in states to raise sales taxes to fill budget holes. later, we will talk about a steady that the stimulus money pentagon jobs recovery and it has not produced jobs for minorities. "washington journal" next. . .

this is tony from our border towns. gueshost: this is not just mex's problem. this is america's problem as well. a lot of it originates here because of the drugs. they should legalize mat

marijuana, but not a hard drugs. we have troops all run the world. iraq, afghanistan, here and there. but on our next-door neighbor, we ignore it. it's starting to hit home now. we need to help with social issues with mexico and economic development with mexico. and fighting the drug wars. sometimes -- at some point we are going to have to consider an option of getting militarily involved. we need to look at the druglords in mexico, looking at them as terrorists, like we fight to al qaeda. caller: tony, we read a lot about border violence in the mexican towns as well. what is it like in losas cruc

es, do you see manifestation of that in your town, the border violence? host: occasionally you hear of homicides and things like that and other types of violence. he him directly linked to the drug trade and this and that. you're about it in the bigger cities like phoenix and albuquerque and cities like that. the thing is it is happening. this is where the drugs go through periods to get to iowa. it comes through the border states. now that's people were killed in an juarez, that sends a chill up our backs on the border, but it should not. it is really our problem now and it has been for a while. maybe this will wake up our

federal government and we will start to realize we need to get a lot more involved in helping our neighbors to the south before its -- before we start feeling more of it. like i said, we send troops all over the world thousands of miles away, yet we ignore what is happening in our backyards. can't we do this for our next door neighbors? certainly we would want to do something. it is in our best interest. at some point we will have to get a lot more directly involved. caller: thanks for the input. let's hear from david on the republican line from florida. good morning, go ahead. host: good morning. there's not a single drug dealer who wants drugs to be legalized. they want to make money. despite how you feel about whether people do drugs, i personally think it's morally

wrong for another human being to tell you what you can or cannot do with your own person. if you are breaking into my house, coordination and me to prison for that, but not because you want to alter your minds and some specific fashion

ellis about that. guest: a $15 billion package that passed the house last week. a few weeks ago the senate these of the measure was a tax break for companies hiring employees with the reauthorization for extensions of the bill america program, allowing companies to write off purchases, tweaking the language to offset the cost when the senate initially passed a version, what both chambers are trying to prove. host: what is the best sense of

what this jobs bill is going to generate fan of >-- generate? what guest: republicans largely voted against the measure in the house. 70 members voted for it. largely because there was a dispute over whether it would create jobs with companies hiring new employees is a provision from members pushing this thing that would have the greatest impact on jobs and we will see if it helps in the short term. host: friday you wrote about the filibuster and that they had held against the package of tax extenders and insurance is that went through the senate last week. in the middle of that it meant that a number of -- federal

workers were temporarily furloughed. what is the status of that legislation? >> -- guest: is being blocked right now, there is a bill that the senate is trying to push through that would allow for those furloughed workers fade -- be paid, but senator colburn is blocking the measure, largely because he is concerned it will not be paid for. democrats are trying to move quickly. emergency spending, the money needs to go to the workers that were forced to miss because congress could not act. it remains to be seen whether they can come together to allow a vote.

host: so this additional jobs legislation, does it come from a sense that the stimulus bill did not generate enough jobs? guest: certainly there was an exhortation by the administration that the unemployment rate would not reach this high level. they were attempting to prevent another depression and stave off the worst of the financial crisis. i would think that everyone on capitol hill would agree that not enough jobs have been created at this time when so many people are looking for new jobs, congress needs to be doing more.

the health care to be -- debate is sucking all the oxygen out of the capital. host: you reported late yesterday that harry reid's wife was released from the hospital after a traffic accident last week. what more can you tell us about this? how will this affect his leadership in the senate? guest: people that know him well know that he is very devoted to his wife, married for 50 years. of course, this came as a big shock to a lot of people. he was discharged on sunday -- she was discharged on sunday

after undergoing back surgery after the collision on interstate 95. the tractor trailer rented her car fwhich was sitting in stop and go traffic. she is recovering, she can walk short distances with assistance, but certainly something that he says he will run for reelection on. host: thank you for joining us this morning. guest: thank you for having me. host: redding, california is next, your phone calls for half an hour. make sure that you meet your

television, jay. caller: we should treat mexico like we treat the terrorists. maybe if we take that more seriously. until they come over here and start killing them -- start killing americans, then we should worry about them. that their own president take care of them. host: topeka, kansas. caller: nobody goes to mexico vacation, they go down there to get drugs. i know it, you know it, everyone knows it. they should close the border. host: here is the story on the drug war affecting u.s. tourism. in particular, hunting tourism.

3% of the country's hunters are from the united states in mexico. those areas have the most intense violence. "to drug violence is putting a damper on efforts to attract american hunters, a way of tourism to bring jobs to rural parts of the country. hunting outfitters stated u.s. warnings against travel to mexico have reduced business by 60%." cheryl, phoenix. independent line. go ahead. it is not just juarez or

tijuana, it is not just a drug issue -- caller: is not just far as or tijuana, it is not just the drug issue. you have people coming into the country, tied up into the garage, being held hostage. there are people down there that will seek money no matter how they can get it. many americans chose to go down there lived and wind up being kidnapped because of the money. another big issue, everyone is against the sheriff here. they feel he is targeting hispanics our borders are not protected. i do not care if he makes prisoners wear pink underwear, it is not an issue.

close the borders, protect the borders. you have open fences, young children being used for what ever. host: was it the right decision to pull the consulate folks out of those towns? caller: they should have protected them more. mexico has got the biggest high dollar forbes millionaire there? why can he not help his country? it gives them just as much of a black guy. host: this letter comes from a viewer.

"my wife was born and raised in mexico. when we were last there in 2006 we did not go across the line even then due to the potential violence due to unemployment, drug wars, etc. one of the main ingredients in the situation is the gun's going from the u.s. into mexico thanks in part to the nra's influence of lack of effective enforcement. therefore, we can start holding the nra countable lives above gunrunning." john, a good morning. caller: some of these arguments we ever before. they talk about drug legalization some of the arguments are that you'll have more people using drugs and it will not solve the problem. it is amazing when you listen to these arguments. no other area has suggested legislation that will not solve the problem.

just one piece of the puzzle. most people do not realize the quantity of money that is spent on this for half of the people in the prisons, from law enforcement -- is enormous. i grew up in the 70's. if you remember, nancy reagan's "just say no" campaign came out back then and it was socially example for people, regular middle-class people to be using drugs. if you legalize drugs, how many people would start using it just because it is legal? not that monemany. take the billions of dollars and do educational campaigns, they work. you have prevention campaigns.

we can go into rehabilitation areas. the main thing is that you put the drug dealers out of business. there is no argument there. you put them out of business. host: thank you for the call. "the wall street journal" has a story about the money from drug dealers. "wachovia is in talks over allegations from mexico. they are talking to the justice department to settle allegations they failure in bank controls allowed mexican exchange houses to launder drug money. they line the u.s.-mexican border and serve as a hub for the global remittance business

allow u.s. and iran to send money back to lead america to help relatives. federal officials identified the money as a way for drug traffickers to move cash around ." larry, stockton, california. independent line. good morning. caller: how're you doing? host: fine, thanks. caller: glad to even hear me. this is not the mexican problem, this is a global problem. drugs in afghanistan have been a problem since our army has been there. this is not a drug problem, this is a money maunder problem. the cartel would lobby lobbyists if they could, that is what is going on.

they cannot stop drugs inside of the jails. to make a proposal to stop drugs from coming across the borders is stupid to believe, you have got corrupt cops and officials. money maunders propagate corruption. the same people that deprive people from health care, destroying people's lives. sheriff's or poor mexicans, they want them to come across. host: this is the front page of

"the wall street journal." "soldiers crossing the field of copies in afghanistan." bloomfield, minn. -- excuse me, michigan is next. caller: good morning, america. the illegal gun sales on the border, there was a huge story from "the new york times" last month. without these weapons the drug trade could not continue. stop these illegal gun sales in the border states. host: thank you, steven. this is the metro section of "the washington post." "the shooter -- the pentagon

shooter gun was traced to tennessee, trading hands in four states." a little bit more about the federal pentagon protection force, two of the officers wounded in that shootout, this is the featured piece of the officers that uncounted the gunmen a couple of weeks ago. "a quiet evening waiting for the next thing reman. this is a featured piece this morning. westminster, good -- go ahead. caller: we have transported the colombian war on drugs to

mexico, but we assisted in the last election to change the outcome of the election. the person that ended up losing actually one, and that is what we got. -- won, and we have a colombian style drug war going on in the borders. we should have assisted in the recounting of the last election in mexico. the person that one would have been president, but probably would have happened would have been a paramilitary takeover of the government. a fraction of the people.

we should, absolutely, legalize marijuana. it takes no steps whatsoever to feed illegal money into corrupt people to have health care for the rest of america. host: another view from jo in oak ridge, tennessee. "it seems to me that this would be a win-win situation for the enforcement and prison industry. drug violence anywhere is fed by our addiction. it would be in no one's interest to push drugs if there was no money in it. spend the money in campaigns against these substances as we do with cigarettes and treat the addictive the way we did with legal addiction."

stephen, good morning. for caller: i am puzzled and tired. mexico, drug lords are having a war. when is america going to worry about americans? when are we going to worry about our drug problem at home? thank you. host: "the washington post" talks about the timing of the attacks, saying that they occurred as the state department took the unusual step of authorizing employees at six consulates to send their families out of the region because of the bloodshed." that announcement was in the works before the three killings. independent line, good morning. caller: the last time i was in

mexico by escorted a neighbor to the alternative medical center for leukemia. i saw nothing that mexican soldiers in flak vests, guns everywhere. this is a volatile situation. people that do not have money or resources. the united states will have to make sure that we do not ignore the poor right near us. that is why there are so many problems . people are trying to survive. we should not allow the people around us to live in poverty. that will help to solve the

problem, if we share some of our wealth. host: 10 more minutes on the calls for drug violence in mexico. from the "el paso times," "i join president obama in strongly condemning these brutal murders. they are another reminder that mexico pause drug-related violence poses a shared security threat to the united states, particularly to border communities." "an estimated 20 u.s. citizens were killed in juarez in 2009." democratic line, go ahead. caller: i would like to say, they should legalize drugs in the united states. prisons are filled with people that committed small crimes, the

state's cannot afford to give them there. bring our soldiers home to protect our borders instead of spreading them all over the world. also, the mexicans are not the only ones bringing drugs into this country. we get stuck on blaming the mexicans when we have immigrants all over the country bringing drugs in. we put the blame on the mexicans. they're not the only ones. you have nigerians, chinese people bringing drugs in. we need to stop blaming everything on the mexicans. host: thank you, kenny. this one is in "the financial times" this morning.

health care legislation likely coming up on the house floor this week, also a piece this morning in "of the washington post" this morning from paul ryan, "health reform in ruins. rather than tackle the writer, they're chasing the premium. already washington has no idea how to pay for unfunded premiums in medicare, medicaid, and social security. creating this new entitlement would accelerate our path to fiscal ruin." texas, charles, what is the sense of the story this morning? caller: everyone is a bit shaken up about it. as for congressman raieyes, he s

not keen on solving anything. he sponsored a ridiculous bill in the house that is a total amnesty bill. he is always talking about being tough on the border in the border security, but he has not done anything in all the years he has represented the people in el paso. there is just constant illegal immigration, selling drugs downtown all over the place to illegal aliens. nothing is really done about it and frankly we should seal the border. all that we would have to do, they always talk about who will build a fence. all we have to do is sanctioned them to the point where the big businessman out there that are hurting because government only

listens to big money, those big businessman said that they would not do business until they stop letting citizens come into this country. the mexican government does nothing to help the illegal immigration problem in this country. there is no two party cooperation. the government does not care at all that debris fell law across the border. they do not do anything about it. there is no program on their side the help. we should sanction mexico a lot, to the point where we say we will lead do business with you until you do your part in the step up to the plate. we are sick of paying for your citizens, giving them free health care, welfare, the entire bet. that is all they have to say on

that. host: 5 more minutes of your calls on mexican drug violence. this story is about google and china. "google is supposed to close their china website, reducing foreign presence in the world's largest web market. their hopes to not filter results in china have all but disappeared." fairfax, virginia. republican line. good morning. caller: i have listened to the comments about legalizing drugs and the history of, drugs were brought into china to change the political system and the strength of the people. if this country had too many militias and gangs concentrated against the government, if we

allowed legalization, those people will use the drugs, like afghanistan, to take positions without considering their own loss of life. we should come down hard on mexico. rather than letting the diplomats say. host: don, ohio. good morning. caller: i feel this way. we have got our troops in iraq and afghanistan. they should be brought home and placed on the borders. since a911911 we have been gettg

people in here illegally. we have to foot their bills at the hospital. they are eagles that are be used for workers in the united states -- illegals that are being used for workers in the united states. host to you in a number of other people of cause -- called for closing the borders, does that just seal off the problem of not actually deal with the problem? caller: if we could bring your board -- our boys home in stationed along the border, there would be a lot less people coming in. the illegal immigrants found in this country should be sent back. they're not helping this country at all. many of them are bringing drugs in all the time. we saw what happens to the

border patrol, the one that shot the legal coming across the border with drugs. they were put in a federal penitentiary? this is ridiculous. host: california, democratic line. caller: i agree with the previous caller. they could also be used to deport all of the legals -- the legal -- illegals here. drug companies are making big money of this already. people are addicted to prescription pain medication. people are out of their head on these premeds. -- pain medications. for years we have known that

drugs have caused brain damage, causing people to not be in their right mind. it seems that laws should be changed to have a lock ups to require people to get help for their drug addictions. they say that they want volunteers, of people commit suicide and have overdoses. all the money we have given to mexico over the years, people are out of jobs. mainly, drug laws should be changed. doctors should be held accountable for giving prescription pain medications to people instead of finding out what is wrong with them into doing something about it. they're people on prescription drugs and illegal drugs, their

lives are ruined. the lives of their families are ruined. laws should be changed to have mandatory drug lockups. host: thank you for weighing in this morning, we will talk more about health care throughout the morning and the week. likely the house will be seeking action. the budget committee today is likely going to mark up the legislation, we will have that live for you later. other policy and legislation policy introduced this week, chris dodd is set to announce his financial reforms package today. the headline here is that he sets his sights on the middle ground. president obama will be in ohio today, talking about health care.

this is the the -- "the wall street journal" talking about that, "battle looms as obama proposes major changes in no child left behind laws." james, republican line, new york city. caller: how're you doing? those last couple of callers made very interesting points. we definitely need more security on the borders. i believe that the government was talking about less security and the borders. not only that, i do not know if the people understand that the cia is involved. no disrespect to the good cia workers out there, but they have been involved as well. this is the problem. so much money is generated by these rugs, this is not just about helping mexico. there needs to be deep-rooted

investigation, the cia has been involved in smuggling drugs. host: how are they involved and where are you reading that? give us a specific example. caller: i got this on the internet from the alex jones show, he reports the news that the mainstream media will not cover. there was a big-time drug dealer and a cia agent investigating him. he told the drug dealer that your suppliers supplier is an informant in he was going to blow the whistle and write a book. anyways, he wound up dead. host: thank you for the call. dave, republican line.

caller: in terms of what the u.s. should do, a big problem is the demand side. the demand for drugs in the united states is very high, driving all of these people to bring drugs into the country. the battle you have with in mexico is directly related. without doing anything else, the drug demand in the united states is reduced, significantly reducing the other problems, that is something we could figure. host: "the wall street journal" as an article about the violence in mexico stretching to the u.s.. "the attacks received about 04 rest of the violence to a new level. until now the killings have generally been between cartels,

targeting the mexican government. the president's strategy of using the military in place a police has come under increasing fire from critics who say that it has increased the violence." texas, henry, democratic line. where are you located? caller: just outside of houston. host: go ahead with your comment. caller: everyone wants to put an army in there, why are we not using our existing customs structures? of not putting up a fence, but military forces like they have in mexico. as far as legalizing drugs, that has been an ongoing battle for years. we should not legalize drugs, we

should increase the penalty for drugs. it is shut down the economy, it shuts it down. it does not need to exist. host: thank you for the input. let's turn our attention to the congressional leadership as the push for health-care legislation is renewed. we will talk about house and senate leadership with kathy kiley and richard cohen, just ahead. ♪

>> the health-care debate moves to the house budget committee today. we will have live coverage beginning at 3:00 p.m. eastern on c-span 3, sees the and radio, and our website, c-span.org.

democrats want to have the budget committee approved a bill under expedited reconciliation procedures. the rules committee voted on wednesday to work out the structure. nancy pelosi says that she hopes to start the debate on thursday hot with votes possible later in the week. visit our health care hub. read the legislation, joined in the conversation yourself on twitter. you can also find cost estimates for the bills and hundreds of hours of video from committee hearings, markups, and other events. that is c-span.org/healthcare. >> which two presidents died on the fourth of july? in the same year? tom jefferson and john adams.

find these and other facts in the new c-span book, "who is buried in grant's tomb"? >> a guidebook, a miniature history on each of these presidents. you can tell a lot about people of the end of their lives. >> a resource guide into the grave sites of every president. now available at your favorite book seller. get a 25% discount that the publishers bread site. -- website. >> "washington journal" continues. host: richard cohen covers congress for "the washington journal." kathy kiley covers congress for "usa today." joining us this morning, thank you both.

richard, after the november vote you did an extensive piece on how nancy pelosi did it. there is a lot in that article the talk about. what specific steps will she take to get the votes that she needs? guest: the most important thing that she has to get to this week is 260 members. -- 216 members. it will take a lot of work to get those final votes on board. over the weekend we heard from democratic leaders, it seems the votes will get their at 100%, but it will be a struggle for commercial reporters.

but exciting to watch. host: you wrote that the november vote was a very personal battle this year. health care was not necessarily her signature piece that she worked on. in terms of her going at it again, going around again, what will she tried to do different this time? guest: what she has to do differently is deal with the fact that we have an election that is seven months away and a number of house democratic members are running scared, facing tough contests. what she will try to do, what she has to do, with those swing members, in many cases she and other members of the leadership, folks from the white house, are going to have to satisfy -- they have certain members, voting for

that bill being in their best interest when they're running for reelection. host: we had a bit of an editorial earlier, they basically said that some of the efforts will suffer in the election and that that is just the way that it will be. how quickly will that remain a political argument for the members concerned about the vote? guest: you heard nancy pelosi talk about it last weekend, sometimes you just have to cast a vote in led the consequences fall where they fall. i was curious to ask richard if he thought that retirement helped or hurt. a number of democrats are stepping down, some of them blue dogs. guest: it will hurt nancy pelosi in the election, these retiring

blue dog democrats, it will be tough for the party to keep them. but it will be easier for a couple of them to vote for the bill that they might have previously voted against. host: our phone lines are open. for democrats, 202-737-0002. for republicans, 202-737-0001. for independents, 202-628-0205. our guests are with us until 8:30 to talk about congressional leadership in the upcoming health care debate. maryland, good morning. caller: i want to give some background on what america is. we produced more goods than france, britain, and a german -- germany combined back in 1915.

they had been able to control the media back then. "give me the power to print your money and i do not care who writes the laws." all of these wall street bankers, they are all subsidiaries appea. host: a couple of articles seem to indicate that this bill, like health care, will attract republican and democratic support. even given the concerns last

week over the bill, there is more likely to be some working together on that? guest: this is one of the opportunities. there are a number of them. climate change is another, maybe even immigration. i think that the health-care debate has become very charged, but there are other examples of legislation, if these big money people had purchased the media, why am i getting paid the same? [laughter] host: take the set aside for a second in the relationship between -- senate side for a second, mitch mcconnell and harry reid, this sort we are they as far apart as they possibly could be in the senate?

guest: i think that what people do not appreciate is that the leaders of congress actually do not have these bitter, partisan relationships. not the way that people might think. i would be interested in hearing richard posner take on this as well. .

especially the house, and kind of a broader theme is the power of leadership and especially in the house has increased to convince me. host: why is that? guest: used to be the committee chairman in the 1980's, 1970's, until a key turning point when the republicans won control of the house and senate in 1994, newt gingrich became speaker and ran the house pretty suspect -- effectively.

it resulted in the weakening of the committee chairman. that continued in 2006. as a result, the leadership, democrats and republicans, are at each other. yes, they have to get along, they do business, but it is all lot rougher than it is in the senate. host: you write about charlie rangel, in addition to leadership, taking on the role -- you write a problem was that there were some missed deadlines. guest: the reason the committee

system was created and the reason it has prospered is bills have gone to committees like ways and means because they have the expertise. what has happened since 1995 with newt gingrich, now with into pelosi, power has been reduced by the committees and to the speakership. you do not have the committee's claim the role like they used to. host: next phone call. addy on the democratic line. caller: first of all, this is not president obama's agenda, this is my agenda. i need insurance. people are making it a race

thing. we need help. host: give us more about the president's relationship with the senate, harry reid? guest: he came from the senate, did not spend too much time there. he certainly had the support of senator reid and his campaign. i once had a campaign event in nevada when then-candidate obama was running for president. harry reid introduced him ground they. he spoke to some of us after, really looking forward to working with now president obama. i think their relationship is a

good one, but i think it is a difficult piece of legislation. moscow in terms of getting that through, has he shown more or less patience than president bush? guest: i think he has been lasting gauged with the details but has been more so in deferring to congress and the leaders of congress to have them work on the specific deal. they have been almost encouraged by the president to do the deal, do the lobbying. this is a different kind of relationship played by the president compared to past presidents of both parties. host: truck from maryland. republican call.

caller: i know we are talking about with the leadership says to the american people, but there will be no stop in the rise of health care premiums. the people who think that they can get health care at a reasonable price, it will not happen. medical services are still going to be expensive. i have been in business for 34 years. i have seen the increases. getting this bill done will not lower premiums. my insurance broker told me of several occasions that for the next four years, might bring in the will quadruple for my employees because there is nothing in the bill that goes into affect until 2014.

most states that do not have pre-existing conditions, which maryland is one, and is all done by age. it is all set by insurance companies, but nobody is talking about this. it will be astronomical the expense in premiums. all of these companies bill raise their premiums for the next four years. there is nothing there to stop them from doing that. that lady saying that she wants insurance, she needs insurance. there is nothing there for you to get insurance. we are going to get subsidized taxes and everything else. that is what is being left behind.

host: thank you. kathy kiely? guest: i think the best sums up why this is so hard for the democrats. there is anxiety, there as to what the effect of this will be. when you are doing social engineering, which is what this is really about, there are unintended consequences. i think everyone has that feeling and there are concerned about what could happen. on the other side, opponents would say there will be competition, there is some precedent that the prospect of change causes change. in the 1990's when the health care bill was up four serious debate, there was a time when costs started to drop just because the government was talking about doing something.

there is that aspect of it. people in favor of this bill would say that you have to start somewhere. if there are things that need to be changed after, then you move on from there. guest: taking this one step further, this historic week in congress. we do not know the outcome. and they are kind of rolling the dice, speaker pelosi, and it is also historic in the sense that democrats have been trying to enact health care reform since franklin roosevelt was president. not only are they this close to doing it, but if they succeed legislatively, and then we are going to have these major historical questions. is it going to work? will it makeor a better health

care system? will the public like it? this will be great, journalistically, for public interest. guest: yes, it is not like it ends with this vote. host: next phone call. caller: i would like to know, if the health care bill does not pass, are the republicans going to come back and pass a good health care bill? host: and did you say the republicans? caller: yes, i did. according to peter ross, who is a representative in my district -- host: how did he vote last time?

caller: well, they all voted no. guest: republicans have said that they have alternatives. whether or not they go to them is up to the democrats, depending on what they do in congress. whether or not they even permit the republicans to bring it to the floor, or even if they provide the votes to support it. republicans say that they are ready to go, but they are not in control. this is a democratically- controlled congress. host: we see a lot of the republican whip eric cantor on

tv. talk about his role in the health-care debate. guest: and generally, the god of the party whip is to make sure that the vote in any party are lined up. for republicans, it is less important. they do not have many opportunities to affect the outcome. that means there is more opportunity for members, like eric cantor -- he has become more of a party spokesperson. i spoke to him on friday for a story i am working on. he is a part of the leadership, so he takes part in the strategy. but increasingly, party leaders are playing an outside role in dealing with the press and

public. host: jackie from ohio. democratic call. caller: i do have a question and a challenge for cathie kiley. you talked about the disproportionate influence of certain groups, people, in regards to what the media will cover. most of us have lost our faith in the mainstream media in the run-up to iraq because they did not take into the claims about wmd's. i know many media outlets have not talked about how many people have actually died. a report said 560,000. how many injured, how many displaced? if kathy thinks her paper is so

balance, could she asked her editors to cover that? no one is talking about what the conditions are really like. in regard to health care, can you explain -- the large majority of democrats support single payer. if nancy pelosi were to put the public option peace in now, how would that hang things up, or if people support it, how would it help? do either of you believe the public option will be put in later? guest: i think, or the option to be included in the legislation, it would be doa in the senate. nancy pelosi agrees. she supports a broader reform that is going to get through congress, if anything gets the

room. but she is also a pragmatic politician and that is why she is doing what she is doing. host: mike on the republican line. caller: two things i would like to see the papers cover more. this is supposedly financed with half a billion in medicare cuts. host: half a trillion. that is right. i want to see the papers talk about the fact that there is not much money there. the second thing is, i pay above flood, dollars a month for our family for help the insurance. well, if pre-existing conditions are eliminated, are we not going to see people like me pay an

increase? if there is an increase of $750 if you do not have insurance, why would i not just not paying my monthly premium and pay my out-of-pocket? if, god forbid, one of us gets sick, then i would sign up for insurance. i could probably save thousands of dollars a year by playing that game. i think we need to look at this system that will cause an immense distortions in the way that people pay for health care. guest: there is some uncertainty in terms of what will happen uncertainty about how of the program would play out, if enacted. in 1988, congress enacted the

overwhelmingly, bipartisan way, the decision by a robber and to provide prescription drug coverage -- ronald reagan to provide prescription drug coverage. one year later, the public showed significant opposition. as a result, congress repealed that program. president bush signed the repeal. none of us are suggesting that this will happen with this bill, but stranger things have happened. we do not know what will happen. the phrase i used earlier -- it depends on how it works out. guest: i believe, if i heard

correctly, he talked about trying to gain the system. i do not been that will be possible. i think you will need health insurance as part of this. that is the way proponents argue how you can afford to get rid of pre-existing conditions, exclusions. you will be bringing in these healthy people to help support the system. host: anything in the bill that says you have to have insurance, you have to have one of these minimum programs? guest: yes, there will be standard. host: the house is taking up the senate bill. what are they marking up? guest: is a complicated process. the house is scheduled to mark

of the reconciliation bill that will make changes in the bill that the senate has already passed. then the plan would be for speaker pelosi to take that reconciliation bill to the house floor. but only after the house has already passed the senate bill from christmas. host: and the president had to sign that. guest: yes, and if and when the house passes, the president has signed, and then perhaps by the end of the week they will come back with this reconciliation bill, make changes in the first bill, then it will go to the senate where there could be all sorts of procedural question, challenges. senate leaders have less

control that house leaders on such issues. host: have gop leaders given any indication in as to what they will do it in opposition? guest: everything. that includes a lot more in the senate than in the house. house rules are set up so that the majority controls what goes on. that is not the case in the senate. i think they are strapping in for a long couple of weeks. host: next phone call. bronson, michigan. caller: my question on health care -- we have been on this for paul little over eight years. this money it affects everyone in the country. if you do not have health care, you are going to have to pay some sort of a fund. they have not applied what it

will be. would it be good to stop all of this gridlock, put it on the november referendum and allow the american people to decide? all these people are doing right now are becoming professional the gridlock-makers, and they are excellent at it. the democrats are all in there. why can they get this passed? -- can't and they get this passed? guest: we do not have a procedure to have a referendum -- what other countries referred to as plebiscites. i think it is possible but you are asking for. it could happen this november indirectly, namely, the election will be a referendum on the

house reform bill and voters in both parties -- republicans will say, let's make this a vote on what the democrats have not done. democrats, for the most part, will say that we think we are happy, proud of what we have done. republicans have stood in the way. in some respects, what the caller is asking for could happen, simply through the e election process. host: you write about the primaries. since 1962 -- what is that a concern? guest: it is ironic.

we take polls -- and lot of people take polls -- and we often focus on partisanship and politics. however, we americans consistently leave the important decisions as to who party nominees will be to the most partisan people in the system. if you do not show up to vote, those that do are the most partisan participants in politics, and guess what kind of candidate they are going to pick? it is one of those factors -- we talked a lot last year about record turnout. there was a record turnout, higher than recently, but one of the experts that i quote in the story shows that in other office

races, this past year, showed a record low turnout. i think it just shows disengagement on the part of americans. on the one hand, they want change in politics, but they are not involved in the early stages, where you really pick who will be the candidate in november. host: is the declining participation of people within the party, does that not have to do with the independent folks in the party not for to the fading with the active -- participating with the active membership? guest: in some states, they have they closed participation

system. other states allow you to participate. there is an interesting movement in california -- someone talked about a referendum. there will be a referendum on the ballot this in june, i believe, to change their primary system. you could go in and vote for a republican or democrat and the top two -- it would be like a runoff. it could be two republican or two democrats. some claim it enhances a voter participation. host: will from tennessee. caller: i appreciate that transparency that c-span provides for america. i wish they would go further and do something about this closed door business going on in

washington. i have a couple of comments. then let me ask a question about health reform. first all, we watch both the house and to then go into their chambers in the morning, offer a word of prayer, and then they go into the pledge of allegiance. then they go right into their legislative speeches and it falls apart. nothing but words. the other thing is, ethics legislation -- it is supposed to protect the american people. you have people like charlie rangel finally coming up. then you have people like barney frank being corrupt and nothing being done about it. that is how government is done,

i guess. this problem about health reform -- i have two senators here in tennessee. i have called both of them. both are republicans, unfortunately, and neither one of them are entering me. i respect them, their positions. lamar alexander and bob corker. i said, if the american government can pay the taxes for these bureaucrats to get that $200,000 a month track, how come they cannot set up another program and called a it the ihs? internal health services? tax the people just like the way the irs is doing. provide america at a health program. then america will trust their

leaders again. host: thank you. we want to give our guests a chance to respond. guest: there were a lot of ideas tabled in there. i think people are frustrated by the complexity of this. it is understandable. the legislative process is a bit of sausage-making, we like to say. that is why people are grateful for c-span because they get into it into what is happening to some degree, is the nature of the business. when someone talked about putting this on the ballot for a referendum -- what will be on the ballot? what should be in the bill? those are the kinds of discussions that almost half to take place in quiet rooms

between each other. frankly, i thought president obama was not when he said, let's put this all on c-span, no offense. all that would have been would be these big grandstanding speeches that the last person objected to. it is a difficult balancing act. you want open government, but if everyone is on camera, no serious negotiations will be done. people will only be playing to the camera. host: why was lamar alexander chosen to lead that republican health care event? guest: he has been bipartisan, he has that reputation. he has worked across party lines before, so i think he is a good

spokesperson to put out there. i think they are trying to battle this image that they are the party of no. host: next phone call. good morning. i want to talk about health care -- caller: good morning. of want to talk about health care. it looks like health care is just for people who have money right out. you look at people down in the cell and especially, they do not make much money. some of them only make $9 an hour. and when you go to the doctor, you have to pay a deductible of $2,500 before you get treated then they take money from your pay. if you have a family, it is

like $120 a week. people who do not make much money do not have money to take home. why do the republicans want to delay health care? guest: you get to the heart of the question. health care has become such a huge part of the economy. people are around the country, including you, that translates into real expense. one reason we are having health reform is because the system is really getting out of control. too much money. maybe this bill will start to

get control of costs by providing better access, but we have to fix this massive health care system. host: richard cohen covers congress for "the national journal." kathy caylee, you can read her work at "usa today." a look at how states are dealing with the budget crunch. we will talk to the joseph henchman. first, at a news update from c- span2 radio. >> president obama flies to ohio today to talk about the proposed health insurance bill. he speaks at a senior center outside cleveland. it is the home of one resident who wrote to the president talking about the increases in health care. after that, the president

returned to meetings in washington christopher dodd unveiled his financial overhaul bill today. reportedly, it expands the powers of the federal reserve board but create a consumer protection program with less authority than the president had asked for. politico reports that some house members are driving cars paid for by taxpayer money. nearly $3,000 in the last quarter of 2009. nine other members are paying more than $1,000 a month. some say that behind these cost is the result of an energy policy requiring the vehicles that they choose be fuel- efficient. others say that their two-year term prevents them from signing longer pleases. -- longer leases. >> our mission is to make

everything more free and open. >> with more than 400 users online, it is the fastest growing website and. the public policy director of facebook. >> committee members mark up legislation in the house today. live coverage that 3:00 on c- span 3. the budget meeting is part of an effort to put the matter to vote by march 18. then the rules committee will meet wednesday to work out the structure of the debate. nancy pelosi says she hopes to begin debate on thursday with both possible later in the week. stay tuned for the latest on

health care. visit c-span.org to see what members of the house are saying. you can also find cost estimates for the bill. c-span's healthcare hub. c-span.org/healthcare. host: joseph henchman with the tax foundation is to come up to us about the increasing taxation across the nation. the report the average sales tax nationwide is 8.6%, with the highest in the country in alaska -- excuse me, alabama.

$450 billion in taxes was generated in 2008. also, state reported a cumulative budget gap in that time, in fiscal year 2010, up $84.3 billion. how i can state taxes go before people said that is enough? guest: that is a question we are looking at. when considering raising taxes, lawmakers have to look at stake to around them to see what is comparable. if it goes too high, people will be going across the border to buy goods and services. this is the question that big government are having in terms of what the sales tax should apply to. host: when did your group start seeing the trend in sales taxes are going up? guest: perhaps going back to

1937 when the first sales tax round were enacted. with the current crisis, we see states looking to the sales tax. lots of states are proposing rate increases or basic expansions. host: taking a look at the average of taxes across the nation. for the radio listeners, or the state with the high state tax, oklahoma, tennessee, louisiana, california, and washington. is there any pattern to these states? guest: for some of them, they do not have the other major tax. washington does not have an income tax, so they rely on the sales tax to make up that revenue. california, they have all the taxes and they are all high. host: what about in the case of

no sales tax? oregon, montana, alaska, new hampshire. guest: alaska can get by because they have a low government mindset. their government provide services for a much lower tax rate. states such as oregon, they have a high income tax now to make up for that. montana, alaska, they have natural resources that they are able to get resources -- revenues from. host: joseph henchman is here to talk about state taxes, and the amount to the increase of them. democrats, 202-737-0002. republicans, 202-737-0001. independents, 202-628-0205. we will get to your phone calls momentarily. with sales taxes going up, in

this recession we have been going through, people are buying less. is it is self-defeating prophecy? aren't the copper is going to be filled up at a slower rate? -- coffers going to be filled up at a closer rick? guest: states cannot print money, so they have two to is to raise revenues. what you have decided that the role is to raise taxes, you have to decide which one to go for. host: do all states have a balanced budget? guest: except for vermont, but they have a slightly different setup. host: next phone call.

caller: i wonder if you have read the book "the history of taxes" and if you recommend that book? guest: do you know who the author is? i have not heard of it. caller: i was trying to look it up. it is a fairly recent book, in the last 10 years. i think the punch line, when you get to the end, it is that if you cast a wide, thin that, -- if everyone is equally mad, taxes are about as fair as you can get them. in texas, it is all on property. in california, in his property, sales, everything.

thank you. guest: i have not heard of the book. i am always looking for new things to read, so i may have to check it out. the perfect sales tax is something that touches every item once and only once. so you have the government not to store and between different items. also, the government should not be taxing the input goods. that would result in double taxation at the final cash register price. i think he was also talking about what alliance you put into a different kind of taxation. i think that is a testament to our federalism. different states rely on a different mixture of revenues. host: what you were talking

about earlier sounds a bit like a value-added tax, that is another option guest. guest: there are a lot of proposals out there right now. right now the average sales tax is about 40% of all goods and services. that is relative to the 1930 ponce when good with a march larger share of our economy, services was smaller. we have now seen that flipped. host: in this recession, you have looked at states that had increased fees for, say, motor vehicle registration and things like that.

guest: that is something that a lot of politicians are reluctant to do. even governors and legislators opposed to taxation, increasing taxes, being much more open to raising fees, such as taxing drivers. host: bill on the republican line. oregon. kansas. caller: i would be interested in what you are doing in things other than sales tax. we also have local taxes that are levied, sometimes for building a courthouse, what ever it might be. there is also a bill that just came from committee. they are looking at adding fees

-- they do not want to use the waord tax -- fees on utilities. what other states doing? are they doing similar things to hide raising taxes but to attract the money from us? guest: absolutely. also run the legal program. -- also run the legal program -- i also run the legal program. there is a constitutional implications. taxes have to go through additional requirements. he mentioned some of the local sales tax in turn districts.

there are about 8000 sales tax jurisdiction to in the united states. contrary to popular belief, there are not aligned by zip codes. some have hundred and of little sales taxes. sometimes they even have different basis, but it is an often popular place to go to. host: david on the independent line. caller: good morning. i had a stroke at one time, so if i am a slow, bear with me. i agree with dr. michael hudson that we are in a time of cerf done. i agree with dr. william black that we have to incentivize fraud. as far as the financial sector, cdo's, the faults swaps, they have grown disproportionately to the goods and services in the

country. why not input the tobin tax? put it on otc's. it would be across the board. it could generate up to one trillion dollars a year. guest: if you are not familiar, the tobin tax is a tax on financial transactions. so on every transaction, this tax would apply. if a stock is traded five times a day, the tax would be applied five times a day. host: who gets taxed on that? the individual or the financial company making the trade? guest: that is the question.

legally, i believe it is the company, but ultimately, all taxes fall on the individual. if a bank were paying for it, it would ultimately fall on people working and putting money into that bank. it is important to remember, individuals pay taxes at the end. another thing to keep in mind, although it can be attractive of this very low rate, the reason it is so low is because there is a broader base whe. when you can talk over and over again, that is why these types of things are so economically distorting. host: next phone call. art on the democratic line. caller: would you consider the

fairness of this -- basically, i am taxed for everything that i have. how can you make this more fair? guest: i think you have hit on one of the fundamental debate in taxation. should we be tortured people for the percentage of services that they use? should we be taxing people based on what they can pay? historically, we have done a little of both. the question of fairness -- sometimes, i think fairness it is in the eye of the beholder

ultimately, it comes down to what you think the proper mix is. host: there was an opinion piece in "the wall street journal" talking about maryland. the first year the higher tax rates apply, the number of million their tax returns fell sharply in maryland. the piece goes on --

is there evidence of this happening in other states where the income tax has been raised? upper income folks not lending residents in the state that they originally did? guest: we have been following this millionaire tax trend. historically, the income tax in is the last tax that they turn to make up their deficit. this time, we are seeing it more often. they have hit on a way to make it apply only to these high income earners, these so-called millionaire's. a lot of them just took effect last year. maryland and new jersey have had longer ones, so we have been able to look at those experiences associated with them. in all states, the number of millionaires is dropping off. certainly, a part of that is the recession.

the maryland comptroller's study is interesting because it goes beyond that to look at specific individuals who filed as millionaires and tracked their behavior over time. that drop shows a significant larger drop than in tax years. that would to just not the thai exchange had an impact. host: yucca valley, go ahead. caller: i wanted to bring up some points about the federal government talking about state spending. in the fdr presidency, he believe that the government should put a band-aid on the economic state. basically, this was a short-term gain but a long-term loss. the government is doing the same

thing now. it is putting in place big government spending. the reason why we have so many taxes is because there is not enough funding from the government. my question is, why are we not stopping big government spending? guest: the government actually provides about 40% of state government funding, which certainly has a lot of federal implications. this has crept up over time, especially back in the roosevelt administration. first, they implemented sales taxes, property tax, and then the rays of the intergovernmental aid. some with strings, some without. this does not directly address your question, but in a way, we have both.

host: the number of states using the stimulus money to help the shortfall in addition raising tax rates. this year, many are in the same situation. there is not much stimulus money to be used, so far more tax increases likely? guest: stimulus was meant to be temporary and does expire in fiscal 2011. some states took that money as a transition costs, so they put their fiscal house in order, report time expenses, got their revenue stabilized. some states and did not do that at all. some just kept on going the way they were going and use that money to fill up that gap for the year, and now there are

facing a fiscal clefcliff. so we could see a lot of states struggling to do with that problem that they have treated for themselves. host: louise on the independent line. caller: i would like to know if it is legal for state government to start taxing the illegals who are sent to other countries? they could start seeing who is legal and who is not. who ever it is not, they should start taxing the money that they are sending some else. then they can use that money toward citizenship. i do not know if any state does that, but i know if the money is not being taxed, that is money that we are losing. guest: i am not sure whether or

not the federal government could tax it. as far as the federal government, there is something called the commerce law which does not allow outside remittances. generally, payroll and income taxes still apply whether you are legal or illegal. beyond that, i do not know the answer to your question. host: she called in from illinois. the governor wants to raise the income tax there. guest: that is right. previously they had a low tax rate. otherwise, taxes are pretty high. host: next phone call. democrat line. st. louis, good morning. caller: i have worked for the

irs. i know that trillions and trillions, in every hour. why does every state claim to be so broke when there are trillions and trillions coming in every half hour? guest: i am not sure. the information about what states are getting in revenues is pretty public. they have a consolidated annual report that is put through the budget process. if states had trillions and trillions somewhere, they would know it. host: in an article about going after folks who owe taxes, california is considering requiring on-line retailers to collect sales taxes from customers in that state.

is that likely to catch on in other states, too? guest: these exist in four states right now. what these taxes do is they allow the state to force these out of state online retailers to collect sales taxes made on purchases made in the state. they are probably unconstitutional and do harm to the interstate commerce. there is in a lengthy report about the current trend of amazon taxation, but it is out there. the argument for r three. one, that it is e.d. revenue. -- that it is easy revenue. state to have enacted this have seen little to no revenue increase. amazon's response to this has been to terminate its affiliate

program. so in lost revenue from people in the state paying taxes in the affiliate program. another reason is that this levels the playing field. rick and mortar locations have to collect sales tax but these places do not, so these taxes would make the obligation even. this is also not the case because these laws are not about leveling the playing field but putting a punitive penalties on companies. brick and mortar companies only need to keep track of one right. on-line companies need to keep all of the rate intact and when they change. host: if i order something on the amazon, technically, do i owe the city of washington something? is it my obligation to pay the city something? guest: when you use a product,

if you have to pay the sales tax on it. new york requires you to fill in your number. you cannot leave that one black on your income tax reform. states are just not willing to force their voters -- to be frank -- to pay these taxes. it is much easier to go after these companies. host: joseph henchman is with the tax foundation. we will go to houston. don on the independent line. .

guest: the difference between taxes and fees, taxes are levees that go to general government services, fees go to the cost of providing service to a particular individual. some states have multiple reading requirements for tax laws that must be read by the

legislature. some states even have over approval requirements. we have a big incentive, not only political, but legal for politicians to avoid calling things taxes and instead calling them fees. host: steve, republican line, good morning. caller: i have got a lot of questions asked, i will take my answer off the air. sales tax versus the unemployment rate. in south dakota the unemployment rate is at 4.16, montana is 6.6. i do not know what it is in utah, but there the federal government has taken over 85% of

the land in utah to where the natural resources are completely taken away. i was wondering, what is a correlation between unemployment and each state is taxed? host: we will get a reply. guest: i have not looked at the statistics closely, but i think they are lower in thendustrial parts of the northeast. the extent of tax policy affecting unemployment and the economy is something that we have researched extensively. states that have a flat, low tax system, they do better in the

short-term animal long-term. some of the states that you mentioned follow more in that rubric that others. host: here is the front page of "the philadelphia inquirer." chris christie, "seeking a property tax curve, pushing the rebate program. -- program." in terms of property taxes, with value going down, how much more of this will we see? >> it will be difficult. many localities depend very much on the property tax. you always keep that revenue high by raising the assessment or the rate, which a lot of localities are doing. so, they're still able to push the revenue of words. many people think they have terrible property taxes. which is true in new jersey,

they have actually push through a reform, building on other reforms, to essentially raise the state income-tax to produce property taxes, creating a mess for the state. now they have high everything. high income taxes and property taxes. the rebate program is very expensive and burdensome. it will be interesting to see what chris christie does to unravel that not. host: your foundation reported that their sales tax was 70%. hot springs village, good morning. independent line. caller: mr. henchman, do not cut me off. i am 86 years old. i am not an economist, just a streetwalker.

i have designed my own income tax plan. i have to bend someone's ear to listen to it. i know the needs tuning up -- guest: do you want to give me the highlights? caller: well, what i have taken into consideration is that everyone does not pay income tax. i have got a plan that will make everyone pay income tax that will be eligible. eligible in the income tax bracket to be able to. but i do not know who to contact. it needs tuning up, i admit, but the idea is there. host: thank you for the call. host: our web site, taxesfoundation.org, i would be

happy to look your plan over. he hit on an important point, of the income tax dollar, less than half of it is subject to taxation. much of it is excluded remote -- mortgage interest deductions, tareq -- charitable contributions, child tax credit, and many other things out there, resulting in higher taxes. so, we often see a lot of income tax reform proposals and allow a lowering of the rate. host: how often as a foundation dc-8 tax idea -- do you see a tax idea come through that is great that has not been thought of before? >> we often see ideas all over the place, even from following the states, every year

legislators have new ideas we have not seen before. some of them are good, some of them are bad. host: compare the situation in the united states to that in europe. guest: clearly they have their value added taxes over there, how that differs, sales tax is charged at the final register, in europe is charged at every level of production with a rebate system to make sure that we are not penalizing products that have multiple stages of production. host: multiple people along the staff pay the tax? guest: as a result, it is harder to evade. you would have to get everyone in the chain of production to avoid it. europe has a very high tax rate. greece is the most recent

example of an increase, raising their rates from 19% to 21%. pretty typical in europe. host: detroit, roger, good morning, democratic line. guest: i had a couple of questions. have you ever heard of cereal based budgeting? is that the same as balancing the budget? also, because of a loss of revenue with a loss of jobs, obviously finding taxable sources of income is going to be difficult. what fundamental ideas can the state governments and the fed look into in terms of generating jobs and industries that will create products and services, goods that will in turn generate sales internally

and abroad that will allow these things to be taxed? with our job service industry going out of the country, the tax base has shrunk. host: thank you for that, we will get an answer. host: the first part of the question, zero based budgeting is the idea that you sort of start each budget a fresh, looking at all of your priorities, not taking it as a given that what you did last year has to continue into this year. this is something that a lot of people give an acknowledgement to. of course, whenever anyone compares budgets, they'll is compare the level proposed to the level last year. the balanced budget is the idea that your revenue goes out in a round if you can borrow, or you

can issue an i/o you -- iou, like california did last year, but the general idea is the were spending more than you take in. a better budget practice would be an effective state rainy day fund. states should be setting aside their revenue every year. at the beginning of the recession the most prudent state had somewhere between 5% and 10% of their revenue in a rainy day fund. as far as growing the long-term economy, we found that the best way to do that in the long term is not your targeted government programs, but having a low, open, broadbased that is open to everyone that everyone can take advantage of.

host: front page of "usa today" there is an article, "democrats in missouri, each one of these holidays cost $1.2 million." arlington, virginia, go ahead. caller: i heard a lot of people talking about how the legal people do not pickaxes, but that is not true. america does not know -- do not pay taxes, but that is not true. a lot of these people pay taxes, the employer takes them off of the legal people.

host: let me get this straight, you were illegal and paying income taxes, not just sales taxes? caller: yes. so the taxes were taken off of my paycheck. host: but you did not file income taxes at the end of the year? caller: i could not. i probably made $150,000 in those four years. guest: a lot of illegal immigrants do pay income taxes and payroll taxes, and because they do not generally file for refunds, if the government took more than their policy, the government generally keeps that.

of course, if they paid in less, or if they owed money, the government would not get that either. i do not know how that even sell. -- evens out. host: john, ky. caller: i have a question for mr. henchman. i am on unemployment, pretty high around here. why does the state of kentucky not hold the state tax on unemployment? host: you get a state tax on your unemployment benefit? caller: i do not, they do not hold out state taxes, just federal. they hit us at the end of the here on that pretty hard. guest: they are not withholding, they're making you pay at the end of the year. withholding in the united states goes back to world war ii. before that if you owe income

taxes, he would write a check of the end of the year. milton friedman invented the idea of holding during world war ii to reduce the administrative costs, you would have just a little bit deducted each year. certainly not your so, there are taxes that does not happen for. there is often a debate -- i have one -- heard one argument that it anesthetizes people the big government. one of the reasons that people hate property tax is because it is so visible, they have to write that huge check every year. oftentimes with income taxes, people get their refunds and they think it is free money, but it is not. host: joseph henchman's report can be found on his website,

taxfoundation,.org. thank you for being here. guest: thank you. host: we will take a look at the stimulus money and how it has affected jobs in the united states. john powell joins us momentarily from ohio state university. first we have a news update from c-span radio. >> arne duncan, speaking earlier today on "good morning america, says that the president's education plan is looking to make some dramatic changes. rather than focusing on grade level proficiency, it would work to get students ready for college or a job. the secretary added that the administration hopes congress will pass the measure this year. it pentagon spokesman commenting earlier said that a report that a defense department official hired private contractors for intelligence gathering in afghanistan and pakistan raises

serious questions that warrant further review. the report is in sunday's "the new york times." the private operation violates u.s. policy against using contractors as spies. census forms for 120 million residents are in the mail. it is used to divide and rational seats and $400 billion in congressional aide. if everyone that it's a form sends it back, the government will save $1 billion in follow- up visits. the national highway traffic administration says that there might never be an answer to the alleged sudden acceleration incidents involving a cuyahoga prius in california -- toyota prius in california. those are some of the latest headlines on c-span radio.

>> the u.s. house is back a legislative work today at 2:00. on its agenda, bills dealing with congressional pay. as well as faa programs. they could take up the tax rates extension bill and health insurance subsidies for insurers. on health care there is a possibility of votes on the senate-passed bill and reconciliation measure occurring sometime this week. they will be getting back to work on a $17 billion jobs bill that does a number of things, including a payroll tax credit for businesses that hire new workers. live, on c-span 2. >> our mission is to make the world more open and connected. we do that by providing people with a free tool where they can share information with anyone, anytime. >> the fastest growing website

in the world, the public policy director of c-span tonight on "the communicator's" on c-span 2. >> "washington journal" continues. host: we are joined this morning from ohio state university by john powell, we are looking this morning at the stimulus spending, particularly the money spent on job recovery and how it has affected employment amongst minority individuals and communities. john powell is with us until 10:00 this morning. here's a look at the report on the american recovery act from one year later. in this report you talked about how this is an uneven economic crisis. some of the figures you have quoted, one out of five people in the united states, living in poverty.

one out of six african americans and latino workers are unemployed, nearly half of all the subprime loans went to black and latino are worse. your report on the spending in these areas is that a fall short? -- it falls short. guest: that is right. host: what was most concern to you? guest: when the department of labor came out with unemployment data, the overall unemployment in the united states went down. for the african-american community, it went up, raising concerns as to why the trends are different than the rest of the country. the most recent data, coming out just a few days ago, a slightly different for african-americans,

but we know that there are pockets throughout the country in the rust belt where unemployment is not going down at the same rate. the strategy of the stimulus plan actually benefits some industries and hurts others. especially construction, those industries ready to start work right away, in hard-hit areas you have fewer shovel ready firms. those also tend to be areas with high numbers of blacks or latinos. host: what were your expectations when the stimulus was passed as to how much this would help the unemployment amongst african-americans and the minority communities? guest: our hope, we tried to

communicate this to the administration, is that we should look at the areas that were the hardest hit and not to have universal strategy. putting in michigan, ohio, pennsylvania -- looking at michigan, ohio, pennsylvania? those areas were harder hit. in terms of the neighborhood stimulation plan, they directed more funds to communities that were harder hit. recently they announced a $4 billion plan for foreclosures. three or four states did not qualify. there is a logic to that, when you say that these people simply will not benefit, the goal should be getting people back to work or people back in their

homes, but the strategy needs to be tailored to the specifics of the population. host: john powell is the executive director of the kervin institute for the study of race and ethnicity. we are talking this morning about the effect of the stimulus legislation amongst minority communities. we will take your calls. for democrats, 202-737-0002. for republicans, 202-737-0001. for independents, 202-628-0205. we will get to your calls momentarily. john powell, you write in your report not just about unemployment, but also about how those funds are being directed at minority and women known to businesses. while they represent 5.2%, 620%, and 28.2% of all businesses

respectively, as of february 2010 they had only received 1.1%, 1.16%, and 2.4% of the federally contracted arra funds. why is that? guest: they're getting about 5% of the public money with the stimulus package. part of it is the size. part of it is bureaucracy. i guess the largest thing is that it is not targeted. there are no deliver it plans saying that it is women that represent these businesses, let's make sure that we purchase in service from those businesses. part of it is that the government is not keeping good data on women and minorities. the day you are seeing comes

largely from the bureau of labor statistics. the data kept directly through the stimulus does not track people by race or gender. one of the things we have been advocating, we are spending $800 billion, we should know where the money is going. host: you have a breakdown of the spending in the report that i will show to the audience. in terms of the spread of those funds, we will let the camera take a look at that chart. the majority of that stimulus fund funding has gone to tax relief for the states, correct? host: correct -- guest: correct. we thought it was important to

note that in terms of implementation, it was not well crafted. host: you wrote an opinion piece earlier in the month that most americans desperately wanted to succeed, because it would be good for the country, possibly lifting all boats. john powell is with us until the end of the program, taking your calls, alice, independent line. caller: when you have no money, there is a barrier, that is where we are down here on the port side of town. as you get more money and everything, that is where it comes in, getting everybody pulling for something that they do not have.

we have nothing to say, that is what i thought. host: any thoughts? guest: i think that the caller's statement that being court creates tremendous barriers -- poor creates tremendous barriers. blacks are about seven times more likely in something called concentrated poverty than whites. poor flights are definitely struggling and we would suggest the resources need to be directed their. if they live in a poor neighborhood they have an experience similar. think about detroit, where unemployment sometimes hovers around 40%.

san francisco, not that it is easy their, but it is a different phenomenon. being poor a barrier in detroit, but a different phenomenon as well. there is a bus system but you cannot gadahn. or there is no system at all. -- you cannot get on. or there is no system at all. one of the things we actually look at is multiple communicators on poverty, geography, transportation, job creation. we need to look at those things all at once. host: tom, michigan, go ahead.

caller: your guest seems intent on using detroit in his talking points, but if you are familiar with the troy, blacks and latinos are the majority -- familiar with detroit, blacks and latinos are the majority. if you continue to use them as some sort of talking points in your initiative, whenever that is, you might think about who is in the mint -- minority, poor whites. thank you for c-span. have a great day. host: we have a look here for the viewers at the overall rates, slightly declining for every group except for african- americans. why is that picking up? guest: two things, to the

caller, i am from detroit, i know quite well. he is right, detroit is a city where the majority of people are african americans. is also the epicenter of the automobile industry. no surprise, that industry is on a serious decline in has been hit much harder. if your industry is in a series free-fall, you will have much greater consequences. recovery is much more stark. so, the governor of michigan has appropriately asked for a special focus on michigan and other rust belt regions, basically regions that have been hit hard by moving heavy industry outside of the united

states. michigan is probably the worst. host: silver spring, chris, republican line. caller: thank-you to c-span, first of all. i work in a very liberal state, maryland. i have been a county employee for 25 years. we continue to bring in black males, we tried to get them hired, they have a terrible work ethic, they never, in over 25 years i have been working near. same with black females. the work ethic is nowhere close to what it should be. host: what is your position? caller: we work in the budget office. people get so frustrated, we tried to bring people in, they

are qualified based on their paperwork. but they get all these people showing up, but they are not doing equal work. it frustrates me. host: any thoughts? guest: i do know that people are differently prepared for work. i do not think that blacks have a different work ethic from whites or any other group. some properties are simply not properly prepared, i would look more carefully at how these people prepare and what is going on in the workplace.

host: moments ago you talked about the auto industry leaving detroit. al about making cars in the u.s. again bell bella joe, independet line. caller: the extent of the surveillance that you were talking about, the largest percentage went to the states. how did that affect school costs? all this money going the bailout the automotive industry, i knew immediately that that was not a good thing. if i fail in my small business, i fail. it keeps me competitive and doing the best i can. i also found out that 60% of the interest of general motors is

owned by the federal government. it appeared to everyone that money was there to help the economy, but it basically went back and was kept out of circulation. i do not think that they thought as well as they should have. putting it into main street could have helped people produce more. maybe that kind of money divided into the state's, that would have been a loan that was paid back, people getting into business, hiring people, renting buildings and supplies. why could that have not been done? how is that affecting the schools? host: we will get a response. guest: school cuts would have been much worse without the stimulus package. $25 billion went to the auto

industry, but secondly, most of that money was taken by chrysler and general motors and has not been paid back. the government became a silent owner, not participating. could you tweak the plan? certainly. i think it would have been substantial to let them fail as an industry. thinking about world war ii, general motors in detroit, their machine building in the united states could not have been built without the equipment. so, it is not just a matter of helping out one particular industry, but really it is about the national security. we have already pumped in something like $3.50 trillion into the banking industry.

we were headed towards a depression and the government had to do something. i think they probably did not do enough, in the most prudent way is, it would have been a catastrophe to sit back and do nothing. host: i want to get your response to congressman john clybourn in the house in his discussion of job creation. also about the congressional black caucus with president obama and urging him to do more in creating jobs. >> can you assure the american people that by july of this year the american economy will begin to create more jobs than it loses? >> i can tell you this, i am

comfortable that for the last two reports we have remained stable at 9.7%. we just as a jobs bill through the house and we will pass another one in the house and senate over the coming days. i feel that we are on course to get this economy moving again. i had a meeting with the congressional black caucus a few days ago, it was a very cordial meeting, one of the most productive meetings i have ever had at the white house. we are all on the same page when it comes to providing health care and creating jobs in this economy. i am comfortable with the relationship that we have with the president and i think we will be working together. host: john powell, do you share the congressman's confidence?

guest: note, first of all i think the government, when you think about the original jobs bill, 15 million -- billion dollars going to congress, in reality it was not a jobs bill. we have not had a serious jobs bill. we have had tax cuts and tax credits. keeping with unemployment around 10%, from my perspective that is unacceptable. unemployment calculations means people looking for jobs. this is not mean a person is out of work and they stopped looking at are no longer counted, we need to do something much more robust and targeted to make sure that american gets back to work. certainly, i think that there are things that need to be done.

i applaud some of the things they have done, but i do not think that they're targeted enough. the suggestion is that we will have high employment over the next three to four years. they pick up or go down a little bit, but it will have a huge impact as the economy is consumer driven. host: monique, south bend, indiana. caller: my question is something that i do not think people want to deal with, basically what i found out, the same people applying to the same jobs, i have not gotten an interview in three years but my caucasian friend is getting interviews. i know this as an african-

american on by inflation. the census in south bend, apparently it has created problems for people getting documentation regarding jobs, but there are caucasians on the panel getting jobs and phone calls. when all of these jobs start to come back, i believe that more caucasians with degrees will be hired -- i mean more blacks with degrees will be hired. host: are you seeing that experience elsewhere? guest: what the caller described is well documented. this is a test, they said exactly the same form, one with eight african-american sounding name and one with a king -- caucasian sounding name.

they find that the applications are treated quite differently by prospective employers. african-american with a college degree is much less likely to get called back for a job that an african-american with a college degree. clearly there is widespread discrimination in the jobs market. in terms of recovery, for every year of recession, it will take four years for the african- american community to recover. statistically there is a huge gap between what happens to the african-american community and the white community. it is well documented. the caller is reflecting something that has been consistently shown in research. host: houston, republican line.

caller: it seems that this country is moving so fast, they have been in jobs for so long, when they are gone, they are out. we were talking about women and the separation of the races, not in power positions. until we give them power positions where we can control the money, they will always be out. that is my comment. host: your thoughts? guest: hard to say that african- americans -- certainly we have the need to have an african- american community that participates in the political process, i agree, but i

hopefully think we will get to a point where it is an american problem. not just people saying that african-americans need jobs and latinos need jobs, but saying that we are spending public money with public programs, we should make sure that all americans participate. to do that you have to knowledge that different people are situated differently. the fact that the steel mills closed was not the fault of a worker. 70% to 80% of people in education are women. focusing resources on education will disproportionately help women. construction, with a few exceptions, tends to be predominantly white and male. the construction industry was doing something that would have a racial agenda footprint.

so, we need to be much more sophisticated in terms of directing things in such a way that all communities develop and benefit. hopefully this will show that this is what america stands for in terms of doing its best. host: john powell is the executive director for the kervin institute. the american recovery and reinvestment act and the financial crisis, one year later. john powell, how long did it take you to put this report together? guest: we started almost as soon as they started the stimulus. we started to track it. we were concerned that this might happen. periodically be put out

different reports. this last one was an accumulation. host: california, good morning. caller: good morning, gentlemen. miami libertarian and it strikes me that we still suffer under slavery, and i think that the answer is simple. replace it with freedom. unfortunately been taken the progressive route, including alcohol and drug prohibition. the incarceration rate for young black men is higher now than when people suffered under jim crow. is one of your policy recommendations to end direct prohibition? guest: that is not one of our

recommendations, but i think your point is well taken. there is a bill in congress regarding crack and cocaine in terms of treatment. crack is something more likely used by the black community, cocaine more likely used in the white community. we are concerned about that, this report is not focused on the use of drugs, and clearly we are not abrogating the removal of legal arguments around drugs. host: your report also deals with the impact of the housing crisis, one year later, inadequate federal response is the headline on the paragraph here.

"neighborhood stabilization programs to purchase they get homeless has been criticized as too little, too late. in many communities the number of vacant homes is several thousand times the number homes purchased. the principle seems sound on its face, it might be putting drops in the wrong bucket. rather than trying to salvage a few homes in overrun neighborhoods, it might be better to move those families into rehabilitated homes in more stable neighborhoods. how would that work? guest: a great question. most people do not understand how we got to the subprime foreclosure crisis. they assume that unsophisticated people were taking all loans -- taking out loans. if we had more time like a joy

you a chart. our lending market became a global market -- if we had more time i could show you a chart. our lending market became a global market. the market than most people did not fully understand. there were always communities that were under-capitalized, we had all of this new money coming into the global market starting in the 1990's, and it accelerated, it was directed into those under-capitalized communities, the banks, instead of holding the loans, they actually passed them through. so, something between 40% of the loans and 50% of the loans would have been cheaper.

the subprime mortgage crisis affected everyone, but particularly the black and latino community. going forward, they did not want to see them segregated, but even under neighborhood stabilization plans it had to be used in the most distressed neighborhoods. people are trying to get out of those neighborhoods, and they're saying that you can. yes, the program was targeted, but those systems have to be targeted in the right way. the way that this money was used, which was as you said, way too little, it kept people away from opportunities. host: georgia, frank, democratic line. go ahead. caller: you had a latino caller about 45 minutes ago, saying

that they paid taxes. but the they were afraid to file for them at the end of the year because of their immigration situation? ain't that something to shake your stick that? the government keeping the money from the latino workers because they're scared? craziest thing i ever heard of, please comment on that. guest: the immigration issue is quite complex. as the caller knows, immigration people who are not documented -- not just latinos, as many are here legally, but there is a

issue around getting there for. tax rebate. immigrants in the late 1890's and 1890's could not only paid taxes, but vote. why we do think about this a lot, it was not the focus of our most recent report. host: you did find that it was the fastest rise of unemployment in 2009 amongst the latino community. what is behind that? guest: part of it is the shrinking industries. also, they are not evenly distributed in the country. california is undergoing a very

serious problem in terms of budget. the uneven nature of the latino population being exposed to unemployment. host: lester, north carolina. republican line. caller: good morning, c-span. mr. howell, have you read any books by bill cosby? particularly ", on, people." guest: i teach political science and sociology, so we have actually cover the work of bill cosby, including responses to his work. caller: i was just wondering how you feel about the notion

that we cannot do anything about an equal employment practices. we cannot do anything until races themselves take control of their own actions. my personal opinion, when you have all of our young, white kids running around with pants on the ground, basically acting more black than white, not just a problem with blacks, i think you have a huge problem with our white kids. i was wondering how you felt about that. caller: what bill cosby did was painted have a picture, a

picture that people could grab onto in the simplest way. certainly there are black kids in white kids that do not behave in particular ways. i have two children of my own. i can tell you that they work. the majority of black kids are trying to do the right thing. when the banks started to fail, we did not turn to the bankers and tell them that we could not help until they change their behavior. we give them a lot of money. and we have not really insisted that they change their behavior. when the automobile industry started to tank, we did not say clearly you made mistakes, we invested public money. we should do it fairly.

that does not mean that the black community should not be taught and expected to show up to work dressed appropriately, but it is not one or the other, it is both. to the extent that bill cosby is focusing just on the black community is problematic. the other thing is -- good news, blend news -- bad news, america has become more tolerance the issue of race -- more tolerant on the issue of race. we are at the point in schools where the majority of children born in the united states are not white. how do we continue to grow and prosper as a country unless we invest in those children? this is not just a black problem

or a white problem. host: rhode island, independent line. caller: thank you for taking my call. is anyone familiar with the smoot-hawley tariff act? killed by congress in the 1970's. the united states had had a steady trade surplus. once the bill was killed by congress, that serve was transformed into a deficit in the trillions of dollars.

congress has not done a blooming thing to fix that. host: any comments on his comments on trade? guest: i do not know the bill that he is making reference to, but i do know that in terms of a budget deficit, under president clinton we had a surplus. the surplus and deficit, until recently, had been cyclical. one of the things that happened was we were not producing. even as we grew economically in the 1980's and 1990's, the distribution of that growth was not evenly felt. the rest of america was treading water. growth in terms of the economy was actually in credit.

part of it was not just recklessness, part of it was maintenance for health care, a tremendous amount of credit card debt. there are serious structural imbalances. i think it we will continue to see a deficit. -- that we will continue to see a deficit. host: there is an article here "bad credit is blocking people getting jobs." the jew find any of this -- did you find any of this in your report? guest: partially with the globalization of the credit market, it became mechanical, measuring people like a

computer. in the 1920's, 1930's, 1940's, a banker would sit down and understand the circumstances of a family. now it is run by a computer. we can use that to say that you missed a payment on your house two years ago because you were not employed, now you are trying to get a job, but you cannot get a job. it did not say anything about your willingness as a worker, if someone had missed their job or being late, that would be relevant. the fact that someone is paying their bills, it is not clear how that is relevant. we think it is an abuse of information. host: one more call from indiana and. james, the morning. caller: -- host: one