Remarks by the Vice President at Sichuan University

Chengdu, China

REMARKS BY VICE PRESIDENT JOSEPH BIDEN

ON U.S.-CHINA RELATIONS

FOLLOWED BY Q & A WITH STUDENTS Sichuan University

Chengdu, China

 10:40 A.M. (Local)

THE VICE PRESIDENT:  Thank you, all, very much.  (Applause.)  Mr. President, thank you for your gracious introduction.  We have an expression in the United States Senate where I served for many years when we want to say something personal, we say, permit me a point of personal privilege.  I would like to introduce you to two of my family members who I’ve brought along with me, my daughter-in-law Kathleen Biden and my granddaughter Naomi Biden.  Would you guys stand?  (Applause.)

It would be more appropriate to say Naomi brought me along with her since she’s a budding Chinese speaker, been taking Chinese for five years, so I’ve been listening to her on the whole trip.

I want to again thank you very much.  I had a wonderful few days in Beijing and a series of very positive and productive conversations with Chinese leaders.  And I’m pleased to make my first visit to western China, which has played such an incredible, such an incredible role in this nation’s proud, proud history, and which today is the vanguard of Chinese -- China’s high-tech future.

Two years ago, Sichuan province suffered one of the greatest natural disasters in China’s recent history.  And the American people were inspired -- were inspired by the way you all came together to help one another during that crisis.  And I’m absolutely amazed as I drive around the city, and I’ll be moving out into the province later, after this speech -- I’m amazed at how quickly you have rebuilt and you have recovered. 

The people of Chengdu, let me say simply that your hospitality has more than lived up to your reputation as the “land of abundance,” so again, thank you so very much for that hospitality.

It’s also great to be here on a university campus.  I also want to thank our host, the university which counts amongst its alumni some of the most illustrious figures in recent Chinese history, including Zhu De and Ba Jin, both of whom are -- one a literary icon; the other, one of the most illustrious figures, and a founding father of the republic.

I’m also pleased to be joined today by -- he’s already been introduced -- but by our ambassador, our new ambassador Gary Locke whose grandfather came to the United States from Canton in the 1890s and toiled as a house servant in the United States in exchange for being able to get English language lessons.  In less than two generations -- two generations later, Gary Locke, his grandson, has served as the governor of his home state of Washington, the U.S. Secretary of Commerce and the chief of mission in one our most important diplomatic posts in the world.

I share this story with you not because it’s unique, but because it is uniquely American.  While not every child or grandchild of an immigrant will reach the pinnacle of society as Ambassador Locke has, America continues to put such possibilities within reach of all those who seek our shores.

On my first visit to China, which was more than 30 years ago when I was a young United States senator in 1979, I was with the first delegation of congressional leaders to visit China after normalization.  We had several days of business with then Vice Premier Deng Xiaoping.  It was a very different country then, but what was absolutely clear to me was that China was on the cusp of a remarkable transformation.

Changes were just getting underway.  My first introduction here in Sichuan that would begin transforming a largely agrarian society into an engine of economic global and help lift hundreds of millions of people out of poverty was -- seemed to me clear at the time.  That first visit came amid a debate in the United States of America similar to the one that exists today about how to view China’s emergence.  Let me be clear -- let me be clear:  I believed in 1979 and said so and I believe now that a rising China is a positive development, not only for the people of China but for the United States and the world as a whole.

A rising China will fuel economic growth and prosperity and it will bring to the fore a new partner with whom we can meet global challenges together.  When President Obama and I took office in January of 2009, we made our relationship with China a top priority.  We were determined to set it on a stable and sustainable course that would benefit the citizens of both our countries.  Our Presidents have met nine times since then, including very successful state visits in Beijing and Washington, and have spoken numerous times by telephone.

Direct discussions between senior policymakers and the personal ties that result from such discussions in my view over the last 35 years of conducting foreign policy are the keys to building cooperation.  They're built on understanding.  They allow us to better understand each other and allow us to define our interests in ways that are clear so that each one of us know what the other country’s interests are, and to see the world through the eyes of the other with the intention of preventing miscommunications and misconceptions that tend to fuel mistrust.

With that goal in mind, we have worked very hard to develop our cooperative partnership through more than 60 separate dialogues on issues of matter to both China and to the United States; and I would suggest to the world as a whole.

The premier forum is what we refer to as the Strategic and Economic Dialogue which brings together policymakers from across both governments to discuss a range of issues from trade barriers to climate change.  But we also recognize -- we also recognized immediately on starting that the importance more directly addressing security issues, as well.  That's why in May we jointly launched the first Strategic Security Dialogue, a new channel for civilian and military leaders to discuss sensitive topics, including cyber and maritime security.  That's why it’s also important that our military leaders work together, get to know one another -- not just our political leaders, but our military leaders -- as Admiral Mullen and General Chen have begun to do in their recent exchange of meetings.

The fact is China and the United States face many of the same threats and share many of the same objectives and responsibilities.  But because we sometimes view threats from different perspectives -- that is China and the United States view them from different perspectives, our -- or favor a different way in dealing with what we perceive to be joint threats, our generals should be talking to each other alongside with our diplomats, as frequently as our diplomats do.  Like China, the United States has a huge stake in the prosperity and stability of Asia and the Pacific.

I look forward to visiting two other Asian nations on this trip.  When I leave China, I’ll go to Mongolia and then to Japan.  The United States -- and I realize this occasionally causes some discomfiture -- but the United States is a Pacific power, and we will remain a specific power -- a Pacific power. 

Over the last 60 years, no country has done more than we have to ensure the stability and security of the Asian-Pacific region.  And I’d respectfully suggest that has been good for China, allowing China to focus on domestic development and to benefit from a growing market.

America’s focus on this critical region will only grow in the years to come as Asia plays an even greater role in the global economy and international affairs. 

As President Obama said in Tokyo during his first visit to Asia as President, and I quote:  “The United States of America may have started as a series of ports and cities along the Atlantic Ocean, but for generations, we have also been a nation of the Pacific.  Asia and the United States are not separated by this great ocean, we are bound by it.”

That's why we’ve begun this dialogue, this Asia-Pacific Dialogue on issues -- to expand cooperation in the region where we both live and operate. 

Let me give you another example of our security cooperation.  The United States and China are also working as international -- with international partners to counter the threat posed by the spread of nuclear weapons, materials and technology, so called nonproliferation.  Along with 46 other world leaders, President Hu honored us by joining President Obama and me at the Nuclear Security Summit in April of last year, and our nations are now collaborating on a center for excellence to provide nuclear security in China.

In my discussions with Vice President Xi this week, I said we have to deepen our conversations on the world’s two primary nuclear proliferating challenges:  North Korea and Iran.  I know that China shares our concerns, but some of you may wonder why our focus -- the focus of the United States is so intense.  The reason is clear:  If armed with nuclear weapons on long-range missiles, North Korea and Iran would pose a direct and serious threat to the security of the United States of America and our allies.  It would present an existential threat.  That is why -- that is why we’ve been working with China and our international partners to maintain peace and stability on the Korean peninsula and to achieve a complete denuclearization of North Korea.  And it is why as the Iranian government continues its illicit nuclear program, we have worked with a range of partners and international institutions to enact the toughest sanctions that Iran has ever faced.

Without vigilant implementation of these sanctions, Iran will evade the consequences of the actions and diplomacy will not be effective in stopping their nuclear program.  So we will continue to look to China to send a clear message to Iranian leaders through its words and its deeds that they, Iran, must live up to their international obligations.

There are many other security challenges that the United States and China share.  From Afghanistan, to Pakistan, to the Sudan -- and we have been and will continue to discuss our mutual interests and concerns.  Continuing to develop our security dialogue and cooperation is the surest way to meet these joint challenges.

Economic issues -- to state the obvious -- have been a particular focus of our nations’ growing cooperation.  Together, we’re working to promote economic growth that is strong, sustainable and balanced, and trade that is free and fair.

Trade and investment between our countries are growing rapidly in both countries, in both directions, creating jobs and economic opportunities in both countries.

We often hear about Chinese exports to the United States, but last year American companies in America exported $110 billion worth of goods and services to China, supporting hundreds of thousands of jobs in America.  The American people and the Chinese people are hopefully -- are becoming aware that it’s in our mutual interest in each of our countries to promote that exchange.

A more prosperous China will mean more demand for American-made goods and services and more jobs back home in the United States of America.  So our desire for your prosperity is not borne out of some nobility.  It is in our self-interest that China continue to prosper.

Every day it becomes clear that as the world’s two largest economies with ever growing ties of investment and commerce, what you do matters to us and matters to the American people.  And what we do matters to you and to the people of China.  To state it bluntly, we have a stake in one another’s success.

Just as putting America’s fiscal policy on a long-term sustainable path is important not only to the United States but to China, to China’s economy, shifting China economy, which the 12th five-year plan calls for, to rely more heavily on consumer demand in China is not only important to China, but it’s important to the United States of America.

As Chinese leaders have told me, this five-year plan will require them to take a number of steps including continuing their effort to move toward a more flexible exchange rate.  It’s in China’s interest, but it’s also overwhelmingly in the interest of the United States.

In this time of uncertainty in global -- in the global economy, it is all the more important that we take the difficult but necessary steps together and along with our G20 partners continue to sustain the global recovery and create jobs and prosperity.  We’re the two biggest engines in the world to be able to do that.  As I said in May, when I opened the annual Strategic and Economic Dialogue in Washington, I said, “For many of the world’s most pressing challenges, it is a simple fact that when the United States and China are not at the table, the solution to the problem is less possible.”

But even as we cooperate, the United States and China also will compete, and competition is healthy.  We will compete in global politics and global economics.  And also -- also it is a feature of global politics and economics.  It’s also a feature of human nature to observe others, to consider how they measure up, to strive to be the best, that's good for both of us.  Genuine competition pushes companies, our companies and our people to perform better, and we should reject the misplaced notion of the zero-sum game in which everything one nation achieves somehow comes at the expense of the other.  It is the opposite. 

So make no mistake, America not only welcomes this healthy competition; competition is stitched into the very fabric of our society and our economic system.  And while I may be a little biased, I have overwhelming confidence in the capability of the American people to compete on a level playing field with any nation and any peoples in the world.

But for this competition to benefit us both, it must take place on a level playing field with rules that are clear and treat all countries fairly and equally.  Although the United States and China are working hard to get this right, we still face obstacles of doing business in each other’s countries.  That's why I acknowledged on this trip the United States should undertake to make it easier for Chinese business people to obtain visas to travel to the United States.  It takes much too long for that to happen.  That’s not in our interest.

And while we are in the midst -- also it’s the reason why the President once he took office ordered for the first time in decades, ordered -- we’re in the midst of a total reform of our export control system.  Already, we have made thousands of new items available for export to China for exclusive civilian use that were not available before, some of which require a license, while others don't.  And tens of thousands of more items will become available very soon.

That's a significant change in our export policy and a rejection of those voices in America that say we should not export that kind of technology to -- for civilian use in China.  We disagree, and we’re changing. 

But it’s also why we are troubled when American investors are prohibited from having wholly owned, fully owned subsidiaries of their own company in many sectors in China and excluded from sectors, entirely excluded from competing in other sectors; restrictions that no other major economy in the world imposes on us or anyone else so broadly.  That's why we have pushed Chinese officials to protect intellectual property rights.  We have welcomed the Chinese State Council’s recent campaign to enforce intellectual property rights, a commitment that President Hu made when he visited and he’s keeping.  But the effort must be strengthened and extended.  

According to the International Trade Commission, American companies lose $48 billion a year and tens of thousands of jobs because of pirated goods and services.  These protections -- intellectual property protections not only benefit the United States and United States workers, United States companies, but I would argue Chinese companies, as well, as they increasingly seek to safeguard their own creations.

You’re here at this great university.  It’s very much in your interest that intellectual property be protected because some of you are the future artists, the future entertainers, the future innovators who will want to be able to have a market for what you do.  But if it can be acquired cheaply and pirated, why would anybody pay you for the same service?

America’s focus on global security, free trade and economic fairness is longstanding.  Since the end of World War II, we’ve helped build an international system that promotes peace and stability, gives all states the opportunity to share in global prosperity and provides rules to protect the basic human rights of all citizens.

China’s tremendous progress in my view can be attributed to the industriousness and talent of the Chinese people, as well as its leadership.  But it was made possible, I respectfully suggest, by an international architecture that promoted stability and prosperity and enables upward mobility for all countries.  I know that many Chinese and probably many of you students believe that your nation will continue on a path of greater prosperity.  I agree that it will.  That is my view, my prediction.  But I also know that some of you are skeptical about America’s future prospects.

With that in view, I would like to suggest that I respectfully disagree with that view and will allay your concerns.  Let me put this in perspective so you can understand why the American people are also confident about their future.  America today is by far the world’s largest economy with a GDP of almost $15 trillion, about two and a half times as large as China’s, the second largest; with a per-capita GDP which is more than $47,000 -- 11 times that of China’s.  I’ve read that some Chinese are concerned about the safety of your investments in American assets.  Please understand, no one cares more about this than we do since Americans own 87 percent of all our financial assets and 69 percent of all our treasury bonds, while China owns 1 percent of our financial assets and 8 percent of our treasury bills respectively.

So our interest is not just to protect Chinese investment.  We have an overarching interest in protecting the investment, while the United States has never defaulted -- and never will default.

I also have confidence in the fundamentals of our economy.  Vice President Xi said it best I think when he told a group of Chinese and American business leaders with whom we met the day  before yesterday, and I quote him, he said, “the U.S. economy is highly resilient and has a strong capacity to repair itself.”  He is right.  I believe America is even better equipped to compete in the economy of the future than it was of the economy of the past.  In the 20th century, the wealth of nation was primarily measured by the abundance of its natural resources, the expanse of its landmass, the size of its population and the potency of its army.  But I believe in the 21st century, the true wealth of a nation will be found in the creative minds of its people and their ability to innovate -- to develop the technologies that will not only spawn new products, but create and awaken entire new industries.  The United States is hardwired for innovation.  It’s part of our DNA from our earliest days.  It has enabled generation after generation of Americans to give life to world-changing ideas -- from the cotton gin, to the airplane, to the microchip, to the Internet, to the world-leading companies like General Electric, Ford, Microsoft and Google.  And I could go on and on.

These accomplishments were made possible not because there’s anything unique about an American.  It’s hard to define what an American is.  Shortly, 50 percent of the American population -- less than 50 percent will be of European stock.  So we are the most -- we are an incredibly heterogeneous nation.  That's part of our strength.  That's part of the boundless capacity of the American people.  But it’s also because of the enduring strength of our political and economic system and the way we educate our children, a system that welcomes immigrants from across the globe who enrich our national fabric and revitalize our diverse multi-ethnic society.  And I would point out, we are still the destination where most people in the world seek to come.  People usually don't seek to come to a nation in decline.

A system that trains students not merely to learn and accept established orthodoxy, but to challenge orthodoxy, challenge their professors, challenge the ideas put forward to them, encourage individual thought and innovation; a system that not only tolerates free expression and vigorous debate, including between citizens and their government, but celebrates and promotes those exchanges; a system in which the rule of law protects private property, provides a predictable investment climate, and ensures accountability for the poor and wealthy alike; and a system with universities that remain -- notwithstanding, and this is a great university -- the ultimate destination for scholars from around the world.  More than 130 [sic] students from China attended our universities last year.  We’re hoping that number will be even larger. 

China has followed a very different economic and political path to prosperity, enhancing some aspects of a free-market system, while resisting political openness and maintaining the state’s deep involvement in economic affairs.  That's a decision for you to make.

Maybe the biggest difference in our respective approaches are our approaches to what we refer to as human rights.  I recognize that many of you in this auditorium see our advocacy of human rights as at best an intrusion, and at worst an assault on your sovereignty.  I want to tell you directly that this is not our intention.  Yes, for Americans there is a significant moral component to our advocacy.  And we observed where we have failed, as well.  But it is who our people are.

But President Obama and I see protecting human rights and freedoms, we see it in a larger context, as well.  Protecting freedoms such as those enshrined in China’s international commitments and in China’s own constitution -- we see them as a key aspect of China’s successful emergence and the key continued growth and prosperity.  I know that some in China believe that greater freedom could threaten economic progress by undermining social stability.  I do not pretend to have the answer, but I believe history has shown the opposite to be true, that in the long run, greater openness is a source of stability and a sign of strength, that prosperity peaks when governments foster both free enterprise and free exchange of ideas, that liberty unlocks a people’s full potential.  And in its absence, unrest festers. 

Openness, free exchange of ideas, free enterprise and liberty are among the reasons why the United States, in my view, is at this moment the wealthiest nation in the history of the world.  It’s why our workers are among the most productive, why our inventors and entrepreneurs hold more patents than any other country in the world, why we are reinvesting in the fundamental sources of our strength -- education, infrastructure, innovation, and why President Obama and I are so confident that America will weather the current economic storm and emerge even stronger, just as we always have in past economic crises, and why there’s no reason why China cannot tap into the same source of strength.

Going forward together is going to have a lot of growing pains.  As I said at the outset, in just over 30 years since I first came to China, your progress has been nothing short of incredible.  I can see that here in Chengdu, the city that is leading the effort to become a major player in the innovation economy, you can feel it.  You can see it in the eyes of some of you students.

Looking at this audience, there are some among you who will be the new pioneers in China’s economic development, leaving your mark on history.  Just like Steve Jobs, the founder of Apple and others have had in the United States, you have the capacity and the potential and I’m sure some of you will do it.

I’m also proud that more than 160 Fortune 500 companies are operating in Chengdu High-tech Zone, including pioneer American businesses like Intel, Dell and Oracle.  The U.S.-China relationship has also improved dramatically in the past 30 years.  In order to cement this robust partnership, we have to go beyond close ties between Washington and Beijing, which we’re working on every day, go beyond it to include all levels of government, go beyond it to include classrooms and laboratories, athletic fields and boardrooms.

That's why we launched our 100,000 Strong Initiative to boost the number of American students studying in China each year and have maintained a robust Peace Corps presence.  How many Peace Corps volunteers are here today?  Raise your hands.  We love you guys.  Welcome.  Welcome.  (Applause.)

Last year, over 800,000 Chinese and 2 million Americans traveled between our countries to live, work, study and explore new places.  On a personal note, I've seen the value of these exchanges through the experiences of my niece, a young woman who learned Mandarin at Harvard and spent a year in Beijing refining her language skills and ultimately worked at our Treasury Department on U.S.-China relations.  There are tens of thousands of you like her, who are going to be the key to cement this relationship and deal with misconception and form the relevant societies about the motivations and operations of each of our countries.

These ties among our people are the life blood of our emerging partnership.  The bottom line is this:  As great nations and as global actors, the United States and China face many of the same challenges and share many of the same responsibilities.  And the more we can work together, the more our people will benefit and -- as I said before it sounds chauvinistic, but the more the world will benefit as a consequence of our cooperation.

President Obama and I will continue the important work of making this partnership even more positive, cooperative and comprehensive in the coming years.  And I hope -- I hope that my visit can serve as a step toward these goals and toward strengthening that bond.

So I thank you all for the honor of being here.  More importantly, I thank you for taking the time to listen.  And with the permission of your president -- they tell me I don't have any time, but I never like to leave a university without at least taking a few questions.  So I hope it’s permissible for me to able to take a few questions from the audience.  Is that permissible, Mr. President.  Is that okay?  All, right.  Thank you.    

As you can see as Vice President, I’m used to always checking with presidents first.  (Laughter.)  I’d be happy to take a couple questions.  My staff is going to get angry if I take too much time.  But, please, there’s microphones in both aisles, I guess.  And I -- I can’t see with the light.  Gentleman all the way in the back waving both hands.  It must be important.

Q    Good morning, Mr. President [sic].  And I’m a -- student from the medical school of Sichuan University.  But my question is about economy first.  And as you know that the China holds about $1 trillion U.S. bonds of treasury bonds.  And that much money -- actually the value is uncertain because of the downgrade of U.S. credit rating.  You seem to have instilled the confidence of the U.S. financial well-being into young people today because I heard you say that the U.S. economy is really resilient.  And -- but words alone cannot ease the mounting concern over the safety of China’s assets.  So we would like to hear more about what measures you’re going to implement to reduce those deficits and redeem the financial strength of America.

THE VICE PRESIDENT:  Thank you very much.

Q    Thank you very much.  (Applause.)

THE VICE PRESIDENT:  It’s a very good question.  One of the multiple rating agencies reduced our rating from AAA to -- plus -- come down one notch.  And that was very disturbing and bothersome to us, and we have to deal with is.

We do have a deficit that I was asked by the President to head up a commission to try to deal with that deficit.  And we made some significant progress, but not the progress we could have made and will make.  The bottom line is we have to deal with two elements of our economy.  One is what we call entitlement programs -- long-term commitments to our people in the area of particularly Medicare.  That is the safety net we have for people once they reach the age of 65 to be able to be assured that they have health care.

And it is not sustainable without some changes in large part because we had what we call a baby boom, which doesn’t sound like much to Chinese -- 40 million people is not a big deal, I know.  (Laughter.)  But adding 40 million people to those who will benefit from the Medicare -- Medicaid payment -- Medicare payments has put the program in a position where changes have to be made.

It’s easy to make those changes, and we had a tentative agreement to do that between the major political leaders of the Republican Party and the Democratic Party and the administration.  But there is a group within the Republican Party that is a very strong voice now that did -- wanted different changes, and so that deal fell through at the very end. 

What we ended up doing is setting up a system whereby we did cut by $1.2 trillion upfront, the deficit over the next 10 years.  And we set up a group of senators that have to come up with another $1.2 to $1.7 trillion in savings or automatically there will be cuts that go into effect in January to get those savings.  So the savings will be accomplished.  But as I was talking to some of your leaders, you share a similar concern here in China.  You have no safety net.  Your policy has been one which I fully understand -- I’m not second-guessing -- of one child per family.  The result being that you’re in a position where one wage earner will be taking care of four retired people.  Not sustainable.

So hopefully we can act in a way on a problem that's much less severe than yours, and maybe we can learn together from how we can do that. 

But in the meantime, the concern that we will not make good on the investments that people have made -- in your case up to $1.7 trillion total out of a very large economy is not to worry about.  We could not afford -- we could not afford not to make good on that requirement.

And that's why the irony was that in the Treasury offering in the first four days after the downgrade, more people actually came and bought our treasuries than before.  And the interest rate paid on those treasury notes actually went down because they were so much in demand.  So obviously, the rest of the world didn't think we were about not to.  If the world thought, my God, they’ve been downgraded, and they are not going to make good on their debt, it would not have been viewed as the safest haven in the whole world to invest.  We are still -- for all the economic difficulties nation’s have -- we are still the single best bet in the world in terms of where to invest.

And so -- but we do have to deal with the deficit.  We will deal with it, and that's what this 2012 election is going to be about.  The American people are going to speak on that.

Now, look, one last point, both our countries are going through a political transition in 2012.  And it’s very important in my view that we both are aware of the political sensitivities in each of the countries as they go through that.  But I’m confident we will come out stronger, as will you.  But I don't in any way suggest -- please don't have the press read that Biden said that $1.7 trillion investment in the United States is not a big deal.  It is a big deal if you are a Chinese.  (Laughter.)  It is not a big deal in terms of our financial instruments.  It is a very small part, and so the Chinese people should take solace.   In order for us not to make good on China’s debt, we would have to disappoint tens of millions of Americans who own 85 percent of that debt.  And just in pure political terms, no politician wants to do that.  (Laughter.)  You’re safe.  (Applause.)

THE VICE PRESIDENT:  Question.  Young man in the striped shirt here.  Can you get him the microphone?

Q    Thank you, very much, Your Excellency Vice President.  I see you not just as the Vice President but a veteran and accomplished public speaker.

THE VICE PRESIDENT:  Do I look that old?  (Laughter.)

Q    I mean being serious -- so as is known to all, public speaking, and English public speaking, in particular, is getting all the more popular in China.  So my question is twofold:  First of all, what role has public speaking played in your life?  Because we say that public speaking is the language of leadership.  And secondly, what role do you think public speaking will play among our youth of the two countries and to our bilateral relations?  Thank you very much.  (Applause.)

THE VICE PRESIDENT:  That's a very good question.  Let me order my thoughts here to make this as brief as I can.  The commodity that is worth a lot more than public speaking is sincerity when one speaks.  I mean this sincerely now.  (Laughter.)  There are great orators that have come along in the world history who have been charlatans.  So the most important thing to look to in a leader’s speech is not the elegance or the rhetorical flourish of his or her comments, but the judgment of whether or not you believe they are sincere in what they're saying.

Secondly, you compliment me by saying I’m an accomplished public speaker.  I don't know whether you’ve had an opportunity to see a movie that has gotten worldwide circulation called “The King’s Speech.”  Well, but for the royal blood and the money, that could have been me.  I was a serious stutterer when I was in school as a child, as a high school student, and even into college.  And I practiced very, very hard by myself, standing in front of a mirror, trying to annunciate without contorting my face. 

 When you think about it, whether it’s China or America, the only impediment people feel free to make fun of and humor of is a stutterer.  If I had a deformed face, you would not make fun of my face.  But if I stood before you and ta-ta-talked to-to-to you like that, you’d do what you’re now -- you’re smiling.  And it’s offensive.  It’s offensive.  Because it is a serious impediment.  When one stutters, people believe they are stupid.  People believe they are not worth much.  And there’s tens of millions of people around the world trapped with a keen mind and big heart, trapped inside of a body that cannot articulate what they feel.

And the reason I bother to mention that to you is to get to the third and most important point.  Speech, communication -- to state the obvious -- is the currency of understanding.  It’s the currency with which we exchange ideas.  It’s stuff from which flows the sense of whether one is being truthful or honest or sincere.  We judge from the way people speak whether they’re being transparent and open, whether they're being cramped and cabined.  And so the thing that I’m most embarrassed about in my career of 38 years of having an opportunity to literally meet every major world leader in the last 38 years.  I was elected as a 30 -- 29-year-old, young man from modest means.  And I’ve had that opportunity.  The thing that always embarrasses me is -- and in the back of my head, I’m embarrassed in front of you -- I’m embarrassed I can’t speak to you in Chinese.  I would -- seriously -- I would rather be able to honor you and show my respect for you by speaking your language, as you honor me by speaking mine.

And so language, the ability not only to master the ability to put your ideas into words succinctly on a platform to communicate ideas to your own people, it is even more impressive when you have the capacity to do that and communicate your ideas, especially as future business and political and moral leaders of the world in the language of the people to whom you are speaking.

So I think there is no greater resource that a nation could seek than having a group of people who were able to communicate in the same idiom, the same dialect, the same -- the same pattern as the people to whom as they're speaking.  Because this is all about -- all about -- understanding one another.

Let me conclude by saying this.  My father was a high school-educated man.  He never went to a university and -- nor did my mother or anyone in my family at that time.  But my father was an elegant, decent man -- eloquent and elegant, decent man.  My father used to have an expression, and maybe it’s the best way for me to conclude my comments with you all, and I wish I could stay later -- longer, sincerely wish I could.  He used to say, Joe, the only conflict that is worse than one that is intended is one that is unintended.  The only conflict worse than one that is intended is one that is unintended. 

Language, speech, interchange, openness, communication -- that is the material that can be used to lessen the possibility of the unintended, the unintended conflict.  I have great faith in all of you.  I mean this sincerely.  You’re an incredible country, an incredible people.  And the fact there’s a hundred thousand students here at this great university, the fact that there are millions of Chinese at universities throughout -- throughout this country; the fact that there’s 130,000 Chinese nationals speaking -- citizens, going to American universities is the stuff which gives me faith.

Believe in yourselves.  Believe in yourselves.  You have the capacity to do anything, anything anyone in the world has ever done.  And the more you do, the better off my granddaughter and my great granddaughter’s generation are going to be. 

Thank you for the honor of being here.  (Applause.)  Thank you, all, very much.  (Applause.)

END                     11:30 A.M. (Local)

Remarks by Vice President Biden at a Meeting with Chinese Premier Wen

Leadership Compound
Beijing, China

3:10 P.M. (Local)
 
PREMIER WEN:  (As translated.)  It’s a great pleasure to meet you today, Mr. Vice President.  I note that we were born in the same year.  You have spent about 35 years in public service, and I’ve been working in the government compound of Beijing for more or less the same period of time.  And I know that you are a big sports fan, so am I.  (Laughter.)
 
I know that in the past weeks and months, you have put in a large amount of effort to assisting the President in securing an agreement with the Congress about raising the U.S. debt ceiling, cutting U.S. deficit and stabilizing the U.S. economy.  You have played a vital role in this process.
 
In spite of the difficulties facing the U.S. economy at present, I have full confidence that the United States will overcome these difficulties and get its economy back on the track of healthy growth.  The prosperity and stability of the United States is in the interest of the whole world.
 
In the past two to three days, you have engaged widely with the sectors in China, both public and private.  You have been sending a very strong message that is the further growth of China-U.S. ties is not only important for our two countries, but also for the whole world.
 
It’s particularly important that you sent a very clear message to the Chinese public that the United States will keep its word or -- and its obligations with regard to its government debt.  It will preserve the safety, liquidity and value of U.S. treasuries.
 
I’m sure that will give a boost to the investors’ confidence in the U.S. economy.  You have already had some meetings with other Chinese leaders.  Today, I would like to focus our discussion on economy.  Now, I would like to give the floor to you, Mr. Vice President.
 
VICE PRESIDENT BIDEN:  Well, Premier, thank you very much for the hospitality.  What a magnificent place.  Now I know why even though we were born in the same year, you look so much younger than I.  (Laughter.)  You worked in a much more commodious environment than I do.  (Laughter.)
 
PREMIER WEN:  (As translated.)  Well, I have -- this idea for our post-meeting schedule today, that is maybe we can take a brief walk in the surrounding areas of this whole compound.  The compound was first built back -- 500 years back, and this current structure that we are having this meeting today has about 250 years of history. 
 
VICE PRESIDENT BIDEN:  I would be delighted to do that if you would just write a note to President Hu of why I’d be late.  (Laughter.)  As Vice President, I’m very accustomed to accommodating Presidents.  (Laughter.)  But I would love to see your place.
 
Let me say that we have something else in common besides our birth year, and that's the -- it’s our absolute and mutual confidence in the U.S. economy.  No one has ever won betting against the U.S. economy.  And I’m anxious to talk to you about both our economies and how we can work together.  But I point out U.S. treasuries, we’re going to -- we’re going to take care of very closely not merely because China owns 8 percent of them, but because the Americans own 85 percent.
 
It is -- we appreciate and welcome your concluding that the United States is such a safe haven because we appreciate your investment in U.S. treasuries.  And very sincerely, I want to make clear that you have nothing to worry about in terms of their -- their viability. 
 
I just had the opportunity to meet with the American business community, some of the leaders here investing in China, and then we had a joint meeting with leading Chinese business enterprises along with -- along with the Vice President whom I have found to be a --
 
(Pool escorted from room before conclusion of event.)
 
END
3:17 P.M. (Local) 

Remarks by Vice President Biden in a Meeting with Chairman Wu

The Great Hall of the People
Beijing, China

3:34 P.M. (Local)
 
CHAIRMAN WU:  Mr. Vice President, on behalf of the National People’s Congress of China, a very warm welcome.
 
VICE PRESIDENT BIDEN:  It’s a delight to be here.
 
CHAIRMAN WU:  And what a delightful thing to see you again in Beijing.  We had a very good conversation back in September 2009 when I visited the United States, and you were very kind to show me your office.
 
VICE PRESIDENT BIDEN:  Mr. Chairman, this is much nicer than my office.  (Laughter.)  
 
CHAIRMAN WU:  Well, I remember I said to you back then that your office was exquisite but not very big. 
 
VICE PRESIDENT BIDEN:  That's right.  You said that very diplomatically.  (Laughter.)
 
CHAIRMAN WU:  But you said with a great sense of humor that this office is the closest to the President’s office.
 
VICE PRESIDENT BIDEN:  That's right.
 
CHAIRMAN WU:  And that shows its importance.  And your visit is a very important one.  Foreign Minister Yang just told me that you had very good discussions with Vice President Xi.
 
VICE PRESIDENT BIDEN:  Yes.
 
CHAIRMAN WU:  You had a deep discussion about issues of mutual interest, and tomorrow you will have meetings with the President and the Premier.  I’m sure that your visit will give new impetus to our bilateral relationship.  We will further promote the steady and sustainable growth of China-U.S. ties.
 
Now, it’s been 10 years since your last visit to China.
 
VICE PRESIDENT BIDEN:  Too long.
 
CHAIRMAN WU:  Well, many changes have taken place here.  I’m happy to learn that besides Beijing, you’re also going to Chengdu.
 
VICE PRESIDENT BIDEN:  Yes.
 
CHAIRMAN WU:  And you will have more opportunities to engage with the young people, and also opportunities to see the post-earthquake reconstruction there.
 
While the city of Dujiangyan has a culture and civilization of over 2,000 years, I’m sure that trip will help you gain a deeper understanding about China.  I sincerely wish you a very happy stay in China.  And you will leave this country with a very fond memory.  Once again, very warm welcome.
 
VICE PRESIDENT BIDEN:  Well, it’s a delight to be here, Mr. Chairman.  As I told you when you were in my office, when I was a chairman, I had a much bigger office.  (Laughter.)  I used to have an important job when I was chairman of the Foreign  Relations Committee.  I had a big office, and a large staff, and then I became Vice President.  (Laughter.)
 
There’s an old joke told by a former Vice President.  He said, I once had two brothers, one went to sea and the other became Vice President.  I never heard from either again. 
 
But unfortunately, your colleagues are hearing from me again and again and again and again.  I beg their indulgence.  We sat together all morning.  The Ambassador has been very gracious, as has the Minister, so I hope they don't mind listening again.
 
As we discussed in my office, Mr. Chairman, you know I now and have since my first visit in 1979 with Vice Premier Deng Xiaoping, I’m of the view that this is a central, critical relationship -- China and the United States.  I hope this doesn’t sound chauvinistic to other countries, but our mutual success will benefit the whole world.  As the two largest economies in the world, at the moment when the world economic circumstance is uneasy, I think we hold the key together to not only our own prosperity, but to generating growth and jobs worldwide.  And that's the overwhelming reason I’ve come, to talk about jobs and growth; and the -- as was phrased this morning, the reordering of our economies -- yours and ours.
 
So I’m anxious to talk to you, and I appreciate your hospitality. 
 
CHAIRMAN WU:  Well, thank you for your warm remarks.
 
END
3:41 P.M. (Local)

Remarks by the President in a Town Hall Meeting in Alpha, Illinois

Country Corner Farm
Alpha, Illinois

4:51 P.M. CDT

THE PRESIDENT: Hello, everybody! (Applause.) Oh, it is good to be back home. (Applause.) Everybody have a seat, relax, take a load off there.

We’ve got some special guests here I want to just acknowledge. First of all, an outstanding public servant, a great governor, Pat Quinn is in the house. (Applause.) Your former congressman, now my Secretary of Transportation, great friend of mine, Ray LaHood is here. (Applause.)

We’ve got another member of Congress who obviously took a wrong turn somewhere. (Laughter.) Thought he was heading back to the West Side of Chicago -- turned out he’s in Alpha. (Laughter.) Danny Davis is here. (Applause.)

We’ve got the mayor of Alpha, Marvin Watters is here. Where’s Mr. Mayor? There he is back there. Good to see you, sir. (Applause.)

Two great friends of mine -- Senator John Sullivan. Where’s John? There he is. (Laughter.) And Dave Koehler is here. Good to see you, Dave. (Applause.)

And finally, I want to thank the owners of this great facility, Bruce and Charlie Curry, owners of Country Corner. (Applause.)

I need to confess something to Bruce and Charlie. One of my speechwriters, it’s his birthday today, so we let him ride on the little cow pull over there. (Laughter.) It said birthday parties available, so we had him sit in there. He’s only 29, and he still fit. So he had a great time there.

This is a town hall meeting. Some of you remember I used to do these when I was your senator instead of your President. I don’t want to do a lot of talking at the front, but I just want to talk to you a little bit about what I’ve been seeing over the last couple of days and what’s been going on in Washington.
 
Obviously we’ve been going through as tough of a time as we’ve seen in my lifetime and in most people’s lifetimes these last two and a half years. We went through the worst financial crisis since the Great Depression. When I took office we had already lost 4 million jobs and we lost another 4 million just in the few months right after I took office. And we’ve been fighting our way back over the last two and half months -- or last two and a half years.

We were on the verge of going into a Great Depression, and we were able to yank ourselves out. The economy is now growing again. Over the last 17 months we’ve created over 2 million jobs in the private sector. We saved an auto industry that was on the brink. (Applause.) We have -- we’ve made investments in clean energy, in rebuilding our roads and our bridges.

And thanks to the great work of Secretary LaHood, we’ve been getting started on the process of making sure we’ve got the best infrastructure around. Thanks to the great work of our Secretary of Agriculture, Tom Vilsack, we’ve tried to strengthen rural communities and farming communities all across the country and all across the Midwest.

And so despite the fact that we’ve gone through tough times, I want everybody to remember we still have the best universities on Earth, the best workers on Earth, the best entrepreneurs on Earth, the best system on Earth. There’s not a country in the world that wouldn’t trade places with the United States of America. (Applause.)

Now, the fact is, though, times are still tough. And some of the reasons times are still tough we don’t have complete control over. The economy was predicted to be growing at about 3.5 percent at the beginning of this year, partly because we had worked a bipartisan package of tax cuts and investment credits to encourage businesses to invest. But then you had the Arab Spring, and that shot gas prices and fuel prices up. And I know a lot of farmers here experienced that spike. And then we had the tsunami in Japan, and that disrupted supply lines and that affected American manufacturing. And then we had the situation in Europe and the debt crisis there, and that started lapping up onto our shores.

And so there are some things we don’t have control over, and the question is, how do we meet these challenges? But there are things that we do have control over. And the biggest challenge we have is in Washington. There’s nothing wrong with our country, but there’s a lot wrong with our politics right now. (Applause.) And that’s what I aim to fix. That’s what we have to fix.

When you look at this recent debt ceiling debacle and the downgrade, that was a self-inflicted wound, completely unnecessary. The truth of the matter is we’ve got a real challenge with debt and deficits. We had a balanced budget in 2000, then we fought two wars without paying for them. We ended up creating a prescription drug plan for seniors, which is the right thing to do, but we didn’t pay for it. Tax cuts we didn’t pay for.

And then the recession hit, and so a lot of money was going out to help local communities keep their firefighters and police officers and teachers on staff -- and Pat Quinn knows how important that was to prevent massive layoffs at the state level. Unemployment insurance to help folks get back on their feet, but that all meant a lot of money was going out, less tax revenue was going in because businesses weren’t doing as well. So combined we’ve got a big debt and deficit challenge that we’ve got to meet.

But what’s frustrating is that two months ago, three months ago, six months ago we could have met that challenge. We could have decided we’re going to come together with a balanced package where we’re closing corporate loopholes and we’re closing tax breaks for the very wealthy, and we’re cutting spending on things we don’t need.

And if we had come together on a bipartisan basis, we could have avoided all this drama over the last two and half months. But that’s not what we did, because what’s happened in Washington these days is there is a group of folks who think that, I’d rather see my opponent lose than see America win. (Applause.) There are folks who are willing to engage in political brinksmanship even if it costs the country.

And I know you’re frustrated. And I want you to know I’m frustrated. And you should be frustrated. The last two and a half days I’ve been traveling all across the Midwest through Iowa and Minnesota and now back home in Illinois. And everywhere I go, what I see are people who are working hard. They’re looking after their families. They’re farming and feeding people not just here in America, but all around the world. They’re going to church. They’re helping out at the food pantry. They’re coaching Little League.

We just came to visit the football team over at Galesburg. They’ve got their new coach. (Applause.) And I think to myself, you know what, if folks in Washington were carrying out their responsibilities the way you’re carrying out your responsibilities, we’d be just fine. We would be just fine. (Applause.)

So the question is, what do we do going forward? Look, even though private sector job growth is good, we’ve still got a long way to go before we put everybody back to work. We need to go ahead and act right now on some proposals that are before Congress, ready to be voted on. We should extend the payroll tax cut that we passed in December, put $1,000 in the typical family’s pocket -- we need to extend that into next year. (Applause.) Because if you’ve got more money in your pockets, that means businesses have more customers, they’re more likely to hire. There’s no reason why we can’t do that right now.

There’s no reason why, as Ray LaHood knows, we’ve got over $2 trillion worth of repairs that need to be made around the country, and I know there are some right here in this county and right here in this state. And we’ve got a lot of construction workers that are out of work when the housing bubble went bust, and interest rates are low, and contractors are ready to come in on time, under budget -- this is a great time for us to rebuild our roads and our bridges, and locks in the Mississippi, and our seaports and our airports. We could be doing that right now, if Congress was willing to act. (Applause.)

Right now, we could pass trade deals that we negotiated that not only have the support of business, but have the support of the UAW. That doesn’t happen very often. And the reason is, is because folks know that not only is that good for agricultural America -- opening up markets, because we’ve got the best farmers in the world -- but it’s also good for manufacturing. There are a whole bunch of Kias and Hyundais being driven around here; that’s great. But I want some Fords and Chevys being driven in Korea. (Applause.) We should pass that bill right now.

We’ve got legislation right now that we call the American Invents Act -- basically, make patents easier so when people come up with a new product or a new service or a new invention, they’re able to turn it around without a lot of red tape and bureaucracy and start businesses that could be hiring. There’s no reason to wait. It should be passed right now.

The fact is this: All these things I just mentioned, historically they’ve had bipartisan support. I mean, if Ray LaHood was still in there -- Ray was a Republican -- he’d vote for every single one of these; he’d be sponsoring them all. (Laughter.) You’ve got a Democratic President who supports these things. There’s no reason for us not to act right now.

And over the course of the next few weeks, I’m going to be putting out more proposals to put people to work right now. And some of them -- yes, some of them cost money. And the way we pay for it is by doing more on deficit reduction than the plan that we had to come up with right at the last minute in order to avoid default. We didn’t do as much as we could have.

When folks tell you that we’ve got a choice between jobs now or dealing with our debt crisis, they’re wrong. They’re wrong. We can’t afford to just do one or the other. We’ve got to do both. And the way to do it is to make some -- reform the tax code, close loopholes, make some modest modifications in programs like Medicare and Social Security so they’re there for the next generation, stabilize those systems. And you could actually save so much money that you could actually pay for some of the things like additional infrastructure right now.

We can close the deficit and put people to work, but what’s required is that folks work together. That’s the big challenge. That’s the big challenge. (Applause.)

So the main thing is I’m here to enlist you in this fight for America’s future. I need you to send a message to your members of Congress, to your representatives that we’re tired of the games. We’re tired of the posturing. We don’t want more press releases. We want action. We want everybody to work together and stop drawing lines in the sand and saying, we’re so rigid, we’re not going to do this or we’re not going to do that, no matter what. Think about country ahead of party. Think about the next generation instead of the next election. (Applause.)

I had some interviews with some reporters, and they said, why don’t you call Congress back right now? And I said, you know what, I hope Congress goes back to their districts. And I want them to listen to how frustrated people are, how angry they are with our politics at a time when we’ve got so much work to do.

Because the last thing we need is Congress to show up back in Congress and do the exact same thing they’ve been doing. They’ve got to think differently about how we’re approaching problems. So I want them to be doing the same thing I’m doing, just talking to ordinary folks and try to remember why they got into public service in the first place. It’s not supposed to be to get attention. It’s not supposed to be so you get interviewed on cable TV. It’s not supposed to be so you have a fancy title.

You’re supposed to be in public service to serve the public. And that means that, yes, you don’t get your way 100 percent of the time. It means that you compromise. It means you apply common sense. And that’s what I’m hoping that everybody takes from visiting their district again and getting out of Washington for a while.

I can tell you nothing is more inspiring to me than the kind of trip that I’ve been taking over the last few days. We’re driving on this big bus and it’s all -- you can’t see out except when you’re standing in front, so I’m out in front. And having breakfast in a diner and going to a football practice; you’re passing rows of kids with flags and grandparents in their lawn chairs and mechanics out in front of their shops and farmers waving from their fields. And it inspires you, because it reminds you about what makes this country so great, why I love this country so much, and why we’ve got to be doing every single thing we can every minute of every day to make sure that you can continue to achieve your American Dream and pass it on to your kids and your grandchildren.

That’s why I ran for President. That’s why a whole bunch of you voted for me to be a U.S. senator and then to be President. (Applause.)

So I need your help, everybody. Thank you. Thank you. (Applause.)

All right, let’s see if this mic is working. It is. All right, what I’m going to do is I’m just going to call on folks as they raise their hands. The only rule is we’re going to go girl, boy, girl, boy -- (laughter) -- so everybody gets a chance. And there are folks in the audience with microphones. So please stand up and introduce yourself before you ask your question. And I’ll start with this young lady right here in the front.

Here we go. You’ve got a gentleman coming up with a mic.

Q Thank you, Mr. President, for being here today in Henry County. My name is Karen Urich (ph). I’m a multigenerational farmer, member of the Henry County Board and Henry County Farm Bureau. My question that I have today is I have a concern over estate taxes.

In 2013, if the Senate and the Congress fails to act, we will have our estate taxes go back to the 2001 level. We have family farms that are experiencing having to sell their land in order to pay the property taxes. And I was wondering what you see for the future of the estate tax. Thank you.

THE PRESIDENT: Well, there’s no reason why we have to go all the way back to the 2001 level. There is a compromise that has been discussed where you’d essentially have a $7 million exemption per family. There are some folks who just want to eliminate the estate tax all together. There are others who want to hike it up back to 2001.

There’s a mid-level proposal that would exempt most -- almost all family farms and nevertheless would still hit folks like Warren Buffett and make sure that he is able to pay what he wants to pay in terms of passing on something not only to his family, but also to the country that has blessed him so much.

So this is going to be part of the larger debate we have about the tax code. And the one thing I want to emphasize, a lot of folks don’t realize this, but there are only 3 percent of the population that has an annual income of more than $200,000 a year. Think about that, 97 percent of folks, their annual income is less than $200,000. And there are only less than 1 percent who are making millions of dollars. And then there’s less than one one-hundredth of 1 percent who are in the Warren Buffett category. That top 1 percent -- in fact, that top one-tenth of 1 percent, those are the main folks who have seen their incomes skyrocket over the last 10, 15 years. Ordinary families, including family farmers, basically your incomes and your wages have flatlined over the last decade.

And so when we think about tax reform we should be thinking about fairness. What’s fair? Nobody likes paying taxes. I promise you, I don’t like paying taxes. But I do believe in paying what I use -- paying for what I use. And if I want good roads, and if I want good schools for kids, and if I want the best universities in the world and I want to make sure that we’re continuing to invest in agricultural research at places like University of Illinois that have helped to make us the most productive farmers in the world, then I think I should have to pay for it. And if I’m better able to pay for it than a waitress who is making $25,000 a year, I don’t mind paying a slightly higher rate. There’s nothing socialist about that. That’s just basic fairness.

And, by the way, when you hear folks saying, well, you know what, that’s job killing -- that’s not job killing. When Bill Clinton was President we created 22 million jobs with a tax rate that was much higher across the board than it is now. We don’t have to go all the way back up there on the estate tax or any other taxes for us to close our deficit and our debt, but we should ask oil and gas companies that are making record profits that they don’t benefit from a special tax loophole that the mom-and-pop store in Alpha doesn’t get. And I don’t think there’s anything wrong with asking me to pay a little more so our senior citizens don’t have to pay an extra $5,000, $6,000 a year for their Medicare. (Applause.) That’s what we’re looking for, is balance in terms of our tax policy. (Applause.)

All right. Who’s next? This is an old friend of mine right here. Introduce yourself for everybody.

Q Phillip Nelson (ph). Welcome back to Illinois, Mr. President.

THE PRESIDENT: Good to see you, Phil.

Q And I just want to say on behalf of Illinois agriculture, we’re glad that you’re in the heartland. And as you know, Illinois agriculture is the major economic driver in this state that employs close to a million people. And my concern is this: As a fourth-generation farmer, we’re very concerned with some of the regulatory challenges that are coming our way as it relates to the Clean Air Act, the Clean Water Act. We’re concerned with what’s going in the Chesapeake Bay, and the fears that that might come to the Mississippi River Basin. And I guess my challenge, Mr. President, is that you work with the EPA Administrator to put some common sense back into some of these regulatory discussions so we don’t regulate farmers out of business.

THE PRESIDENT: Well, let me say this about -- (applause) -- because I got this question when I was in Atkinson. Some of these regulatory concerns that people have, frankly, are unfounded in the sense that if somebody even has an idea or a thought about some regulation, then right away the message is sent out, they’re coming and they’re going to make it impossible for you to farm and this and that and the other. And this thing may still be completely in a theoretical stage, where folks are trying to figure out how do we make sure that our streams and our rivers aren’t messed up. And there may not even be a regulation in place before people are already getting worried about what’s coming down the pipe.

There is not a rule or regulation that we don’t do a complete cost-benefit analysis at this point, and that we don’t have intensive discussions with those who would potentially be affected. Now, what I do think is true is that, in the past -- I’ll say not under my administration, but I think in the past historically -- there have been times where the EPA or other regulatory agencies don’t listen to farmers and figure out how can we provide them flexibility in meeting some of their goals.

So I was talking to Tom Vilsack yesterday, and he was using as an example that, in the state of Washington -- maybe it was Oregon; it was in the Pacific Northwest -- there was concern about some of the runoff was making it harder for salmon in those regions, which is also a big industry in Washington. And the problem was -- it wasn’t pollution, it was actually heating. Some of the runoff from some of the plants in the area were getting too hot, and that was inhibiting salmon. So instead of just coming up with a regulation that prohibited these industries, what they came up with was, working with farmers and conservationists, planting trees along the rivers that cooled the waters so that the salmon were unaffected.

Well, that’s the kind of creative approach where, if you’re listening to folks on the ground and you say, here, we’ve got a problem that we do need to solve, but is there a smarter way to doing it that ends up being a win-win instead of end up being a lose-lose? Let’s work together. And that’s the kind of approach that we need to take.

Don’t be fooled. I think if somebody goes out and says, we can’t afford clean air and clean water, that’s wrong. I don’t believe that. And I don’t think most farmers would agree with that, because, ultimately, nobody is better stewards of the land. And the reason we’ve got these incredible farms all around us is because we’ve got incredibly rich soil. We’ve got to make sure that we’re conserving that soil. We’ve got to make sure that our air and water continues to be healthy for our kids. And I think farmers care about that more than anybody.

So we’ve got the same goal. The question is, are we able to work together to figure out a smart way to achieve these goals? And that’s what my administration is going to be committed to doing, all right?

Right there. Yes.

Q Thank you, President Obama, and welcome to this area. My name is Judy Gunzeth (ph), and I’m director of tourism for Galesburg and Knox County. So thank you for coming for --

THE PRESIDENT: This is a great tourist location right here, County Corner.

Q Exactly.

THE PRESDIENT: Bring your families. (Applause.)

Q I also want to congratulate you on recently turning 50. I passed that milestone recently, and it’s not as bad as what people think.

THE PRESIDENT: How come you look so much better than me? (Laughter.)

Q I live in Galesburg. (Laughter.)

THE PRESIDENT: That’s why. Okay. All right. That makes sense, that makes sense.

Q I also want to commend your wife, our First Lady, on her efforts to encourage healthy eating.

THE PRESIDENT: Yes.

Q I believe that people who eat healthy are healthy, and a healthy nation is a productive nation. And I think a lot about our children, our school children, and people who are on food stamps -- and just the entire nation needs to live healthy. But it also, in the long term, it reduces health care costs, and we’re thinking about short-term health care costs, but we’re also thinking in long-term health care costs.

THE PRESIDENT: Right.

Q So what I’d like to hear is maybe just your philosophy from your administration -- ways to expound upon what your wife is doing and encouraging -- and positive incentives to encourage people to eat healthy, to live healthy, especially for our schoolchildren.

THE PRESIDENT: Well, it’s a great question. And first of all, thank you for what you’re doing to promote tourism here in Galesburg. I want to point out that America as a whole needs to do a better job of promoting tourism, because -- it used to be we just took for granted everybody wanting to come here. Now countries all around the world are promoting their countries, and we want tourism dollars to come here. And so I’ve set up a tourism council to make sure that they visit not just San Francisco and Manhattan, but they also understand what an incredible travel opportunity there is here in the Midwest and in small towns all across America.

Michelle has done a great job with a combination of nutrition facts, but also exercise. And you’re right, the reason she thought it was so important is she’s a mom with two kids. And she knows that Malia and Sasha, if they start off with healthy habits now, they’re going to be healthier when they get older. And it turns out -- we were just talking about the budget -- about a third of our increase in health care cost is directly attributable to obesity and illnesses like diabetes that are entirely preventable and curable if folks got back into the same habits that our parents and our grandparents had.

Now, a lot of it is just movement and exercise and getting kids off the couch. And that’s why you see Michelle, she goes to these events, and I will tell you, she is in very good shape. And she was running routes with the -- running routes with NFL players and throwing in first pitches and doing double-dutch and -- I can’t keep up with her.

But food is an important component of it, and this is something that actually can benefit farmers, particularly family farmers. We want more produce -- more vegetables and more fruit -- consumed all across the country. And a lot of times, farmers are not making all the money from their products because it goes through this chain of shipping and processing and distribution, and there are a lot of middlemen between the farmer and the end user. And so there’s an economic component as well as a health component, where if we can get farmers more directly linked to consumers, they’re selling their products more directly, they’re getting more fresh vegetables, more fresh fruit, then everybody can benefit.

And the way we’re trying to do it -- Michelle is doing it not by regulation, not by telling folks they have to do something, but by just information. And they’ve been able to get a lot of agreements with companies. You had Wal-Mart, for example, realizing that more and more people were asking for healthier products in their stores. Voluntarily, they and a whole bunch of other big retailers have said, we’re going to start linking up with family farmers; we’re going to start setting up better grocery stores in underserved communities, like in Danny’s district where you can go for miles without seeing a fresh vegetable; and linking up -- setting up farmers markets in urban areas where people can sell produce. And a lot of this stuff we’ve been able to do voluntarily without legislation.

Now, there are still some legislative elements to this thing. So, for example, we passed the Child Nutrition Act just to make sure that our meals in schools are a little bit healthier, so that kids are getting not just processed food, but they’re also getting fresh produce as well. And some of the time that’s a little bit more expensive in the schools. So the question is, are there some things we can cut out in order to pay to make sure that our kids are healthier? But they’ll learn more, they’ll be healthier in the long term, and in the long term we will save money, and it’s good for farmers as well.

Thanks for the great question. All right. The gentleman right here. You just stood up. There you go.

Q Thank you, Mr. President. My name is Alfred Ramirez. I’m president of the Hispanic Chamber in the Quad Cities area, and an employee of Group O in Moline. I’m going to -- this is one of the most painful places I think our country has been in decades or centuries, where we have those in power and influence who are literally tearing our country apart between the haves and the have-nots. We are willing to dismantle programs that they call entitlement programs, and those recipients or beneficiaries of those programs don’t have a mind of their own and are merely asking for a handout. And as we look for our adjustments to the budget and our cuts, could you please speak to some of those very programs that are not necessarily sacred but must stay in place to even have a ripple effect for those who benefit from them?

THE PRESIDENT: Well, first of all, let me separate out some of these programs. And I’m going to start with Social Security. People pay into Social Security. It’s a social insurance program. They’re not getting it for free. It’s not a handout. It’s taken out of your check. It’s been taken out of your check for a lifetime. And it provides you a floor when you retire.

Now, hopefully, people have other savings that help supplement their incomes in their golden years. But we’ve got to make sure Social Security is there not just for this generation but for the next generation. (Applause.) Now, Social Security is not posing a huge problem with respect to our debt and our deficit. There is a problem that if we don’t make any modifications at all, then in a few years what will start happening is, is that the amount of money going out is more than the amount coming -- amount of money going in. And people debate how soon, but in a couple of decades you’d start having a situation where you’d only get 75 cents on the dollar that you expected on Social Security.

If we make some modest changes now, the kind of changes that Ronald Reagan and Tip O’Neill agreed to back in 1983, we can preserve Social Security, make sure it’s there for the future 75 years out. So Social Security is something that we can solve relatively easily. It doesn’t mean that we don’t make any changes at all, because there may be some tweaks that we can make to the program, but we can assure that Social Security is there for future generations.

The bigger problem is Medicare and Medicaid. And the reason that’s a problem is because health care costs keep on going up faster than inflation, people’s wages, people’s incomes at the same as folks are getting older, so we’ve got more people into the system. And if we didn’t do anything, then Medicare and Medicaid would gobble up basically the entire federal budget -- and we couldn’t pay for our schools, we couldn’t pay for fixing our airports, we couldn’t pay for basic research. All the things that we expect out of our federal government we couldn’t do. All we’d be doing is just paying doctors and hospitals and nursing home facilities. That would take up the whole budget. That’s no way to run a country.

The health care bill that I passed begins the process of trying to reduce the cost of health care, reforming the cost of health care by, for example, telling providers instead of having five tests that you charge for each one, have one test and email to the five specialists who may need the test. (Applause.) Start using electronic medical records. Instead of reimbursing you for how many procedures you do, we’re going to reimburse you for how well you help the patient get well overall. We’re going to say to hospitals, how good are you at reducing infection rates in your hospital so that people aren’t being readmitted getting sick all the time.

So there are a whole bunch of things we can do to make the health care system more efficient. But even if we do all those things, we’re still going to have a problem with Medicare and Medicaid. And my basic principle is, let’s make sure that we keep this program intact, both programs -- Medicare and Medicaid -- for people in need: for our seniors, for disabled kids, for folks who’ve got a parent who’s severely ill and they’ve only got a certain capacity to support them and help them. But let’s also make sure that we’re making some common-sense changes that allows the program to be there in the future. This is in contrast to the approach that’s been taken, I’ve got to admit, by the House of Representatives when they passed their budget.

They passed a budget that basically called for voucherizing the Medicare system. This is the Republicans in the House of Representatives. And basically what they say is, here’s a flat rate that you get for Medicare, and you know what, if it turns out that it doesn’t buy you enough insurance, that’s your problem; that’s not our problem.

Now, this will cut the deficit. It will save the government money, but it does so by shifting the costs from the government to individual seniors. It doesn’t solve the problem by actually reducing health care costs. So I think that’s the wrong approach to take. I think that’s the wrong approach to take. (Applause.)

But I want to be honest with folks: We are going to have to make some modifications to Medicare and Medicaid. They don’t have to be radical, but we’re going to have to make some modifications to them in order for them to be there for the next generation. That’s part of our obligation, because we can’t just be not thinking about our kids and our grandkids as we move forward.

But we can do it in a way where the average senior is still protected, is still getting all the help that they need. It’s not a voucher program. It is guaranteed health care, because I think that’s a core principle that we’ve got to preserve. All right? (Applause.)

All right. It’s getting a little warm out here, huh? You guys doing all right? You guys hanging in there? All right. It’s a young woman’s turn. Right over there in the striped shirt. You. Yes.

Q Our family does a lot of --

THE PRESIDENT: What’s your name?

Q Allie Hand (ph).

THE PRESIDENT: Hey, Allie.

Q Our family does a lot of farming and stuff. And we’ve noticed the county fairs are shrinking. Is there anything you’re going to do about that?

THE PRESIDENT: Well, one thing I’m going to do -- I went to a county fair today and they were showing some cows. And I didn’t judge them. (Laughter.) They all looked pretty good to me. (Laughter.)

But I think the county fair tradition is so important, not only because it’s an economic attraction for the community, but also because it brings the community together. It’s a focal point for a county and it reminds people of what holds America together and the heartland together.

And so, working with the state of Illinois, working with tourism bureaus, we want to continue to promote county fairs all across Illinois. One of the things I’d like to see is -- and Danny may agree with this, coming from Chicago. There are kids in Danny’s district -- in fact, the overwhelming majority of kids in Danny’s district, they’ve never seen a cornfield like this. They’ve never seen a cow. If you asked them what does a tomato plant look like, they’d have no idea.

So part of what I’d like to see is actually more tourism maybe organized through school trips and others for people from outside of rural areas to appreciate what’s happening in rural areas. Where are they getting their food from? It doesn’t just show up in cellophane in a supermarket. Somebody is growing that. And part of the challenge is America has become so productive agriculturally that you now only have a couple percent of the people who are actively involved in farming. Ninety-eight percent of people, they just eat. (Laughter.) And I think a county fair can be a powerful education tool, and I’d like to see more kids just coming out here and be able to appreciate all the hard work that goes into the food on their table. And so maybe that’s something that your outstanding governor might want to work on. All right? (Applause.)

I got time for two more questions. Two more questions. Young man in the green, right there. Well, there are two young men in green, but I was calling on this guy right here. Yes.

Q Hello. My name is Eric Palmer (ph) and I go to Augustana College.

THE PRESIDENT: Great school.

Q Yes, it is. First of all, I just want to let you know of one thing: I am not disappointed in you like Michele Bachmann wants everyone to believe. (Applause.)

THE PRESIDENT: Thank you. I appreciate that.

Q My question is about Social Security. I know that one of your ideas to fix the solvency of it is to reevaluate the equation that determines the COLA, the cost-of-living adjustment. But as the law stands right now, we are only taxed on the first $107,000 that we make.

THE PRESIDENT: Right.

Q That means every dime that I make is taxed for Social Security.

THE PRESIDENT: Right.

Q I don’t make $107,000. (Laughter.) But that means that --

THE PRESIDENT: Somebody said you will --

Q Someday, I hope.

THE PRESIDENT: Yes, you sound pretty smart. It sounds like you’re going to do just great.

Q Thanks. But that means that people like Mitt Romney only pay into Social Security on the first one-tenth of 1 percent of what they make.

THE PRESIDENT: Right.

Q Can we look forward to you telling the Republicans that it’s time that the wealthy pay their fair share? (Applause.)

THE PRESIDENT: Well, first -- this is a very well-informed young man here. (Laughter.) You’re exactly right that the way the Social Security system works, there’s what’s called -- there’s basically a cap on your Social Security, which there isn’t, by the way, on Medicare. But Social Security, it only goes up to the first $107,000; and you’re right, somebody who makes -- who has net assets of $250 million and are making maybe $5 million a year just on interest or capital gains or something, just a fraction of it’s going to Social Security. I think there’s a way for us to make adjustments on the Social Security tax that would be fairer than the system that we use right now.

I do think, in terms of how we calculate inflation, that’s important as well. By the way, seniors -- a bunch of them were upset over the last couple years because some of -- because seniors didn’t get a cost-of-living adjustment. I got a lot of letters -- “Mr. President, how come I didn’t get a COLA this year for my Social Security?” And I answered this question at the previous town hall; I figured I’d clear something up now. The way the system works is you automatically get a cost-of-living adjustment based on the inflation rate. The President doesn’t make that decision; it’s based on a formula.

And when the economy was really in the drink in 2009 and 2010, there was basically no inflation -- prices were actually going down. That’s why seniors did not get the cost-of-living adjustment. That doesn’t mean that they weren’t still having a hard time because food prices or gas prices or what have you might have been going up, or the cost of medicine. So as a consequence, we actually proposed -- and I’m sure Danny was one of the co-sponsors of this -- legislation that would have given an extra $250 to seniors just to help make ends meet. We couldn’t get Republican support for it. But seniors who are still upset about not getting your COLA -- or if they’re not here, but when you go back and you’re talking to your grandma and they’re still mad at me about it, I just want you guys to set the record straight, okay?

All right, I’ve got one last question, and I’m going -- I’ve got to ask this young lady right here, the next generation -- she gets the last word.

Q Mr. President, my name is Jordan Vinolcavak (ph), and my stepdad is the sheriff of Henry County. This year could set a record on the number of law enforcement officers killed in the line of duty. Does your administration have any plans that would include better equipping, training, or anything else that would help keep all officers safe?

THE PRESIDENT: Well, it’s a great question. How old are you, Jordan?

Q Thirteen.

THE PRESIDENT: Thirteen -- you’re Malia’s age. So you’re going into 8th grade?

Q Yes.

THE PRESIDENT: Did you already start?

Q Yes.

THE PRESIDENT: Yes? How’s school going so far?

Q Good. Today was my first day. (Laughter.)

THE PRESIDENT: Yes? No wonder you look so cheerful. (Laughter.) Well, thank you for the question, Jordan, and tell your stepdad we’re proud of him for his service. This is an example of what we have to pay for. You’re right, we’ve seen -- even though the crime rate overall and the violent crime rate has been going down, fatalities among law enforcement have actually been going up. And part of it is because criminals are getting more powerful weapons than they ever have before.

And so we’ve got to help our law enforcement -- provide them with better protection, provide them with better crime-fighting strategies. That’s true in big cities; it’s also true in rural communities. We’ve got to do a better job of tracing weapons that are going to criminals.

I’m a big believer in the Second Amendment. And I’m a big believer in hunting and sportsmen. But I also think that making sure that we’re keeping guns out of the hands of criminals is something all of us should be able to agree on. (Applause.)

But, Jordan, let me tell you something. We actually have been doing a lot. We’ve been giving a lot of money to local law enforcement, partly to prevent layoffs, partly to ensure they’ve got better equipment, things like interoperable radios so that when something happens -- let’s say you’ve got all power out, one of these tornadoes hit like hit in Joplin -- that they’re able to come together and still communicate effectively.

We’ve got things called Burn Grants that are very important to local law enforcement in dealing with, for example, methamphetamine production here in the Midwest. But all that costs money. And that’s why I want everybody to remember you’re going to hear a lot of stuff over the next year and a half, just like you have for the last two and half years, people attacking government and saying government is the problem.

And I think Jordan just reminded us government are our police officers and our firefighters. Government is all those young men and women who have been serving, protecting us in Afghanistan and Iraq. (Applause.) Government are the folks who work for FEMA, who when there’s a flood come in and help communities get back on their feet. Government is our astronauts. Government are the folks who are helping make sure that our food is properly inspected.

So don’t buy into this notion that somehow all our problems would be solved if we eliminate government. Part of the reason we had this financial crisis was because we didn’t have government doing a good enough job looking over the shoulders of the banks to make sure that they weren’t taking crazy risks. (Applause.)

And part of what happens is that people get so frustrated with politics that they just get fed up and they kind of lump government together with politics. Well, no, government needs to improve. It needs to get more efficient. We’ve got to be smarter about how we regulate issues. We’ve got to make sure that we’re not wasting taxpayer money.

But there’s a difference between politics and government. And what’s really broken is a politics that doesn’t reflect the core values and the decency and the neighborliness of the American people. (Applause.)

And that’s what I’m fighting for, and that’s what I need you fighting for. Thank you very much, Alpha. Love you. Appreciate you. (Applause.)

END
5:40 P.M. CDT