* Merkel praises U.S. movement on climate change * Obama says both sides speak with one voice on Iran (Recasts with quotes from news conference) By Jeff Mason WASHINGTON, June 26 (Reuters) - U.S. President Barack Obama and German Chancellor Angela Merkel displayed a united front on Friday over Iran, climate and regulation, smoothing over -- at least in public -- differences that dogged their relationship. Obama, who called Merkel a friend he could trust, said the two spoke with one voice in condemning the crackdown on demonstrators in Iran after its disputed election. Merkel, who has criticized Obama's economic stimulus plan, praised U.S. efforts to fight global warming and said a bill in the U.S. Congress would advance international talks on climate change later this year. "The chancellor and I discussed the tragic situation in Iran," Obama said at the opening of a joint news conference. "Today we speak with one voice. The rights of the Iranian people to assemble, to speak freely, to have their voices heard -- those are universal aspirations." The two leaders also discussed accelerating the Middle East peace process, fighting extremism in Afghanistan, and creating a "more substantive" relationship with Russia, Obama said. Merkel and Obama, who will attend the Group of Eight summit of wealthy nations in Italy next month, have clashed over the best way to lift the globe out of recession. Democrat Obama presided over a $787 billion U.S. economic stimulus package shortly after taking office in January, while Merkel, a conservative, has spoken against massive spending to fix the world's economic ills. "I underscored our commitment to strengthening financial regulations, and I welcome Chancellor Merkel's commitment to reform," Obama said in a nod to their respective priorities. On climate change, Merkel was expected to press Obama to back a European Union goal of limiting increases in global average temperatures to no more than 2 degrees Celsius. But the chancellor, whose visit coincided with a vote in the House of Representatives on a bill capping carbon emissions, went out of her way to praise the U.S. legislation, which Obama supports, and its potential to boost U.N. negotiations in Denmark in December. "It should not be underestimated what sort of opportunity this brings to us to come to a good, a sustainable result during the Copenhagen conference," she said. BUILDING A RELATIONSHIP Other areas of disagreement came up. Merkel's government has resisted U.S. requests that it accept inmates from the Guantanamo prison that Obama plans to close by early 2010. Obama said the two sides were discussing the issue. "We have seen a positive response from countries across Europe in the general sense of wanting to help," he said. "Chancellor Merkel -- she has an obligation obviously to make sure that Germany's national security interests come first in these considerations. We understand that." Merkel, who is running in Germany's September federal election for a second term, said her country would not shirk its responsibilities on that issue. "We are showing a constructive spirit, and we will come to a result," she said. "I'm confident of that." Merkel had a warm relationship with former President George W. Bush, a Republican, and has sought to develop one with Obama, even while disagreeing with some of his policies. "Obama is the most popular politician in Germany," said Jeremy Shapiro, a foreign policy fellow at the Washington-based Brookings Institution. "She's got to be seen as somebody who's his friend but is also capable of respectfully disagreeing and articulating German positions." Obama seemed to sense that need and made clear his admiration for the German leader. "I've now dealt with a lot of world leaders, and I think that Chancellor Merkel is smart, practical, and I trust her when she says something," Obama said. "That kind of approach is exactly what you want from an international partner." (Editing by Mohammad Zargham)
Candles spell Iran during a vigil in Vancouver, British Columbia June 25, 2009. Several thousand people gathered to protest against the situation in Iran. REUTERS/Andy Clark (CANADA CONFLICT POLITICS IMAGES OF ...
