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former head of cbo and president of american action for rum, douglas holtz-eakin.president said the budget will grow the economy and create jobs and hard work pays. what is your take on it? >> that was his 2009 budget i think. or was that his 2010? 2011? 2012? look, if you put aside the social security proposal which there should be real discussion, this is very similar to his previous budgets. the economic assumptions aring a press sieve. his budget has the economy growing more rapidly in the near term than does cbo. despite that has lower interest rates. that is a way to have budgetary savings. his budget has the usual games on budget gimmicks what we count as usual spending we don't have it explain. we'll pay doctors more in medicaid and now explain how we do it. if you strip all that away and look at a apples-to-apples comparison you will find that house budget cuts, $4.6 trillion over the next 10 years and balances. the senate budget cuts, $600 billion over the next 10 years and the president's budget cuts 580 billion. since he raises about 600 billion in taxe

and douglas holtz-eakin, an economist and and president of the american action forum. david kay johnston, let me start with you, start with personal taxes that many people face a deadline on. talk about possible forms, what is the big problem with the system right now. >> well, for most people it is that they should not have to file. the government has all the information it needs for people who only get income from wages or pensions. and so if we excluded a small amount of money from dividends and interest, which we did do in the 1970s we could eliminate tax filing for about 100 million of the 140 million people. so that is at the bottom en. at the top end we allow people to make unlimited amounts of money and not pay taxes on them if they run hedge funds or executives. they can defer the taxes into the future, sometimes decades into the future. and they can borrow in many cases against this money to live on and not pay taxes for a long time. >> brown: first respond to that, does that sound look a good wish list. >> that's a good starting point of the number one thing

just to get rid of some, and i like douglas holtz-eakin tremendously.an able economist and social critic, but talk straight here. there's any part to growth, labor, of course, and capital. what's left out of the discussion is, without question, population growth. we're dependent on a capitalist society on that and any other real form of economics, population growth. lori: right. >> what we have now is a u.s. chamber of commerce. we have a certain body of orthodox of the establishment represented by doug and his folks down in washington. he suggests that population growth is now the critical component because we do have capital in unending streams now running into the economy. population growth is what is missing. this is their idea. we had 54 million abortions in this country. we brought in app estimated, as many as 20 million illegal immigrants, and, yet, we still have an economic problem. the best minds have got to do better than to say what we have to have are illegal immigrants in the country. it -- with this in view, why not bring into the country

douglas holtz-eakin. and by bringing them into the daylight, what effect would that have? parts i agree with the basic p oint. the impact of bringing them into illegal labor force would been twofold. the first is, from the perspective of the worker, it would eliminate the capacity for exploitation and bad working conditions. from the employer's standpoint, it would allow them to pick flexibly managed their labor force without severe -- without fear of legal repercussions, which every employer would like to do. i guess the thing that i find frustrating about the debate is that there are two aspects of the economics that have emerged as utterly clear over the past several years. number one, the presence of competition that is a real issue for our low-skilled americans is not about immigration. it is about being in a global economy where there is a great abundance of low-skilled labor and geographic location has very little to do with it. the bill does not change that. that's a reality we cannot change. >> off schuring of american jobs has as much to do with it as immigration

douglas holtz-eakin. and by bringing them into the daylight, what effect would that have? >> i agree with the basic point. the impact of bringing them into illegal labor force would been twofold. -- legal labor force would been twofold. the first is, from the perspective of the worker, it would eliminate the capacity exploitation and bad working conditions. from the employer's standpoint, it would allow them to pick flexibly managed their labor force without fear of legal repercussions, which every employer would like to do. findss the thing that i frustrating about the debate is that there are two aspects of the economics that have emerged as utterly clear over the past several years. number one, the presence of competition that is a real issue for our low-skilled americans is not about immigration. it is about being in a global economy where there is a great abundance of low-skilled labor and geographic location has very little to do with it. the bill does not change that. that's a reality we cannot change. >> off shoring of american jobs has as much to do with it as imm

douglas holtz-eakin, former director of the congressional budget office. and another economist named peter, who is on the u.s. civil rights commission. they will testify about how illegal immigration can affect the u.s. economy. a hearing on friday. then on monday a second hearing. after that we have to see how the process unfolds. especially republicans on the judiciary committee are calling for more than the currently scheduled hearings. probably sometime in early may we will move to the markup process which is where the senators on the judiciary committee can begin offering amendments and releasing how they want to continue to shape the bill. we hope it gets passed out of committee and go to the senate floor. host: rebekah kaplan of the national journal. wilmington, north carolina, kathleen is on our democrat line. is roberta our guest aplan.rebecca caller: my biggest fear is that our country is in a state of fear. thing wehe worst could ever have as americans. we have based our country from the beginning of a great work ethic. there are so many things

douglas holtz-eakin, former director of the congressional budget office. and another economist named peter,ho is on the u.s. civil gh c ttify about how illegal immigration can affect the u.s. economy. a hearing on friday. then on monday a second hearing. after that we have to see how the process unfolds. especially republicans on the judiciary committee are calling for more than the currently scheduled hearings. probably sometime in early may we will move to the markup process which is where the senators on the judiciary committee can begin offering amendments and releasing how they want to continue to shape the bill. we hope it gets passed out of committee and go to the senate floor. host: rebecca kaplan of the national journal. wilmington, north carolina, kathleen is on our democrat line. thatr: my biggest fear is our country is in a state of fear. fear is the worst thing we could ever have as americans. we have based our country from the beginning of a great work ethic. there are so many things we could do instead of being frightened every time somethin

douglas holtz-eakin. and by bringing them into the daylight, what effect would that have? >> i agree with the basic point. the impact of bringing them into illegal labor force would been twofold. -- legal labor force would been twofold. the first is, from the perspective of the worker, it would eliminate the capacity for exploitation and bad working conditions. from the employer's standpoint, it would allow them to pick flexibly managed their labor force without fear of legal repercussions, which every employer would like to do. i guess the thing that i find frustrating about the debate is that there are two aspects of the economics that have emerged as utterly clear over the past several years. number one, the presence of competition that is a real issue for our low-skilled americans is not about immigration. it is about being in a global economy where there is a great abundance of low-skilled labor and geographic location has very little to do with it. the bill does not change that. that's a reality we cannot change. >> off shoring of american jobs has as much to do with

guys coming in who need to leave and this is tremendously helpful, and taking a look at what douglas holtz-eakin has talked about, this is not just some increase in the economic health of the country. its $2.70 trillion in reducing the deficit by having more people working. more people working, more people paying taxes is not a tax increase. it is deficit-reduction without a tax increase. i think it's the kind of deficit reduction that we can get bipartisan support for in the country. grow up all sorts of other issues. what about public education? public schools don't teach kids how to read english well and don't teach them american history. but that's a problem, then we need education reform. that is being worked on a state- by-state. that's a problem for kids born here as well as everybody else, in terms of the quality of education they're getting. what about the welfare system? 185 means-tested welfare programs. bill clinton worked with republican congress to reform aid to families with dependent children. we can make progress on the others as well, and reforming welfare is important and need

douglas holtz-eakin argued that population growth would be a big alsomic benefits, but he ignores the academic literature and the development literature that looked at the impact of -- it does not show a big benefit. he never mentions in his paper the impact of legalizing illegal immigrants. >> thank you. one more sentence. >> if we decide to go ahead with this, we have to be honest with the american people and make it clear it comes with very large fiscal costs. , you havenorquist been here waiting patiently y. >> thank you. people are an asset, not a liability. america is the richest country in the world and also the most emmerich friendly country in the world. it is our history and what we have proved again and again. those of us who would change our history and would make us less immigrant friendly would also make us less successful, less prosperous, and certainly less american. i am delighted that at a time when pplabt washington not being able to get something done in come together, we have seen a lot of movement on this issue. the reagan republican movement understands the need