From our studios in new york city, this is charlie rose. President obama arrived in china monday for regional visit. Leaders have gathered in beijing for the asiapacific Economic Cooperation summit. Tomorrow, president obama and xi jinping will engage in a series of meetings. The visit will capture the complexities of the relationship, the tensions are rising power confronting an established one, as well as the promise of the worlds two largest economies can find common cause on issues like Climate Change. From china, the president will travel to burma and in australia. Joining me is the chief u. S. Commentator for the financial times. His latest piece is called china is no refuge for obamas woes. China strikes back recounts his trip to china with jimmy carter. With me in new york, ching lee is the director of the china center at the brookings institution. I am pleased to have them all with me. I begin with you, cheng li. Tell me, what is the status of the u. S. China relationship today . Uncertainty. There are Different Directions the relationship can go. Its a critical time. We know china is a paradox of hope and fear, probably more so than any other time in the last 25 years. On the hope side, the leadership is very strong on anticrunching and wants to adopt an ambitious market reform agenda. They also talk about the rule of law. At the same time, the political control, the control of media, control of intellectuals, has reached a peak. There is a concern about the direction china is going. Tell me where you think the relationship is and where the president is, reflecting on your column, on going to china. I was on the white house trip in 2009 where president obama made his first visit, and then of course he was very much at the height of his domestic standing. The democrats controlled both chambers of congress, and obamas global standing, he had just received a nobel prize. The chinese under a different president , hu jintao, a much more low key character, treated him pretty shabbily. He offered him a gtwo level of cooperation in terms of the u. S. And china tackling global warming, terrorism, the aftermath of the 2008 financial meltdown, and china really didnt want to hear any of it. It didnt want to step up to the plate. They kind of spurned obama and treated him not particularly well given how warm the president s overture was. Fast forward to now, exactly six years later, and president obamas domestic standing is at a low point following the midterm elections. The relationship, as you said, is a lot more complicated. China under xi jinping is a lot bolder and a lot more vicious than it was under hu jintao and his predecessors. I think obama goes very much as the weak leader who is on the decline, whos got two years left, but whose party is out of power. Xi jinping as the most powerful president since Deng Xiaoping, probably. So, weve got two very different positions for the leaders and much more complex agenda. Ji jinping wants to develop what he calls a new great power relationship, and this is something that makes president obama and america in general feel fairly uneasy. I wouldnt be hugely optimistic that president obamas leverage in this context is going to be very big. Im sure xi jinping will be polite, will roll out the red carpet at the apec summit, but i dont think this is the situation where president obama is going to be successful. So much has changed since obama was last there. On the one hand, we have a tremendous shift in the real power relations between the United States and china, but even more of an impediment is china has kind of arrived and does no longer, as Deng Xiaoping once counsel the chinese to do, to keep their heads down and buy their time. There is a bit of an attitude problem in china that shifted dramatically. A lot of the old toolkit that United States normally brings to their in the relationship is not operable anymore. I think really what is missing, despite all of the protestations on both sides, is that that there is much common interest, and we should find a way to get together to win xi jinpings notion of a new power relationship. I dont detect a tremendous amount of willingness to hunker down mantoman in a congenial way to solve problems. We see much more sort of suspicion about the motives of each. I would have to say that the climate is not terrific for the kind of breakthrough that people are very nostalgic for on both sides, from the days of kissinger and nixon, or even jimmy carter, who youll recall in 1979, engineered the rerecognition of china and the normalization of diplomatic relations. I want to point out also that this comes after xi jinping has just seen japanese Prime Minister abe, vladimir putin, so hes stretching his connections to other power centers. In chinas mind and xi jinpings mind, the u. S. China relationship is the most important bilateral relationship of the 21st century. China cannot afford not dealing with that relationship on the right terms. They believe that china reconciled the relationship with russia to try to have the leverage with the United States. China wants japan because it has the backing of the United States, so therefore, the u. S. Is the real power that can make a difference in the chinese perspective. Xi jinping wanted to improve that relationship, a specially seize that opportunity. Xi jinping has emerged as a strong leader. Hes not antiu. S. As some people believe. He has a lot of american friends, and also, he has said to the chinese public recently he loves hollywood movies, sports, the nba. His life has been heavily engaged with the bill gates foundation, aids prevention, tobacco control, etc. These really show that he wants to have constructive, friendly relations with the United States. At the same time, there is concern about the u. S. Policy of containment against china. If you believes do you think its him or the army that believes that the United States wants to contain it . The u. S. Wants to contain china. Why does it spread sentiment in china not just with military or with leaders but also with the chinese public . How deep is unclear, but it slightly spread, the sentiment. We mentioned earlier that china feels like it has arrived and wants to the recognized as an equal with the United States, and it would seem to me that that would give confidence to the relationship. One thing, if i may often, we dont appreciate that in this year earning china has for global standing and to gain the respect of the world that underlying our relationship with china, indeed all of the western world, is completely different political systems and values. This makes it very difficult for the average american or european in london or oxford to really respect china and the way china wants to be respected. I think we have one point did succeed in sort of putting the different political systems and values to one side and getting on with your common interests. Carter had a real lovefest with Deng Xiaoping. Now, this might be the bitter progeny of 1989. The political differences in our systems and values continue to mitigate against us really feeling comfortable with each other and affording each other the kind of respect, which i think china historically has worked tremendously hard to attain and for whom it matters a great deal. Is it possible that the president will say, look, i may not be able to do much domestically, but certainly there is a whole range of Foreign Policy challenges and opportunities. Yes, i do think that, but dont forget that the central plank of president obamas Foreign Policy, perhaps his legacy, the thing that he most wants to be his legacy, is the hit it to asia, which secretary of state Hillary Clinton announced in his first term. The chinese see this as a thinly veiled u. S. Strategy of u. S. Containment, and xi jinping has been more explicit about seeing it as such. Part of president obamas pivot to asia, its not just shifting military resources to the asiapacific, but its also the economic initiative. There is the transpacific trade partnership, which president obama really wants to push ahead with on this asian trip. The tpp has 11 countries in it, but not china. China has not been invited to join the tpp. Japan is in it, south korea is in it, and so forth. Its going to be harder with that suspicion that there is a u. S. Encirclement going on, even under what perceived to be a weak president , it is going to be hard for the president to say, lets cooperate on isis or shoring up the Iraqi Government or persuading iran to conclude a nuclear deal. Isnt china continuing to buy iranian oil . It is indeed, and it has very different interests in terms of iran and the u. S. Does. There is another pivot to asia going on. Thats a close relationship between president clinton and xi jinping president putin and xi jinping. One of the bestselling books in china right now is called putin, the great. It is seen as a bit of a hero in china. I think theres a climate for obama to say, lets Work Together on myanmar its not as propitious as you might hope. What should the president do . The president does end up in china with a limited number of prospects for major cooperation. One paradoxically is north korea because i think the chinese, you dont need to get more than one glass of wine in a chinese friend or diplomat to hear them just the as exasperated with pyongyang as the americans are. I think thats a hopeful area. Climate change has been an infinitely retreating horizon of hope. Everybody hopes that the u. S. And china will be able to really have a major collaboration. China is doing a good deal on this front, in a patchwork, piecemeal way, but washington is so bollocksed that we dont know if that will happen. Many states like california are very ambitious and very have very ambitious and very active Climate Change collaborations with china. Thats not going to help obama much in beijing. What might come out of this . I think the Economic Cooperation will be a major item. You cannot imagine the International Economic integration if you exclude china or the United States. Therefore, the number one economy and the number two economy have to cooperate together. The United States wants chinas investment. China has money for infrastructure in the u. S. At the same time, u. S. Companies cannot access china. That includes public health, education, green consumption, and particularly the pollution control. United States Companies have leverage in this area. Therefore, there is tremendous room for cooperation, environmental protection, energy, antiterrorism. In all of these areas, there is tremendous room for development. Obama Just Announced that the u. S. Will offer chinese visitors 10year and 15year visas. Also, beyond the economic front, and our values to a certain extent, there is a difference in values, but also the shared values coming universal values of rule block. At a time in china, there was no middle class. Even in the 1990s, there was no middle class. Now the middle class is changing china in a profound way. Thank you very much. Great to see you. Thank you, chang lee. We will be right back. Stay with us. Tony vidal is here, the founder and ceo of nest. The company is revolutionizing how we use unloved products in our home. Google bought nest earlier this year. They paid him 3. 2 billion, it was said. He was previously at apple where he led teams that created the ipad and iphone. He has authored more than 300 patents. Im pleased to have him here. Welcome. Its great to be here. Give me the sense of where you think nest will go. Explain this to me. It was born out of the idea really of looking around the home at these products that weve been using for years they are really important products like thermostats and smoke alarms and saying, they havent really been changed since i grew up. Why was this . When i was buried building a house in lake tahoe and designing it, i wanted to be the greenest, most connected house there was. What was really strange was that i could buy these products, but they were more expensive than an iphone or ipod. They had nowhere near the capabilities. I was like, theres something wrong. I said, why dont we look at taking the technology we know of in these other connected products like a smartphone, and lets reinvent the products that are so important in our homes . What is the end product . The first one is a thermostat. It is called the nest learning thermostat. We made it look beautiful, first of all. The reason is, you put it on your wall. Why should you have a plastic, gray box that you dont know how to work or use . That was first, make it beautiful. Then, because the thermostat controls over 50 of your home energy bill in the u. S. , 1200, it should be easy to use so it can help you save money and stay comfortable. It turns itself down when youre not at home, when you are not there, it turns itself down. It learns from you. Typically, you had to Program Thermostats before. You had to say, what time do i wake up, what time do i, home. It was like a 1980s vcr. No one did that. No one really programmed their thermostat to save energy. We just learned. As you turn it up or turn it down it learns from your life experiences. Exactly. Where are you going to move into . Give me a sense of some of these unloved products that are Fertile Ground for you. The second one was the smoke and co2 detector. It just beeps today. We want to change that. There are all kinds of appliances your dishwasher, your dryer, your refrigerator those are interesting products. They dont have the idea of how much it costs for energy. When are you home, when are you away . We are working together with different appliance manufacturers to bring that information and connect it into one space so that these products can become intelligent. We cant build everything, but we think all of these things should be connected in a common way in the home so it can be more convenient for you. How did your experience at apple serve you in doing this . Be developed the ipod with others. It takes a team. I worked at a Company Called general magic before apple. I learned really how to do products. It was the mac team minus steve building this iphone very early. At apple, what i really learned was about experience. Designing a product experience, not just designing a product, but next year in spirit how you first learn about the but how you have an experience. How you first learn about it, the branding, how you on box unbox it. Theres a ceremony of unboxing now. From there, installing and configuring it. All of those things amount to a product experience. That really was the thing that i sought out. What was it that steve this is not a broad question about steves genius, but what did he add to that process . One was disciplined. Making sure we looked at every single element and going, why do we do this, and seeing the cracks between the experience, when you are in retail to when you unboxed it. What were the cracks, and making sure we fill those cracks. Sometimes, we would be struggling, the team of us, really smart people, would struggle with a problem for six or seven months, and steve wasnt a part of it. We would come up with three or four options. We would present and the three or four options and say, this is the best of the worst options, and he would come in, and really not having details, he would come in with a fifth option that was just break through. We would all sit there, and our jaws would be on the table. Why didnt i think of this . Exactly. You went, ok, this is amazing. A unique experience. Absolutely. When you left apple, did you say, we are going to create a company thats going to make us rich, or did you have other visions . I was already retired with my wife and our kids. My wife had also worked for steve for almost a decade. What did she do . She was head of hr. She helped build the big team. We have been working so hard, so we wanted to take time for our kids. We got anxious and wanted to travel the world. As we designed this house in lake tahoe, we were living in all of these houses around the world with our kids, and we said, they have the same problems all over the world. Thats where i got the bug. We actually cut the trip short. I was like, ive got to get back. When you have a good idea, weve got a run back now, much to her chagrin. What did you do when you left . You were young. You have a family. You have a lot of money. The idea was what when he left apple . To find myself, to take care of my kids . It was really about both of us working so intensely, and we have a newborn and a one and a halfyearold. It was a really important moment where we came home, and our son was crying. Something had happened that day. He ran to his nanny instead of my wife. That was the moment we both looked at each other and said, somethings not right. You just went, there are these special times that money can buy cant buy back, right, when the kids are small. They are cherished moments. Dont squander those. We said, now its time. Steve really respected it. He was wondering when my wife was going to tell him that. He was really beside himself, distraught when she told him. Did you go in together or separate . It was separate. Who went first . I think i did. He knew. He knew it was coming. We also went in together when we decided we were getting engaged. You had to get his approval . [laughter] we didnt go that far. I didnt ask for my wifes hand in marriage with her father. We didnt go that far. It was a very interesting moment when we told him. We did it very secretly. It sounds like almost a family. Without a doubt. When we first realized we were pregnant and we told steve, steve literally went and he took as each oneonone outside and spent an hour or two hours, and we talked about having kids individually. We see the genius. We read all of his books and what have you, but when you actually have those moments where he really cared, and he said, money tell you some of those things that were important to him about raising his kids, it was amazing. David kelly had worked with steve. When he found out he had cancer, steve was like all over it. Let me give you my experience. Let me tell you what you will feel. Let me tell you