row.

MSG network ratings, they're soaring. Hey, those Lin jerseys, they're selling pretty well, too. And those Linisms, people can't get enough of those Linisms.

ROMANS: I know. It's Lincredible. It's just Lincredible.

Are they getting a good return on their investment? I mean, he's not, like, one of the most highly-paid players.

KOSIK: Right. You're right about that.

In fact, an analyst said that, at this point, this kid has really earned his keep in just five games. He reportedly makes $800,000 a year. Yes, that's small change, because think about the average NBA player salary. Last season it was around $5 million.

ROMANS: Wow.

KOSIK: Now, if this winning streak continues, it could help MSG's bottom line. It could get more advertising. It could even settle a pricing dispute with Time Warner Cable, which at this point right now is not carrying Knicks games. But there are some critics saying if you're buying into this stock right now, it's a little irrational, they say, because any increase in sales and advertising is just a drop in the bucket at this point. (STOCK MARKET REPORT)

ROMANS: Wow. I love this story. I love it because he went to Harvard. I mean, he's a real smart kid. Right?

So you've got a professional athlete who is a really smart guy. And also, Rob Marciano, who -- you know, he told me, so it must be true -- he said that more presidents have come out of Harvard than professional basketball players.

Interesting, right?

KOSIK: He's a great joy to watch. I'll tell you what, I'm interested in the NBA again.

ROMANS: I know. Me too. All right. Thanks so much, Alison Kosik. We'll talk to you next hour.

Just in time for Valentine's Day, promising new research shows stem cells can undo damage from heart disease.

(COMMERCIAL BREAK)

ROMANS: Here's your chance to "Talk Back" on one of the big stories of the day.

It's Valentine's Day. Singles are looking for love, and lovebirds are storming their local flower shops and jewelry stores desperate to find that last-minute gift. It's a stressful day, I guess, for everybody. So we want to hear from you.

Our "Talk Back" question today, Valentine's Day: Love it or hate it?

Send your thoughts to Suzannne's Facebook page at Facebook.com/SuzanneCNN.

Later, we're going to hear from a comedian Dean Obeidallah, who says it's time to tear up those valentines.

All right. Spying on Syria. You can bet all those explosions and attacks on civilians are being closely monitored by U.S. intelligence. Our Pentagon correspondent Barbara Starr will join us live with details.

(COMMERCIAL BREAK)

ROMANS: Here's a rundown of some of the stories we're working on today. Next, U.S. intelligence officials are spying on Syria's embattled regime as well as on the terrorist groups that may try to fill the void there.

You have to see how fans are paying tribute to Whitney Houston in song.

And later, really fixing broken hearts this Valentine's Day. How stem cells can undo damage from heart disease. (BEGIN VIDEO CLIP)

(CHANTING)

(END VIDEO CLIP)

ROMANS: You have been seeing the massive protests in Syria as well as the government attacks on its own people. It may seem the world is just standing by watching, but you may be surprised how closely the U.S. Is watching and monitoring that situation.

Our Pentagon correspondent, Barbara Starr, reports Syria is a top priority for U.S. Intel.

(BEGIN VIDEOTAPE)

BARBARA STARR, CNN PENTAGON CORRESPONDENT (voice-over): All eyes and ears on Syria. CNN has learned that spying on Assad's moves in the brutal war against his own people is now a top priority for U.S. intelligence and the military.

The State Department released these images showing Syrian artillery guns outside a town. American officials tell CNN classified higher-resolution images show military targets being tracked in case U.S. action is ordered. The U.S. is looking to involve more satellites and drones and spy planes. Sources tell CNN that the U.S. is already secretly eavesdropping on telephone and electronic communications of Assad's regime.

It comes as a United Nations official accused Syria of crimes against humanity.

NAVI PILLAY, U.N. HIGH COMMISSION FOR HUMAN RIGHTS: Children have not been spared. Children have been killed by beating, sniper fire, and shelling from government security forces in several places throughout Syria.

STARR: Assad's government is not the only focus. U.S. intelligence has picked up on cell phone communications of known al Qaeda operatives inside Syria. After several suicide bombings, including this police station in Aleppo, there are growing indicators a small group of al Qaeda operatives from next door Iraq are now inside Syria.

SETH JONES, RAND CORPORATION: What's already been clear is that al Qaeda in Iraq, in particular, has pushed in operational and tactical-level units into Syria right now and appears to have conducted some of the high-profile bombings.

STARR: Al Qaeda's leaders, Ayman al Zawahiri, now call al Assad "the butcher son of a butcher" and praises Syrian for waging jihad. But there's little they endorse al Qaeda or that he will have much impact, just as he did not when he endorsed Egyptian oppositions forces.

JONES: I think it's a safe bet that Zawahri is not involved in operational and tactical efforts in Iraq or Syria right now, only urging action.

(END VIDEOTAPE)

ROMANS: Barbara Starr joins us live now.

Barbara, is the United States preparing to take action in Syria or just getting ready in case?

STARR: At this point, one has to take the administration at face value, Christine. No military action contemplated. So why are they gathering this intelligence? This is turning into a humanitarian crisis. They want to have the information and the intel about where the Syrian regime forces are and where they are moving around. But also put Assad's regime on notice, they are watching him and his forces very carefully. If it was to come to a crime against humanity, some kinds of war crimes action in the future, whey will have the evidence. And if there's military action, they will have the intel on hand to be ready to go, if it were to come to that -- Christine?

ROMANS: Barbara Starr at the Pentagon. Thank you.

In the meantime, the funeral for Whitney Houston is set, but fans continue to remember her in song.

(SINGING)

ROMANS: Hear the musical tributes on YouTube.

(SINGING)

(COMMERCIAL BREAK)

ROMANS: It was one of Whitney Houston's most famous tunes. Now Jeanne Moos reports "I Will Always Love You," in every version, is flooding the Internet in Whitney Houston's honor.

(BEGIN VIDEOTAPE)

JEANNE MOOS, CNN NATIONAL CORRESPONDENT (voice-over): If this isn't stuck in your mind by now --

(SINGING)

MOOS: -- you have a Teflon skull. It's not just the media playing it over and over.

(SINGING)

MOOS: It's the tributes from professional singer/song writers, like Butch Walker, who posted this to YouTube --

(SINGING)

MOOS: -- to singer Sasha Allen. And the amateurs are singing it, too, from a dorm rooms --

(SINGING)

MOOS: -- to a New York City subway car.

(SINGING)

MOOS: Whitney Houston's number one hit sung on the number-two train.

Elizabeth Hasselbeck wore it on her blouse on "The View."

ELIZABETH HASSELBECK, CO-HOST, THE VIEW: That son, "I'll Always Love You" was always my karaoke song. And I would get to that last part where she -- (SINGING) -- and I would always cough.

MOOS: To cover the failure to reach that high.

(on camera): Some in the music business had a name for the highest part of that song. It was called simply "the note."

(SINGING)

MOOS (voice-over): But sometimes even Whitney couldn't hit it.

(SINGING)

MOOS: This concert in South Korea --

(SINGING)

MOOS: -- she chugged some water and continued.

(SINGING)

MOOS: The songs' of appeal was global. Wen Yu Chung (ph) sang it on a Taiwanese talent show and brought some in the audience to tears.

(SINGING)

MOOS: He sang it on "Ellen."

I know we think of it as Whitney Houston's song, but it was Dolly Parton who wrote it.

(SINGING)

MOOS: Wrote it to ease the pain when she decided to part ways with a business partner. Dolly later old Country Music Television, saying, just because I'm going, doesn't mean I won't love you.

(SINGING)

MOOS: One of the most popular tribute videos ricocheting around the web was from the United Arab Emirates where the Dubai Fountains showered Whitney Houston with love even before her death.

(SINGING)

MOOS: Chances are we wouldn't have to be remembering her sound track from "The Bodyguard" if only she had guarded her own body better.

(SINGING)

MOOS: Jeanne Moos, CNN --

BUTCH WALKER, SINGER: Bye, Whitney.

MOOS: -- New York.

(END VIDEOTAPE)

ROMANS: Mitt Romney is trailing in the polls in Michigan. So what is he doing to deal with the trouble in the state where he grew up? Find out in our "Political Ticker" update.

(COMMERCIAL BREAK)

ROMANS: A new poll shows Mitt Romney trailing Rick Santorum in Michigan. That's the state where Romney grew up. That's the state where his father served as governor.

Joe Johns is live from the political desk in Washington.

It was also a state that was home to the auto bailout, something that Mitt Romney was against.

JOE JOHNS, CNN SENIOR CORRESPONDENT: Yes.

ROMANS: So what is Romney doing to deal with his trouble in Michigan?

JOHNS: It's pretty extraordinary that Mitt Romney would have a problem in Michigan. Behind in the polls, the primary is at the end of the month. Today, we got a glimpse today of how he's trying to fix it.

He put out an op-ed in the "Detroit News" today, calling himself "a son of Detroit." Issued a wholehearted defense of his opposition of the bailout of the auto industry. He says, when it happened, he supported a managed bankruptcy. As it turns out, essentially, it was the very thing that happened. The fact that he's behind in the state is certainly troublesome for him. It really is the state where he grew up. His father a top automobile executive there, not to mention the governor of the state, as you said. You would think he would have favorite-son status there, at least among Republicans. We'll see. The primary is on the 28th.

ROMANS: In the meantime, Newt Gingrich, is he pulling back on his attack strategy?

JOHNS: In a lot of ways, Newt Gingrich has switched back and forth in this campaign between the tough-talking master of the attack that he's so good at and the big-picture guy who is bristling with ideas and vision, which he's also good with. He's going to tone down the attacks and focus on the vision. He says his ideas are much bolder than the other candidates in the race. He also says, when he stayed positive, he did much better in the campaign. So he's going back to that.

Talked about this a little on the west coast this weekend, in some of his speeches, he didn't even mention Mitt Romney or Rick Santorum. This change in tactics is a real reflection of the fact that Mitt Romney has the money to bury Newt Gingrich in negative advertising if he wants to. And Gingrich doesn't have the money to respond in kind. So a little bit of a switch in tactics.

The other thing that's important to say, Christine, is he's showing no signs of wanting to get out of the race, at least right now.

ROMANS: You know what's so interesting, Joe, we're talking about the ins and outs of just the Republican race for president of this country. The contradiction between our style of government, with -- the president meeting with the leader-in-waiting for the Chinese. They name their leaders and all of that as political intrigue there. It's so different. It's a contradiction of the two systems is amazing.

JOHNS: It certainly is. It's fascinating. We were talking about stringing together some of the comments that some people in the Republican campaign trail have made about China. That's pretty fascinating too. The range of views about China and, you know, their economic policies and trade policies.

ROMANS: It's really interesting. We will be following the visit of Mr. Xi for the next couple of days.

Joe Johns. Thanks, Joe.

For the latest political news, you know where to go, CNNpolitics.com.

(COMMERCIAL BREAK)

ROMANS: All right. We want to bring you some tape right now of the president and the leader-in-waiting, the new president next year of China. Let's listen in.

(BEGIN LIVE SPEECH)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: This is, obviously, a great opportunity for us to build on the U.S./China relationship, but also an opportunity to return the extraordinary hospitality that Vice President Xi showed Vice President Biden during his recent visit to China.

TRANSLATOR: (SPEAKING FOREIGN LANGUAGE)

OBAMA: As I indicated during my recent visit to AIPAC and the East Asia summit, the United States is a pacific nation, and we are very interested and very focused on continuing to strengthen our relationships, to enhance our trade and our commerce, and make sure that we are a strong and effective partner with the Asia-Pacific region. And obviously, in order to do that, it is absolutely vital that we have a strong relationship with China.

TRANSLATOR: (SPEAKING FOREIGN LANGUAGE)

OBAMA: Over the last three years, I've had a great opportunity to develop a strong working relationship with President Hu, and we have continually tried to move forward on the basis of recognizing that a cooperative relationship based on mutual interests and mutual respect is not only in the interests of the United States and China, but is also in the interests of the region and in the interests of the United States, or in the interests of the world.

TRANSLATOR: (SPEAKING FOREIGN LANGUAGE)

OBAMA: On the basis of that understanding, we have established very extensive strategic and economic dialogues between our two countries. We have been able to pursue a significant consultation on opportunities for both countries to improve their economic relationship and their strategic relationship, and also manage areas of tension in a way that is constructive.

TRANSLATOR: (SPEAKING FOREIGN LANGUAGE)

OBAMA: That includes working together in the G-20 to manage the world economic crisis that had such an impact not only on both our countries, but on the entire world. And because of U.S./China cooperation, I think that we were able to help stabilize the situation at a very difficult time. It also includes the work that we've been able to do together in dealing with regional hot spot issues, like the Korean Peninsula and issues like Iran that obviously have an impact on everybody.

TRANSLATOR: (SPEAKING FOREIGN LANGUAGE)

OBAMA: Throughout this process, I have always emphasized that we welcome China's peaceful rise. That we believe that a strong and prosperous China is one that can help to bring stability and prosperity to the region and to the world. And we expect to be able to continue on the cooperative track that we've tried to establish over the last three years.

TRANSLATOR: (SPEAKING FOREIGN LANGUAGE)

OBAMA: We have tried to emphasize that because of China's extraordinarily -- extraordinary development over the last two decades, that with expanding power and prosperity also coming increased responsibilities. And so we want to work with China to make sure that everybody is working by the same rules of the road when it comes to the world economic system, and that includes insuring that there is a balanced trade flow not only between the United States and China, but around the world. It also means that on critical issues like human rights, we will continue to emphasize what we believe is the importance of recognizing the aspirations and rights of all people. And we expect that China will continue to take a growing role in world affairs. And we believe that it is critically important that the United States and China develop a strong working relationship to help to bring stability, order, and security that ultimately provides a better life for both the people of the United States and the people of China.

TRANSLATOR: (SPEAKING FOREIGN LANGUAGE)

OBAMA: So, Mr. Vice President, I hope you have a wonderful visit while you're here. I'm sure the American people welcome you. I'm glad that you're going to get an opportunity to get out of Washington. I know you'll be visiting Iowa, where you visited many years ago when you were governor. And I understand you're also going to be going to Los Angeles and maybe even taking in a Lakers game. So I hope you enjoy that very much. But I want to extend my deepest welcome to you and look forward to a future of improved dialogue and increased cooperation in the years to come.

TRANSLATOR: (SPEAKING FOREIGN LANGUAGE)

(END LIVE SPEECH)

ROMANS: All right. You were listening to the president and also the Chinese vice president, who will take over as president of that country next year.

You heard a lot of diplomatic code there. The president being very careful in choosing his words, because this is a very -- it's a sensitive and important relationship. Choosing his words very carefully, talking about managing areas of tension between the two countries, saying that's been constructive. Talking about a strategic and economic dialogue, cooperative relationships, mutually beneficial relationships, strong prosperity in China can bring stability to the region -- a lot of this we've heard from other presidents as well who have played this diplomat -- danced this diplomatic dance with the Chinese on all these issues.

The president also mentioning the aspirations and rights of all people. This is something the human rights experts have long said, that by being China's biggest customers for its goods, it's actually emboldening a Communist regime that does not allow not only intellectual property rights but human rights of its own citizens, something that this president and others have talked to the Chinese about.

At any rate, we'll continue to follow this. The vice president is on his way to Iowa tomorrow and then Los Angeles later this week.