The Future of U.S. Immigration Policy: Next Steps

RICHARD N. HAASS: Well, good morning. Thank you -- (chuckles) -- a shout-out. Good morning. I'm Richard Haass and I want to welcome one and all to today's symposium here at the Council on Foreign Relations.

This is all part of a continued effort here to highlight the issue of immigration reform in the United States. This morning's events, though, are also part of something larger, an initiative here that the Council on Foreign Relations is undertaking as part of its 90th birthday year, and the theme is renewing America.

Now, throughout our history the council has focused largely, as you might expect, on the classic questions of American foreign policy: the use of force, the use of diplomacy and other tools. But in the immediate future and possibly beyond, we'll also be looking closely at issues that traditionally fell in the basket of what we thought of as domestic -- immigration policies, to be sure, but also issues like education, debt, trade, infrastructure -- essentially many of us believe will constitute the principle challenges to U.S. power and ultimately our ability to lead abroad. It's no accident, I would argue, that the chairman of the Joint Chiefs of Staff, Admiral Mullen, has talked about our debt as the principle national security challenge facing the United States and the world today -- not a rising China but a rising debt.

Basically, about two years ago in July of 2009 the Council on Foreign Relations released an independent task force report on U.S. immigration policy, and I saw copies of it piled up outside, and today's symposium uses this report as a baseline or a launching pad for continuing the discussion.

The task force was co-chaired by Jeb Bush, former governor of Florida; Mack McLarty, the former White House chief of staff. And Ted Alden, the Bernard Schwartz senior fellow here at the Council on Foreign Relations, who you'll be seeing in a minute, directed the project.

This report -- and it was a consensus report -- said that we need three things -- and by "we," I mean the United States -- first, a more efficient and welcoming legal immigration system that responds to labor market needs and enhances U.S. competitiveness by attracting and retaining high-skilled immigrants.

Secondly, there is a requirement for better enforcement to discourage illegal immigration into the United States, and thirdly, there is a requirement for a humane pathway to allow the more than 10 million of migrants currently living illegally, which is the legacy in many ways of previous immigration policy failures -- that they need to have a pathway to earn the right to remain in this country legally.

Speaking personally, I find a lot about this comprehensive approach to commend itself and I think it's noteworthy that the -- this administration's recent blueprint for immigration reform, which was released after the president's speech in El Paso, closely tracks this report's recommendations. That said, the summer of 2009, while only 24 months ago, seems a lot longer than that and may in some ways be longer than that or longer ago than that politically.

And recommendations that look to many people to be sound, sensible and centrist now look politically unachievable. So this symposium is asking the question -- and I think it's the right question -- whether there are ways to move ahead on immigration and immigration reform if we can't move ahead comprehensibly, in particular where there are ways to move ahead legislatively, whether there are ways to move ahead administratively and, above all, piecemeal. If you can't have everything you want, can you get something you want and begin to make progress to bring about immigration reform in the small and the specific if you can't bring it about in the comprehensive and the large?

All this takes place against the reality that the rest of the world is moving. And by that I mean while the United States is debating, or in some cases not debating, immigration policy, the rest of the world is changing. China and India, for example, are luring back many of their science and engineering graduates from American universities.

Other countries, Germany, Canada, Australia, just to name three, have become much more aggressive in attracting and retaining skilled immigrants. I think the fact is if we continue not to act, to put it bluntly, if this country continues to dither on this issue, the United States, American society, the American economy will simply lose many of the advantages that have come from this country being where so many bright, ambitious people have wanted to visit and to stay and to build their lives.

I'm pleased today that we will have the mayor of New York, my mayor, my neighbor, Mike Bloomberg, with us today to deliver the keynote address, and Mayor Bloomberg has been an outspoken voice on the immigration debate and continues to focus attention on issues that have not moved within the administration and the Congress.

Before I hand things over to Matthew Winkler, who will kick off this first session, let me just recognize, first of all, Luis Ubinas and the Ford Foundation for their investment in this effort and their real commitment to immigration reform. Secondly, let me thank Jeb Bush and Mack McLarty for all the leadership they provided to task force and to Ted Alden as well for crafting a report that stands the test of time.

Let me also thank other people who participated in the task force. Here at the council in Washington, I'd like to thank Anya Schmemann and her team at the task force, as well as Chris Tuttle and all those in the meetings program, who make events like this possible, and last but far from least, let me thank you all.

This is one of those critical issues that I believe will have tremendous consequences, not just for this country's competitiveness but also for our ability to integrate and move forward as a society and indeed in some ways for our national security.

So again, I want to thank you for your interest in this issue and for coming here this morning.

With that, over to you.

MATTHEW WINKLER: Thank you very much.

And what might make some sense in this discussion, immigration as an engine of the economy, to provide, say, 10 facts that here's hoping illuminate the issue and, as was just suggested so eloquently, put us right at the center of something that is probably, we hope, the most critical and necessary issue to be dealt with for the U.S. economy.

One, today's immigrants are more diverse than they were a century ago. Immigrants have more than twice the rate of U.S.-born Ph.D.s. On average, immigrants improve the living standards of Americans by boosting wages and lowering prices. Immigrants are not a net drain on the federal government budget. Taxes paid by immigrants and their children, legal and unauthorized, exceed the cost of services that they use.

Funding for enforcement in the number of unauthorized immigrants has risen since 2003. Immigrants do not disproportionately burden U.S. correctional facilities and institutions. Recent immigrants reflect America's melting pot culture, much akin to the immigrants of a century ago. The skill composition of immigrants is lower when compared to Canada and Australia because of U.S. policies that emphasize family relationships over skill.

Immigrants start new businesses and file patents at higher rates than U.S. citizens. And finally, the U.S. is issuing a declining number of visas for high-skilled workers. And you know, what I'd like to do is start, you know, from U.S. policy.

If you look at U.S. immigration today, it satisfies no one. There's not an American business that's satisfied, not immigrants, not their families, not voters, not our elected officials. The political debate is focused on border security.

So first, Ale, I'd like to turn to you. Do you agree or disagree that our system was designed for sort of another era and needs a fundamental change?

ALEJANDRO MAYORKAS: Well, let me -- let me answer that by saying I'm not sure I agree, if I may, with the framework of the disjunctive, that it's designed for another era or that it's in need of repair. I would say that it's in need of repair, and I'm not sure whether it was designed for a different era or not. But yes, I do not think the objective of spurring economic growth is being achieved as ably as I think the system intended.

WINKLER: And, you know, if we could turn to the economic impact of the current system, what is the consequence of having, you know, green cards issued for family reasons while something like 85 percent, and yet 15 percent go to skilled workers?

MAYORKAS: It was interesting, if I can, you mentioned 10 facts, and I don't have at my disposal the empirical data to assess each one of those 10 facts, but you did make a point, I think, that you said that our system seems to prioritize family unity over, perhaps, economic growth.

And I think that our system has three overarching objectives: family unity, economic growth and humanitarian relief, and I'm not sure it's an either/or proposition or it's a prioritization of one or the other. I think really we have to limit our focus on the economic growth aspect and say, that is a critical goal of our immigration system; are we achieving it. It's not that we are prioritizing one of the other goals at the expense of -- but rather do our laws, do our regulations, do our policies actually achieve the objective of maximizing economic growth through the introduction of talent from all over -- all over -- all over the world.

WINKLER: Let's take something that's really tangible here, and, Ted, I think you've really examined this quite thoroughly, which is, you know, if you can get the discussion of immigration closer to the whole subject of money, where the money is, where the money is for the U.S. and, say, focus on visas, for example, what about visas as an impediment to tourism, you know, business in general?

And, Ted, I know you've studied this pretty carefully.

EDWARD ALDEN: Thanks very much, Matt.

And I'd like to second Ale's comment. I think, you know, one of the issues that we're hoping to highlight today is that there has not been enough kind of systematic thinking in action in the United States that connects up immigration with our economic performance. And I think the reason for that is that for most of modern U.S. history, we haven't really had to worry about this problem.

The United States was, for many reasons, the most attractive country in the world for all sorts of immigrants, including very highly skilled and talented immigrants. If you were the best at what you did, you wanted to come to the United States. This was the place where your talents were going to be rewarded to the highest level.

What we've seen happen as a result of what Fareed Zakaria has called "the rise of the others" is that there's a lot more competition in the world now for the best and the brightest, that they are a scarce resource, and the United States has not really made that flip to recognize that it's not just a matter of sitting back and saying, okay, people are always going to want to come here because we are the most dynamic economy in the world..

We now have to compete for those individuals, and I don't think our immigration system as a whole has reflected that switch. It's been a problem of deciding who to keep out, because the demand was always much, much greater than our ability to take in immigrants, and that continues to be the case at a kind of macro level.

But in terms of the most skilled immigrants, they have a lot of choices, and we haven't thought about, well, what are the things that we need to do through our visa system, through our green card system, through our universities to attract and keep these people in the United States. And that's the mind shift that we as a country have not made.

WINKLER: So what would -- what would you do right away, or what could we do right away with respect to visas?

ALDEN: You know, I think there are -- there are things that could be done administratively. There are things that could be done legislatively. I think legislatively the most important thing is to make it easy for foreign students in the United States, those coming to American universities -- particularly in science and engineering fields, where the demand is so high -- to make it easy for them to remain and work in the United States, to offer them a fairly fast transition to a green card for permanent residence and citizenship.

And, you know, In Canada, the process of citizenship takes three years. You know, here, if you're -- if you're an Indian graduate student of science, you're lucky you get on an H-1B visa. You're looking often at six years on that visa and maybe an eight, 10-year wait before you get your green card, then another several years before citizenship -- this incredibly convoluted process, which is difficult and expensive for the immigrants throughout.

So that would be one element. On the visa side, I think there's still a huge amount that we can do just to make the system work more efficiently. And I don't want to go into the whole realm of security concerns. There are a lot of legitimate ones with the visa system. But people need to know that if they want to come to the United States and they apply for a visa, they will get a decision in a prompt fashion.

Sometimes the decision's going to be no, but it needs to be a system that operates quickly. We as a country lose these huge conventions. The U.S. Travel Association had a recent report, World Petroleum Congress 2014. Houston thought it was going to get it. The consensus of the industry was no, it's going to be too difficult for people who want to travel to that convention to get visas to come to the United States -- 9,000 visitors, millions of dollars in economic activity for Houston out the window. You multiply that by a thousand, and that's the kind of problems that we're dealing with.

WINKLER: You know, some of the research that's come out of CFR shows that something like the number of temporary visas for high-skilled workers has doubled since 1996 while the number of green cards has remained the same. I mean, how big a problem is that right there?

ALDEN: I'd like to defer to Vivek on some of this, but this is increasingly the bottleneck. You know, the bottleneck is that -- and again, I won't, you know, get into all the technicalities, but there are, you know, particularly for Chinese and Indians, for the two biggest countries in the world that are producing thousands and thousands of highly trained students, there are real hard caps on the number of those individuals who can get green cards every year, and that's a situation that -- those caps have been in place for decades and not updated to reflect the enormous changes that we've seen in Asia, which have really, you know, transformed the global economy and they're transforming our economy, whether we like it or not.

MAYORKAS: I think the wait is six years, if I'm not mistaken, with respect to those countries, and people are not willing -- industry is not willing to wait six years and people are not willing to wait six years when markets -- other markets are readily available to them.

Ted speaks of the numerical limits and especially, I think, most acutely with respect to particular countries, and that's a very macro point. There are also, I think you referred, Matthew, to some of the smaller things that we can do to change things. The high-tech companies have articulated to me that they are -- they find it very difficult to compete for talent when we do not allow family members of H-1B workers to obtain employment in the United States. Other countries do.

And so a spouse of a high-skilled worker who herself or himself wants to be gainfully employed cannot be gainfully employed in the United States as a spouse of an H-1B visa holder.

WINKLER: Well, Vivek, you know, is there anything that you see that is below the radar that right now is particularly relevant to this issue?

VIVEK WADHWA: Let me address some of the issues we just discussed. For example, our U.S. policy is dated. If you're a foreign student coming here for a Ph.D., you have to go to the consulate in India or China or wherever it is. First of all, you're made to treat like -- you're treated like a third-class citizen in those consulates. Just try going there in front of the consuls. They really treat you like dirt. It's like -- in India, it's like the days of the British raj, when the British would treat you like that, number one.

Number two, you get in front of the consul; they ask you, is your intent to stay permanently in the United States.

They ask you the same question seven different ways. If you blink wrongly and if you even hint that you might, you know, indeed want to work in the United States after you graduate or stay there permanently, you're out, OK? That's the -- that's the way the system works today.

Then we talk about -- you know, these -- these dependents of H1 visas, as Ale just talked about. In Saudi Arabia, you know, we're berating Saudi Arabia for not letting women work. If you are the wife of a scientist who's here working for a top university, you're not allowed to work. In many states, you can't get a driver's license. You can't get a Social Security number.

We treat these skilled workers worse than -- that, you know, women are treated in most other countries, other than perhaps Saudi Arabia. So, yes, we are in the '60s, and we don't recognize it. We're looking around. Right now, our senators and congressmen tirade against skilled immigrants -- they're taking our jobs away -- and they keep slapping fees on top of H-1Bs. They're looking for, you know, fraud and abuse because companies are trying to serve American companies and get jobs done over here.

This is -- when the world looks at America, we are as disgusted with American policies as Americans are with Saudi Arabian women not being able to drive. You have to realize that we sit here and we don't have a perspective of how the world is looking at us. So if you're in India right now, it used to be that if you were in -- you know, one of the -- IRT is the top university in India. There's seven of them right now.

If you're an IRT graduate, by default you would come to America because this was the place to be. If you're an IRT graduate today, you show off to your friends that you didn't even apply to an American company; you joined a local firm, because it's a matter of pride that you're working for a local company, and IRT graduates get better jobs in India. They make more money, their career progression is better than if they came to the United States.

You know, Ale said that right now it takes six years for a skilled immigrant to get a green card. That's false. If you're an Indian -- one of my -- I teach at Duke University. When one of my masters students graduates, the process is that they get an OPT visa, a temporary work visa for a while, and then they can get an H-1B visa. Then two or three years later, the company decides to file for a green card. That's when the clock starts ticking.

Today, we're processing applications that were filed in 2002 for Indians. That was before the backlog became works. My guess is that if one of my students started the process today, it would take them 20 or 30 years to get a green card based on the current delays, just extrapolating linearly.

You know, we keep talking about the 10 million, 12 million unskilled immigrants. Guess how many skilled workers there are legally in the United States -- doctors, engineers, scientists, computer programmers -- waiting for green cards? One million. His department doesn't publish that data because it's probably too embarrassing for them.

The 1 million skilled immigrants in the United States today are waiting for green cards. We actually added the numbers up, you know, using our -- (inaudible) -- this is as of 2008. My guess is the number is probably 1.2 million right now here legally. How many visas do we have every year for skilled immigrants? One hundred and twenty thousand in the EB-1, EB-2, EB-3 categories, plus there's a 7 percent per country limit.

You know, if you talk about dated policies, the 7 percent limit came -- was implemented decades ago because we were trying to limit the number of Japanese, I believe. There was some story behind that, but the result is that out of this million backlog about 350 (thousand) to 400,000 of them are Indians, about a quarter-million are Chinese. So 8,400 visas available per year, 250,000 people waiting -- guess how long it's going to take. So the result is that they're going back home.

WINKLER: How do you -- how do you, though, respond to the perception, which is -- which is widespread, that foreign workers are taking American jobs?

WADHWA: Well, to some extent, that's true. They do. The reason why America is what it is, is because we've -- I mean, generation after generation, we've had waves of immigrants coming here, making Americans work harder, making them compete for their jobs, and they have caused America to compete, and this is why we didn't stagnate like Europe did, because we've always had these waves of people coming in, undercutting salaries, making people work harder, you know, stay up at night to compete. That's what America's about.

Now, we can decide that we want to stop all foreign competition and close the doors, but we'll go the way of Venezuela. We'll go the way of these, you know, countries, which became third-world countries (that were ?) prosperous. It would be a disaster for American competitors.

WINKLER: So how do you get some harmonic convergence with the politicians who are --

WADHWA: Well, you have to fine-tune it. First of all, you have to acknowledge that it is indeed 1960s policies. We're back in the days when it was just us and the evil empire. Those were the only two superpowers. It's not like that anymore.

The rest of the world is rising rapidly. You're seeing momentum all over the world. Even in Ecuador, you're going to begin to see startups happening. Mexico is trying to set up a high-tech center in Cabo, of all the places, because it's safer than other places. So all over the world you're seeing these high techs.

Chile, I'll definitely talk about startup Chile. Chile is now offering $40,000 to any entrepreneur from anywhere in the world that wants to come and live there just for six months -- no -- visas are no issue -- $40,000 for free, just for starting up a company over there.

MAYORKAS: If I can jump in, apparently at my own peril -- (laughter) -- the -- actually, Vivek, the argument -- so the tech companies say that one of the reasons why they have difficulty competing for the H-1B talent is because, for example, we as a matter of policy do not allow, as a matter of regulation do not allow the spouse of an H-1B worker, high-skilled worker, to be -- to be employed. They make the argument that it is not a one-for-one job displacement formula; that if in fact you let the spouse work, you are indeed taking a job from an American worker. That is the argument against allowing the spouse to work.

WADHWA: That's what the Saudi Arabians say about the women -- that women will take our jobs away. It's the same logic.

MAYORKAS: But you -- but you mentioned that they do compete. The argument in favor of allowing the spouse to work is that the skilled worker, in drawing the skilled worker here, that skilled worker creates far more -- far many more American jobs than does the spouse replace one, so --

WADHWA: But let's look at the humane aspect of it. We're in America with the Immigration Department talking about why women shouldn't be allowed to work. I mean, we're talking about women, because predominantly, the H-1Bs are males. The spouses can't work. Does that -- does that make sense over here in this country?

And by and large, the spouses are highly educated. So we're worried about -- you know, we're not going to allow the spouses of skilled workers to work because it might impact the American workforce. This is American thinking. If this is not 1960s thinking, then what is? You're seeing it play out, you know, in front of you, folks.

MAYORKAS: I'm not -- I'm not sure I would view that issue through the lens of gender, quite frankly. I'm not --

WADHWA: It is a gender issue, though. The reality is that the majority that these companies are hiring are males.

MAYORKAS: I mean, Ted, I don't know if you'd be willing to arbitrate this -- (laughter) -- but I haven't -- I haven't heard --

WADHWA: I'll calm down.

MAYORKAS: No, no, no, I haven't -- I haven't heard that issue articulated through the -- through the lens of gender discrimination.

Look, the question I have -- and it dovetails, Ted, with something that you said -- is, Vivek, you mentioned that now the graduate of one of the preeminent Indian universities will actually consider it bragging rights to be employed by a local firm. Is that by virtue of the fact that United States policy has made the United States less attractive to that talent, or is it because of the rise in fact of the home country's prominence on the economic --

WADHWA: Both factors -- both factors are equally important.

ALDEN: I mean, I think that's -- you know, that's the situation we're in, which is both of these things are going on. I think, you know, there's no -- there's no question that these countries would have done a much better job in retaining their own talent, regardless of what the United States has done. The question is, do we want to push these people away, and too, too much of what we do on the policy front pushes these people away, at our cost.

WINKLER: Nobody on this stage wants to push people away, right? So what is the way to convince policymakers to accept that as a given to begin with?

ALDEN: Well, you know, I think that this issue is stuck in a lot of ways, which is, you know, what Richard noted in his opening remarks, and I'm not sure what the right combination of arguments or political pressure is that unsticks it.

What I do know is that as a country, we are in an economic situation that is tougher than we have been in for generations. There was a McKenzie study out last week looking at job prospects over the next decade, and only under the most optimistic set of circumstances, levels of job creation equal to those we saw in the 1990s, which were very high, do we get back to anything like full employment over the next decade.

So it seems to me everything we need to do has to be focused on job creation. One of the most troubling things in the McKenzie study was looking at the rate of new job creation. You know, the strange thing about the United States economy is we destroy jobs at an extraordinary rate all the time. The reason our unemployment has historically been low is that we create them faster than any other country.

Well, you look at the last decade, that rate of new job creation has dropped dramatically. So, you know, one question at the top of the agenda ought to be, how do we encourage the job creators. Well, it gets back to Vivek's work about immigrant entrepreneurship. High-skilled immigrants are a tremendous source of new corporate startups. These new corporate startups hire people. I mean, that ought to be front and center, it seems to me, in this debate.

WINKLER: Related to that, the U.S. travel association said that a smarter visa system would create 1.3 million American jobs, and, Ted, unemployment is 9.1 percent. So what do you do?

ALDEN: Well, you know, this is our largest single-service export, tourism, but what -- again, what we've seen over the last decade, the U.S. share of global tourism has been flat for a decade. The number of global tourists has risen by 60 percent over that decade, again, a lot of it fueled from these fast-growing developing economies, from the Brazils, from the Chinas, from the Indias, only they're not going to the United States. They're going to Western Europe, and one of the reasons is the difficulty and expense of getting a visa to come to the United States. The Travel Association argues -- and I tend to agree with them -- make that process easier. Bring more people to the United States. That's a lot of easy job creation. That's something that all we need to do is make our own procedures more efficient, and there's a real economic windfall from that. Why not do the simple things like that that we can do?

MAYORKAS: I think that's a very -- I think that's a very important point. There are process improvements that we can make that can have material impact and positively so. So you mentioned the creation of jobs, Ted. The immigrant investor visa program, the EB-5 program, is a program that provides for an immigrant to receive a visa if a sufficient investment of capital is made, and jobs are created directly or indirectly through the development of a -- of a new business.

Our processing of that program has been suboptimal, and so we have needed to address it. And we received tremendous feedback from the EB-5 community with respect to our administration of that program, and three weeks ago, I think we made a very innovative proposal to really reinvent that process, and we're receiving public comments and response to our proposal.

But it speaks of expedited processing, the hiring of the expertise required to really analyze these very sophisticated proposals, having an expert panel conduct interviews of applicants. It's very innovative for our agency.

Vivek has spoken in Silicon Valley. We attended a roundtable discussion, and Vivek spoke of the fact that my agency's H-1B policy memorandum has had an adverse effect on immigrant entrepreneurs' ability to obtain an H-1B visa, and so we are looking at that policy and specifically one aspect of that policy to determine whether in fact the policy is what it should be.

WINKLER: Ted and Vivek have characterized where we are as literally a crisis of significant proportions. Just wondered, in your role -- you're the policymaker -- what are the victories that you see or you would like to achieve or, you think, you can achieve?

ALDEN: Just to be fair to Ale, Congress is the policymaker on a lot of this. I mean, the administration operates within a set of constraints, so it's not like you can wave a magic wand.

WADHWA: (Cross talk.)

ALDEN: It's not like he can wave a magic wand and fix all this.

WADHWA: Yeah. He has to take the corporate line here, the government line, and I'm sure that he doesn't believe in it, so -- (laughter) -- you can't believe in it. But he has to sit here and smile and pretend he does.

ALDEN: I didn't say that.

MAYORKAS: And that concludes my -- (inaudible) --

WINKLER: So what I want to know is, are you totally ineffectual.

MAYORKAS: There are -- there are three layers of influence in the -- in the administration of immigration policy. There is -- and it is hierarchical. There is the statutory framework, which is really the ultimate design. There is regulatory authority, which is intended to implement the intent of the legislature. When it enacts statutes, there are implementing regulations, and then there are policies beneath that.

We as an agency can implement policies and we as a department can promulgate regulations. But really, when one speaks of numerical limits, when one speaks of per-country caps, those are a matter of statutory reform, and I think we all know how well comprehensive immigration reform is proceeding through the legislative process. So I don't know if there's a tremendous level of optimism right now with respect to a fundamental redesign of our country's visa structure.

WINKLER: Given all that, is there anything that you can do that, you would say, makes a difference for the better, and what is that?

MAYORKAS: Well, the EB-5 program, I think it's capped out at 10,000 visas a year, but, you know, that's a -- that's a lot of job creation and a lot of investment of capital in the United States economy. I think our proposal, when it is implemented and when it comes into effect, will have a real difference, a material difference with respect to the success of the EB-5 program.

If in fact we reform our H-1B policy -- and I can share a little bit about what that issue is. If in fact we reform our H-1B policy so that immigrant entrepreneurs can access the H-1B program with greater facility than is now the case, then, Vivek, I think you would argue that we're going to see a lot more entrepreneurs use the H-1B issue.

WADHWA: What he's talking about is that right now if you're starting a company, you can't -- and the company is taking off, you raise capital and everything is set, you're going to start employing Americans, that company can hire anyone but you if you're an immigrant who founded that company. So the problem is that there are so many tight restrictions on the H-1B visa, if he fixes the problem so that if I start a company and it employs Americans, and if I'm working for it, it's well-capitalized and so on, I can get a visa, that'll allow thousands of people who are already in Silicon Valley to start to create their startups, to start their businesses. It will allow my students at Duke to do that. That's a quick fix.

MAYORKAS: So Vivek, when we -- when we spoke of this issue in Silicon Valley, I think you mentioned the part of the policy that dealt with the sole -- the sole employee.

WADHWA: Yes.

MAYORKAS: Right. So this is the -- this is issue in a nutshell. The H-1B visa is for the skilled worker. So what about the immigrant entrepreneur who's actually starting his or her own company? Of course, Vivek, under your paradigm, it would be just a "his," but let's say -- (laughter) --

WADHWA: I'll get back to that.

MAYORKAS: -- let's say -- let's say -- I'm just going to push for equality for a moment -- (laughter) -- so let's just say that the immigrant entrepreneur wants to utilize an H-1B visa, and the entrepreneur really starts his or her own company and is the only employee. The H-1B law provides that the employer must exercise -- I'm sorry -- must have the right of control over the employee in order for that employee to avail him or herself of the H-1B visa.

Does the immigrant entrepreneur, who's really starting him or herself a company, does the company exercise control over that individual if that develop is the sole employee? Under certain corporate structures, that might be the case, if you have a board of directors and the board of directors actually exercises control, determines the salary, determines the conditions of employment and the like.

But it's an issue. It's a legitimate issue, and some might argue that, is that really what the H-1B visa, the skilled worker, was designed for. Was it designed for the individual who comes to this country to start his or her own company and begin to employ others and raise capital and really incubate a company? And I think that's a legitimate policy question and I think it's a legitimate legal analysis that must be undertaken.

I will say when Vivek raised the issue with me in Silicon Valley, I went back to our H-1B policy memo and looked at the section at issue. At the very least, that section is not as well-written as it should be and not as, I think, legally tight as it needs to be as an important policy pronouncement. But then we, I think, need to get to the legal and policy issues that I addressed, and we're looking at that, because we do understand it's significant, a significance of which I was unaware until Vivek articulated it in Silicon Valley.

WADHWA: And again, this is a malfunction of the new era. Today you can create a technology startup with $20,000, which could become a Facebook and employ, you know, tens of thousands of people. It wasn't like that. The graduates of our STEM programs right now are more interested in becoming entrepreneurs than ever before. Before, the norm used to be that you'd join an IBM or a Microsoft. That's what you strived for. Now in the universities, you go there, you're seeing a new spate of entrepreneurship, which everyone wants to participate in.

We want more of that. We want thousands more startups, because of the thousands more startups, you might have a Google or a Facebook in there. The likelihood is out of a thousand, you will have one.

MAYORKAS: And I think that's a critically important point, and it really, Ted, I think speaks to -- what you mentioned earlier is that the new horizon doesn't match with the old structure, and the structure has not changed to account for the -- for the dynamics that we're seeing.

In that very same roundtable, which was hosted at Stanford, there were a number of Stanford business students that were working on these new companies -- something that I don't remember occurring 20 years ago -- but they were not applying to the large financial institutions or the big companies. They were going out, taking a risk and starting something. It is a phenomenon that our statutory scheme does not really account for.

WINKLER: And how would you -- Ted, how would you go about convincing policymakers to get to this new perception that you're talking about?

ALDEN: (Laughter.) Well, you know, if I knew that, I would have -- I would have done it already.

I get back to focusing as much of this discussion as we can on the economy and our needs as an economy in this new world that we're moving into. I think an awful lot of the immigration debate has been focused around the issue of illegal immigration, which is an extremely important one and needs to be addressed. It's been focused around the issue of border security, which is a hugely important issue, the one we've made a lot of progress on, underappreciated progress.

I think far too little attention has been paid to the economic side of this debate, and I just think that that's where everybody in this country is right now. That's issue number one.

WINKLER: So why don't you -- why don't you help us and quantify how you make that argument in an economic context?

ALDEN: Well, I think it really does get back to the -- to the job creation part. I think, you know, there's an unfortunate way in which we talk about the economy that really misunderstands the way -- the way economies work, and I'll use an example that's in the news today.

Lamar Smith, the Republican chairman of the House Judiciary Committee, is introducing a bill to require employment verification for all employers, and a lot of that makes sense. In our task force report, we were positive on the direction that E-Verify is taking.

But Smith's argument is, well, that if we put E-Verify in place and anyone who's not authorized to work in this country loses that job as a result, that's going to free up all of these jobs for Americans -- simply not the way economies work. I mean, what's likely to happen is a bunch of those jobs will go underground in a cash economy. In many other cases, businesses will simply go under. In other cases, they'll move abroad.

Economies are not static, and, again, I get back to the point I made about the high level of job destruction in the United States that used to be offset by the high level of job creation. That's where we need to focus on. We need to be looking at the job creation side, rather than imagining there's this sort of fixed number of jobs out there, and we have to decide how to divvy them up, and obviously it would be better to have Americans doing those jobs than to have immigrants doing those jobs than to have illegal immigrants doing those jobs -- to set up a kind of hierarchy.

That's not the way economies work. It's particularly not the way a dynamic economy like the United States has ever worked, and so I think that needs to be a central focus in this debate.

WINKLER: Well, how do you connect immigration to American jobs? -- open immigration to more American jobs?

ALDEN: I think it gets back to the role that immigrants have played in job creation, which is a very strong role. And that's -- I mean, we haven't talked a lot about other sectors, like agriculture and other things. There are a lot of jobs -- there are businesses that just wouldn't be operating in the United States without immigrant labor at all different levels. But I think, you know, the job creation entrepreneurial site is really central to making this argument.

WINKLER: Vivek, what would you say?

WADHWA: I mean, you know, for example, the quick fix over here, if I wanted to create jobs, is that of these million people who are waiting, anyone who buys a house or starts a company can get a green card. They're here legally. They, you know, went by the book. They had the skills. That's why they were admitted over here. So if you put a minimum threshold of $250,000, I'll bet you we would have 50,000 houses sold within, you know, three months of this program being launched. You're talking about a multibillion-dollar stimulus to the economy for zero cost.

So there are smart things we can do like that -- students, let them start their companies. If their companies don't work out, they have to leave or unless they start again. There are a lot of, you know, simple fixes which give a major boost to the economy, because the fact is that if you look at Silicon Valley, during the biggest period of growth in recent history, 1995 to 2005, when the dot-com boom happened, 52 percent of the startups, they were started by immigrants, people born abroad -- 52 percent.

The majority of those people came here as students, and typically 13 years after coming here, they started companies. I mean, I was one of them. I mean, I founded two companies in America. The first one employed a thousand people. The second one employed 200 people. So it's not one-for-one. It's a thousand-for-one, very often, that when you bring the right people in here to this country.

ALDEN: And one of the things we need to do, I think, is to experiment on a small scale, as well. The Canadians have done this. You take -- you take an example. Like, one of -- one of the real concerns that the Canadians have had is that all the immigrants want to move to the three big cities. They want to move to Vancouver, Toronto or Montreal. So they set up small-scale schemes to say, well, you can jump the queue, in effect, if you're willing to go live in Winnipeg, a cold, midwestern city that was worried about losing its population.

Well, there's been a revival in Winnipeg. There have been a lot of immigrants coming to Winnipeg on this program. It's revived the economy of Winnipeg. We could do experiments like that with Northeastern cities and other places. We don't.

WINKLER: Mayor Bloomberg, who will be here later today, actually suggested that the way to revive Detroit is to say to any immigrant who wants to come here, please, as soon as possible, and you will have a process of renovation. Do you agree?

ALDEN: I do. I do. There are real-world examples of this.

WINKLER: Why does that work?

ALDEN: I think it works because, you know, when you see immigrants move into these old cities, they revitalize a lot of these neighborhoods. I mean, it creates a local economy. There's a dynamism associated with that. I mean, Detroit's problem is depopulation, right? People are leaving Detroit, and so you have entire neighborhoods where people can't sell their houses, houses are empty, crime goes up because people aren't in the streets. A pretty easy way to address a problem like that, but it takes a lot of experimentation.

WINKLER: On that note, let's open it up to everybody here and take some questions.

Ma'am?

QUESTIONER: I'm Mitzi Wertheim with the Naval Postgraduate School, and I've been spending a lot of time in the last two years thinking about jobs. Let me just make one comment.

I came to Washington in 1960 and -- when the Peace Corps was created, and the whole question of all of these immigrants -- the reason we didn't want to hang on to them was we wanted to send them back home to basically create what we've now created. I mean, that was -- I mean, I watched that happen.

I guess the thing that gets me is we don't have a good narrative on how to fix it. I mean, I've heard some ideas here, but nobody tells the story in the way in which the rest of us can really understand the dimensions of the problem and the breadth with enough detail of what we could do about it.

I mean, I kept thinking, for example, that the visa issue was something that the State Department ought to be able to just fix. You do have to have some understanding about all the barriers that exist in each one of these, and if there are other stories -- I mean, I think TIME Magazine did a story on creating jobs, and it had seven or eight different ideas. They all came from overseas, and we have to start learning about, what can we learn from others.

So I'd be interested in how we create a narrative that the people get.

WADHWA: Mitzi, let me give you one narrative. The million skilled immigrants here -- doctors, scientists, lawyers, et cetera -- why don't we just give them green cards right now, because the group I talked about in Silicon Valley, they came here, they got green cards and then they started companies?

Well, these people can't do it. I bet you if we did the same survey of Silicon Valley, you know, two or three years from now, 52 percent wouldn't be founders because they're stuck in the H-1B visa mess. So we just have to provide more green cards.

You know, we keep talking about these work visas. The issue isn't the work visa. The issue is the green cards, the number of green cards. It's a numerical fix. Instead of 120,000 with a 7 percent per-country limit, make it 250,000 with no limit. It'll fix itself within two or three years. It costs nothing, zero.

We're not bringing in a flood of new -- of new people from outside who are going to take American jobs away. These are people who are already here who would now be buying houses, who would now be creating companies, who would now be, you know, digging deep roots over here, becoming Americans like all the others are. It's a subclass. It's a very simple fix.

QUESTIONER: And have the rest of the country hear this narrative.

ALDEN: Can I -- just briefly, I mean, I think the point's a very good one, because we have historically had this immigrant narrative, and it was essentially about what America could do for the immigrants: America as the land of opportunity where you could make good, where you could do better than your parents, and your children would do better than you.

We're in an era where we kind of need a different narrative, which is more about what immigrants can do for us at a time when our country is struggling, and we haven't developed that narrative. I think you're right.

WADHWA: I mean, most people's doctor's are foreign-born these days. If you now start talking about, do you want your doctor to have to go back home, that would be a good message. (Laughter.

WINKLER: We have a question here.

QUESTIONER: Yes, Marisa Lino from Northrop Grumman -- any discussion of changing numbers requires legislation. You're not going to get any legislation in the run-up to an election year. I mean, that's just, I think, pretty clear. The other problem I see -- and I'd be interested in your comments -- if you look at some of the things that the right has said about this issue -- you've got to strengthen our borders, you've got to strengthen our systems, stuff like E-Verify -- E-Verify is only as good as the Social Security database, which is not good. I could use stronger terms.

But it needs to be cleaned up. You need to spend money to clean up the Social Security database. They are -- Congress is right now in the process of eviscerating part of DHS's budget for the -- for the coming year. I mean, we'll see what the ultimate result is, but FY '12 is looking pretty bad for some parts of DHS, I'm sure you would agree.

So I'd be interested in, you know, the kind of narrative that Mitzi was talking about doesn't lend itself easily to a sound bite in an election year. What you need are good sound bites, unfortunately -- sorry to sound so negative.

MAYORKAS: Well, I mean, that wasn't -- I didn't take that as a question. I took that as a comment. But let me -- let me say it really does echo what Mitzi said in terms of the need for a narrative, but what I -- what I understand Vivek and Ted to be articulating is that the narrative is not that it's a one-for-one, that an immigrant with economic potential, whether that be highly skilled or otherwise, who comes to this country displaces an American worker. That is not the narrative that I hear my two colleagues articulate.

The narrative that I hear them articulating is that that individual creates opportunities not just for him or herself and his or her family, but for the surrounding community and the business environment, and so that the net effect -- and Vivek will know the data, because obviously he's an expert -- the net effect of the introduction of that talent -- either at a higher level than our visa policies currently permit or at a speed that our system currently allows -- will be a net positive effect on the creation of jobs in our economy. I think that's the narrative.

WADHWA: We have to educate people the pie gets bigger when you bring, you know, more people. It doesn't -- it's not taking jobs away. You start making the economy boom, and everyone benefits from it.

ALDEN: I mean, just on the legislation, I don't disagree, but you can't help but wonder, where has some of the creativity of our lawmakers gone. I mean, you could actually point to the elements on the table. I mean, Lamar Smith wants all companies to adopt E-Verify. Zoe Lofgren, the ranking member on that committee, has introduced a bill that expands the number of green cards and eases procedures for foreign science and engineering students coming to the United States.

Senators Kerry, Lugar and others support, you know, a startup visa bill that would help with immigrant entrepreneurs, and there's still a lot of support for the DREAM Act for, you know, roughly 2 million kids who've grown up in the United States, are here undocumented because their parents brought them here but still a lot of support for that. Can we imagine a minipackage coming together from those different elements? This is the sort of thing that we used to be able to do in Washington.

So, yes, we can't do the comprehensive bill, but maybe there's something smaller that could deal with some of the different pieces that both sides of the aisle could agree are important. It's depressing to think that our system has lost the capacity for that sort of bargaining. I mean, everybody might put the package together differently, but you could imagine, just from the things out there, a legislative bargain that makes sense, not to say we're going to get it, but --

MAYORKAS: Well, the question is, is the pessimism with respect to legislative prospects leading to a passivity with respect to those proposed legislative pieces, because the E-Verify legislation, I think people expect it to pass the House. Senator Reid had an op-ed piece this morning on the DREAM Act, and it's going to be interesting what happens in the Senate if not the House with respect to whether anything -- any other legislative ideas are put forward as a companion to that E-Verify piece.

And so need for reform requires more than pessimism and passivity, or it requires at least pessimism that triggers activity.

WINKLER: We have a question over here. I just -- before we get to it, could you just explain, though, why the DREAM Act is important for this narrative that you want to create?

ALDEN: Well, you know, I think if you're looking at the question of wasted talent -- I mean, so we're talking about, you know, a lot of this talk has been about immigrant students that we send back.

Well, you look at these kids who have grown up in the United States, gone through high school, want to go on to university, find that door closed -- maybe in some cases, they go to university but they want to work; they find that door closed. They want to go and serve in the military,; they find that door closed.

This is, again, a wealth of talent that we're throwing away. We're basically telling these people, well, you've grown up in the United States, but we are going to close every door on your prospect for bettering yourself.

I mean, honestly, it's hard for me to think of anything more un-American than that, closing those sort of doors to people.

MAYORKAS: So there's a -- there's a -- there's an economic aspect that Ted has articulated to the DREAM Act. I'm not sure the crux of the DREAM Act is really an economic one.

ALDEN: Well, I think it could be. I mean, there's a lot of wasted potential there that we -- you know, again, you get back to the McKenzie study. There are hundreds of thousands of jobs out there right now that are not being filled because we're not training people in our schools and our community colleges to fill those jobs. We can't afford as a society to be throwing away potential.

WINKLER: And Ted, I understand your narrative is really, you know, you want to reward initiative, because that is -- essentially the American way is initiative -- (inaudible) --

ALDEN: Absolutely, absolutely.

WINKLER: Your question?

QUESTIONER: Rob Cortel with Intelex -- just two quick kind of observations and then a question -- one is you really need Michele Bachmann here if you really want to understand the politics of it, because it does relate to the narrative.

A lot of this discussion is around aspects of this issue which appeal to intellectual elites like the people in this room and -- but a lot of the narrative appeals to everybody else. So your part of this narrative is we need these people; they're talented; it'll help make America great and good. The rest of the population hears illegal immigration.

So what you really have to do is turn this to what every politician, including Michele Bachmann, say, which is that they favor legal immigration, and to use that as a take-off to what that actually means in and of itself.

The second point here is that my legal residence is three and a half hours south of here on the western shore of the Chesapeake Bay on a little island in Matthews County, just above Williamsburg, and it's to the same point, which is -- which had a crab-picking operation for years, which just about died until they got legal, legal Latin American immigrants, and the attitudes on this island of these few people, that has 800 people -- and they've got 30 workers who come over -- is totally different.

These people are accepted in the community. They're legal immigrants and all that. So if you're going to change the narrative, you actually have to push it down into something that is meaningful to most people inside the population. I just think a lot of this is very elite and effete, almost, in some ways.

And that goes to the third part of it, and this is really a question to all of you. So many of these conversations are around this issue of the educated, high-skilled, high-value worker, but the reality is the country has a deficit of workers in a category that will do jobs most of us won't do, ranging from chicken-plucking to crab-picking to working on the farms and picking tomatoes and things like that. So I'd be interested in hearing how you deal with that.

WADHWA: Well, you know, I've been in the middle of those debates as well. What people argue is that if those cherry-picking jobs paid $20 an hour, you'd find enough Americans to do them. The reason why Americans don't want them is because they're too low. And I've spoken to people on the other side who say that even they were offered $15 an hour plus benefits, Americans don't want to do them. There's emotion over here.

On the skill side, the problem -- the reason why we have, you know, this problem is because in the tech industry, once you're over 40 or when you're 45 years of age, writing old computer languages, you become less valuable. In other words, no one wants to hire someone making $150,000 a year whose skills are dated. Therefore, they want the younger workers in who make $65,000 a year, who are twice as productive. We don't talk about that.

So what happens is -- and this -- and this has been the case always in the tech industry. It has nothing to do with immigration. But because we don't talk about the age issue, now you have this unemployed -- when workers get to be 45, 50 years of age, they can't get unemployment; they can't make $150,000, anymore; they can make $80,000 -- they start complaining that foreigners took our jobs away; we had these H-1Bs; we had to train our replacements and so on.

(Inaudible) -- we're not facing the reality of the situation over here. It's like telling the NFL that you have to hire anyone, regardless of age, you know, but that's what this is all about. If we now want to become a socialist country and have everything being based on equality and protectionism and so on, we'll become a third-world country very rapidly. Those are things we don't talk about.

ALDEN: I guess the only thing I would add is that, you know, part of the difficulty in any discussion of immigration is that you get very quickly to, well, we need to solve the whole problem, right? We need to solve every single aspect of it.

And part of what I would argue is, let's try some things on a small scale, you know, with respect to agricultural work.

The Canadians, again, have got this kind of small-scale program that they run with Mexico for temporary workers who come up for the summers to do agricultural work. We can do things on a small scale here, try different combinations out, see what works, see what doesn't work. We're sort of stuck in this position that unless we can solve every aspect of the immigration problem, from, you know, enforcement to low skill to high skill, we're not going to do anything.

You know, part of what I was hoping when we organized this symposium is to push for, let's work where we can work and start to make progress. So I completely agree with your point. I think there are multiple levels at which we need to address the problem, but let's try some small initiatives --

WADHWA: Ted is right. There's no way we're going to solve the problem of, quote, "amnesty" in this administration. It's not going to happen the next two or three years. Now, if we don't fix the rest of the problems, our economy will continue to be in a slump. We're going to be exporting people en masse.

ALDEN: -- or even -- or even fix some of the problems.

WINKLER: So what's the one thing you would do, Ted? What's the one thing you think we could do?

ALDEN: Well, I think that, you know, stapling green cards to science engineering immigrants who graduate from, you know, advanced programs, I think that's an easy thing to do that gets you a lot of benefits very quickly. There's a lot of stuff on the entrepreneur -- I mean, you know, we've talked about a bunch of different initiatives. There's not one silver bullet. I think there's a bunch of small-scale things you should do.

Q: Could I make a comment? It's intriguing that all of the discussion assumes federal dominancy, yet in an area where we've had difficulty with illegal immigration and what have you, by default, it has increasingly gone to the states. The assumption of all of the discussion is -- even as you've come up with small projects, is that there cannot be any delegation of federal to state or even to local to permit variations along the context of what you're describing. Why not? Why is the answer always looking down federal what's good for one is good for all?

WADHWA: I think I told the -- (inaudible) --

ALDEN: I don't know. I actually think there should be. I think there's no reason -- I mean, I think it has to be a federal delegation, because this is a federal authority, but I think there's no reason the federal government couldn't allow the states to experiment more with programs in some of these different areas. I don't think there's any inherent -- I mean, maybe I'm missing something, but I don't think there's any inherent reason that something like that couldn't be done.

WADHWA: (Inaudible.)

MAYORKAS: Well, you know, immigration law is federal law for a reason. There are foreign policy implications. Numerical caps with respect to particular countries have foreign policy implications, and so the delegation to states of federal immigration policy is not as simple as addressing a local or a regional economic need.

So how many individuals, how many high-skilled workers will we take from China or from India, and whether the visa policy's with respect to those particular companies, which are our greatest producers of high-skilled talent, entrepreneurial talent currently, that has implications, economic, bilateral implications with respect to economic relations, foreign policy implications. And so there's a reason why immigration policy is in fact federal in nature.

WADHWA: But let me -- you know, you've raised a great point, though. What if Detroit wanted to say that, look, all of these million people that are here, anyone who wants to start a company in Detroit can stay here regardless of visa status; that even though you're on an H-1B visa, you can start your company here? They'd probably get tens of thousands of people moving there to start companies.

MAYORKAS: Well, I think -- I think we're going to see that issue unfold, if I'm not mistaken, with respect to the proposed legislation in Utah. Utah has proposed immigration policies as statutes that cover a wide array of immigration issues. Some of them do not take effect immediately. I think some of the guest worker programs, which speak to your point, I think they take effect in 2013.

And so it may -- it might not be ripe for legal action just yet. I don't know, I haven't analyzed that issue, but I would imagine as that day draws near, and if in fact federal action has not been taken legislatively, then I think we're going to see the issue that you raise addressed in the court system, I would anticipate.

WINKLER: A question in the back, all the way in the back. Yeah.

MAYORKAS: Ted, if I may, while that microphone is working its way, Ted mentioned the idea of initiatives and trying something. The difficulty there, and I do think trial and error is a useful tool -- we do it. Some might argue, some of our stakeholders might argue that we err more than we try, but, you know, we learn. We learn, which is why we have, I think, in a model of open government, now we do not promulgate policies unilaterally. We post them for public comment to understand from industries that we serve, from stakeholders, what the consequences might be of the policies that we propose.

We also are doing trial and error with respect to certain process changes to find out what we think might work, will it work, will it not work. Given the legislative process, it is very, very difficult at best to really experiment in the reform of the immigration system aspects that we're speaking of today -- very difficult.

WINKLER: I just would like -- you know, there are some actually very powerful narratives that perhaps are obscured. For example, Hyundai is a very, very successful car manufacturer, especially in the United States. It has created successful manufacturing plants, which in turn have created all kinds of spin-off businesses that have fed off of the original car plant and created burgeoning economies, you know?

And this is not an isolated example, and this is where immigration and homegrown talent converge harmoniously. Just, you know, for people looking for a narrative, that's a very powerful one.

There's a question back here.

QUESTIONER: Vic Johnson with the Association of International Educators -- I just wanted to make a couple of comments.

First of all, on piecemeal immigration reform, I would point out we're doing that now. It's called enforcement. You can pass any enforcement measure you want to propose in the United States Congress, and that's one of the things that keeps driving the immigration debate to the right, toward the closure side.

You can always build the fence higher. You can always build the fence longer. You can always put more boots on the ground on the border. You can always deport more people than the previous administration did, and we're doing all of those things.

The question is, how can we leverage the desire for enforcement to get other pieces of immigration reform done, and that's called comprehensive. I mean, there's a reason you do it comprehensively. So there are various packages that I think many of us would like to see, fine -- but there's --- would like to see tried, but there's always the guy at the end of the line who isn't getting what he needs out of your piecemeal package and who knows nobody's going to help him once everybody else has what they want.

That's why a congressman like Luis Gutierrez have been reluctant to endorse other proposals, because their primary interest is, how do these 12 million people get their situation normalized.

And if he keeps saying to everybody, well, I'll support everything you want and we'll do that last because it's the hardest -- it'll never happen.

So it's -- you know, it's politically hard to put together a package that will pass except for enforcement, and we can keep going on down that road for as long as we want until you can't build the fence any higher.

The second and last point, but kind of related, is on the narrative question. You know, I mean, the way you do the narrative is by doing it. This is what makes it such a frustrating question. There are narratives out there -- we've spun off a few here. There are a lot more, but the anti-immigrant side is dominating the narrative, and the people who see this issue the other way are sort of demobilized at this point. I think one of you made that point.

You know, the president isn't talking much about it, the congressional leadership isn't talking much about it, the immigration groups and ethnic groups, the drivers of this debate in the NGO sector, are quiet. We're saying, we can't introduce legislation because, why should we bother; well, it can't pass.

Well, it can't pass if it's not introduced, and you have these vicious cycles going whereby we make progress impossible because people are afraid to tell our narrative.

I think that where it starts is with the best storyteller we have in the United States system. That's the president of the United States. You start the narrative at that level, and other political leaders pick it up. It gives context for the NGOs to orient their conversations. It gives context for conversations in our committees, and you build this narrative over the course of years. You don't not do it because it's an election year. You just have to start doing it. We have to reclaim this conversation somehow. People have to grab a hold of it and do it in our political sectors, or things will keep heading in the opposite direction, as they are now, because those storytellers are the ones that are controlling the debate.

WINKLER: Well, President Obama did in fact give a speech with a broad and comprehensive outline of immigration reform. You, Vivek, I think, characterized it as a giant press release, if I'm not mistaken.

WADHWA: I mean, we're saying all the right things but not taking any action. You know, I think that the chances of getting this amnesty issue resolved before the next administration are zero. Now, if we wait three or four or five years to fix the issue of unskilled immigrants -- I'm sorry, of skilled immigrations, what's going to happen is that the skilled workers will be long gone. Students are already going back. They'll go back faster.

India and China are already becoming booming tech centers, and those will become Silicon Valley classes within the next five years or so. The unskilled will still be here because those people have no choice. The people who have a choice won't be here. So hence there's an urgency in doing what you can do, so I agree 100 percent with Ted that you have to do what you can do, and do it now; that if we can agree on the DREAM Act, if we can agree on either the Zoe Lofgren legislation or the Lugar legislation, let's get those things through and then worry about the rest of the mess afterwards.

QUESTIONER: Alan Wendt -- one hears the argument that the reason firms can't find enough skilled workers is because they're not paying high enough wages, and that if they raised the wage level, adequate supply from the current population would be forthcoming. I would just like any of you to comment on that notion, whether there's substance behind that argument or not.

ALDEN: I live in Silicon Valley, and wages are shooting through the roof. And the issues is that you can find -- there's also a lot of unemployment in the tech sector. The issue is that the high -- you know, the people with the current skills, the ones who can really be very productive, they're in short supply.

Now, we can try to force companies to hire everyone that's unemployed, but, again, we'll cripple our companies. You've got to realize Silicon Valley is now competing with tech centers all over the world. And the other thing we don't realize is, is that the majority of revenue that American companies get right now is from abroad. I mean, Intel, HP, 72 percent of their revenue is from abroad. IBM, two-thirds of their revenue is from abroad.

So companies are now developing products abroad. They have to understand global markets. Americans don't. They don't know where France is in many cases on the map, right? So the fact is that unless you bring the skilled workers in who enrich our own companies, we're going to lose out globally. We may dominate our own market, but we won't dominate the fastest growth markets in the world.

ALDEN: I want to come in on -- because I -- you know, I work on this. This is a much broader issue than immigration. I work a lot on trade and investment issues, and when you talk to multinational corporations, there has actually been some return of jobs to the United States of traditional manufacturing jobs, partly because costs have been rising in places like China.

But a lot of those jobs are paying wages half of what the old union manufacturing jobs used to pay, and so you could say, well, yeah, if we paid more, we'd attract more people to those jobs, but the reality is those companies won't pay more. If they have to pay more, they're going to locate elsewhere in the world.

We are operating in a global economy in which we face some painful kinds of decisions, which is, you know, is the productivity of our workforce high enough that we can continue to pay wages far higher than all of our competitors? And if the answer is no, there are two responses. One is we might just need to accept the growth of a certain number of jobs that don't pay wages the way the jobs used to, and the second is to upgrade our workforce through education, through training.

I will give the administration a lot of credit on this one. They focused a lot on community colleges. Our workforce has to operate at a level of productivity that makes it profitable for companies to pay higher wages and still operate in the United States. And again, it's a mind-set shift to say, well, if companies just paid more, they'd attract more American workers. Well, the reality is they won't. They'll go and continue to expand overseas, which as Vivek pointed out, they're doing already --

WADHWA: Or they'll be out of business because they're not competitive anymore.

ALDEN: -- or they'll be out of business.

MAYORKAS: I'm not -- I'm not exactly sure it's a one-size-fits-all, so I read in one of your articles, I think, that one of the high tech companies moved one to -- moved one of its facilities to Vancouver for the purpose of drawing talent because of the economic circumstances here in this country and in terms of drawing talent. It might have been your --

ALDEN: It was Microsoft that did it back in 2007.

MAYORKAS: Then it might have been your piece, Ted, in Newsweek.

Well, that applies to Microsoft. So I'd be curious to know what has happened to American Apparel in the facility in Los Angeles that was the subject of a visit by immigration enforcement authorities, and quite a number of undocumented workers, who were paid very well, were displaced. What has happened to that facility?

Have in fact American workers come in and performed the work that undocumented workers previously performed? I remember reading articles not too long ago with respect to Chipotle, and I think it was a subject of an investigation, and Chipotle took great pride in the Latino workforce and had, I think, some issues or alleged issues with respect to the documentation of its workforce.

Were any people released from employment and, if so, were those jobs filled by American workers or documented immigrants? It's interesting to see the data, because at that level, the analysis might be different than the analysis applicable to Silicon Valley.

And that's what's difficult about a narrative. It's the narrative that, look, we have high unemployment, we have jobs being filled by individuals who are in undocumented status. If those individuals do not fill those jobs, there will be room for American workers to gain employment. That is not an inaccessible narrative. When one gets into a contrary narrative, one starts to get into a host of issues and layers.

QUESTIONER: Hector Sanchez from the Labor Council for Latin American Advancement, representing the interests of Latino workers, including undocumented workers -- it seems like a lot of this conversation, which by the way is very interesting, is missing the central point of the immigration debate, which is undocumented workers. We've been focusing on a number of solutions from the skilled workers' perspective, but I don't think I have here any real answers and short-term answers to what we can realistically do in terms of undocumented workers.

We have seen the enforcement-only policies for the last 10 years, and it's getting out of hand. We have sent he anti-immigrant debate just keep increasing and moving extremely to the right. We're talking about the 14th Amendment. We're talking about excluding immigrants from the census. We're talking about all these things that seem, at some point, unrealistic, but the point is that they're going so much to the extreme right that when they come to the table to propose something that in the old times could seem realistic, they actually can't get it done.

We totally disagree on E-Verify -- that you mentioned you agree. We disagree with anything that increases the vulnerability of workers. And from the economic point of view, if we keep pushing for enforcement-only policies, we're just going to increase the vulnerability of those undocumented workers and keep bringing wages down, and it's an issue that we also need to discuss.

So there was some mention of what we can do. I know by now we know that there is not going to be immigration reform before the elections. What we can do realistically to help increase the respect of labor rights, human rights and civil rights of undocumented workers in the next -- before the elections -- e proposed initially -- and this is an executive order -- an executive order from the president -- to stop the deportation of the DREAM students. It would be interesting to hear in this context what we can do with a focus on undocumented workers before the 2012 elections.

WINKLER: (Inaudible.)

ALDEN: I'd be happy to.

WINKLER: Yeah.

ALDEN: I'd be happy to. I mean, I think, you know -- and Rob raised, in some levels, the same point.

I think the administration's strategy -- and it's a carryover from the second term of the Bush administration and, I must admit, was reflected a lot in the report that I worked on with Jeb Bush and Mack McLarty. I think the hope was that if you could reassure the public that immigration enforcement was being done in a serious way, that it would free up political space for broader immigration reform.

I think that's been the high-level political strategy on this for a long time, because people look back to the '86 experience and the takeaway from that was, well, we had legalization for nearly 3 million people with the promise of immigration enforcement, but the enforcement never happened, so this time we need to show up front that we're serious about enforcement, and then that will open up political space for another legalization.

I think the reality is that's not happened. I think the tougher the enforcement measures have got, we've actually seen political support from the Republican side for comprehensive reform get narrower and narrower. So the question is, how do you respond in that new environment. And it goes beyond the scope of this panel, but I think the administration needs to take a different stand, to say, look, you know, our belief as an administration -- and they're on record on this -- is that a lot of these people should have a path to legal status in the United States, so we're not just as a matter of course going to deport 400,000 people a year.

They've tried to make a priority of people who have criminal histories, and I think that has pretty broad support. But there are still, you know, hundreds of thousands of people being deported every year who have no criminal histories, so I think something like you're talking about, in terms of saying we're just not going to deport DREAM Act students, is a start. It's takes a lot of sense and it's a kind of pushback, and it says we as an administration believe these people deserve status in the United States, so we're not, as a matter of course, going to deport them.

But that would be a big political shift from the emphasis really, for much of the last decade, which has been about trying to reassure the public that government is serious about enforcement. So I don't -- I don't see that change happening, because I think the administration is still very wedded to that strategy. It's just not clear it's working.

QUESTIONER: Hi, Charlie Skuba from Georgetown University. I have a question for Alejandro. I was intrigued actually in the spirit of small things we can do, by your comments about EB-5 visa reform. I believe that it calls for a limit of 10,000 people per year who invest either a million dollars or create 10 jobs in the United States. One question would be, how much of that is being used, and secondly, what kind of reform can you tell us a little bit about how that program is being approved.

MAYORKAS: Sure. The -- it's a --- the investment of a million dollars and the creation of 10 jobs; or in a certain setting with the creation of a regional center, it's the investment of $500,000 and the creation of 10 jobs directly or indirectly.

And the proposals in support of an immigrant investor visa program are extraordinarily complex. They're supported by economic analyses and credit analyses, and as you can imagine, the analysis -- whether jobs are created or not created directly or indirectly -- is a sophisticated one.

And one observation that we had is that we don't have the expertise to really assess the accuracy or adequacy of the submissions that we receive, and so one proposal was to hire a greater cadre of economic experts, of business development experts, credit analysts and the like to assess the proposals that we receive.

The second was business needs sometimes to move fast, and we have to move fast as companions in that effort, and so the proposal speaks of expedited processing or premium processing. The inability of individuals to access us directly with respect to a case causes delays in the processing of these cases, and so we are creating an avenue for the petitioners or their representatives to actually speak with the adjudication team, communicate with the adjudication team in real time so that we can expeditiously or with facility address questions on a real-time basis or address issues on a real-time basis.

And then if in fact there's a question that has not been resolved or an issue that has not been resolved, we're basically going to have, like, a hearing, allow the individual to come in, the petitioner to come in with evidence -- we've never done this before -- and have them appear before an economic expert, an adjudication expert, guided by counsel, and try to resolve issues right then and there so we can maximize the potential of a job-creating visa program. They might not seem very significant, those proposals, but they are very much so.

WINKLER: We have time, I think, for one more question.

QUESTIONER: I would like you to comment on kind of going on the point the gentleman made back here about the states, only I would turn that around a little bit to say, do not the states and in fact the governors have a responsibility to add to this narrative. And I ask that question because this administration put forward -- I think, which was a pretty good program, which is to go after, through the Secure Communities program, criminal aliens, and it goes to building that narrative of having a process in place to identify those people who are here illegally, who have extensive criminal history, to remove those first.

Well, the governors of New York, the governors of Massachusetts, the governors of Indiana have now wanted to opt out of that program because they don't feel as if that was working as well as it should, and they were identifying the wrong individuals, when in fact a record number of deportations -- not raids of a flower march or raids of finding the 24-year-old female with kids here but criminal aliens.

And so I would just argue that to help build this narrative about addressing, I think, what's probably in most people's minds, illegal aliens who are here and the security aspects of it first, and then if those states could then participate in a program such as secure communities in a meaningful way, that would help us build a narrative to then add to the more skilled workers that we want to have here. Any comment?

ALDEN: Yeah, I mean, you know, it would take a whole nother panel to get into all the issues surrounding secure communities, which are many. I think the problem is I don't think it's helped to build a positive narrative. I know that's the intention. I mean, I think the intention is to say that enforcement is going to be targeted; we're going to go after people that we would all agree we don't want in this country.

I don't think it's done that. I think it's instead -- I think it's equated in the public mind immigrants with criminals, when in fact, you know, if you look at the data, criminality in the immigrant population is lower than it is in the general population.

So I think, you know, we could get into all the specifics of the program, whether it works, what are the issues about it. Julia Preston held a wonderful roundtable series recently up at Princeton where we got into this a great deal. It's out there in the YouTube world if anybody wants to watch it. But I think from the perspective of the narrative that we've talked about here, I don't think it's been constructive. I think it's worked against building progress for addressing some of the issues we've talked about today, unfortunately.

WINKLER: I'm afraid our time is up, but Ted, Ale, Vivek, thank you so much.

And thank you all.

MAYORKAS: Thank you all very much.

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THIS IS A RUSH TRANSCRIPT.

RICHARD N. HAASS: Well, good morning. Thank you -- (chuckles) -- a shout-out. Good morning. I'm Richard Haass and I want to welcome one and all to today's symposium here at the Council on Foreign Relations.

This is all part of a continued effort here to highlight the issue of immigration reform in the United States. This morning's events, though, are also part of something larger, an initiative here that the Council on Foreign Relations is undertaking as part of its 90th birthday year, and the theme is renewing America.

Now, throughout our history the council has focused largely, as you might expect, on the classic questions of American foreign policy: the use of force, the use of diplomacy and other tools. But in the immediate future and possibly beyond, we'll also be looking closely at issues that traditionally fell in the basket of what we thought of as domestic -- immigration policies, to be sure, but also issues like education, debt, trade, infrastructure -- essentially many of us believe will constitute the principle challenges to U.S. power and ultimately our ability to lead abroad. It's no accident, I would argue, that the chairman of the Joint Chiefs of Staff, Admiral Mullen, has talked about our debt as the principle national security challenge facing the United States and the world today -- not a rising China but a rising debt.

Basically, about two years ago in July of 2009 the Council on Foreign Relations released an independent task force report on U.S. immigration policy, and I saw copies of it piled up outside, and today's symposium uses this report as a baseline or a launching pad for continuing the discussion.

The task force was co-chaired by Jeb Bush, former governor of Florida; Mack McLarty, the former White House chief of staff. And Ted Alden, the Bernard Schwartz senior fellow here at the Council on Foreign Relations, who you'll be seeing in a minute, directed the project.

This report -- and it was a consensus report -- said that we need three things -- and by "we," I mean the United States -- first, a more efficient and welcoming legal immigration system that responds to labor market needs and enhances U.S. competitiveness by attracting and retaining high-skilled immigrants.

Secondly, there is a requirement for better enforcement to discourage illegal immigration into the United States, and thirdly, there is a requirement for a humane pathway to allow the more than 10 million of migrants currently living illegally, which is the legacy in many ways of previous immigration policy failures -- that they need to have a pathway to earn the right to remain in this country legally.

Speaking personally, I find a lot about this comprehensive approach to commend itself and I think it's noteworthy that the -- this administration's recent blueprint for immigration reform, which was released after the president's speech in El Paso, closely tracks this report's recommendations. That said, the summer of 2009, while only 24 months ago, seems a lot longer than that and may in some ways be longer than that or longer ago than that politically.

And recommendations that look to many people to be sound, sensible and centrist now look politically unachievable. So this symposium is asking the question -- and I think it's the right question -- whether there are ways to move ahead on immigration and immigration reform if we can't move ahead comprehensibly, in particular where there are ways to move ahead legislatively, whether there are ways to move ahead administratively and, above all, piecemeal. If you can't have everything you want, can you get something you want and begin to make progress to bring about immigration reform in the small and the specific if you can't bring it about in the comprehensive and the large?

All this takes place against the reality that the rest of the world is moving. And by that I mean while the United States is debating, or in some cases not debating, immigration policy, the rest of the world is changing. China and India, for example, are luring back many of their science and engineering graduates from American universities.

Other countries, Germany, Canada, Australia, just to name three, have become much more aggressive in attracting and retaining skilled immigrants. I think the fact is if we continue not to act, to put it bluntly, if this country continues to dither on this issue, the United States, American society, the American economy will simply lose many of the advantages that have come from this country being where so many bright, ambitious people have wanted to visit and to stay and to build their lives.

I'm pleased today that we will have the mayor of New York, my mayor, my neighbor, Mike Bloomberg, with us today to deliver the keynote address, and Mayor Bloomberg has been an outspoken voice on the immigration debate and continues to focus attention on issues that have not moved within the administration and the Congress.

Before I hand things over to Matthew Winkler, who will kick off this first session, let me just recognize, first of all, Luis Ubinas and the Ford Foundation for their investment in this effort and their real commitment to immigration reform. Secondly, let me thank Jeb Bush and Mack McLarty for all the leadership they provided to task force and to Ted Alden as well for crafting a report that stands the test of time.

Let me also thank other people who participated in the task force. Here at the council in Washington, I'd like to thank Anya Schmemann and her team at the task force, as well as Chris Tuttle and all those in the meetings program, who make events like this possible, and last but far from least, let me thank you all.

This is one of those critical issues that I believe will have tremendous consequences, not just for this country's competitiveness but also for our ability to integrate and move forward as a society and indeed in some ways for our national security.

So again, I want to thank you for your interest in this issue and for coming here this morning.

With that, over to you.

MATTHEW WINKLER: Thank you very much.

And what might make some sense in this discussion, immigration as an engine of the economy, to provide, say, 10 facts that here's hoping illuminate the issue and, as was just suggested so eloquently, put us right at the center of something that is probably, we hope, the most critical and necessary issue to be dealt with for the U.S. economy.

One, today's immigrants are more diverse than they were a century ago. Immigrants have more than twice the rate of U.S.-born Ph.D.s. On average, immigrants improve the living standards of Americans by boosting wages and lowering prices. Immigrants are not a net drain on the federal government budget. Taxes paid by immigrants and their children, legal and unauthorized, exceed the cost of services that they use.

Funding for enforcement in the number of unauthorized immigrants has risen since 2003. Immigrants do not disproportionately burden U.S. correctional facilities and institutions. Recent immigrants reflect America's melting pot culture, much akin to the immigrants of a century ago. The skill composition of immigrants is lower when compared to Canada and Australia because of U.S. policies that emphasize family relationships over skill.

Immigrants start new businesses and file patents at higher rates than U.S. citizens. And finally, the U.S. is issuing a declining number of visas for high-skilled workers. And you know, what I'd like to do is start, you know, from U.S. policy.

If you look at U.S. immigration today, it satisfies no one. There's not an American business that's satisfied, not immigrants, not their families, not voters, not our elected officials. The political debate is focused on border security.

So first, Ale, I'd like to turn to you. Do you agree or disagree that our system was designed for sort of another era and needs a fundamental change?

ALEJANDRO MAYORKAS: Well, let me -- let me answer that by saying I'm not sure I agree, if I may, with the framework of the disjunctive, that it's designed for another era or that it's in need of repair. I would say that it's in need of repair, and I'm not sure whether it was designed for a different era or not. But yes, I do not think the objective of spurring economic growth is being achieved as ably as I think the system intended.

WINKLER: And, you know, if we could turn to the economic impact of the current system, what is the consequence of having, you know, green cards issued for family reasons while something like 85 percent, and yet 15 percent go to skilled workers?

MAYORKAS: It was interesting, if I can, you mentioned 10 facts, and I don't have at my disposal the empirical data to assess each one of those 10 facts, but you did make a point, I think, that you said that our system seems to prioritize family unity over, perhaps, economic growth.

And I think that our system has three overarching objectives: family unity, economic growth and humanitarian relief, and I'm not sure it's an either/or proposition or it's a prioritization of one or the other. I think really we have to limit our focus on the economic growth aspect and say, that is a critical goal of our immigration system; are we achieving it. It's not that we are prioritizing one of the other goals at the expense of -- but rather do our laws, do our regulations, do our policies actually achieve the objective of maximizing economic growth through the introduction of talent from all over -- all over -- all over the world.

WINKLER: Let's take something that's really tangible here, and, Ted, I think you've really examined this quite thoroughly, which is, you know, if you can get the discussion of immigration closer to the whole subject of money, where the money is, where the money is for the U.S. and, say, focus on visas, for example, what about visas as an impediment to tourism, you know, business in general?

And, Ted, I know you've studied this pretty carefully.

EDWARD ALDEN: Thanks very much, Matt.

And I'd like to second Ale's comment. I think, you know, one of the issues that we're hoping to highlight today is that there has not been enough kind of systematic thinking in action in the United States that connects up immigration with our economic performance. And I think the reason for that is that for most of modern U.S. history, we haven't really had to worry about this problem.

The United States was, for many reasons, the most attractive country in the world for all sorts of immigrants, including very highly skilled and talented immigrants. If you were the best at what you did, you wanted to come to the United States. This was the place where your talents were going to be rewarded to the highest level.

What we've seen happen as a result of what Fareed Zakaria has called "the rise of the others" is that there's a lot more competition in the world now for the best and the brightest, that they are a scarce resource, and the United States has not really made that flip to recognize that it's not just a matter of sitting back and saying, okay, people are always going to want to come here because we are the most dynamic economy in the world..

We now have to compete for those individuals, and I don't think our immigration system as a whole has reflected that switch. It's been a problem of deciding who to keep out, because the demand was always much, much greater than our ability to take in immigrants, and that continues to be the case at a kind of macro level.

But in terms of the most skilled immigrants, they have a lot of choices, and we haven't thought about, well, what are the things that we need to do through our visa system, through our green card system, through our universities to attract and keep these people in the United States. And that's the mind shift that we as a country have not made.

WINKLER: So what would -- what would you do right away, or what could we do right away with respect to visas?

ALDEN: You know, I think there are -- there are things that could be done administratively. There are things that could be done legislatively. I think legislatively the most important thing is to make it easy for foreign students in the United States, those coming to American universities -- particularly in science and engineering fields, where the demand is so high -- to make it easy for them to remain and work in the United States, to offer them a fairly fast transition to a green card for permanent residence and citizenship.

And, you know, In Canada, the process of citizenship takes three years. You know, here, if you're -- if you're an Indian graduate student of science, you're lucky you get on an H-1B visa. You're looking often at six years on that visa and maybe an eight, 10-year wait before you get your green card, then another several years before citizenship -- this incredibly convoluted process, which is difficult and expensive for the immigrants throughout.

So that would be one element. On the visa side, I think there's still a huge amount that we can do just to make the system work more efficiently. And I don't want to go into the whole realm of security concerns. There are a lot of legitimate ones with the visa system. But people need to know that if they want to come to the United States and they apply for a visa, they will get a decision in a prompt fashion.

Sometimes the decision's going to be no, but it needs to be a system that operates quickly. We as a country lose these huge conventions. The U.S. Travel Association had a recent report, World Petroleum Congress 2014. Houston thought it was going to get it. The consensus of the industry was no, it's going to be too difficult for people who want to travel to that convention to get visas to come to the United States -- 9,000 visitors, millions of dollars in economic activity for Houston out the window. You multiply that by a thousand, and that's the kind of problems that we're dealing with.

WINKLER: You know, some of the research that's come out of CFR shows that something like the number of temporary visas for high-skilled workers has doubled since 1996 while the number of green cards has remained the same. I mean, how big a problem is that right there?

ALDEN: I'd like to defer to Vivek on some of this, but this is increasingly the bottleneck. You know, the bottleneck is that -- and again, I won't, you know, get into all the technicalities, but there are, you know, particularly for Chinese and Indians, for the two biggest countries in the world that are producing thousands and thousands of highly trained students, there are real hard caps on the number of those individuals who can get green cards every year, and that's a situation that -- those caps have been in place for decades and not updated to reflect the enormous changes that we've seen in Asia, which have really, you know, transformed the global economy and they're transforming our economy, whether we like it or not.

MAYORKAS: I think the wait is six years, if I'm not mistaken, with respect to those countries, and people are not willing -- industry is not willing to wait six years and people are not willing to wait six years when markets -- other markets are readily available to them.

Ted speaks of the numerical limits and especially, I think, most acutely with respect to particular countries, and that's a very macro point. There are also, I think you referred, Matthew, to some of the smaller things that we can do to change things. The high-tech companies have articulated to me that they are -- they find it very difficult to compete for talent when we do not allow family members of H-1B workers to obtain employment in the United States. Other countries do.

And so a spouse of a high-skilled worker who herself or himself wants to be gainfully employed cannot be gainfully employed in the United States as a spouse of an H-1B visa holder.

WINKLER: Well, Vivek, you know, is there anything that you see that is below the radar that right now is particularly relevant to this issue?

VIVEK WADHWA: Let me address some of the issues we just discussed. For example, our U.S. policy is dated. If you're a foreign student coming here for a Ph.D., you have to go to the consulate in India or China or wherever it is. First of all, you're made to treat like -- you're treated like a third-class citizen in those consulates. Just try going there in front of the consuls. They really treat you like dirt. It's like -- in India, it's like the days of the British raj, when the British would treat you like that, number one.

Number two, you get in front of the consul; they ask you, is your intent to stay permanently in the United States.

They ask you the same question seven different ways. If you blink wrongly and if you even hint that you might, you know, indeed want to work in the United States after you graduate or stay there permanently, you're out, OK? That's the -- that's the way the system works today.

Then we talk about -- you know, these -- these dependents of H1 visas, as Ale just talked about. In Saudi Arabia, you know, we're berating Saudi Arabia for not letting women work. If you are the wife of a scientist who's here working for a top university, you're not allowed to work. In many states, you can't get a driver's license. You can't get a Social Security number.

We treat these skilled workers worse than -- that, you know, women are treated in most other countries, other than perhaps Saudi Arabia. So, yes, we are in the '60s, and we don't recognize it. We're looking around. Right now, our senators and congressmen tirade against skilled immigrants -- they're taking our jobs away -- and they keep slapping fees on top of H-1Bs. They're looking for, you know, fraud and abuse because companies are trying to serve American companies and get jobs done over here.

This is -- when the world looks at America, we are as disgusted with American policies as Americans are with Saudi Arabian women not being able to drive. You have to realize that we sit here and we don't have a perspective of how the world is looking at us. So if you're in India right now, it used to be that if you were in -- you know, one of the -- IRT is the top university in India. There's seven of them right now.

If you're an IRT graduate, by default you would come to America because this was the place to be. If you're an IRT graduate today, you show off to your friends that you didn't even apply to an American company; you joined a local firm, because it's a matter of pride that you're working for a local company, and IRT graduates get better jobs in India. They make more money, their career progression is better than if they came to the United States.

You know, Ale said that right now it takes six years for a skilled immigrant to get a green card. That's false. If you're an Indian -- one of my -- I teach at Duke University. When one of my masters students graduates, the process is that they get an OPT visa, a temporary work visa for a while, and then they can get an H-1B visa. Then two or three years later, the company decides to file for a green card. That's when the clock starts ticking.

Today, we're processing applications that were filed in 2002 for Indians. That was before the backlog became works. My guess is that if one of my students started the process today, it would take them 20 or 30 years to get a green card based on the current delays, just extrapolating linearly.

You know, we keep talking about the 10 million, 12 million unskilled immigrants. Guess how many skilled workers there are legally in the United States -- doctors, engineers, scientists, computer programmers -- waiting for green cards? One million. His department doesn't publish that data because it's probably too embarrassing for them.

The 1 million skilled immigrants in the United States today are waiting for green cards. We actually added the numbers up, you know, using our -- (inaudible) -- this is as of 2008. My guess is the number is probably 1.2 million right now here legally. How many visas do we have every year for skilled immigrants? One hundred and twenty thousand in the EB-1, EB-2, EB-3 categories, plus there's a 7 percent per country limit.

You know, if you talk about dated policies, the 7 percent limit came -- was implemented decades ago because we were trying to limit the number of Japanese, I believe. There was some story behind that, but the result is that out of this million backlog about 350 (thousand) to 400,000 of them are Indians, about a quarter-million are Chinese. So 8,400 visas available per year, 250,000 people waiting -- guess how long it's going to take. So the result is that they're going back home.

WINKLER: How do you -- how do you, though, respond to the perception, which is -- which is widespread, that foreign workers are taking American jobs?

WADHWA: Well, to some extent, that's true. They do. The reason why America is what it is, is because we've -- I mean, generation after generation, we've had waves of immigrants coming here, making Americans work harder, making them compete for their jobs, and they have caused America to compete, and this is why we didn't stagnate like Europe did, because we've always had these waves of people coming in, undercutting salaries, making people work harder, you know, stay up at night to compete. That's what America's about.

Now, we can decide that we want to stop all foreign competition and close the doors, but we'll go the way of Venezuela. We'll go the way of these, you know, countries, which became third-world countries (that were ?) prosperous. It would be a disaster for American competitors.

WINKLER: So how do you get some harmonic convergence with the politicians who are --

WADHWA: Well, you have to fine-tune it. First of all, you have to acknowledge that it is indeed 1960s policies. We're back in the days when it was just us and the evil empire. Those were the only two superpowers. It's not like that anymore.

The rest of the world is rising rapidly. You're seeing momentum all over the world. Even in Ecuador, you're going to begin to see startups happening. Mexico is trying to set up a high-tech center in Cabo, of all the places, because it's safer than other places. So all over the world you're seeing these high techs.

Chile, I'll definitely talk about startup Chile. Chile is now offering $40,000 to any entrepreneur from anywhere in the world that wants to come and live there just for six months -- no -- visas are no issue -- $40,000 for free, just for starting up a company over there.

MAYORKAS: If I can jump in, apparently at my own peril -- (laughter) -- the -- actually, Vivek, the argument -- so the tech companies say that one of the reasons why they have difficulty competing for the H-1B talent is because, for example, we as a matter of policy do not allow, as a matter of regulation do not allow the spouse of an H-1B worker, high-skilled worker, to be -- to be employed. They make the argument that it is not a one-for-one job displacement formula; that if in fact you let the spouse work, you are indeed taking a job from an American worker. That is the argument against allowing the spouse to work.

WADHWA: That's what the Saudi Arabians say about the women -- that women will take our jobs away. It's the same logic.

MAYORKAS: But you -- but you mentioned that they do compete. The argument in favor of allowing the spouse to work is that the skilled worker, in drawing the skilled worker here, that skilled worker creates far more -- far many more American jobs than does the spouse replace one, so --

WADHWA: But let's look at the humane aspect of it. We're in America with the Immigration Department talking about why women shouldn't be allowed to work. I mean, we're talking about women, because predominantly, the H-1Bs are males. The spouses can't work. Does that -- does that make sense over here in this country?

And by and large, the spouses are highly educated. So we're worried about -- you know, we're not going to allow the spouses of skilled workers to work because it might impact the American workforce. This is American thinking. If this is not 1960s thinking, then what is? You're seeing it play out, you know, in front of you, folks.

MAYORKAS: I'm not -- I'm not sure I would view that issue through the lens of gender, quite frankly. I'm not --

WADHWA: It is a gender issue, though. The reality is that the majority that these companies are hiring are males.

MAYORKAS: I mean, Ted, I don't know if you'd be willing to arbitrate this -- (laughter) -- but I haven't -- I haven't heard --

WADHWA: I'll calm down.

MAYORKAS: No, no, no, I haven't -- I haven't heard that issue articulated through the -- through the lens of gender discrimination.

Look, the question I have -- and it dovetails, Ted, with something that you said -- is, Vivek, you mentioned that now the graduate of one of the preeminent Indian universities will actually consider it bragging rights to be employed by a local firm. Is that by virtue of the fact that United States policy has made the United States less attractive to that talent, or is it because of the rise in fact of the home country's prominence on the economic --

WADHWA: Both factors -- both factors are equally important.

ALDEN: I mean, I think that's -- you know, that's the situation we're in, which is both of these things are going on. I think, you know, there's no -- there's no question that these countries would have done a much better job in retaining their own talent, regardless of what the United States has done. The question is, do we want to push these people away, and too, too much of what we do on the policy front pushes these people away, at our cost.

WINKLER: Nobody on this stage wants to push people away, right? So what is the way to convince policymakers to accept that as a given to begin with?

ALDEN: Well, you know, I think that this issue is stuck in a lot of ways, which is, you know, what Richard noted in his opening remarks, and I'm not sure what the right combination of arguments or political pressure is that unsticks it.

What I do know is that as a country, we are in an economic situation that is tougher than we have been in for generations. There was a McKenzie study out last week looking at job prospects over the next decade, and only under the most optimistic set of circumstances, levels of job creation equal to those we saw in the 1990s, which were very high, do we get back to anything like full employment over the next decade.

So it seems to me everything we need to do has to be focused on job creation. One of the most troubling things in the McKenzie study was looking at the rate of new job creation. You know, the strange thing about the United States economy is we destroy jobs at an extraordinary rate all the time. The reason our unemployment has historically been low is that we create them faster than any other country.

Well, you look at the last decade, that rate of new job creation has dropped dramatically. So, you know, one question at the top of the agenda ought to be, how do we encourage the job creators. Well, it gets back to Vivek's work about immigrant entrepreneurship. High-skilled immigrants are a tremendous source of new corporate startups. These new corporate startups hire people. I mean, that ought to be front and center, it seems to me, in this debate.

WINKLER: Related to that, the U.S. travel association said that a smarter visa system would create 1.3 million American jobs, and, Ted, unemployment is 9.1 percent. So what do you do?

ALDEN: Well, you know, this is our largest single-service export, tourism, but what -- again, what we've seen over the last decade, the U.S. share of global tourism has been flat for a decade. The number of global tourists has risen by 60 percent over that decade, again, a lot of it fueled from these fast-growing developing economies, from the Brazils, from the Chinas, from the Indias, only they're not going to the United States. They're going to Western Europe, and one of the reasons is the difficulty and expense of getting a visa to come to the United States. The Travel Association argues -- and I tend to agree with them -- make that process easier. Bring more people to the United States. That's a lot of easy job creation. That's something that all we need to do is make our own procedures more efficient, and there's a real economic windfall from that. Why not do the simple things like that that we can do?

MAYORKAS: I think that's a very -- I think that's a very important point. There are process improvements that we can make that can have material impact and positively so. So you mentioned the creation of jobs, Ted. The immigrant investor visa program, the EB-5 program, is a program that provides for an immigrant to receive a visa if a sufficient investment of capital is made, and jobs are created directly or indirectly through the development of a -- of a new business.

Our processing of that program has been suboptimal, and so we have needed to address it. And we received tremendous feedback from the EB-5 community with respect to our administration of that program, and three weeks ago, I think we made a very innovative proposal to really reinvent that process, and we're receiving public comments and response to our proposal.

But it speaks of expedited processing, the hiring of the expertise required to really analyze these very sophisticated proposals, having an expert panel conduct interviews of applicants. It's very innovative for our agency.

Vivek has spoken in Silicon Valley. We attended a roundtable discussion, and Vivek spoke of the fact that my agency's H-1B policy memorandum has had an adverse effect on immigrant entrepreneurs' ability to obtain an H-1B visa, and so we are looking at that policy and specifically one aspect of that policy to determine whether in fact the policy is what it should be.

WINKLER: Ted and Vivek have characterized where we are as literally a crisis of significant proportions. Just wondered, in your role -- you're the policymaker -- what are the victories that you see or you would like to achieve or, you think, you can achieve?

ALDEN: Just to be fair to Ale, Congress is the policymaker on a lot of this. I mean, the administration operates within a set of constraints, so it's not like you can wave a magic wand.

WADHWA: (Cross talk.)

ALDEN: It's not like he can wave a magic wand and fix all this.

WADHWA: Yeah. He has to take the corporate line here, the government line, and I'm sure that he doesn't believe in it, so -- (laughter) -- you can't believe in it. But he has to sit here and smile and pretend he does.

ALDEN: I didn't say that.

MAYORKAS: And that concludes my -- (inaudible) --

WINKLER: So what I want to know is, are you totally ineffectual.

MAYORKAS: There are -- there are three layers of influence in the -- in the administration of immigration policy. There is -- and it is hierarchical. There is the statutory framework, which is really the ultimate design. There is regulatory authority, which is intended to implement the intent of the legislature. When it enacts statutes, there are implementing regulations, and then there are policies beneath that.

We as an agency can implement policies and we as a department can promulgate regulations. But really, when one speaks of numerical limits, when one speaks of per-country caps, those are a matter of statutory reform, and I think we all know how well comprehensive immigration reform is proceeding through the legislative process. So I don't know if there's a tremendous level of optimism right now with respect to a fundamental redesign of our country's visa structure.

WINKLER: Given all that, is there anything that you can do that, you would say, makes a difference for the better, and what is that?

MAYORKAS: Well, the EB-5 program, I think it's capped out at 10,000 visas a year, but, you know, that's a -- that's a lot of job creation and a lot of investment of capital in the United States economy. I think our proposal, when it is implemented and when it comes into effect, will have a real difference, a material difference with respect to the success of the EB-5 program.

If in fact we reform our H-1B policy -- and I can share a little bit about what that issue is. If in fact we reform our H-1B policy so that immigrant entrepreneurs can access the H-1B program with greater facility than is now the case, then, Vivek, I think you would argue that we're going to see a lot more entrepreneurs use the H-1B issue.

WADHWA: What he's talking about is that right now if you're starting a company, you can't -- and the company is taking off, you raise capital and everything is set, you're going to start employing Americans, that company can hire anyone but you if you're an immigrant who founded that company. So the problem is that there are so many tight restrictions on the H-1B visa, if he fixes the problem so that if I start a company and it employs Americans, and if I'm working for it, it's well-capitalized and so on, I can get a visa, that'll allow thousands of people who are already in Silicon Valley to start to create their startups, to start their businesses. It will allow my students at Duke to do that. That's a quick fix.

MAYORKAS: So Vivek, when we -- when we spoke of this issue in Silicon Valley, I think you mentioned the part of the policy that dealt with the sole -- the sole employee.

WADHWA: Yes.

MAYORKAS: Right. So this is the -- this is issue in a nutshell. The H-1B visa is for the skilled worker. So what about the immigrant entrepreneur who's actually starting his or her own company? Of course, Vivek, under your paradigm, it would be just a "his," but let's say -- (laughter) --

WADHWA: I'll get back to that.

MAYORKAS: -- let's say -- let's say -- I'm just going to push for equality for a moment -- (laughter) -- so let's just say that the immigrant entrepreneur wants to utilize an H-1B visa, and the entrepreneur really starts his or her own company and is the only employee. The H-1B law provides that the employer must exercise -- I'm sorry -- must have the right of control over the employee in order for that employee to avail him or herself of the H-1B visa.

Does the immigrant entrepreneur, who's really starting him or herself a company, does the company exercise control over that individual if that develop is the sole employee? Under certain corporate structures, that might be the case, if you have a board of directors and the board of directors actually exercises control, determines the salary, determines the conditions of employment and the like.

But it's an issue. It's a legitimate issue, and some might argue that, is that really what the H-1B visa, the skilled worker, was designed for. Was it designed for the individual who comes to this country to start his or her own company and begin to employ others and raise capital and really incubate a company? And I think that's a legitimate policy question and I think it's a legitimate legal analysis that must be undertaken.

I will say when Vivek raised the issue with me in Silicon Valley, I went back to our H-1B policy memo and looked at the section at issue. At the very least, that section is not as well-written as it should be and not as, I think, legally tight as it needs to be as an important policy pronouncement. But then we, I think, need to get to the legal and policy issues that I addressed, and we're looking at that, because we do understand it's significant, a significance of which I was unaware until Vivek articulated it in Silicon Valley.

WADHWA: And again, this is a malfunction of the new era. Today you can create a technology startup with $20,000, which could become a Facebook and employ, you know, tens of thousands of people. It wasn't like that. The graduates of our STEM programs right now are more interested in becoming entrepreneurs than ever before. Before, the norm used to be that you'd join an IBM or a Microsoft. That's what you strived for. Now in the universities, you go there, you're seeing a new spate of entrepreneurship, which everyone wants to participate in.

We want more of that. We want thousands more startups, because of the thousands more startups, you might have a Google or a Facebook in there. The likelihood is out of a thousand, you will have one.

MAYORKAS: And I think that's a critically important point, and it really, Ted, I think speaks to -- what you mentioned earlier is that the new horizon doesn't match with the old structure, and the structure has not changed to account for the -- for the dynamics that we're seeing.

In that very same roundtable, which was hosted at Stanford, there were a number of Stanford business students that were working on these new companies -- something that I don't remember occurring 20 years ago -- but they were not applying to the large financial institutions or the big companies. They were going out, taking a risk and starting something. It is a phenomenon that our statutory scheme does not really account for.

WINKLER: And how would you -- Ted, how would you go about convincing policymakers to get to this new perception that you're talking about?

ALDEN: (Laughter.) Well, you know, if I knew that, I would have -- I would have done it already.

I get back to focusing as much of this discussion as we can on the economy and our needs as an economy in this new world that we're moving into. I think an awful lot of the immigration debate has been focused around the issue of illegal immigration, which is an extremely important one and needs to be addressed. It's been focused around the issue of border security, which is a hugely important issue, the one we've made a lot of progress on, underappreciated progress.

I think far too little attention has been paid to the economic side of this debate, and I just think that that's where everybody in this country is right now. That's issue number one.

WINKLER: So why don't you -- why don't you help us and quantify how you make that argument in an economic context?

ALDEN: Well, I think it really does get back to the -- to the job creation part. I think, you know, there's an unfortunate way in which we talk about the economy that really misunderstands the way -- the way economies work, and I'll use an example that's in the news today.

Lamar Smith, the Republican chairman of the House Judiciary Committee, is introducing a bill to require employment verification for all employers, and a lot of that makes sense. In our task force report, we were positive on the direction that E-Verify is taking.

But Smith's argument is, well, that if we put E-Verify in place and anyone who's not authorized to work in this country loses that job as a result, that's going to free up all of these jobs for Americans -- simply not the way economies work. I mean, what's likely to happen is a bunch of those jobs will go underground in a cash economy. In many other cases, businesses will simply go under. In other cases, they'll move abroad.

Economies are not static, and, again, I get back to the point I made about the high level of job destruction in the United States that used to be offset by the high level of job creation. That's where we need to focus on. We need to be looking at the job creation side, rather than imagining there's this sort of fixed number of jobs out there, and we have to decide how to divvy them up, and obviously it would be better to have Americans doing those jobs than to have immigrants doing those jobs than to have illegal immigrants doing those jobs -- to set up a kind of hierarchy.

That's not the way economies work. It's particularly not the way a dynamic economy like the United States has ever worked, and so I think that needs to be a central focus in this debate.

WINKLER: Well, how do you connect immigration to American jobs? -- open immigration to more American jobs?

ALDEN: I think it gets back to the role that immigrants have played in job creation, which is a very strong role. And that's -- I mean, we haven't talked a lot about other sectors, like agriculture and other things. There are a lot of jobs -- there are businesses that just wouldn't be operating in the United States without immigrant labor at all different levels. But I think, you know, the job creation entrepreneurial site is really central to making this argument.

WINKLER: Vivek, what would you say?

WADHWA: I mean, you know, for example, the quick fix over here, if I wanted to create jobs, is that of these million people who are waiting, anyone who buys a house or starts a company can get a green card. They're here legally. They, you know, went by the book. They had the skills. That's why they were admitted over here. So if you put a minimum threshold of $250,000, I'll bet you we would have 50,000 houses sold within, you know, three months of this program being launched. You're talking about a multibillion-dollar stimulus to the economy for zero cost.

So there are smart things we can do like that -- students, let them start their companies. If their companies don't work out, they have to leave or unless they start again. There are a lot of, you know, simple fixes which give a major boost to the economy, because the fact is that if you look at Silicon Valley, during the biggest period of growth in recent history, 1995 to 2005, when the dot-com boom happened, 52 percent of the startups, they were started by immigrants, people born abroad -- 52 percent.

The majority of those people came here as students, and typically 13 years after coming here, they started companies. I mean, I was one of them. I mean, I founded two companies in America. The first one employed a thousand people. The second one employed 200 people. So it's not one-for-one. It's a thousand-for-one, very often, that when you bring the right people in here to this country.

ALDEN: And one of the things we need to do, I think, is to experiment on a small scale, as well. The Canadians have done this. You take -- you take an example. Like, one of -- one of the real concerns that the Canadians have had is that all the immigrants want to move to the three big cities. They want to move to Vancouver, Toronto or Montreal. So they set up small-scale schemes to say, well, you can jump the queue, in effect, if you're willing to go live in Winnipeg, a cold, midwestern city that was worried about losing its population.

Well, there's been a revival in Winnipeg. There have been a lot of immigrants coming to Winnipeg on this program. It's revived the economy of Winnipeg. We could do experiments like that with Northeastern cities and other places. We don't.

WINKLER: Mayor Bloomberg, who will be here later today, actually suggested that the way to revive Detroit is to say to any immigrant who wants to come here, please, as soon as possible, and you will have a process of renovation. Do you agree?

ALDEN: I do. I do. There are real-world examples of this.

WINKLER: Why does that work?

ALDEN: I think it works because, you know, when you see immigrants move into these old cities, they revitalize a lot of these neighborhoods. I mean, it creates a local economy. There's a dynamism associated with that. I mean, Detroit's problem is depopulation, right? People are leaving Detroit, and so you have entire neighborhoods where people can't sell their houses, houses are empty, crime goes up because people aren't in the streets. A pretty easy way to address a problem like that, but it takes a lot of experimentation.

WINKLER: On that note, let's open it up to everybody here and take some questions.

Ma'am?

QUESTIONER: I'm Mitzi Wertheim with the Naval Postgraduate School, and I've been spending a lot of time in the last two years thinking about jobs. Let me just make one comment.

I came to Washington in 1960 and -- when the Peace Corps was created, and the whole question of all of these immigrants -- the reason we didn't want to hang on to them was we wanted to send them back home to basically create what we've now created. I mean, that was -- I mean, I watched that happen.

I guess the thing that gets me is we don't have a good narrative on how to fix it. I mean, I've heard some ideas here, but nobody tells the story in the way in which the rest of us can really understand the dimensions of the problem and the breadth with enough detail of what we could do about it.

I mean, I kept thinking, for example, that the visa issue was something that the State Department ought to be able to just fix. You do have to have some understanding about all the barriers that exist in each one of these, and if there are other stories -- I mean, I think TIME Magazine did a story on creating jobs, and it had seven or eight different ideas. They all came from overseas, and we have to start learning about, what can we learn from others.

So I'd be interested in how we create a narrative that the people get.

WADHWA: Mitzi, let me give you one narrative. The million skilled immigrants here -- doctors, scientists, lawyers, et cetera -- why don't we just give them green cards right now, because the group I talked about in Silicon Valley, they came here, they got green cards and then they started companies?

Well, these people can't do it. I bet you if we did the same survey of Silicon Valley, you know, two or three years from now, 52 percent wouldn't be founders because they're stuck in the H-1B visa mess. So we just have to provide more green cards.

You know, we keep talking about these work visas. The issue isn't the work visa. The issue is the green cards, the number of green cards. It's a numerical fix. Instead of 120,000 with a 7 percent per-country limit, make it 250,000 with no limit. It'll fix itself within two or three years. It costs nothing, zero.

We're not bringing in a flood of new -- of new people from outside who are going to take American jobs away. These are people who are already here who would now be buying houses, who would now be creating companies, who would now be, you know, digging deep roots over here, becoming Americans like all the others are. It's a subclass. It's a very simple fix.

QUESTIONER: And have the rest of the country hear this narrative.

ALDEN: Can I -- just briefly, I mean, I think the point's a very good one, because we have historically had this immigrant narrative, and it was essentially about what America could do for the immigrants: America as the land of opportunity where you could make good, where you could do better than your parents, and your children would do better than you.

We're in an era where we kind of need a different narrative, which is more about what immigrants can do for us at a time when our country is struggling, and we haven't developed that narrative. I think you're right.

WADHWA: I mean, most people's doctor's are foreign-born these days. If you now start talking about, do you want your doctor to have to go back home, that would be a good message. (Laughter.

WINKLER: We have a question here.

QUESTIONER: Yes, Marisa Lino from Northrop Grumman -- any discussion of changing numbers requires legislation. You're not going to get any legislation in the run-up to an election year. I mean, that's just, I think, pretty clear. The other problem I see -- and I'd be interested in your comments -- if you look at some of the things that the right has said about this issue -- you've got to strengthen our borders, you've got to strengthen our systems, stuff like E-Verify -- E-Verify is only as good as the Social Security database, which is not good. I could use stronger terms.

But it needs to be cleaned up. You need to spend money to clean up the Social Security database. They are -- Congress is right now in the process of eviscerating part of DHS's budget for the -- for the coming year. I mean, we'll see what the ultimate result is, but FY '12 is looking pretty bad for some parts of DHS, I'm sure you would agree.

So I'd be interested in, you know, the kind of narrative that Mitzi was talking about doesn't lend itself easily to a sound bite in an election year. What you need are good sound bites, unfortunately -- sorry to sound so negative.

MAYORKAS: Well, I mean, that wasn't -- I didn't take that as a question. I took that as a comment. But let me -- let me say it really does echo what Mitzi said in terms of the need for a narrative, but what I -- what I understand Vivek and Ted to be articulating is that the narrative is not that it's a one-for-one, that an immigrant with economic potential, whether that be highly skilled or otherwise, who comes to this country displaces an American worker. That is not the narrative that I hear my two colleagues articulate.

The narrative that I hear them articulating is that that individual creates opportunities not just for him or herself and his or her family, but for the surrounding community and the business environment, and so that the net effect -- and Vivek will know the data, because obviously he's an expert -- the net effect of the introduction of that talent -- either at a higher level than our visa policies currently permit or at a speed that our system currently allows -- will be a net positive effect on the creation of jobs in our economy. I think that's the narrative.

WADHWA: We have to educate people the pie gets bigger when you bring, you know, more people. It doesn't -- it's not taking jobs away. You start making the economy boom, and everyone benefits from it.

ALDEN: I mean, just on the legislation, I don't disagree, but you can't help but wonder, where has some of the creativity of our lawmakers gone. I mean, you could actually point to the elements on the table. I mean, Lamar Smith wants all companies to adopt E-Verify. Zoe Lofgren, the ranking member on that committee, has introduced a bill that expands the number of green cards and eases procedures for foreign science and engineering students coming to the United States.

Senators Kerry, Lugar and others support, you know, a startup visa bill that would help with immigrant entrepreneurs, and there's still a lot of support for the DREAM Act for, you know, roughly 2 million kids who've grown up in the United States, are here undocumented because their parents brought them here but still a lot of support for that. Can we imagine a minipackage coming together from those different elements? This is the sort of thing that we used to be able to do in Washington.

So, yes, we can't do the comprehensive bill, but maybe there's something smaller that could deal with some of the different pieces that both sides of the aisle could agree are important. It's depressing to think that our system has lost the capacity for that sort of bargaining. I mean, everybody might put the package together differently, but you could imagine, just from the things out there, a legislative bargain that makes sense, not to say we're going to get it, but --

MAYORKAS: Well, the question is, is the pessimism with respect to legislative prospects leading to a passivity with respect to those proposed legislative pieces, because the E-Verify legislation, I think people expect it to pass the House. Senator Reid had an op-ed piece this morning on the DREAM Act, and it's going to be interesting what happens in the Senate if not the House with respect to whether anything -- any other legislative ideas are put forward as a companion to that E-Verify piece.

And so need for reform requires more than pessimism and passivity, or it requires at least pessimism that triggers activity.

WINKLER: We have a question over here. I just -- before we get to it, could you just explain, though, why the DREAM Act is important for this narrative that you want to create?

ALDEN: Well, you know, I think if you're looking at the question of wasted talent -- I mean, so we're talking about, you know, a lot of this talk has been about immigrant students that we send back.

Well, you look at these kids who have grown up in the United States, gone through high school, want to go on to university, find that door closed -- maybe in some cases, they go to university but they want to work; they find that door closed. They want to go and serve in the military,; they find that door closed.

This is, again, a wealth of talent that we're throwing away. We're basically telling these people, well, you've grown up in the United States, but we are going to close every door on your prospect for bettering yourself.

I mean, honestly, it's hard for me to think of anything more un-American than that, closing those sort of doors to people.

MAYORKAS: So there's a -- there's a -- there's an economic aspect that Ted has articulated to the DREAM Act. I'm not sure the crux of the DREAM Act is really an economic one.

ALDEN: Well, I think it could be. I mean, there's a lot of wasted potential there that we -- you know, again, you get back to the McKenzie study. There are hundreds of thousands of jobs out there right now that are not being filled because we're not training people in our schools and our community colleges to fill those jobs. We can't afford as a society to be throwing away potential.

WINKLER: And Ted, I understand your narrative is really, you know, you want to reward initiative, because that is -- essentially the American way is initiative -- (inaudible) --

ALDEN: Absolutely, absolutely.

WINKLER: Your question?

QUESTIONER: Rob Cortel with Intelex -- just two quick kind of observations and then a question -- one is you really need Michele Bachmann here if you really want to understand the politics of it, because it does relate to the narrative.

A lot of this discussion is around aspects of this issue which appeal to intellectual elites like the people in this room and -- but a lot of the narrative appeals to everybody else. So your part of this narrative is we need these people; they're talented; it'll help make America great and good. The rest of the population hears illegal immigration.

So what you really have to do is turn this to what every politician, including Michele Bachmann, say, which is that they favor legal immigration, and to use that as a take-off to what that actually means in and of itself.

The second point here is that my legal residence is three and a half hours south of here on the western shore of the Chesapeake Bay on a little island in Matthews County, just above Williamsburg, and it's to the same point, which is -- which had a crab-picking operation for years, which just about died until they got legal, legal Latin American immigrants, and the attitudes on this island of these few people, that has 800 people -- and they've got 30 workers who come over -- is totally different.

These people are accepted in the community. They're legal immigrants and all that. So if you're going to change the narrative, you actually have to push it down into something that is meaningful to most people inside the population. I just think a lot of this is very elite and effete, almost, in some ways.

And that goes to the third part of it, and this is really a question to all of you. So many of these conversations are around this issue of the educated, high-skilled, high-value worker, but the reality is the country has a deficit of workers in a category that will do jobs most of us won't do, ranging from chicken-plucking to crab-picking to working on the farms and picking tomatoes and things like that. So I'd be interested in hearing how you deal with that.

WADHWA: Well, you know, I've been in the middle of those debates as well. What people argue is that if those cherry-picking jobs paid $20 an hour, you'd find enough Americans to do them. The reason why Americans don't want them is because they're too low. And I've spoken to people on the other side who say that even they were offered $15 an hour plus benefits, Americans don't want to do them. There's emotion over here.

On the skill side, the problem -- the reason why we have, you know, this problem is because in the tech industry, once you're over 40 or when you're 45 years of age, writing old computer languages, you become less valuable. In other words, no one wants to hire someone making $150,000 a year whose skills are dated. Therefore, they want the younger workers in who make $65,000 a year, who are twice as productive. We don't talk about that.

So what happens is -- and this -- and this has been the case always in the tech industry. It has nothing to do with immigration. But because we don't talk about the age issue, now you have this unemployed -- when workers get to be 45, 50 years of age, they can't get unemployment; they can't make $150,000, anymore; they can make $80,000 -- they start complaining that foreigners took our jobs away; we had these H-1Bs; we had to train our replacements and so on.

(Inaudible) -- we're not facing the reality of the situation over here. It's like telling the NFL that you have to hire anyone, regardless of age, you know, but that's what this is all about. If we now want to become a socialist country and have everything being based on equality and protectionism and so on, we'll become a third-world country very rapidly. Those are things we don't talk about.

ALDEN: I guess the only thing I would add is that, you know, part of the difficulty in any discussion of immigration is that you get very quickly to, well, we need to solve the whole problem, right? We need to solve every single aspect of it.

And part of what I would argue is, let's try some things on a small scale, you know, with respect to agricultural work.

The Canadians, again, have got this kind of small-scale program that they run with Mexico for temporary workers who come up for the summers to do agricultural work. We can do things on a small scale here, try different combinations out, see what works, see what doesn't work. We're sort of stuck in this position that unless we can solve every aspect of the immigration problem, from, you know, enforcement to low skill to high skill, we're not going to do anything.

You know, part of what I was hoping when we organized this symposium is to push for, let's work where we can work and start to make progress. So I completely agree with your point. I think there are multiple levels at which we need to address the problem, but let's try some small initiatives --

WADHWA: Ted is right. There's no way we're going to solve the problem of, quote, "amnesty" in this administration. It's not going to happen the next two or three years. Now, if we don't fix the rest of the problems, our economy will continue to be in a slump. We're going to be exporting people en masse.

ALDEN: -- or even -- or even fix some of the problems.

WINKLER: So what's the one thing you would do, Ted? What's the one thing you think we could do?

ALDEN: Well, I think that, you know, stapling green cards to science engineering immigrants who graduate from, you know, advanced programs, I think that's an easy thing to do that gets you a lot of benefits very quickly. There's a lot of stuff on the entrepreneur -- I mean, you know, we've talked about a bunch of different initiatives. There's not one silver bullet. I think there's a bunch of small-scale things you should do.

Q: Could I make a comment? It's intriguing that all of the discussion assumes federal dominancy, yet in an area where we've had difficulty with illegal immigration and what have you, by default, it has increasingly gone to the states. The assumption of all of the discussion is -- even as you've come up with small projects, is that there cannot be any delegation of federal to state or even to local to permit variations along the context of what you're describing. Why not? Why is the answer always looking down federal what's good for one is good for all?

WADHWA: I think I told the -- (inaudible) --

ALDEN: I don't know. I actually think there should be. I think there's no reason -- I mean, I think it has to be a federal delegation, because this is a federal authority, but I think there's no reason the federal government couldn't allow the states to experiment more with programs in some of these different areas. I don't think there's any inherent -- I mean, maybe I'm missing something, but I don't think there's any inherent reason that something like that couldn't be done.

WADHWA: (Inaudible.)

MAYORKAS: Well, you know, immigration law is federal law for a reason. There are foreign policy implications. Numerical caps with respect to particular countries have foreign policy implications, and so the delegation to states of federal immigration policy is not as simple as addressing a local or a regional economic need.

So how many individuals, how many high-skilled workers will we take from China or from India, and whether the visa policy's with respect to those particular companies, which are our greatest producers of high-skilled talent, entrepreneurial talent currently, that has implications, economic, bilateral implications with respect to economic relations, foreign policy implications. And so there's a reason why immigration policy is in fact federal in nature.

WADHWA: But let me -- you know, you've raised a great point, though. What if Detroit wanted to say that, look, all of these million people that are here, anyone who wants to start a company in Detroit can stay here regardless of visa status; that even though you're on an H-1B visa, you can start your company here? They'd probably get tens of thousands of people moving there to start companies.

MAYORKAS: Well, I think -- I think we're going to see that issue unfold, if I'm not mistaken, with respect to the proposed legislation in Utah. Utah has proposed immigration policies as statutes that cover a wide array of immigration issues. Some of them do not take effect immediately. I think some of the guest worker programs, which speak to your point, I think they take effect in 2013.

And so it may -- it might not be ripe for legal action just yet. I don't know, I haven't analyzed that issue, but I would imagine as that day draws near, and if in fact federal action has not been taken legislatively, then I think we're going to see the issue that you raise addressed in the court system, I would anticipate.

WINKLER: A question in the back, all the way in the back. Yeah.

MAYORKAS: Ted, if I may, while that microphone is working its way, Ted mentioned the idea of initiatives and trying something. The difficulty there, and I do think trial and error is a useful tool -- we do it. Some might argue, some of our stakeholders might argue that we err more than we try, but, you know, we learn. We learn, which is why we have, I think, in a model of open government, now we do not promulgate policies unilaterally. We post them for public comment to understand from industries that we serve, from stakeholders, what the consequences might be of the policies that we propose.

We also are doing trial and error with respect to certain process changes to find out what we think might work, will it work, will it not work. Given the legislative process, it is very, very difficult at best to really experiment in the reform of the immigration system aspects that we're speaking of today -- very difficult.

WINKLER: I just would like -- you know, there are some actually very powerful narratives that perhaps are obscured. For example, Hyundai is a very, very successful car manufacturer, especially in the United States. It has created successful manufacturing plants, which in turn have created all kinds of spin-off businesses that have fed off of the original car plant and created burgeoning economies, you know?

And this is not an isolated example, and this is where immigration and homegrown talent converge harmoniously. Just, you know, for people looking for a narrative, that's a very powerful one.

There's a question back here.

QUESTIONER: Vic Johnson with the Association of International Educators -- I just wanted to make a couple of comments.

First of all, on piecemeal immigration reform, I would point out we're doing that now. It's called enforcement. You can pass any enforcement measure you want to propose in the United States Congress, and that's one of the things that keeps driving the immigration debate to the right, toward the closure side.

You can always build the fence higher. You can always build the fence longer. You can always put more boots on the ground on the border. You can always deport more people than the previous administration did, and we're doing all of those things.

The question is, how can we leverage the desire for enforcement to get other pieces of immigration reform done, and that's called comprehensive. I mean, there's a reason you do it comprehensively. So there are various packages that I think many of us would like to see, fine -- but there's --- would like to see tried, but there's always the guy at the end of the line who isn't getting what he needs out of your piecemeal package and who knows nobody's going to help him once everybody else has what they want.

That's why a congressman like Luis Gutierrez have been reluctant to endorse other proposals, because their primary interest is, how do these 12 million people get their situation normalized.

And if he keeps saying to everybody, well, I'll support everything you want and we'll do that last because it's the hardest -- it'll never happen.

So it's -- you know, it's politically hard to put together a package that will pass except for enforcement, and we can keep going on down that road for as long as we want until you can't build the fence any higher.

The second and last point, but kind of related, is on the narrative question. You know, I mean, the way you do the narrative is by doing it. This is what makes it such a frustrating question. There are narratives out there -- we've spun off a few here. There are a lot more, but the anti-immigrant side is dominating the narrative, and the people who see this issue the other way are sort of demobilized at this point. I think one of you made that point.

You know, the president isn't talking much about it, the congressional leadership isn't talking much about it, the immigration groups and ethnic groups, the drivers of this debate in the NGO sector, are quiet. We're saying, we can't introduce legislation because, why should we bother; well, it can't pass.

Well, it can't pass if it's not introduced, and you have these vicious cycles going whereby we make progress impossible because people are afraid to tell our narrative.

I think that where it starts is with the best storyteller we have in the United States system. That's the president of the United States. You start the narrative at that level, and other political leaders pick it up. It gives context for the NGOs to orient their conversations. It gives context for conversations in our committees, and you build this narrative over the course of years. You don't not do it because it's an election year. You just have to start doing it. We have to reclaim this conversation somehow. People have to grab a hold of it and do it in our political sectors, or things will keep heading in the opposite direction, as they are now, because those storytellers are the ones that are controlling the debate.

WINKLER: Well, President Obama did in fact give a speech with a broad and comprehensive outline of immigration reform. You, Vivek, I think, characterized it as a giant press release, if I'm not mistaken.

WADHWA: I mean, we're saying all the right things but not taking any action. You know, I think that the chances of getting this amnesty issue resolved before the next administration are zero. Now, if we wait three or four or five years to fix the issue of unskilled immigrants -- I'm sorry, of skilled immigrations, what's going to happen is that the skilled workers will be long gone. Students are already going back. They'll go back faster.

India and China are already becoming booming tech centers, and those will become Silicon Valley classes within the next five years or so. The unskilled will still be here because those people have no choice. The people who have a choice won't be here. So hence there's an urgency in doing what you can do, so I agree 100 percent with Ted that you have to do what you can do, and do it now; that if we can agree on the DREAM Act, if we can agree on either the Zoe Lofgren legislation or the Lugar legislation, let's get those things through and then worry about the rest of the mess afterwards.

QUESTIONER: Alan Wendt -- one hears the argument that the reason firms can't find enough skilled workers is because they're not paying high enough wages, and that if they raised the wage level, adequate supply from the current population would be forthcoming. I would just like any of you to comment on that notion, whether there's substance behind that argument or not.

ALDEN: I live in Silicon Valley, and wages are shooting through the roof. And the issues is that you can find -- there's also a lot of unemployment in the tech sector. The issue is that the high -- you know, the people with the current skills, the ones who can really be very productive, they're in short supply.

Now, we can try to force companies to hire everyone that's unemployed, but, again, we'll cripple our companies. You've got to realize Silicon Valley is now competing with tech centers all over the world. And the other thing we don't realize is, is that the majority of revenue that American companies get right now is from abroad. I mean, Intel, HP, 72 percent of their revenue is from abroad. IBM, two-thirds of their revenue is from abroad.

So companies are now developing products abroad. They have to understand global markets. Americans don't. They don't know where France is in many cases on the map, right? So the fact is that unless you bring the skilled workers in who enrich our own companies, we're going to lose out globally. We may dominate our own market, but we won't dominate the fastest growth markets in the world.

ALDEN: I want to come in on -- because I -- you know, I work on this. This is a much broader issue than immigration. I work a lot on trade and investment issues, and when you talk to multinational corporations, there has actually been some return of jobs to the United States of traditional manufacturing jobs, partly because costs have been rising in places like China.

But a lot of those jobs are paying wages half of what the old union manufacturing jobs used to pay, and so you could say, well, yeah, if we paid more, we'd attract more people to those jobs, but the reality is those companies won't pay more. If they have to pay more, they're going to locate elsewhere in the world.

We are operating in a global economy in which we face some painful kinds of decisions, which is, you know, is the productivity of our workforce high enough that we can continue to pay wages far higher than all of our competitors? And if the answer is no, there are two responses. One is we might just need to accept the growth of a certain number of jobs that don't pay wages the way the jobs used to, and the second is to upgrade our workforce through education, through training.

I will give the administration a lot of credit on this one. They focused a lot on community colleges. Our workforce has to operate at a level of productivity that makes it profitable for companies to pay higher wages and still operate in the United States. And again, it's a mind-set shift to say, well, if companies just paid more, they'd attract more American workers. Well, the reality is they won't. They'll go and continue to expand overseas, which as Vivek pointed out, they're doing already --

WADHWA: Or they'll be out of business because they're not competitive anymore.

ALDEN: -- or they'll be out of business.

MAYORKAS: I'm not -- I'm not exactly sure it's a one-size-fits-all, so I read in one of your articles, I think, that one of the high tech companies moved one to -- moved one of its facilities to Vancouver for the purpose of drawing talent because of the economic circumstances here in this country and in terms of drawing talent. It might have been your --

ALDEN: It was Microsoft that did it back in 2007.

MAYORKAS: Then it might have been your piece, Ted, in Newsweek.

Well, that applies to Microsoft. So I'd be curious to know what has happened to American Apparel in the facility in Los Angeles that was the subject of a visit by immigration enforcement authorities, and quite a number of undocumented workers, who were paid very well, were displaced. What has happened to that facility?

Have in fact American workers come in and performed the work that undocumented workers previously performed? I remember reading articles not too long ago with respect to Chipotle, and I think it was a subject of an investigation, and Chipotle took great pride in the Latino workforce and had, I think, some issues or alleged issues with respect to the documentation of its workforce.

Were any people released from employment and, if so, were those jobs filled by American workers or documented immigrants? It's interesting to see the data, because at that level, the analysis might be different than the analysis applicable to Silicon Valley.

And that's what's difficult about a narrative. It's the narrative that, look, we have high unemployment, we have jobs being filled by individuals who are in undocumented status. If those individuals do not fill those jobs, there will be room for American workers to gain employment. That is not an inaccessible narrative. When one gets into a contrary narrative, one starts to get into a host of issues and layers.

QUESTIONER: Hector Sanchez from the Labor Council for Latin American Advancement, representing the interests of Latino workers, including undocumented workers -- it seems like a lot of this conversation, which by the way is very interesting, is missing the central point of the immigration debate, which is undocumented workers. We've been focusing on a number of solutions from the skilled workers' perspective, but I don't think I have here any real answers and short-term answers to what we can realistically do in terms of undocumented workers.

We have seen the enforcement-only policies for the last 10 years, and it's getting out of hand. We have sent he anti-immigrant debate just keep increasing and moving extremely to the right. We're talking about the 14th Amendment. We're talking about excluding immigrants from the census. We're talking about all these things that seem, at some point, unrealistic, but the point is that they're going so much to the extreme right that when they come to the table to propose something that in the old times could seem realistic, they actually can't get it done.

We totally disagree on E-Verify -- that you mentioned you agree. We disagree with anything that increases the vulnerability of workers. And from the economic point of view, if we keep pushing for enforcement-only policies, we're just going to increase the vulnerability of those undocumented workers and keep bringing wages down, and it's an issue that we also need to discuss.

So there was some mention of what we can do. I know by now we know that there is not going to be immigration reform before the elections. What we can do realistically to help increase the respect of labor rights, human rights and civil rights of undocumented workers in the next -- before the elections -- e proposed initially -- and this is an executive order -- an executive order from the president -- to stop the deportation of the DREAM students. It would be interesting to hear in this context what we can do with a focus on undocumented workers before the 2012 elections.

WINKLER: (Inaudible.)

ALDEN: I'd be happy to.

WINKLER: Yeah.

ALDEN: I'd be happy to. I mean, I think, you know -- and Rob raised, in some levels, the same point.

I think the administration's strategy -- and it's a carryover from the second term of the Bush administration and, I must admit, was reflected a lot in the report that I worked on with Jeb Bush and Mack McLarty. I think the hope was that if you could reassure the public that immigration enforcement was being done in a serious way, that it would free up political space for broader immigration reform.

I think that's been the high-level political strategy on this for a long time, because people look back to the '86 experience and the takeaway from that was, well, we had legalization for nearly 3 million people with the promise of immigration enforcement, but the enforcement never happened, so this time we need to show up front that we're serious about enforcement, and then that will open up political space for another legalization.

I think the reality is that's not happened. I think the tougher the enforcement measures have got, we've actually seen political support from the Republican side for comprehensive reform get narrower and narrower. So the question is, how do you respond in that new environment. And it goes beyond the scope of this panel, but I think the administration needs to take a different stand, to say, look, you know, our belief as an administration -- and they're on record on this -- is that a lot of these people should have a path to legal status in the United States, so we're not just as a matter of course going to deport 400,000 people a year.

They've tried to make a priority of people who have criminal histories, and I think that has pretty broad support. But there are still, you know, hundreds of thousands of people being deported every year who have no criminal histories, so I think something like you're talking about, in terms of saying we're just not going to deport DREAM Act students, is a start. It's takes a lot of sense and it's a kind of pushback, and it says we as an administration believe these people deserve status in the United States, so we're not, as a matter of course, going to deport them.

But that would be a big political shift from the emphasis really, for much of the last decade, which has been about trying to reassure the public that government is serious about enforcement. So I don't -- I don't see that change happening, because I think the administration is still very wedded to that strategy. It's just not clear it's working.

QUESTIONER: Hi, Charlie Skuba from Georgetown University. I have a question for Alejandro. I was intrigued actually in the spirit of small things we can do, by your comments about EB-5 visa reform. I believe that it calls for a limit of 10,000 people per year who invest either a million dollars or create 10 jobs in the United States. One question would be, how much of that is being used, and secondly, what kind of reform can you tell us a little bit about how that program is being approved.

MAYORKAS: Sure. The -- it's a --- the investment of a million dollars and the creation of 10 jobs; or in a certain setting with the creation of a regional center, it's the investment of $500,000 and the creation of 10 jobs directly or indirectly.

And the proposals in support of an immigrant investor visa program are extraordinarily complex. They're supported by economic analyses and credit analyses, and as you can imagine, the analysis -- whether jobs are created or not created directly or indirectly -- is a sophisticated one.

And one observation that we had is that we don't have the expertise to really assess the accuracy or adequacy of the submissions that we receive, and so one proposal was to hire a greater cadre of economic experts, of business development experts, credit analysts and the like to assess the proposals that we receive.

The second was business needs sometimes to move fast, and we have to move fast as companions in that effort, and so the proposal speaks of expedited processing or premium processing. The inability of individuals to access us directly with respect to a case causes delays in the processing of these cases, and so we are creating an avenue for the petitioners or their representatives to actually speak with the adjudication team, communicate with the adjudication team in real time so that we can expeditiously or with facility address questions on a real-time basis or address issues on a real-time basis.

And then if in fact there's a question that has not been resolved or an issue that has not been resolved, we're basically going to have, like, a hearing, allow the individual to come in, the petitioner to come in with evidence -- we've never done this before -- and have them appear before an economic expert, an adjudication expert, guided by counsel, and try to resolve issues right then and there so we can maximize the potential of a job-creating visa program. They might not seem very significant, those proposals, but they are very much so.

WINKLER: We have time, I think, for one more question.

QUESTIONER: I would like you to comment on kind of going on the point the gentleman made back here about the states, only I would turn that around a little bit to say, do not the states and in fact the governors have a responsibility to add to this narrative. And I ask that question because this administration put forward -- I think, which was a pretty good program, which is to go after, through the Secure Communities program, criminal aliens, and it goes to building that narrative of having a process in place to identify those people who are here illegally, who have extensive criminal history, to remove those first.

Well, the governors of New York, the governors of Massachusetts, the governors of Indiana have now wanted to opt out of that program because they don't feel as if that was working as well as it should, and they were identifying the wrong individuals, when in fact a record number of deportations -- not raids of a flower march or raids of finding the 24-year-old female with kids here but criminal aliens.

And so I would just argue that to help build this narrative about addressing, I think, what's probably in most people's minds, illegal aliens who are here and the security aspects of it first, and then if those states could then participate in a program such as secure communities in a meaningful way, that would help us build a narrative to then add to the more skilled workers that we want to have here. Any comment?

ALDEN: Yeah, I mean, you know, it would take a whole nother panel to get into all the issues surrounding secure communities, which are many. I think the problem is I don't think it's helped to build a positive narrative. I know that's the intention. I mean, I think the intention is to say that enforcement is going to be targeted; we're going to go after people that we would all agree we don't want in this country.

I don't think it's done that. I think it's instead -- I think it's equated in the public mind immigrants with criminals, when in fact, you know, if you look at the data, criminality in the immigrant population is lower than it is in the general population.

So I think, you know, we could get into all the specifics of the program, whether it works, what are the issues about it. Julia Preston held a wonderful roundtable series recently up at Princeton where we got into this a great deal. It's out there in the YouTube world if anybody wants to watch it. But I think from the perspective of the narrative that we've talked about here, I don't think it's been constructive. I think it's worked against building progress for addressing some of the issues we've talked about today, unfortunately.

WINKLER: I'm afraid our time is up, but Ted, Ale, Vivek, thank you so much.

And thank you all.

MAYORKAS: Thank you all very much.

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THIS IS A RUSH TRANSCRIPT.

EDWARD SCHUMACHER-MATOS: Well, welcome everybody. If we could please all sit down.

This is our second panel of the day. My name is Edward Schumacher-Matos. I am still technically for a few more days up at Harvard where I've been teaching at the Kennedy School on migration policy and I had been writing a column for the Washington Post. I stopped a few months ago because I'm just taking up a new position as ombudsman at NPR. So I'm in this transition state. I drove in just yesterday with a car full of clothes, so -- (scattered laughter.)

MS. : Welcome. It's hot.

SCHUMACHER-MATOS: But I think we have an interesting panel here today to address really the politics and the policy and where can we go next? What can we do?

I think most of us, if we believe in immigration reform, may be a little bit depressed in this room because it looks like it's going nowhere at the moment. It is so caught up in the politics and has been now for a few years. But there is always a tempting thought that there's something that can be done and we do need to know what the state of the play is, and sooner or later something will be done. We know that because it always has been done in the past and it's going to have to be done again in the future.

I hosted a conference on migration and development this past weekend up at Harvard on what's going on in the rest of the world in descending countries. And it was a curious thing that they had these economists from all around the world there and the real feeling was was that migration is in many ways the primordial issue, the defining issue of the 21st century. If once upon time it was racial integration, if for the last few years, the major social issues were, you know, gender immigration and things like that, that for the 21st century it's going to be the integration of immigrants and the great growth of migrants moving across the world and that we can't stop it.

And so, will we change the way we think? Is that going to be required? Is there a generational change that may make a lot of our fight space seem moot and old hat in just a few years, or are we caught in such a political logjam that a lot of opportunities are just going to pass us by as a nation?

So these are all things to talk about today. We have a great, great, great panel. Maybe I should introduce -- you have their bios, so I won't give lengthy introductions, if that's OK.

Immediately here to my right is Alfonso Aguilar. Alfonso was once the first chief of the U.S. Office of Citizenship, appointed by President Bush. He's now executive director of the Latino Partnership for Conservative Principles and represents a movement, a growing movement, really, inside Latinos, trying to recognize their conservative side and marry the Latinos with the Republican Party.

And then on the political opposite side we have Angela Kelley, who was kind enough to join us when the congressman who was supposed to be here couldn't come today. But Angela is a stalwart of the immigration scene here in Washington and has been for a number of years and -- at the Center for American Progress. And so -- and the work that she has done on immigration, I -- you know, I see it regularly coming across the (trends ?), the very well-argued positions in favor of immigration reform.

And finally we have Andrew Kohut who is the president of Pew --

ANDREW KOHUT: Pew Research Center.

SCHUMACHER-MATOS: -- Pew Research Center and the great thing about Pew is that everybody turns -- on all sides of this issue turn to Pew for unbiased data. They are the source of so much that we know in terms of numbers and public opinion on this issue.

And so, I think we have a nice mix here, right, left and middle. My job is to try to moderate this and so what I think I'll do is start off the discussion asking Andy, really, where are we in the way of public opinion on this issue? Is there an opening in terms of opinion to move forward? What does the public want?

KOHUT: There's plenty of openings. I think the most important thing to understand about public opinion is that -- about immigration -- is that it's at variance with the way advocates and partisans here in Washington think about things.

Americans hold two seemingly contradictory attitudes at very high levels and very consistently. One, they want to see greater border security and enforcement, 75 (percent), 80 percent. At the same time, we get almost as many people saying we think it's right to provide a pathway to citizenship for illegals if they pass background checks, they have jobs, and will pay fines. We've asked both of these questions a variety of ways over a reasonable period of time and we get the same answers.

In terms of trends, I was listening -- thinking about what you said about how immigration is so much an important issue and the movement of people. What we do see over a longer period of time is that Latinos get better evaluations from the public at large than they did in the 1990s, as do Asians and other minority groups. The American public is getting with it with respect to the fact that the society is changing.

Now, there is a division of opinion that runs pretty much along an interesting line based upon experience with immigrants. A majority of people think that -- a thin majority think that the immigrants strengthen our country, that they don't weaken our culture. But the view that immigrants weaken our culture are most prevalent in the areas where there are no immigrants, where there is really a bloc of nativist sentiment.

The other thing I would suggest is that the -- there is an issue, there's a divide with respect to jobs. Most Americans say that many immigrants are taking -- or immigrants are taking many of the jobs that most Americans really don't want. Yet, there is a division of opinion about whether immigration is hurting the job situation and that comes largely from people who are at the lower end of the socio-economic spectrum.

I'll just finish with a quick political trend, and that is up to 19 -- or 2004, we saw the Republican Party making great gains among Latinos, I think more than 40 percent voted for President Bush in 2004. Since then, the Republican Party has taken on the issue of immigration in a very hard-line way from the point of view of Latinos, the Latino vote has gone increasingly in the Democratic direction. In fact, Latinos now play an important role in a number of the socio-political groups that we identify as key to the Democratic Party.

SCHUMACHER-MATOS: Well, Angela, one of the criticisms then, if public opinion feels that way, is that there's a lack of leadership. Your team is in the White House, in a way, right? If I can say that, more Democratic aligned, the president recently gave his blueprint for immigration reform. What is -- could you summarize for us and the audience, you know, where you see the administration is today and if you think they are indeed leading as forcefully as they can. And if not, why not?

ANGELA KELLEY: The president did give a very clear picture of what our immigration policy should look like when he gave a speech recently in El Paso, a very detailed blueprint, really goes into a lot of depth about what he would want to see. It would be really easy to turn that blueprint into a bill. The problem is that the bill would never move.

The House of Representatives is currently controlled by Republicans who have been very focused -- in fact there's a hearing today on a bill that Lamar Smith, the chair of the Judiciary Committee, has introduced on e-Verify, an electronic verification system, and that's really where they want to stay. They want to stay on the enforcement, you know, ball field. And they're not willing, I think, to have the broader conversation about comprehensive reform about frankly solving the problem.

So we have a sense, I think a pretty clear picture of what this administration would want to do legislatively, but there's nobody to pick up the ball and run with it.

And even in the Senate, you know, we saw with the effort to pass the Dream Act, a very modest measure for undocumented young people who came through no choice of their own to this country, an effort to try to get them on a path to citizenship if they finish college, or two years of college, or if they serve our military. And that was met with you know, virtually no Republican support and went down in defeat, very sadly, just a few months ago.

So I think the state of play in Congress is like swimming in peanut butter. I mean, you're going to get nowhere. It's a pretty ugly and tough battle and I'm afraid it's going to be that way for some time. And we're likely just to see a stalemate at best.

The administration has been very aggressive in pursuing enforcement policies, there is no doubt about that. More people will be deported under President Obama than under President Bush. A very aggressive expansion of local law enforcement engaging in immigration, enforcement through secure communities. We continue to see, sadly, dreamers, young people who would qualify for the Dream Act being deported despite promises that they wouldn't be deported. So frankly there is a sense of disappointment that the administration has been as aggressive as it's been in how it's enforced immigration laws. Of course, it has to enforce our laws, that is its responsibility. But there has felt at times to be a disconnect between, frankly, some of the rhetoric and some of the actions.

SCHUMACHER-MATOS: Well, Alfonso, you've heard what the public wants. The administration is -- not only has a blueprint but is really coming down hard on the enforcement side. Why isn't that enough with the Republicans? The complaint is that perhaps the Republicans keep moving the goalposts.

ALFONSO AGUILAR: Well, I hate to begin by disagreeing with Angela, but --

KELLEY: That's OK, Alfonso. It won't be the last time. (Laughter.)

AGUILAR: But look, the problem is on both sides and I think it would be an oversimplification to say -- some do try to say that this is not moving because of the Republicans or because of some nativist feelings in the country. That's part of the story, but there's also a vacuum of leadership at the White House.

The president talks about this a lot. The president gave a great speech in El Paso, but it was a very political speech designed to anger Republicans, and he did.

The president has talked with everyone. One of the last meetings at the White House was with members of the Bush administration. Well, the Bush administration is over. They should meet with the current leadership and that hasn't happened. A serious conversation with the Republican leadership in the House and Senate has not happened.

Now the answer is, we don't have anybody in Congress, a Republican, that's willing to work with us. I ask you this. When George W. Bush in '07 sent Secretary Chertoff and Secretary Gutierrez to negotiate with Ted Kennedy, did he think he had the votes? No. But that is leadership.

The role of the president is to be the consensus builder. You have to bring people together and he's using this issue as a political wedge issue to get the Latino vote.

Clearly, on the Dream Act, the Dream Act strategy was designed for Republicans to oppose it. In the past there have been Republicans that have supported the Dream Act, but it was introduced in a lame duck session and Republicans in the Senate were told you cannot introduce amendments. Who is going to vote for that? So they voted against it, including five or six Democrats. And then they said, "You see, they're against immigration." A very effective strategy.

But Latinos know better. And going back to the numbers, while definitely Obama did very well with Latino voters in '08, if we look at the numbers, the exit polling in 2010, Republicans didn't do that bad with Latinos. Across the board in House races they got about 38 percent of the Latino vote. For the Republicans to win the White House, they don't need the majority of Republican votes, they need 40 (percent) to 44 percent. Now what's happening on our side is frankly that a small minority, but very effective, has hijacked this issue and the majority of Republicans, of conservatives are not being courageous.

So I'm critical of both, of the president, but also of the GOP for not showing the courage to stand on principle. They're afraid of certain groups, the main anti-immigration lobby. And let me tell you, we've been one of the few conservative organizations to come out and call by name -- and I'll call by name again -- the three main anti-immigration groups, knocking to the conservative movement, saying they're conservative when they're not, FAIR, CIS and NumbersUSA, trying to influence Republican politicians with information that is wrong. And we know that these organizations were founded and staffed by zero population control activists, radical environmentalists, Planned Parenthood organizers. When did those become conservatives? And then we're listening to those individuals.

And then also some talk show hosts who, if you come out and say "I'm for immigration," you're immediately going to be branded as supporter of amnesty. We need courageous leadership. And what we're trying to do is to create the arguments and the circumstances to the -- reclaim this issue.

Immigration should not be the issue for RINOs, or for moderate Republicans. No. It should be the issue for strong conservatives. And when they attack me because every time you say for immigration, the first thing they say is, "Oh, you're a RINO." I say, "OK, I'm pro-life, for traditional marriage, I like the Ryan entitlement plan, I'm for strong national security and I'm a free market conservative and because of that I'm for immigration. How am I a RINO?"

We have to say that if you are for free market -- if you're a free market conservative you can't be against immigration. The reality is we need foreign workers. And this whole issue that we have in this country is because of big government, because of Washington setting arbitrarily quotas that don't reflect the needs of the market, so that's why we have illegality.

If we're against big government, if we're against policies that disrupt the market, then we should be for creating mechanisms to facilitate the legal flow of immigrants into the country, and that's what we need. We need courageous leadership from Republicans and there are many in the House, but they're silent and somebody needs to go back to that Reagan kind of leadership. You remember, Reagan was a populist conservative and there was one or two issues where the conservative, the establishment, or for even some groups didn't like, but he stood up on principle. And that's what we need.

So it's going to take time and I'm an optimist. The positive thing is that the Hispanic community keeps on growing and the thing that the politicians love the most are votes. The question is, how long is it going to take for both sides to say, "OK, now we really need to do something. We have to stop playing politics."

Is it going to be before 2012? I don't think so. Is it going to be after? Yes, I think so. But I think we need to work on both sides to make sure that we stop listening to the extremes that actually meet, the anti-immigration groups and big labor, because nobody talks about big labor, but they've been involved in this from the get-go. They don't want to see a new guest worker program. They don't. Many of these anti-immigration groups use the same arguments espoused by big labor.

So this is a very complex issue. And frankly, we also have to recognize, just to conclude, that there is a certain uneasiness with the rapid growth of immigration and the new settlement patterns that we have to acknowledge. When 5 (thousand), 10,000 Mexican immigrants arrive in a town in the middle of Iowa that hasn't seen any immigration, that can create uneasiness. And we can't be so self-righteous to say, "No, no, I won't be accepting." It creates problems.

And that may be reflected in some of the positions that some people espouse, and these anti-immigration groups are taking advantage of that.

SCHUMACHER-MATOS: Andrew, is there on the -- we see that the -- not all the Tea Party, because there are Libertarians in the Tea Party who are pro-immigration, but we see this populist right that's associated generally with the Tea Party being very, very strong, their intensity is very high. And even though they are not necessarily large in number they have --

KELLEY: They're loud.

SCHUMACHER-MATOS: -- as Alfonso said, was it you, or did I just say hijacked the party?

KELLEY: They're very loud.

SCHUMACHER-MATOS: But in any event, so much of the Republican leadership has been a little bit afraid of that element within their base.

Is there anything that you see on the horizon with the new mainstream that has been emerging among young people, or the growing number of Hispanics coming -- voting and coming into the political mainstream, that would be a bounce to this that might even overweigh it, that could push something through? Or are we -- do you see that we are going to be many years of where we are today?

KOHUT: Well, I don't know about many years, but it's an interesting question that you've posed, because the issue with 2010 for Latinos and for other elements of the Obama coalition, young people, African Americans, was their lack of participation. Their voting rates really fell off precipitously compared to 2008. And what we have seen politically during the Obama years is that the critics of Obama are so much more energized and have so much more strident, intense views about what he -- how much they don't like what he's done. And the people who are his strongest backers continue to give approval -- reasonable approval levels, but their strength of approval and their sense that he has achieved what they thought he would achieve in any one of a number of respects is just not there. And if Obama is going to succeed, he's got to get a number of these groups in his coalition and certainly including Latinos that have some sense that he is, you know, on his way to getting -- doing what he promised.

SCHUMACHER-MATOS: So, Angela --

KELLEY: I totally agree with --

SCHUMACHER-MATOS: -- some people say that even now the word "comprehensive" abhors amnesty and now just anything that says comprehensive automatically sends up all kinds of red flags by the opposition. And maybe we need a new strategy, a more piecemeal strategy.

KELLEY: I mean -- you know, you can give it a new name, it's -- and you know, a tactic that's being pursued in the House by the Republicans is enforcement only, let's start with electronic verification system. But the truth is, and I think Alfonso would agree with me, is that you don't solve the problem that way. If you've got 7 (million), 8 million workers, what we know about e-verify for example, is that half the undocumented who are working will continue working. E-verify won't catch them. But we know that 800,000 Americans, if this program is put on steroids the way Smith wants it to be, will lose their jobs because they won't be able to correct the errors in the databases.

You've got to deal with the folks who are here without status. You could start with the Dream Act kids, but that's frankly a very imbalanced package, because you'd still have all these workers that will get pushed further underground, or will continue working.

So I'm not a big plan of the piecemeal strategy just because I don't think it solves the problem. I get that there's, you know, apprehension around this issue for some of the dynamics that Alfonso described. But I also believe, and this is what Andrew was saying, that ultimately the public wants a solution and you see the debate playing out in very interesting ways locally.

So, a year ago when Arizona passed, I would've thought that Arizona-like measures would just pass through all the statehouses, right? Like wildfire. No pun intended because of the fire in Arizona now.

But -- and it's true. I mean, there have been some really tough measures that have passed in Alabama and in Georgia, nearly happened in Florida, but in large part a lot of states rejected it. Or you saw Utah, for example, pass a really tough, pretty flawed, ugly measure, but they were trying, they were reaching by trading a worker program. It's unconstitutional, the bill is kind of ugly, but politically it's an important signal because you've got this bright red state like Utah that's saying, "Wait a minute. Do we really want to kick these people out? Wouldn't it be smarter to put them on the rolls, make sure they are working, get them in the system and have them integrated into our communities."

I think it gets to some of the unease that Alfonse was describing that communities feel when people first land there and they're not sure what to do about it.

So I wasn't surprised that a Georgia and Alabama passed the laws that they did, but I think what's noteworthy are the states that didn't pass it, like a Kentucky, looked at the cost of it and said, "No way, this isn't going to solve the problem. This is going to hurt our fragile state economy. Let's not do it."

So you see the conversation happening locally, I think frankly and more sensible ways than it happens in Washington. And I think it's going to be a combination of forces. I think it's going to be continued pressure at the statehouse, in some cases to do good things like you saw in Connecticut around the Dream Act, in Maryland the same thing, sometimes bad outcomes like in Alabama, or Georgia, but that's where the conversation is happening.

More and more youth engaging on this issue, particularly around the Dream Act, but this is a demographic that when they are asked about "Does immigration bother you? What do you think about the undocumented?" They look at you like you have two heads. They don't even know what you're talking about because for them this is just a matter of course. They grew up in a much more diverse society.

So I do think this is an issue that's eventually going to age out, right? I also think it's an issue that people will just come to a sensible solution because economics are in our favor.

Look, immigrants are extraordinary entrepreneurs. What it takes to come to this country, to start a business, to leave everything you know. I mean that's the backbone of so much of this country and its history, people who want to belong, people of faith, people who took extraordinary risks like my parents did. They left a comfortable life in Bolivia for me and for my brother and my sister. How many people in this audience have that same story, or know someone who does? It is the genius of this country and ultimately I think that will prevail.

SCHUMACHER-MATOS: Let me ask one more question of Andrew before opening it up to the audience.

Andrew, I mean one thing, the young people that Angela talked about and the trends that Alfonso sees, but the great -- in all your polling, sort of the great American middle, as you've noted, wants both enforcement and legalization, some kind of a comprehensive reform, but they also want tough enforcement.

Is it possible that some of the things that Angela is saying, you know, sends up red flags with the great American middle and that is a strategy that just is a no-win strategy that would -- that stops the public from trying to push the politicians to come to some kind of resolution? In other words, they want more -- they would rather -- instead of Angela's position on this, a position that had more enforcement, or if you put the enforcement first, a little harder?

KELLEY: Can I just insert one thing, though? I'm not being all rosy about it --

SCHUMACHER-MATOS: Yeah.

KELLEY: -- because look, there are tough enforcement measures in place. The 2007 debate there were a lot of benchmarks that were put out in the bill, enforcement benchmarks that DHS was supposed to meet before any of the benefits would kick in, before we legalize a single person, right?

The bill failed. It collapsed in a spectacular way. But what didn't stop happening was those enforcement measures, right?

So we have more boots on the ground than we've ever had, the biggest Border Patrol. We are closer to building the fence and completing the fence than we've ever had. We've got more investment in technology than we've ever had. So we have done a lot at the border and I think that DHS, for all its enormous budget, does an extraordinarily poor job of promoting itself and of indicating what they have done well. I mean I think that's a really key message that Democrats and Republicans should both embrace, because at the end of the day we have a right to secure our borders. We have a right to control who comes into this country and it needs to be under our terms and conditions.

The way to get that control, though, is by having a structure for visas so that people come legally with a visa and not with a smuggler. But I don't want to, you know, be painted as the -- you know, the gal who's all about --

SCHUMACHER-MATOS: I hear you. I hear you. That's fair enough.

KELLEY: -- you know, her family's lovely history, it really is. We've got to be tough, I get that.

KOHUT: But in response to your question, quickly. The enforcement attitude is not at war with the acceptance attitude. But to your point it's very true. When we've sampled communities that have experienced tremendous onsets of immigrants, they just feel overwhelmed and their view are quite different than what we see in the national -- in national polling, just as this other element where there is real opposition -- exists in places where there are no immigrants.

So it's really kind of a complicated -- it's a complicated picture.

SCHUMACHER-MATOS: Right. Let's open it up to the audience. I'm sure that many people here have their own views on this, or good questions.

Please identify yourself. Remember that this session is totally on the record. So Ed, you want to go first?

QUESTIONER: I'm going to take the organizer's prerogative and start it off.

Alfonso, I want to ask you about the Tea Party, because there is something that has mystified me about the Tea Party. I do a lot of work on trade as well, and when this new cohort of Tea Party Republicans came in, there was a lot of speculation where are they going to be on trade? Are they going to be pro trade? Or are they going to be more skeptical? Because trade raises a lot of the same concerns as immigration, you know, job displacement, job losses.

The Tea Party has turned out to be solidly pro trade. You know, I think if the three free trade agreements that are standing out there were put in front of the House they would sail through with virtually unanimous Republican support. And yet, on immigration, from the Tea Party you have this tremendous skepticism and, you know, you talk about free market conservatism. I'm trying to figure that out, how -- why do we see that different?

AGUILAR: Well, first of all let me tell you, we tend to generalize about the Tea Party. You know, what is the Tea Party? We should talk about Tea Parties. In each state you may have different groups. And there is a Tea Party mass that shares one thing and it's this anger against the expansion of government. But there's no consensus on immigration.

The Tea Partiers you hear on TV are some of those in the leadership of some of those groups, but they're not all Tea Partiers. So if you talk to some of the Tea Party members of Congress in private, they will tell you that they very much are for immigration because of free market principles. Again, it's creating the circumstances for those strong conservatives to stand out.

I mean we can't -- you know, we go back and -- you know, and I say this publicly because, I mean, I like Governor Bush, I like Secretary Gutierrez, I like Secretary Chertoff, but they represent a Republican leadership of the past. Right now who's in office are the Tea Partiers. We have to deal with them and if you have a constructive conversation with them, you can actually get support.

SCHUMACHER-MATOS: We had a question here.

QUESTIONER: The three of you implied that better assimilation policies will be needed. And Alfonso, a question for you. You expressed concerns about big government, but isn't government's role to help these new arrivals assimilate, language training, job training, preparing communities? What can be done to better mesh the communities and the new arrivals?

AGUILAR: Well, you know, I headed the Office of Citizenship, which was created precisely to use the immigration system and the naturalization process to encourage assimilation. I think we should talk about assimilation. President Bush talked about assimilation. Obama doesn't talk about assimilation because for certain liberal sectors that is a politically incorrect term. I don't mean cultural assimilation. We're talking clearly about American political assimilation.

We respect diversity but within the unity of certain principles, common language, common political principles and a shared sense of history.

I think this is not necessarily a matter of investing money, but of encouraging the community because integration is a two-way street -- encouraging immigrants in a friendly way to learn English and embrace America, and frankly I believe the majority of immigrants are integrating and are becoming good Americans but we have to get the communities involved.

That's why when I was chief of citizenship I encouraged the churches to get involved, non-traditional groups, because sometimes I feel that the groups that are involved on integration are more focused on let's provide health services, let's provide settlement, you know, education. All those things are important. We're not going to create -- and when I go to Europe, and I did a lot of exchange with the Europeans, they invest tons of money on that type of services, and those immigrants don't feel integrated.

There's a great thing that, you know, somebody said recently. There is something seductive about American society. And it's a civic seduction. Latin Americans come here, immigrants, because they want to be part of America. They don't come here to feel as a permanent underclass. I mean, this Latino effect is actually a very American experience. You know, some come from Nicaragua, some from Puerto Rico, whatever, but when they come here, they want to be American.

One of the greatest indicators of integration is that second -- by third generation, over 50 percent of Latinos and Asians marry outside of their ethnicity. So integration is happening, but I think we should talk about assimilation to ensure the receiving communities that America is still the dream, that we're still a country based on ideals and that immigrants make this country more, not less American.

KOHUT: Yeah, I do a lot of surveys in Europe and the divides between immigrants in Europe and the main population groups is so much broader and deeper than it is here. We have this tradition. They don't.

KELLEY: Yeah. Can I just make a quick comment on this because I think I'm largely in the same place that Alfonso is, and we've done some work on looking at immigrants, home ownership rates, language acquisition. Sociologists call the U.S. a language graveyard -- and I'm a great example of it because my Spanish is terrible, much to my grandmother's chagrin -- you know, earnings.

And so, those kinds of indicators really do tell a good news story and I always describe it as the movie, right? But in places like a North Carolina, or an Arkansas they're just taking snapshots and a snapshot doesn't tell you the whole story when folks first arrive because they do struggle. They don't speak English and it's harder for them. But if you look at a movie, like California, where we've seen over generations, it's a pretty -- it's a happy ending.

So I think it's the effort to try to pull the camera back and understand a little bit more deeply some of the complex issues.

I'm sometimes having to deal with integration, but I'm struck often by charges, especially by Republicans, that immigrants don't integrate, when those are the very same folks that are introducing bills that would change the 14th Amendment so if you're born here you're not a U.S. citizen, the same folks that would very aggressively have local police making it terrifying for a woman to report that she is being beaten, or for a father to take his son who's just fallen and broken his arm, to the hospital.

So if we push measures like those that make people afraid to be part of their community, then what we're doing is thwarting our integration. And I often find that that tends to be Republicans, some, not all, tend to go and that frankly is just undermining our nation's proud history as a nation of immigrants where people do integrate.

SCHUMACHER-MATOS: (Off mic.)

QUESTIONER: Thank you very much to all of you. I'm Julia Sweig here with the Council on Foreign Relations.

And I wonder if I could get the three of you to sort of build a little bit on Ted's question about this contradiction between being pro-free trade but anti-immigration and get to the question of race. And also, the general economic crisis that the country is in.

And Andy, is there a correlation between an increase in anti-immigrant attitude and generally the sort of financial economic crisis that the country is in? And to the extent that the Tea Party members and sort of nationalist ethos among them is targeted toward immigrants? Is this a -- I know the cleavages are much deeper in Europe, but is there -- is this a thread of American racism, or a racist component to the critique and the backlash against immigrants?

Just -- if you could just tease this out, because I do find myself scratching my head a little bit at all of these contradictions, especially because what I'm hearing is that there really is a very strong partisan divide on this issue, even though you two analytically coincide so much.

KELLEY: Right.

QUESTIONER: Thank you.

KELLEY: Andy give her an answer. (Laughs.)

KOHUT: Sure. The -- I was going to mention this to you, Ted, when you talked about the Tea Party embrace of free trade, yet lack of embrace for immigration. Free trade is business and for the Tea Party that's good. There are more reservations about immigration.

And what we're seeing now -- in fact we haven't published this yet, is growing -- is a growing isolationist sentiment among conservative Republicans. That's quite remarkable and that may tie more to some of these anti-immigration attitudes.

And, you know, Julia, there isn't rising anti-immigration sentiment. What we're talking about is the partitioning of the American public and voting blocs in such a way that you have a group of people who hold these views very strongly, but that doesn't suggest more broadly that there is a rise in anti-immigration sentiment. It isn't there.

There's nothing to say that -- there's not a dependent variable, so to speak, of anti-immigration that's correlated with concerns -- with growing concerns about the economy. There are growing concerns about the economy, but we don't see among the public at large more anti-immigrant sentiment. What we see is a greater -- what we released in a major report a while ago is a more doctrinaire political landscape. And on the right you have staunch conservatives who are largely Tea Party advocates who hold very, very strident points of view on this issue and many others, but not on business. That's within the bounds of acceptability.

SCHUMACHER-MATOS: In the back, sir.

QUESTIONER: Thank you. Rich Stana with GAO.

One of the things with comprehensive immigration reform is going to be whether the bureaucracy can manage this well. And if the bureaucracy doesn't manage it well, I wonder if the American public's vision of this is going to go in a direction we don't want it to go. And yet, the kind of numbers we're talking about, the bureaucracy has never been stress tested to that degree.

We talked a little bit earlier about the inability to do the visa process expeditiously. The immigrant integration programs are almost non-existent. On the other hand, you know, trying to get the incidents of fraud to an acceptable level on these applications isn't always there. You know, the border really isn't ready, no matter what progress has been made.

So what do you think is going to have to happen to get the machinery of government ready to manage something like comprehensive immigration reform?

SCHUMACHER-MATOS: Who are you -- are you addressing it to anyone in particular on --

QUESTIONER: Well, I think you've got the whole spectrum. (Laughter.)

SCHUMACHER-MATOS: I think we should start with Angela on this one.

KELLEY: I really wish this were a question that was happening because we're frankly just so far from this being realistically posed.

Soon after Obama took office -- actually after he was elected, there was a lot of, and continues to be good thinking put into how do you structure a legalization program that has to be as broad as possible, right, because we want to include as many people as we can, so we don't have a big class of undocumented immigrants, which was one of the flaws of the 1986 program; protect against fraud, but at the same time seem tough enough. And that isn't a perfect formula.

I think the 2006 bill, 2007 bill tried to get at that. But the machinery behind it, the technology behind it, the manpower, it would be an extraordinary task that I couldn't begin to, like, outline, but particularly around the legalization piece.

I'm somewhat less worried about what the future flow piece would look like because I do think that there's very good thinking that's been done by the AFL-CIO, by NPI and others in how we might be able to determine what would be the proper number of visas.

But I do think where you have a robust program that would provide a degree of comfort for 11 million people to come forward in an orderly way that ensures that they are who they say they are, and that we're doing the right background checks, and that they're meeting the requirements of tax payments and language acquisition, it would be quite a task.

So no, there's no magic bullet or, you know, soundbite I can give you on that.

SCHUMACHER-MATOS: Before asking Alfonso if he has something, I would like to follow up on that question. The bureaucracy question is a great question in terms of -- I mean, for example, you were critical of expanding e-Verify.

KELLEY: Yeah, exactly.

SCHUMACHER-MATOS: And I know you guys are critical also of secure communities. And for those who don't know, it's the program where everybody who's arrested gets run through -- everybody, no matter if you're immigrant or non-immigrant, everything gets run through these fingerprint checks, and that's really the program that's catching some of the people who are being deported.

Yet, if you don't start these programs now, how do you have them up and working and effective even if they have those problems like e-Verify has, at the moment you do have a comprehensive immigration reform or some kind of a deal come online?

KELLEY: Totally agree. And something like e-Verify, I mean it already is in operation, right? It doesn't begin to cover all businesses, it's not mandatory, but there are states, and the Supreme Court recently said this was OK, for states to require it of its employers. And then those that have government contracts, for example, have to use e-verify.

So we are in effect being able to make the program better. There have been improvements to it, but what's being proposed is going really from, you know, when a toddler is taking his first steps to running a marathon. And that's what we're suggesting is just too big a leap. But I totally agree with you, we have to start small and make it effective.

SCHUMACHER-MATOS: Alfonso?

AGUILAR: Well, I was there when we were preparing for immigration reform, and the Bush administration was taking steps to get ready for a legalization. So we were looking at different things.

First of all, you know, we started E-Verify, and it's not a perfect system -- there's room for improvement. But, as Angela said, it's there. Some states have mandated it, but -- it's a difficult task, but one thing that -- but it's possible. But it's possible because I think in this country, we have the technology to make this happen.

I think with legalization, immigration services would get a lot of money that it could invest in -- because, frankly, it's true -- if -- through fees and penalities to invest in technology. But I would say also -- and perhaps this is where I also differ with Angela in terms of -- you know, economically, when it comes to immigration, I'm much more liberal. And there -- there's where you find some Tea Partiers are saying let's have a market-based guest worker program. Let's let them in as many as we need, as our economy needs. That then is even more challenging to operate something like that.

But I think we have to be open to including the private sector in the management of our immigration system as long as we as the government doesn't give up the responsibilities of background checks and key things like that. But we have the technology to manage millions of people. I think it just has to be a better system if we incorporate the private sector. It's not only government, because when you have government controlling everything, you're going to have a lot of problems, and that's what we've seen in the past.

But I must say about USCIS, it has improved dramatically --

KELLEY: Mm-hmm.

AGUILAR: -- and they've shown it. And that's a credit to both administrations for reducing processing times incredibly. I mean, you can get naturalized in some places in three months.

KELLEY: Yeah. Point well taken.

SCHUMACHER-MATOS: Before we move to the other side of the room, let me ask -- yes.

KOHUT: He had his hand up for a long time.

QUESTIONER: Yeah, Rob Quartel, NTELX. Just two quick pieces of background. I sit on the Northern Virginia Technology Council Board, which is the largest technology group of employers in the country, including Silicon Valley, and I've been involved off and on in politics too.

It seems to me there's a big difference between the immigration communities on this. I see out in Northern Virginia the Indian community is utterly organized, and we just had a panel. They were talking about technology visas and education and all the rest of this stuff. And they have raised their issue right to the top and sort of almost get there. The Latino community doesn't. It's just not organized in the same way. And I know it's split -- you have the Puerto Ricans who are citizens as soon as they come here anyway, and then you have everyone else. Yet it's one of the fastest-growing groups.

The last time we saw an organized Latino political movement was Cesar Chavez out in California that was successful. Today, you just see any of it. I can think of 10 things I'd be doing if I were Latino and onto this issue, starting with finding every kid who was shipped back to Mexico or Latin American because his parents were shipped back, and bring them back and make them citizens.

So why is that? What can you do about it?

SCHUMACHER-MATOS: Who would like to take that?

KELLEY: Well, we'd love your help. (Laughter.) I have to tell you, though, I would say that Senator Bennett and Senator Reid and Senator Boxer would probably disagree with your analysis that the Latino community is unorganized because the reason that they're on Capitol Hill right now is because the Latino community turned out in huge numbers when in those races the Republican opponents were, frankly, utterly -- lacked any respect to the community.

So I'm not so sure that they're that unorganized. And given the rapid increase in the Latino vote and the importance of it, it's hard to deny when you look at Nevada and Colorado and New Mexico and Florida in the upcoming election that they're not going to matter a whole, whole lot.

The issues probably of the Indian community are much more narrow. They have a lot more to do with H-1B visas and with a lack of permanent visas, so people, after their H-1B has expired don't have an ability to then convert in permanent status. Frankly, I haven't seen those people make any progress on Capitol Hill either. I think that they're caught up in the same, just bitter, bitter partisan politics that invade not only immigration, but, frankly, every issue that policymakers just seem incapable of having a civil conversation with each other about.

SCHUMACHER-MATOS: Andrew, you did a -- Pew did a report on leadership or the lack of leaderhip among Latinos. Is there anything you'd like to add to -- is that an element here that --

KOHUT: I'm going to pass on that question because I didn't -- I wasn't directly involved' it comes out in our Hispanic unit and I don't have a good recollection and I don't want to misquote it.

AGUILAR: That's an extraordinary question that you've made, and I think that we have to recognize that today's Latino community is not the same of Cesar Chavez. This is a community that's much more diverse, different socio-economic backgrounds, higher level foreign born; 40 percent are foreign born. Of the rest the majority are children of immigrants. They're more socially conservative. So it's a very different community. You cannot generalize about Latinos.

You know, the worst thing that Harry Reid could have said is you can't be Hispanic and Republican. I mean that was just so insulting, even to Hispanic Democrats, to make a statement like that, or to say all Puerto Ricans are Democrats. Well, you know, I'm Puerto Rican and you go to Central Florida and you meet those Puerto Ricans, they are not like Puerto Ricans in New York or Illinois. It's different.

So to generalize and say there's -- the Latino concept, it's an American phenomenon. When you have immigrants coming here they're Nicaraguan, they're Costa Rican, some are Puerto Rican, but there's a diversity of ideas. And in that respect I think Republicans, if they were to get their act together, could be very competitive with Latinos.

QUESTIONER: (Off mic) -- that community too, so I know about the Puerto Rican community. And I will say you are not organized. And what Republicans do, I'm a Republican, is we break them off on social issues. Yet, every Latin American -- Latin immigrant in the United States has one family member or more who has been sent back. Every single family knows someone who's been sent back. This is the central issue of that community. They need to organize around it, including around Republicans and they need to go to the Republicans and say we need something done.

AGUILAR: Yes, immigration has to be part of the mix. To say that immigration is the number one issue, I think is a stretch. I think it has to be in the mix. But they're concerned about the economy, about jobs, about education, health care, so there are other issues. But let me tell you, on social issues we've -- let me tell you, I was very involved in California. I actually campaigned for Carly Fiorina, and if you look at the performance of Carly Fiorina with Latino voters, was much better than her predecessors. Support for Barbara Boxer went down.

So if you have a good candidate you can be competitive. And Carly Fiorina was a good candidate and had a position that was palatable to Latinos. Not perfect, but better than many other Republicans. Certainly she was no Sharron Angle.

KELLEY: She was not. You are.

SCHUMACHER-MATOS: Let me -- here on this side. Yes ma'am.

QUESTIONER: Marisa Lino from Northrop-Grumman. I want to go back to e-verify and ask you all to comment on an idea that is really old, not necessarily that new, and that is to take the discussion of cleaning up the database which is essentially the Social Security database, out of the immigration debate and put it into a debate about identity theft. This is something Senator Schumer tried to do in New York and didn't succeed. But if you could take it out of that debate, everyone wants to be secured against identity theft, and why not clean up the database and take it out of that immigration debate and you would have at least a step forward on getting something done that would improve the system.

SCHUMACHER-MATOS: Anybody want to --

KELLEY: You might -- you may also opened those other cans of biometric worms that would, you know, result in interesting coalitions where you have, you know, the ACLU and the far right, like, hanging together really tight and Senator Leahy, who chairs the Senate Judiciary Committee, his head exploding at Senator Schumer.

So it's great drama --

SCHUMACHER-MATOS: Biometric worms coming --

KELLEY -- and worms coming out, yeah. What nice visuals.

So it's an interesting idea but I just -- it's not like we would then be kind of getting rid of an easy subject -- or one hard subject and going to an easy subject.

SCHUMACHER-MATOS: You had a question here, ma'am?

QUESTIONER: I am sometimes astounded -- oh, I'm Clara Adams, Brigadier General, United States Army, retired.

And I was just going to say that I am sometimes quite astounded at the amnesia that my American people can have every now and then. There was a time in our history -- and I think Carville said it some years ago, it's the economy, stupid.

There was a time in our history whenever we -- while we did not have a policy that said that illegals could come to this country, we did wink and nod and turn our heads and they came. And we somehow or another didn't do anything about it. The economy is booming, we need people to do low-level jobs, that type -- I've been assigned to some -- I've been stationed in some of those countries -- I mean in some of those states --

SCHUMACHER-MATOS: Right.

QUESTIONER: -- where they came in quite often. And I'm just wondering how do we somehow try and mitigate that situation, because you see it's their children that we're talking about these days, you see, and they are still here in this country somehow or another. And all of a sudden, 20 years later we decide that it's time for them to go when the economy is not doing as well.

SCHUMACHER-MATOS: Mm-hmm. Alfonso, why don't you take that one.

AGUILAR: Well let me say this was even an issue in '06 when unemployment was you know, what, 5 or less percent.

QUESTIONER: That's not 20 years ago.

AGUILAR: I know, I know. But again, there's a difference because this immigration phenomenon, this is what you have to understand, the growth of the immigrant community and the new settlement patterns, this started basically '95. It's a new phenomenon. We haven't seen this since 100 years ago. And 100 years ago what we did was pass a terrible law, the National Origin Act in 1924, and we basically closed the door to immigration.

I mean, we have a rosy picture of 100 years ago the nation of immigrants, but what the nation of immigrants did 100 years ago was close the door to immigrants. We're not going to do that again.

QUESTIONER: Let me just make one other point. Twenty years ago, or 25 years ago, we did not know how many illegal immigrants we had in this country because we didn't track them, OK? And so, there may have been more people here at that time, that's my point. There may have been more people here at that time that were not -- (off mic) --

KOHUT: But the difference between then and now, which is the public opinion is responsive to, is the absolute size of the immigrant population, but legal and illegal. It's presence, it's greater presence cause the issue.

QUESTIONER: Yes, I get it. But now -- and we have a better way of documenting -- of dealing with the documented numbers.

KOHUT: But it's not so much just --

QUESTIONER: I mean there are documented numbers. My point here is that yes, there have been many people who whenever folk were not paying attention came into the country, but there were also people who came that we probably suspected that were here, but we didn't keep track of them because they were taking care of some other issues and business --

AGUILAR: I'll restate her question. Why don't Republicans recognize that Republican business did a lot of the winking and nodding when all those people came. (Laughter.)

AGUILAR: Hey, I'm a free market conservative. I believe that we need foreign workers because -- not only because Americans don't want to do certain jobs, but because sometimes there are no Americans of working age -- there's a population thing here, to do those jobs. If you go to Iowa you go to search some manufacturing plants where the average age of a plant worker is 57. The average age of a Latino is 27. The average age of an Anglo American is 41.

So -- Bill Clinton said this, we don't need less immigrants, we actually need more immigrants and the basic research of an economy is people, so we need more people.

SCHUMACHER-MATOS: Colonel, you had a question for a long time.

QUESTIONER: (Off mic) -- forum that so many of us are either immigrants or descendants of immigrants in some form or fashion. But the question I had was how much do we think that the paranoia, real or perceived, is affected by -- and I have a list of things here: one, cyberterrorism or terrorism; R&D theft and export; access to other world markets; personnel security; and race and socio-economics?

SCHUMACHER-MATOS: Andy, you want to tackle that one?

KOHUT: Yeah, I would put something else on the top of the list, and that is concern -- maybe it came under one of your other categories, and that is concern about narco-violence on the border. I mean --

QUESTIONER: I said terrorism -- (off mic).

KOHUT: I think that, again, talking in a more localized basis, that is certainly a factor when you talk to people in Arizona, or you talk to people in California, or places who are near the border who see this as a potential personal threat to their communities. I'm less clear on the impact of some of the other factors that you made.

SCHUMACHER-MATOS: In the back of the room. Yes, sir, all the way in the back.

QUESTIONER: Well, I'm glad that Alonzo (sic) has been talking so much about Iowa, because I'm one of those Latinos from Iowa so -- (laughter) -- and I want to tell you a very quick story and then ask a question.

One of the things that the Ames straw poll, which will be happening in about six weeks is a very big deal and about 10 years ago many of the people from Washington who had flown out to cover that suddenly turned around and saw about 6,000 Latinos who were there not to see the governor of Texas, but to see Emilio Navarette, who is a -- for those of you who might not know, a musician. And people came from all over Iowa to see Emilio and then there was that who's that guy up there with Emilio? (Laughter.)

Well, but to the Anglo media from DC it was George Bush has enormous Latino support. These people couldn't necessarily vote. These people weren't necessarily U.S. citizens. Nobody was asking about their status at the time. But immediately the mean was set as far as being a compassionate conservative, a new type of Republican.

We were able to, I think in the comprehensive immigration reform work in '07 -- '06, '07, make some inroads because we had somebody like that in the White House and it dragged both senators -- and I was on the House side at the time and we had a number of folks who were ready to move if necessary -- but it was because we had a Republican president who was pushing that.

Alonzo (sic), who do you see in this current field or otherwise that is going to be able to do that? Do we have to -- as a community do we have to wait for Jeb Bush 2016, or George P. 2024? Are all of the eggs in one family's basket or is this something that you see the Republican Party being able to come to the table?

AGUILAR: Well that is a very good question. And look, again, I've said this, I love the Bush family -- (laughs). But w -- this is not an issue for moderate Republicans. Conservatives, strong conservatives, not only fiscal conservatives, full conservatives, those who abide by the full conservatism, are strong on national security, fiscal conservatives, free market conservatives should embrace immigration like Ronald Reagan did.

I don't think it requires us to wait for Jeb Bush. I suspect that the candidate we're going to get is a candidate who is pro-immigration like John McCain was. I mean, John McCain was handicapped by Tom Tancredo and by the actions of many Republicans in Congress. But overall, John McCain was good on immigration.

I think, you know, probably all of them, whoever is elected will have a decent position on immigration. Who to watch right now? It'll be interesting to see what Romney says at the end. I think Pawlenty already made a big gaffe in New Hampshire. I don't think he's going to get any Hispanic support if he were to be the candidate. I think Gingrich has been very interesting, even though his campaign is --

KELLEY: Imploding. (Laughs.)

AGUILAR: -- imploding. He has been very good in saying, look, you know, we have to find a middle road. We cannot deport everyone. You know, we have to deal with border security.

And there is somebody out there who is starting to be heard. It's Governor Perry. I know a lot of people have been talking about the law in Texas, whatever, but Governor Perry is very good overall on this issue. So I think we're going to have a good candidate on the issue.

SCHUMACHER-MATOS: Yes, sir.

QUESTIONER: Hi, Dan Griswold with the Cato Institute and we're pro free market, pro limited government, pro trade and pro immigration, which can be a kind of lonely territory sometimes --

KELLEY: Four stars for you, Dan. (Laughter.)

QUESTIONER: We've published lots of good work validating a lot of the economic arguments you've heard today in favor of immigration and I've spent a lot of time beating up on my Republican friends for their stand on immigration. But Angela, I want to just ask a kind of tough love question for my Democratic friends on immigration.

KELLEY: That's okay for me, Dan. (Laughter.)

QUESTIONER: The Republican Senate in 2006 --

KELLEY: Yeah.

QUESTIONER: -- actually passed out a reform bill --

KELLEY: Twenty-three Republicans.

QUESTIONER: -- as flawed and as watered down as it was. The Democratic Senate in '07 didn't get it out, we can argue about why that is. The temporary worker provisions, we've argued at Cato that for immigration reform to work you've got to have a robust temporary worker program and that was the problem with 1986 IRCA.

KELLEY: Right.

QUESTIONER: It had amnesty, it had enforcement, but didn't have any provisions for future flows.

My question is, President Obama ran in 2008 promising to take up immigration reform, to pass it in his first year. He didn't. The AFL-CIO I don't think played a constructive role in the Senate debates and they were behind with their friend Byron Dorgan in watering down the temporary worker program. My question is, didn't the Democrats have an opportunity in '09 and '10? They had a popular president, they controlled the machinery in Congress. Couldn't they have found time while they were ramming through health care -- (laughter) -- the stimulus and that sort of thing, couldn't they have found time to get comprehensive immigration reform done?

I think to his credit, President Bush took more risks for immigration reform than President Obama has so far.

KELLEY: Well, here's one big difference, is that when Bush was in the White House, there were also champs on Capitol Hill. And so, you had a very engaged John McCain and you had an extraordinarily committed workhorse in Ted Kennedy, and both of those people were gone and there was not the kind of leadership, and it has to be bipartisan Dan. And you know that, and you need to have members who are work horses and who are willing to have very tough, sustained conversations with members, introduce a bill and drive it.

And we saw that and many people in this room, I know, followed the debate really closely, particularly in 2006 when 23 Republicans stood up and supported a bill that would've legalized most of 11 million undocumented people. It wasn't that many years ago.

But those days are gone, and it's because one by one we've seen the sort of courage, frankly, of John McCain, wither and become just myopic about enforcement. We've seen someone like Lindsey Graham who stood up and drove through the Senate Judiciary Committee with enough Republican votes a bill in '06 and in '07, declare that birth right citizenship, the 14th Amendment, needs to be revisited.

I mean it's just extraordinary the change, the change in real champs and no one could fill Ted Kennedy's shoes, to be perfectly blunt.

So, there was health care, there was the economy, and there was the energy bill, and all those issues took precedenc. And immigration -- unlike if you ever watched the show American Idol, if you're like a great singer and you might be number four, so you don't win, but you still get a great recording contract, with immigration it didn't work out that way for us. We were number four and our plane, which was ready to go, right? We were a full crew, we had all the fuel on the plane, CR was going to take off, we had good ideas to try to make it happen, and the weather never cleared and we never got to take off.

Now is that because Obama was the pilot and he should have stopped health care and he should have not focused on the economy and he should have not had energy go first? Maybe. Some can argue that. I'm not, you know -- I don't think it was all his fault. I would've loved the White House to have leaned into it more and I want that every single day. I mean, this is what -- this is the issue that I live for. So in my perfect world this is the issue that he would live for. But none of us live in a perfect world.

SCHUMACHER-MATOS: If I can follow up. Andy, is there support in the American public for a temporary worker program?

KOHUT: I think under the right conditions there are, yeah, under the right conditions, yeah.

SCHUMACHER-MATOS: Yes maam.

QUESTIONER: Hazel Denton, Johns Hopkins SAIS. In our last session we focused on how the landscape has been changing and so -- you know, as we compete for different migrants. But there is also a changing dynamic here in the U.S. which we haven't touched on. The discussion is immigration, but the focus is on Hispanics.

The Hispanics as a part of the U.S. population is guaranteed to grow. If you look at the fertility rates of whites, blacks, Asians, they're either at or below replacement. Whites are significantly below. Hispanics, though, are above, significantly above.

So as we talk today about the political dimensions we have to bear in mind this group is growing and I don't think we've mentioned that.

KELLEY: Demographics are destiny. The Latino population from 2000 until now has grown by 43 percent. The white population has grown by one percent.

SCHUMACHER-MATOS: We have time for one last question.

Yes, sir.

QUESTIONER: (Off mic) -- Sanchez, from LCLAA, Latino Labor. It seems like labor has, interestingly, been attacked in the room a number of times. Just a couple of comments.

Yes, the Latino population is playing a central role -- 17 percent of the population in the nation right now according to the latest census. We're going to be 30 percent of the population by 2050, so we need to pay critical attention to the Latino community. And this goes to the comment of the gentleman, which is a reflection of the national lack of understanding of the Latino community, how the national conservative media covers the Latino community.

If you see the national marches all over the nation, the biggest numbers probably that this country has seen going to the streets to oppose one single issue because of the Latino and immigrant communities went to the streets. When they say we don't participate, we're not organized, well, maybe somebody should go to the Congress and each one of those offices have seen Latinos advocating for immigration reform. We have met with every single Cabinet from President Obama. And I don't know, we were not welcome with President Bush, but maybe some of the Latino -- I'm talking labor, brother, I'm talking labor. (Laughter.) I'm talking labor. I was never in the White House. Now things have changed.

But it's interesting and it's a very important and critical question to really emphasize the Latino community from that perspective. I'm going to point at an interesting question for this room, and this council on immigration, and I want to emphasize this question from the immigration point of view.

When it comes to the debate of free trade, we need to be very careful from the root causes of immigration and how free trade agreements, especially with Mexico and Central America. CAFTA and NAFTA have been a central place, a central tool to displaced workers in Mexico and Central America. Immigration after NAFTA increased 65 percent and today 80 percent of all undocumented workers are from Mexico and Central America, something that drastically increased once these economic policies started putting in place.

As I say, I just really, honestly want to put it out there, to think about it honestly. This is not just to yell at each other, it's just to think about it from an honest perspective. This has been very interesting conversation, to honestly -- we need to be more honest, both sides, conservatives and progressives, to see what works, what doesn't work and what are some of the root causes of the problem.

SCHUMACHER-MATOS: Alfonso, you get a chance to -- unless someone has really strong feelings, you get a chance to closeus out here.

AGUILAR: I haven't been to the White House under the Obama administration also. (Laughter.)

No, I think that -- look, you know, I think, you know, if it's on NAFTA, you know, that may have been a reason, certainly, that has contributed to the migration of Mexicans into the United States. But I mean there are many economists who think that NAFTA has not been the magic solution to Mexico, but it has certainly provided to the Mexican economy certain stability, and a lot of indicators show that.

There are many reforms, however, that Mexico has to undertake to liberalize its economy to make it grow, and make sure that its middle class grows. But I think NAFTA has been very successful, you know. But yeah, I mean, that may have been a reason that contributes to that.

But again, at the end, and let me finish by agreeing with -- and this is where we agree -- is that, look, I believe in strong border security. I believe in some form of electronic verification that works, e-verify that works. But that is not enough. We need some way to bring people out of the shadows and also to legalize the flow of people so people are encouraged to enter legally and not illegally.

Creating a guest worker program, or a mechanism to legalize that flow and a flow that is reflective of the needs of the market it's absolutely necessary to guarantee border security. We are spending millions, billions of dollars detaining people who our economy actually needs and attracts. So I would argue that we have to do the two things at the same time, and I think that's what the American people want to see.

SCHUMACHER-MATOS: Well, with that, we bring this session to a close. I think our panelists have certainly acquitted themselves very, very well. We even find a lot of agreement across this panel, which is great. And they deserve a round of applause. Thank you. (Applause.)

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THIS IS A RUSH TRANSCRIPT.

EDWARD SCHUMACHER-MATOS: Well, welcome everybody. If we could please all sit down.

This is our second panel of the day. My name is Edward Schumacher-Matos. I am still technically for a few more days up at Harvard where I've been teaching at the Kennedy School on migration policy and I had been writing a column for the Washington Post. I stopped a few months ago because I'm just taking up a new position as ombudsman at NPR. So I'm in this transition state. I drove in just yesterday with a car full of clothes, so -- (scattered laughter.)

MS. : Welcome. It's hot.

SCHUMACHER-MATOS: But I think we have an interesting panel here today to address really the politics and the policy and where can we go next? What can we do?

I think most of us, if we believe in immigration reform, may be a little bit depressed in this room because it looks like it's going nowhere at the moment. It is so caught up in the politics and has been now for a few years. But there is always a tempting thought that there's something that can be done and we do need to know what the state of the play is, and sooner or later something will be done. We know that because it always has been done in the past and it's going to have to be done again in the future.

I hosted a conference on migration and development this past weekend up at Harvard on what's going on in the rest of the world in descending countries. And it was a curious thing that they had these economists from all around the world there and the real feeling was was that migration is in many ways the primordial issue, the defining issue of the 21st century. If once upon time it was racial integration, if for the last few years, the major social issues were, you know, gender immigration and things like that, that for the 21st century it's going to be the integration of immigrants and the great growth of migrants moving across the world and that we can't stop it.

And so, will we change the way we think? Is that going to be required? Is there a generational change that may make a lot of our fight space seem moot and old hat in just a few years, or are we caught in such a political logjam that a lot of opportunities are just going to pass us by as a nation?

So these are all things to talk about today. We have a great, great, great panel. Maybe I should introduce -- you have their bios, so I won't give lengthy introductions, if that's OK.

Immediately here to my right is Alfonso Aguilar. Alfonso was once the first chief of the U.S. Office of Citizenship, appointed by President Bush. He's now executive director of the Latino Partnership for Conservative Principles and represents a movement, a growing movement, really, inside Latinos, trying to recognize their conservative side and marry the Latinos with the Republican Party.

And then on the political opposite side we have Angela Kelley, who was kind enough to join us when the congressman who was supposed to be here couldn't come today. But Angela is a stalwart of the immigration scene here in Washington and has been for a number of years and -- at the Center for American Progress. And so -- and the work that she has done on immigration, I -- you know, I see it regularly coming across the (trends ?), the very well-argued positions in favor of immigration reform.

And finally we have Andrew Kohut who is the president of Pew --

ANDREW KOHUT: Pew Research Center.

SCHUMACHER-MATOS: -- Pew Research Center and the great thing about Pew is that everybody turns -- on all sides of this issue turn to Pew for unbiased data. They are the source of so much that we know in terms of numbers and public opinion on this issue.

And so, I think we have a nice mix here, right, left and middle. My job is to try to moderate this and so what I think I'll do is start off the discussion asking Andy, really, where are we in the way of public opinion on this issue? Is there an opening in terms of opinion to move forward? What does the public want?

KOHUT: There's plenty of openings. I think the most important thing to understand about public opinion is that -- about immigration -- is that it's at variance with the way advocates and partisans here in Washington think about things.

Americans hold two seemingly contradictory attitudes at very high levels and very consistently. One, they want to see greater border security and enforcement, 75 (percent), 80 percent. At the same time, we get almost as many people saying we think it's right to provide a pathway to citizenship for illegals if they pass background checks, they have jobs, and will pay fines. We've asked both of these questions a variety of ways over a reasonable period of time and we get the same answers.

In terms of trends, I was listening -- thinking about what you said about how immigration is so much an important issue and the movement of people. What we do see over a longer period of time is that Latinos get better evaluations from the public at large than they did in the 1990s, as do Asians and other minority groups. The American public is getting with it with respect to the fact that the society is changing.

Now, there is a division of opinion that runs pretty much along an interesting line based upon experience with immigrants. A majority of people think that -- a thin majority think that the immigrants strengthen our country, that they don't weaken our culture. But the view that immigrants weaken our culture are most prevalent in the areas where there are no immigrants, where there is really a bloc of nativist sentiment.

The other thing I would suggest is that the -- there is an issue, there's a divide with respect to jobs. Most Americans say that many immigrants are taking -- or immigrants are taking many of the jobs that most Americans really don't want. Yet, there is a division of opinion about whether immigration is hurting the job situation and that comes largely from people who are at the lower end of the socio-economic spectrum.

I'll just finish with a quick political trend, and that is up to 19 -- or 2004, we saw the Republican Party making great gains among Latinos, I think more than 40 percent voted for President Bush in 2004. Since then, the Republican Party has taken on the issue of immigration in a very hard-line way from the point of view of Latinos, the Latino vote has gone increasingly in the Democratic direction. In fact, Latinos now play an important role in a number of the socio-political groups that we identify as key to the Democratic Party.

SCHUMACHER-MATOS: Well, Angela, one of the criticisms then, if public opinion feels that way, is that there's a lack of leadership. Your team is in the White House, in a way, right? If I can say that, more Democratic aligned, the president recently gave his blueprint for immigration reform. What is -- could you summarize for us and the audience, you know, where you see the administration is today and if you think they are indeed leading as forcefully as they can. And if not, why not?

ANGELA KELLEY: The president did give a very clear picture of what our immigration policy should look like when he gave a speech recently in El Paso, a very detailed blueprint, really goes into a lot of depth about what he would want to see. It would be really easy to turn that blueprint into a bill. The problem is that the bill would never move.

The House of Representatives is currently controlled by Republicans who have been very focused -- in fact there's a hearing today on a bill that Lamar Smith, the chair of the Judiciary Committee, has introduced on e-Verify, an electronic verification system, and that's really where they want to stay. They want to stay on the enforcement, you know, ball field. And they're not willing, I think, to have the broader conversation about comprehensive reform about frankly solving the problem.

So we have a sense, I think a pretty clear picture of what this administration would want to do legislatively, but there's nobody to pick up the ball and run with it.

And even in the Senate, you know, we saw with the effort to pass the Dream Act, a very modest measure for undocumented young people who came through no choice of their own to this country, an effort to try to get them on a path to citizenship if they finish college, or two years of college, or if they serve our military. And that was met with you know, virtually no Republican support and went down in defeat, very sadly, just a few months ago.

So I think the state of play in Congress is like swimming in peanut butter. I mean, you're going to get nowhere. It's a pretty ugly and tough battle and I'm afraid it's going to be that way for some time. And we're likely just to see a stalemate at best.

The administration has been very aggressive in pursuing enforcement policies, there is no doubt about that. More people will be deported under President Obama than under President Bush. A very aggressive expansion of local law enforcement engaging in immigration, enforcement through secure communities. We continue to see, sadly, dreamers, young people who would qualify for the Dream Act being deported despite promises that they wouldn't be deported. So frankly there is a sense of disappointment that the administration has been as aggressive as it's been in how it's enforced immigration laws. Of course, it has to enforce our laws, that is its responsibility. But there has felt at times to be a disconnect between, frankly, some of the rhetoric and some of the actions.

SCHUMACHER-MATOS: Well, Alfonso, you've heard what the public wants. The administration is -- not only has a blueprint but is really coming down hard on the enforcement side. Why isn't that enough with the Republicans? The complaint is that perhaps the Republicans keep moving the goalposts.

ALFONSO AGUILAR: Well, I hate to begin by disagreeing with Angela, but --

KELLEY: That's OK, Alfonso. It won't be the last time. (Laughter.)

AGUILAR: But look, the problem is on both sides and I think it would be an oversimplification to say -- some do try to say that this is not moving because of the Republicans or because of some nativist feelings in the country. That's part of the story, but there's also a vacuum of leadership at the White House.

The president talks about this a lot. The president gave a great speech in El Paso, but it was a very political speech designed to anger Republicans, and he did.

The president has talked with everyone. One of the last meetings at the White House was with members of the Bush administration. Well, the Bush administration is over. They should meet with the current leadership and that hasn't happened. A serious conversation with the Republican leadership in the House and Senate has not happened.

Now the answer is, we don't have anybody in Congress, a Republican, that's willing to work with us. I ask you this. When George W. Bush in '07 sent Secretary Chertoff and Secretary Gutierrez to negotiate with Ted Kennedy, did he think he had the votes? No. But that is leadership.

The role of the president is to be the consensus builder. You have to bring people together and he's using this issue as a political wedge issue to get the Latino vote.

Clearly, on the Dream Act, the Dream Act strategy was designed for Republicans to oppose it. In the past there have been Republicans that have supported the Dream Act, but it was introduced in a lame duck session and Republicans in the Senate were told you cannot introduce amendments. Who is going to vote for that? So they voted against it, including five or six Democrats. And then they said, "You see, they're against immigration." A very effective strategy.

But Latinos know better. And going back to the numbers, while definitely Obama did very well with Latino voters in '08, if we look at the numbers, the exit polling in 2010, Republicans didn't do that bad with Latinos. Across the board in House races they got about 38 percent of the Latino vote. For the Republicans to win the White House, they don't need the majority of Republican votes, they need 40 (percent) to 44 percent. Now what's happening on our side is frankly that a small minority, but very effective, has hijacked this issue and the majority of Republicans, of conservatives are not being courageous.

So I'm critical of both, of the president, but also of the GOP for not showing the courage to stand on principle. They're afraid of certain groups, the main anti-immigration lobby. And let me tell you, we've been one of the few conservative organizations to come out and call by name -- and I'll call by name again -- the three main anti-immigration groups, knocking to the conservative movement, saying they're conservative when they're not, FAIR, CIS and NumbersUSA, trying to influence Republican politicians with information that is wrong. And we know that these organizations were founded and staffed by zero population control activists, radical environmentalists, Planned Parenthood organizers. When did those become conservatives? And then we're listening to those individuals.

And then also some talk show hosts who, if you come out and say "I'm for immigration," you're immediately going to be branded as supporter of amnesty. We need courageous leadership. And what we're trying to do is to create the arguments and the circumstances to the -- reclaim this issue.

Immigration should not be the issue for RINOs, or for moderate Republicans. No. It should be the issue for strong conservatives. And when they attack me because every time you say for immigration, the first thing they say is, "Oh, you're a RINO." I say, "OK, I'm pro-life, for traditional marriage, I like the Ryan entitlement plan, I'm for strong national security and I'm a free market conservative and because of that I'm for immigration. How am I a RINO?"

We have to say that if you are for free market -- if you're a free market conservative you can't be against immigration. The reality is we need foreign workers. And this whole issue that we have in this country is because of big government, because of Washington setting arbitrarily quotas that don't reflect the needs of the market, so that's why we have illegality.

If we're against big government, if we're against policies that disrupt the market, then we should be for creating mechanisms to facilitate the legal flow of immigrants into the country, and that's what we need. We need courageous leadership from Republicans and there are many in the House, but they're silent and somebody needs to go back to that Reagan kind of leadership. You remember, Reagan was a populist conservative and there was one or two issues where the conservative, the establishment, or for even some groups didn't like, but he stood up on principle. And that's what we need.

So it's going to take time and I'm an optimist. The positive thing is that the Hispanic community keeps on growing and the thing that the politicians love the most are votes. The question is, how long is it going to take for both sides to say, "OK, now we really need to do something. We have to stop playing politics."

Is it going to be before 2012? I don't think so. Is it going to be after? Yes, I think so. But I think we need to work on both sides to make sure that we stop listening to the extremes that actually meet, the anti-immigration groups and big labor, because nobody talks about big labor, but they've been involved in this from the get-go. They don't want to see a new guest worker program. They don't. Many of these anti-immigration groups use the same arguments espoused by big labor.

So this is a very complex issue. And frankly, we also have to recognize, just to conclude, that there is a certain uneasiness with the rapid growth of immigration and the new settlement patterns that we have to acknowledge. When 5 (thousand), 10,000 Mexican immigrants arrive in a town in the middle of Iowa that hasn't seen any immigration, that can create uneasiness. And we can't be so self-righteous to say, "No, no, I won't be accepting." It creates problems.

And that may be reflected in some of the positions that some people espouse, and these anti-immigration groups are taking advantage of that.

SCHUMACHER-MATOS: Andrew, is there on the -- we see that the -- not all the Tea Party, because there are Libertarians in the Tea Party who are pro-immigration, but we see this populist right that's associated generally with the Tea Party being very, very strong, their intensity is very high. And even though they are not necessarily large in number they have --

KELLEY: They're loud.

SCHUMACHER-MATOS: -- as Alfonso said, was it you, or did I just say hijacked the party?

KELLEY: They're very loud.

SCHUMACHER-MATOS: But in any event, so much of the Republican leadership has been a little bit afraid of that element within their base.

Is there anything that you see on the horizon with the new mainstream that has been emerging among young people, or the growing number of Hispanics coming -- voting and coming into the political mainstream, that would be a bounce to this that might even overweigh it, that could push something through? Or are we -- do you see that we are going to be many years of where we are today?

KOHUT: Well, I don't know about many years, but it's an interesting question that you've posed, because the issue with 2010 for Latinos and for other elements of the Obama coalition, young people, African Americans, was their lack of participation. Their voting rates really fell off precipitously compared to 2008. And what we have seen politically during the Obama years is that the critics of Obama are so much more energized and have so much more strident, intense views about what he -- how much they don't like what he's done. And the people who are his strongest backers continue to give approval -- reasonable approval levels, but their strength of approval and their sense that he has achieved what they thought he would achieve in any one of a number of respects is just not there. And if Obama is going to succeed, he's got to get a number of these groups in his coalition and certainly including Latinos that have some sense that he is, you know, on his way to getting -- doing what he promised.

SCHUMACHER-MATOS: So, Angela --

KELLEY: I totally agree with --

SCHUMACHER-MATOS: -- some people say that even now the word "comprehensive" abhors amnesty and now just anything that says comprehensive automatically sends up all kinds of red flags by the opposition. And maybe we need a new strategy, a more piecemeal strategy.

KELLEY: I mean -- you know, you can give it a new name, it's -- and you know, a tactic that's being pursued in the House by the Republicans is enforcement only, let's start with electronic verification system. But the truth is, and I think Alfonso would agree with me, is that you don't solve the problem that way. If you've got 7 (million), 8 million workers, what we know about e-verify for example, is that half the undocumented who are working will continue working. E-verify won't catch them. But we know that 800,000 Americans, if this program is put on steroids the way Smith wants it to be, will lose their jobs because they won't be able to correct the errors in the databases.

You've got to deal with the folks who are here without status. You could start with the Dream Act kids, but that's frankly a very imbalanced package, because you'd still have all these workers that will get pushed further underground, or will continue working.

So I'm not a big plan of the piecemeal strategy just because I don't think it solves the problem. I get that there's, you know, apprehension around this issue for some of the dynamics that Alfonso described. But I also believe, and this is what Andrew was saying, that ultimately the public wants a solution and you see the debate playing out in very interesting ways locally.

So, a year ago when Arizona passed, I would've thought that Arizona-like measures would just pass through all the statehouses, right? Like wildfire. No pun intended because of the fire in Arizona now.

But -- and it's true. I mean, there have been some really tough measures that have passed in Alabama and in Georgia, nearly happened in Florida, but in large part a lot of states rejected it. Or you saw Utah, for example, pass a really tough, pretty flawed, ugly measure, but they were trying, they were reaching by trading a worker program. It's unconstitutional, the bill is kind of ugly, but politically it's an important signal because you've got this bright red state like Utah that's saying, "Wait a minute. Do we really want to kick these people out? Wouldn't it be smarter to put them on the rolls, make sure they are working, get them in the system and have them integrated into our communities."

I think it gets to some of the unease that Alfonse was describing that communities feel when people first land there and they're not sure what to do about it.

So I wasn't surprised that a Georgia and Alabama passed the laws that they did, but I think what's noteworthy are the states that didn't pass it, like a Kentucky, looked at the cost of it and said, "No way, this isn't going to solve the problem. This is going to hurt our fragile state economy. Let's not do it."

So you see the conversation happening locally, I think frankly and more sensible ways than it happens in Washington. And I think it's going to be a combination of forces. I think it's going to be continued pressure at the statehouse, in some cases to do good things like you saw in Connecticut around the Dream Act, in Maryland the same thing, sometimes bad outcomes like in Alabama, or Georgia, but that's where the conversation is happening.

More and more youth engaging on this issue, particularly around the Dream Act, but this is a demographic that when they are asked about "Does immigration bother you? What do you think about the undocumented?" They look at you like you have two heads. They don't even know what you're talking about because for them this is just a matter of course. They grew up in a much more diverse society.

So I do think this is an issue that's eventually going to age out, right? I also think it's an issue that people will just come to a sensible solution because economics are in our favor.

Look, immigrants are extraordinary entrepreneurs. What it takes to come to this country, to start a business, to leave everything you know. I mean that's the backbone of so much of this country and its history, people who want to belong, people of faith, people who took extraordinary risks like my parents did. They left a comfortable life in Bolivia for me and for my brother and my sister. How many people in this audience have that same story, or know someone who does? It is the genius of this country and ultimately I think that will prevail.

SCHUMACHER-MATOS: Let me ask one more question of Andrew before opening it up to the audience.

Andrew, I mean one thing, the young people that Angela talked about and the trends that Alfonso sees, but the great -- in all your polling, sort of the great American middle, as you've noted, wants both enforcement and legalization, some kind of a comprehensive reform, but they also want tough enforcement.

Is it possible that some of the things that Angela is saying, you know, sends up red flags with the great American middle and that is a strategy that just is a no-win strategy that would -- that stops the public from trying to push the politicians to come to some kind of resolution? In other words, they want more -- they would rather -- instead of Angela's position on this, a position that had more enforcement, or if you put the enforcement first, a little harder?

KELLEY: Can I just insert one thing, though? I'm not being all rosy about it --

SCHUMACHER-MATOS: Yeah.

KELLEY: -- because look, there are tough enforcement measures in place. The 2007 debate there were a lot of benchmarks that were put out in the bill, enforcement benchmarks that DHS was supposed to meet before any of the benefits would kick in, before we legalize a single person, right?

The bill failed. It collapsed in a spectacular way. But what didn't stop happening was those enforcement measures, right?

So we have more boots on the ground than we've ever had, the biggest Border Patrol. We are closer to building the fence and completing the fence than we've ever had. We've got more investment in technology than we've ever had. So we have done a lot at the border and I think that DHS, for all its enormous budget, does an extraordinarily poor job of promoting itself and of indicating what they have done well. I mean I think that's a really key message that Democrats and Republicans should both embrace, because at the end of the day we have a right to secure our borders. We have a right to control who comes into this country and it needs to be under our terms and conditions.

The way to get that control, though, is by having a structure for visas so that people come legally with a visa and not with a smuggler. But I don't want to, you know, be painted as the -- you know, the gal who's all about --

SCHUMACHER-MATOS: I hear you. I hear you. That's fair enough.

KELLEY: -- you know, her family's lovely history, it really is. We've got to be tough, I get that.

KOHUT: But in response to your question, quickly. The enforcement attitude is not at war with the acceptance attitude. But to your point it's very true. When we've sampled communities that have experienced tremendous onsets of immigrants, they just feel overwhelmed and their view are quite different than what we see in the national -- in national polling, just as this other element where there is real opposition -- exists in places where there are no immigrants.

So it's really kind of a complicated -- it's a complicated picture.

SCHUMACHER-MATOS: Right. Let's open it up to the audience. I'm sure that many people here have their own views on this, or good questions.

Please identify yourself. Remember that this session is totally on the record. So Ed, you want to go first?

QUESTIONER: I'm going to take the organizer's prerogative and start it off.

Alfonso, I want to ask you about the Tea Party, because there is something that has mystified me about the Tea Party. I do a lot of work on trade as well, and when this new cohort of Tea Party Republicans came in, there was a lot of speculation where are they going to be on trade? Are they going to be pro trade? Or are they going to be more skeptical? Because trade raises a lot of the same concerns as immigration, you know, job displacement, job losses.

The Tea Party has turned out to be solidly pro trade. You know, I think if the three free trade agreements that are standing out there were put in front of the House they would sail through with virtually unanimous Republican support. And yet, on immigration, from the Tea Party you have this tremendous skepticism and, you know, you talk about free market conservatism. I'm trying to figure that out, how -- why do we see that different?

AGUILAR: Well, first of all let me tell you, we tend to generalize about the Tea Party. You know, what is the Tea Party? We should talk about Tea Parties. In each state you may have different groups. And there is a Tea Party mass that shares one thing and it's this anger against the expansion of government. But there's no consensus on immigration.

The Tea Partiers you hear on TV are some of those in the leadership of some of those groups, but they're not all Tea Partiers. So if you talk to some of the Tea Party members of Congress in private, they will tell you that they very much are for immigration because of free market principles. Again, it's creating the circumstances for those strong conservatives to stand out.

I mean we can't -- you know, we go back and -- you know, and I say this publicly because, I mean, I like Governor Bush, I like Secretary Gutierrez, I like Secretary Chertoff, but they represent a Republican leadership of the past. Right now who's in office are the Tea Partiers. We have to deal with them and if you have a constructive conversation with them, you can actually get support.

SCHUMACHER-MATOS: We had a question here.

QUESTIONER: The three of you implied that better assimilation policies will be needed. And Alfonso, a question for you. You expressed concerns about big government, but isn't government's role to help these new arrivals assimilate, language training, job training, preparing communities? What can be done to better mesh the communities and the new arrivals?

AGUILAR: Well, you know, I headed the Office of Citizenship, which was created precisely to use the immigration system and the naturalization process to encourage assimilation. I think we should talk about assimilation. President Bush talked about assimilation. Obama doesn't talk about assimilation because for certain liberal sectors that is a politically incorrect term. I don't mean cultural assimilation. We're talking clearly about American political assimilation.

We respect diversity but within the unity of certain principles, common language, common political principles and a shared sense of history.

I think this is not necessarily a matter of investing money, but of encouraging the community because integration is a two-way street -- encouraging immigrants in a friendly way to learn English and embrace America, and frankly I believe the majority of immigrants are integrating and are becoming good Americans but we have to get the communities involved.

That's why when I was chief of citizenship I encouraged the churches to get involved, non-traditional groups, because sometimes I feel that the groups that are involved on integration are more focused on let's provide health services, let's provide settlement, you know, education. All those things are important. We're not going to create -- and when I go to Europe, and I did a lot of exchange with the Europeans, they invest tons of money on that type of services, and those immigrants don't feel integrated.

There's a great thing that, you know, somebody said recently. There is something seductive about American society. And it's a civic seduction. Latin Americans come here, immigrants, because they want to be part of America. They don't come here to feel as a permanent underclass. I mean, this Latino effect is actually a very American experience. You know, some come from Nicaragua, some from Puerto Rico, whatever, but when they come here, they want to be American.

One of the greatest indicators of integration is that second -- by third generation, over 50 percent of Latinos and Asians marry outside of their ethnicity. So integration is happening, but I think we should talk about assimilation to ensure the receiving communities that America is still the dream, that we're still a country based on ideals and that immigrants make this country more, not less American.

KOHUT: Yeah, I do a lot of surveys in Europe and the divides between immigrants in Europe and the main population groups is so much broader and deeper than it is here. We have this tradition. They don't.

KELLEY: Yeah. Can I just make a quick comment on this because I think I'm largely in the same place that Alfonso is, and we've done some work on looking at immigrants, home ownership rates, language acquisition. Sociologists call the U.S. a language graveyard -- and I'm a great example of it because my Spanish is terrible, much to my grandmother's chagrin -- you know, earnings.

And so, those kinds of indicators really do tell a good news story and I always describe it as the movie, right? But in places like a North Carolina, or an Arkansas they're just taking snapshots and a snapshot doesn't tell you the whole story when folks first arrive because they do struggle. They don't speak English and it's harder for them. But if you look at a movie, like California, where we've seen over generations, it's a pretty -- it's a happy ending.

So I think it's the effort to try to pull the camera back and understand a little bit more deeply some of the complex issues.

I'm sometimes having to deal with integration, but I'm struck often by charges, especially by Republicans, that immigrants don't integrate, when those are the very same folks that are introducing bills that would change the 14th Amendment so if you're born here you're not a U.S. citizen, the same folks that would very aggressively have local police making it terrifying for a woman to report that she is being beaten, or for a father to take his son who's just fallen and broken his arm, to the hospital.

So if we push measures like those that make people afraid to be part of their community, then what we're doing is thwarting our integration. And I often find that that tends to be Republicans, some, not all, tend to go and that frankly is just undermining our nation's proud history as a nation of immigrants where people do integrate.

SCHUMACHER-MATOS: (Off mic.)

QUESTIONER: Thank you very much to all of you. I'm Julia Sweig here with the Council on Foreign Relations.

And I wonder if I could get the three of you to sort of build a little bit on Ted's question about this contradiction between being pro-free trade but anti-immigration and get to the question of race. And also, the general economic crisis that the country is in.

And Andy, is there a correlation between an increase in anti-immigrant attitude and generally the sort of financial economic crisis that the country is in? And to the extent that the Tea Party members and sort of nationalist ethos among them is targeted toward immigrants? Is this a -- I know the cleavages are much deeper in Europe, but is there -- is this a thread of American racism, or a racist component to the critique and the backlash against immigrants?

Just -- if you could just tease this out, because I do find myself scratching my head a little bit at all of these contradictions, especially because what I'm hearing is that there really is a very strong partisan divide on this issue, even though you two analytically coincide so much.

KELLEY: Right.

QUESTIONER: Thank you.

KELLEY: Andy give her an answer. (Laughs.)

KOHUT: Sure. The -- I was going to mention this to you, Ted, when you talked about the Tea Party embrace of free trade, yet lack of embrace for immigration. Free trade is business and for the Tea Party that's good. There are more reservations about immigration.

And what we're seeing now -- in fact we haven't published this yet, is growing -- is a growing isolationist sentiment among conservative Republicans. That's quite remarkable and that may tie more to some of these anti-immigration attitudes.

And, you know, Julia, there isn't rising anti-immigration sentiment. What we're talking about is the partitioning of the American public and voting blocs in such a way that you have a group of people who hold these views very strongly, but that doesn't suggest more broadly that there is a rise in anti-immigration sentiment. It isn't there.

There's nothing to say that -- there's not a dependent variable, so to speak, of anti-immigration that's correlated with concerns -- with growing concerns about the economy. There are growing concerns about the economy, but we don't see among the public at large more anti-immigrant sentiment. What we see is a greater -- what we released in a major report a while ago is a more doctrinaire political landscape. And on the right you have staunch conservatives who are largely Tea Party advocates who hold very, very strident points of view on this issue and many others, but not on business. That's within the bounds of acceptability.

SCHUMACHER-MATOS: In the back, sir.

QUESTIONER: Thank you. Rich Stana with GAO.

One of the things with comprehensive immigration reform is going to be whether the bureaucracy can manage this well. And if the bureaucracy doesn't manage it well, I wonder if the American public's vision of this is going to go in a direction we don't want it to go. And yet, the kind of numbers we're talking about, the bureaucracy has never been stress tested to that degree.

We talked a little bit earlier about the inability to do the visa process expeditiously. The immigrant integration programs are almost non-existent. On the other hand, you know, trying to get the incidents of fraud to an acceptable level on these applications isn't always there. You know, the border really isn't ready, no matter what progress has been made.

So what do you think is going to have to happen to get the machinery of government ready to manage something like comprehensive immigration reform?

SCHUMACHER-MATOS: Who are you -- are you addressing it to anyone in particular on --

QUESTIONER: Well, I think you've got the whole spectrum. (Laughter.)

SCHUMACHER-MATOS: I think we should start with Angela on this one.

KELLEY: I really wish this were a question that was happening because we're frankly just so far from this being realistically posed.

Soon after Obama took office -- actually after he was elected, there was a lot of, and continues to be good thinking put into how do you structure a legalization program that has to be as broad as possible, right, because we want to include as many people as we can, so we don't have a big class of undocumented immigrants, which was one of the flaws of the 1986 program; protect against fraud, but at the same time seem tough enough. And that isn't a perfect formula.

I think the 2006 bill, 2007 bill tried to get at that. But the machinery behind it, the technology behind it, the manpower, it would be an extraordinary task that I couldn't begin to, like, outline, but particularly around the legalization piece.

I'm somewhat less worried about what the future flow piece would look like because I do think that there's very good thinking that's been done by the AFL-CIO, by NPI and others in how we might be able to determine what would be the proper number of visas.

But I do think where you have a robust program that would provide a degree of comfort for 11 million people to come forward in an orderly way that ensures that they are who they say they are, and that we're doing the right background checks, and that they're meeting the requirements of tax payments and language acquisition, it would be quite a task.

So no, there's no magic bullet or, you know, soundbite I can give you on that.

SCHUMACHER-MATOS: Before asking Alfonso if he has something, I would like to follow up on that question. The bureaucracy question is a great question in terms of -- I mean, for example, you were critical of expanding e-Verify.

KELLEY: Yeah, exactly.

SCHUMACHER-MATOS: And I know you guys are critical also of secure communities. And for those who don't know, it's the program where everybody who's arrested gets run through -- everybody, no matter if you're immigrant or non-immigrant, everything gets run through these fingerprint checks, and that's really the program that's catching some of the people who are being deported.

Yet, if you don't start these programs now, how do you have them up and working and effective even if they have those problems like e-Verify has, at the moment you do have a comprehensive immigration reform or some kind of a deal come online?

KELLEY: Totally agree. And something like e-Verify, I mean it already is in operation, right? It doesn't begin to cover all businesses, it's not mandatory, but there are states, and the Supreme Court recently said this was OK, for states to require it of its employers. And then those that have government contracts, for example, have to use e-verify.

So we are in effect being able to make the program better. There have been improvements to it, but what's being proposed is going really from, you know, when a toddler is taking his first steps to running a marathon. And that's what we're suggesting is just too big a leap. But I totally agree with you, we have to start small and make it effective.

SCHUMACHER-MATOS: Alfonso?

AGUILAR: Well, I was there when we were preparing for immigration reform, and the Bush administration was taking steps to get ready for a legalization. So we were looking at different things.

First of all, you know, we started E-Verify, and it's not a perfect system -- there's room for improvement. But, as Angela said, it's there. Some states have mandated it, but -- it's a difficult task, but one thing that -- but it's possible. But it's possible because I think in this country, we have the technology to make this happen.

I think with legalization, immigration services would get a lot of money that it could invest in -- because, frankly, it's true -- if -- through fees and penalities to invest in technology. But I would say also -- and perhaps this is where I also differ with Angela in terms of -- you know, economically, when it comes to immigration, I'm much more liberal. And there -- there's where you find some Tea Partiers are saying let's have a market-based guest worker program. Let's let them in as many as we need, as our economy needs. That then is even more challenging to operate something like that.

But I think we have to be open to including the private sector in the management of our immigration system as long as we as the government doesn't give up the responsibilities of background checks and key things like that. But we have the technology to manage millions of people. I think it just has to be a better system if we incorporate the private sector. It's not only government, because when you have government controlling everything, you're going to have a lot of problems, and that's what we've seen in the past.

But I must say about USCIS, it has improved dramatically --

KELLEY: Mm-hmm.

AGUILAR: -- and they've shown it. And that's a credit to both administrations for reducing processing times incredibly. I mean, you can get naturalized in some places in three months.

KELLEY: Yeah. Point well taken.

SCHUMACHER-MATOS: Before we move to the other side of the room, let me ask -- yes.

KOHUT: He had his hand up for a long time.

QUESTIONER: Yeah, Rob Quartel, NTELX. Just two quick pieces of background. I sit on the Northern Virginia Technology Council Board, which is the largest technology group of employers in the country, including Silicon Valley, and I've been involved off and on in politics too.

It seems to me there's a big difference between the immigration communities on this. I see out in Northern Virginia the Indian community is utterly organized, and we just had a panel. They were talking about technology visas and education and all the rest of this stuff. And they have raised their issue right to the top and sort of almost get there. The Latino community doesn't. It's just not organized in the same way. And I know it's split -- you have the Puerto Ricans who are citizens as soon as they come here anyway, and then you have everyone else. Yet it's one of the fastest-growing groups.

The last time we saw an organized Latino political movement was Cesar Chavez out in California that was successful. Today, you just see any of it. I can think of 10 things I'd be doing if I were Latino and onto this issue, starting with finding every kid who was shipped back to Mexico or Latin American because his parents were shipped back, and bring them back and make them citizens.

So why is that? What can you do about it?

SCHUMACHER-MATOS: Who would like to take that?

KELLEY: Well, we'd love your help. (Laughter.) I have to tell you, though, I would say that Senator Bennett and Senator Reid and Senator Boxer would probably disagree with your analysis that the Latino community is unorganized because the reason that they're on Capitol Hill right now is because the Latino community turned out in huge numbers when in those races the Republican opponents were, frankly, utterly -- lacked any respect to the community.

So I'm not so sure that they're that unorganized. And given the rapid increase in the Latino vote and the importance of it, it's hard to deny when you look at Nevada and Colorado and New Mexico and Florida in the upcoming election that they're not going to matter a whole, whole lot.

The issues probably of the Indian community are much more narrow. They have a lot more to do with H-1B visas and with a lack of permanent visas, so people, after their H-1B has expired don't have an ability to then convert in permanent status. Frankly, I haven't seen those people make any progress on Capitol Hill either. I think that they're caught up in the same, just bitter, bitter partisan politics that invade not only immigration, but, frankly, every issue that policymakers just seem incapable of having a civil conversation with each other about.

SCHUMACHER-MATOS: Andrew, you did a -- Pew did a report on leadership or the lack of leaderhip among Latinos. Is there anything you'd like to add to -- is that an element here that --

KOHUT: I'm going to pass on that question because I didn't -- I wasn't directly involved' it comes out in our Hispanic unit and I don't have a good recollection and I don't want to misquote it.

AGUILAR: That's an extraordinary question that you've made, and I think that we have to recognize that today's Latino community is not the same of Cesar Chavez. This is a community that's much more diverse, different socio-economic backgrounds, higher level foreign born; 40 percent are foreign born. Of the rest the majority are children of immigrants. They're more socially conservative. So it's a very different community. You cannot generalize about Latinos.

You know, the worst thing that Harry Reid could have said is you can't be Hispanic and Republican. I mean that was just so insulting, even to Hispanic Democrats, to make a statement like that, or to say all Puerto Ricans are Democrats. Well, you know, I'm Puerto Rican and you go to Central Florida and you meet those Puerto Ricans, they are not like Puerto Ricans in New York or Illinois. It's different.

So to generalize and say there's -- the Latino concept, it's an American phenomenon. When you have immigrants coming here they're Nicaraguan, they're Costa Rican, some are Puerto Rican, but there's a diversity of ideas. And in that respect I think Republicans, if they were to get their act together, could be very competitive with Latinos.

QUESTIONER: (Off mic) -- that community too, so I know about the Puerto Rican community. And I will say you are not organized. And what Republicans do, I'm a Republican, is we break them off on social issues. Yet, every Latin American -- Latin immigrant in the United States has one family member or more who has been sent back. Every single family knows someone who's been sent back. This is the central issue of that community. They need to organize around it, including around Republicans and they need to go to the Republicans and say we need something done.

AGUILAR: Yes, immigration has to be part of the mix. To say that immigration is the number one issue, I think is a stretch. I think it has to be in the mix. But they're concerned about the economy, about jobs, about education, health care, so there are other issues. But let me tell you, on social issues we've -- let me tell you, I was very involved in California. I actually campaigned for Carly Fiorina, and if you look at the performance of Carly Fiorina with Latino voters, was much better than her predecessors. Support for Barbara Boxer went down.

So if you have a good candidate you can be competitive. And Carly Fiorina was a good candidate and had a position that was palatable to Latinos. Not perfect, but better than many other Republicans. Certainly she was no Sharron Angle.

KELLEY: She was not. You are.

SCHUMACHER-MATOS: Let me -- here on this side. Yes ma'am.

QUESTIONER: Marisa Lino from Northrop-Grumman. I want to go back to e-verify and ask you all to comment on an idea that is really old, not necessarily that new, and that is to take the discussion of cleaning up the database which is essentially the Social Security database, out of the immigration debate and put it into a debate about identity theft. This is something Senator Schumer tried to do in New York and didn't succeed. But if you could take it out of that debate, everyone wants to be secured against identity theft, and why not clean up the database and take it out of that immigration debate and you would have at least a step forward on getting something done that would improve the system.

SCHUMACHER-MATOS: Anybody want to --

KELLEY: You might -- you may also opened those other cans of biometric worms that would, you know, result in interesting coalitions where you have, you know, the ACLU and the far right, like, hanging together really tight and Senator Leahy, who chairs the Senate Judiciary Committee, his head exploding at Senator Schumer.

So it's great drama --

SCHUMACHER-MATOS: Biometric worms coming --

KELLEY -- and worms coming out, yeah. What nice visuals.

So it's an interesting idea but I just -- it's not like we would then be kind of getting rid of an easy subject -- or one hard subject and going to an easy subject.

SCHUMACHER-MATOS: You had a question here, ma'am?

QUESTIONER: I am sometimes astounded -- oh, I'm Clara Adams, Brigadier General, United States Army, retired.

And I was just going to say that I am sometimes quite astounded at the amnesia that my American people can have every now and then. There was a time in our history -- and I think Carville said it some years ago, it's the economy, stupid.

There was a time in our history whenever we -- while we did not have a policy that said that illegals could come to this country, we did wink and nod and turn our heads and they came. And we somehow or another didn't do anything about it. The economy is booming, we need people to do low-level jobs, that type -- I've been assigned to some -- I've been stationed in some of those countries -- I mean in some of those states --

SCHUMACHER-MATOS: Right.

QUESTIONER: -- where they came in quite often. And I'm just wondering how do we somehow try and mitigate that situation, because you see it's their children that we're talking about these days, you see, and they are still here in this country somehow or another. And all of a sudden, 20 years later we decide that it's time for them to go when the economy is not doing as well.

SCHUMACHER-MATOS: Mm-hmm. Alfonso, why don't you take that one.

AGUILAR: Well let me say this was even an issue in '06 when unemployment was you know, what, 5 or less percent.

QUESTIONER: That's not 20 years ago.

AGUILAR: I know, I know. But again, there's a difference because this immigration phenomenon, this is what you have to understand, the growth of the immigrant community and the new settlement patterns, this started basically '95. It's a new phenomenon. We haven't seen this since 100 years ago. And 100 years ago what we did was pass a terrible law, the National Origin Act in 1924, and we basically closed the door to immigration.

I mean, we have a rosy picture of 100 years ago the nation of immigrants, but what the nation of immigrants did 100 years ago was close the door to immigrants. We're not going to do that again.

QUESTIONER: Let me just make one other point. Twenty years ago, or 25 years ago, we did not know how many illegal immigrants we had in this country because we didn't track them, OK? And so, there may have been more people here at that time, that's my point. There may have been more people here at that time that were not -- (off mic) --

KOHUT: But the difference between then and now, which is the public opinion is responsive to, is the absolute size of the immigrant population, but legal and illegal. It's presence, it's greater presence cause the issue.

QUESTIONER: Yes, I get it. But now -- and we have a better way of documenting -- of dealing with the documented numbers.

KOHUT: But it's not so much just --

QUESTIONER: I mean there are documented numbers. My point here is that yes, there have been many people who whenever folk were not paying attention came into the country, but there were also people who came that we probably suspected that were here, but we didn't keep track of them because they were taking care of some other issues and business --

AGUILAR: I'll restate her question. Why don't Republicans recognize that Republican business did a lot of the winking and nodding when all those people came. (Laughter.)

AGUILAR: Hey, I'm a free market conservative. I believe that we need foreign workers because -- not only because Americans don't want to do certain jobs, but because sometimes there are no Americans of working age -- there's a population thing here, to do those jobs. If you go to Iowa you go to search some manufacturing plants where the average age of a plant worker is 57. The average age of a Latino is 27. The average age of an Anglo American is 41.

So -- Bill Clinton said this, we don't need less immigrants, we actually need more immigrants and the basic research of an economy is people, so we need more people.

SCHUMACHER-MATOS: Colonel, you had a question for a long time.

QUESTIONER: (Off mic) -- forum that so many of us are either immigrants or descendants of immigrants in some form or fashion. But the question I had was how much do we think that the paranoia, real or perceived, is affected by -- and I have a list of things here: one, cyberterrorism or terrorism; R&D theft and export; access to other world markets; personnel security; and race and socio-economics?

SCHUMACHER-MATOS: Andy, you want to tackle that one?

KOHUT: Yeah, I would put something else on the top of the list, and that is concern -- maybe it came under one of your other categories, and that is concern about narco-violence on the border. I mean --

QUESTIONER: I said terrorism -- (off mic).

KOHUT: I think that, again, talking in a more localized basis, that is certainly a factor when you talk to people in Arizona, or you talk to people in California, or places who are near the border who see this as a potential personal threat to their communities. I'm less clear on the impact of some of the other factors that you made.

SCHUMACHER-MATOS: In the back of the room. Yes, sir, all the way in the back.

QUESTIONER: Well, I'm glad that Alonzo (sic) has been talking so much about Iowa, because I'm one of those Latinos from Iowa so -- (laughter) -- and I want to tell you a very quick story and then ask a question.

One of the things that the Ames straw poll, which will be happening in about six weeks is a very big deal and about 10 years ago many of the people from Washington who had flown out to cover that suddenly turned around and saw about 6,000 Latinos who were there not to see the governor of Texas, but to see Emilio Navarette, who is a -- for those of you who might not know, a musician. And people came from all over Iowa to see Emilio and then there was that who's that guy up there with Emilio? (Laughter.)

Well, but to the Anglo media from DC it was George Bush has enormous Latino support. These people couldn't necessarily vote. These people weren't necessarily U.S. citizens. Nobody was asking about their status at the time. But immediately the mean was set as far as being a compassionate conservative, a new type of Republican.

We were able to, I think in the comprehensive immigration reform work in '07 -- '06, '07, make some inroads because we had somebody like that in the White House and it dragged both senators -- and I was on the House side at the time and we had a number of folks who were ready to move if necessary -- but it was because we had a Republican president who was pushing that.

Alonzo (sic), who do you see in this current field or otherwise that is going to be able to do that? Do we have to -- as a community do we have to wait for Jeb Bush 2016, or George P. 2024? Are all of the eggs in one family's basket or is this something that you see the Republican Party being able to come to the table?

AGUILAR: Well that is a very good question. And look, again, I've said this, I love the Bush family -- (laughs). But w -- this is not an issue for moderate Republicans. Conservatives, strong conservatives, not only fiscal conservatives, full conservatives, those who abide by the full conservatism, are strong on national security, fiscal conservatives, free market conservatives should embrace immigration like Ronald Reagan did.

I don't think it requires us to wait for Jeb Bush. I suspect that the candidate we're going to get is a candidate who is pro-immigration like John McCain was. I mean, John McCain was handicapped by Tom Tancredo and by the actions of many Republicans in Congress. But overall, John McCain was good on immigration.

I think, you know, probably all of them, whoever is elected will have a decent position on immigration. Who to watch right now? It'll be interesting to see what Romney says at the end. I think Pawlenty already made a big gaffe in New Hampshire. I don't think he's going to get any Hispanic support if he were to be the candidate. I think Gingrich has been very interesting, even though his campaign is --

KELLEY: Imploding. (Laughs.)

AGUILAR: -- imploding. He has been very good in saying, look, you know, we have to find a middle road. We cannot deport everyone. You know, we have to deal with border security.

And there is somebody out there who is starting to be heard. It's Governor Perry. I know a lot of people have been talking about the law in Texas, whatever, but Governor Perry is very good overall on this issue. So I think we're going to have a good candidate on the issue.

SCHUMACHER-MATOS: Yes, sir.

QUESTIONER: Hi, Dan Griswold with the Cato Institute and we're pro free market, pro limited government, pro trade and pro immigration, which can be a kind of lonely territory sometimes --

KELLEY: Four stars for you, Dan. (Laughter.)

QUESTIONER: We've published lots of good work validating a lot of the economic arguments you've heard today in favor of immigration and I've spent a lot of time beating up on my Republican friends for their stand on immigration. But Angela, I want to just ask a kind of tough love question for my Democratic friends on immigration.

KELLEY: That's okay for me, Dan. (Laughter.)

QUESTIONER: The Republican Senate in 2006 --

KELLEY: Yeah.

QUESTIONER: -- actually passed out a reform bill --

KELLEY: Twenty-three Republicans.

QUESTIONER: -- as flawed and as watered down as it was. The Democratic Senate in '07 didn't get it out, we can argue about why that is. The temporary worker provisions, we've argued at Cato that for immigration reform to work you've got to have a robust temporary worker program and that was the problem with 1986 IRCA.

KELLEY: Right.

QUESTIONER: It had amnesty, it had enforcement, but didn't have any provisions for future flows.

My question is, President Obama ran in 2008 promising to take up immigration reform, to pass it in his first year. He didn't. The AFL-CIO I don't think played a constructive role in the Senate debates and they were behind with their friend Byron Dorgan in watering down the temporary worker program. My question is, didn't the Democrats have an opportunity in '09 and '10? They had a popular president, they controlled the machinery in Congress. Couldn't they have found time while they were ramming through health care -- (laughter) -- the stimulus and that sort of thing, couldn't they have found time to get comprehensive immigration reform done?

I think to his credit, President Bush took more risks for immigration reform than President Obama has so far.

KELLEY: Well, here's one big difference, is that when Bush was in the White House, there were also champs on Capitol Hill. And so, you had a very engaged John McCain and you had an extraordinarily committed workhorse in Ted Kennedy, and both of those people were gone and there was not the kind of leadership, and it has to be bipartisan Dan. And you know that, and you need to have members who are work horses and who are willing to have very tough, sustained conversations with members, introduce a bill and drive it.

And we saw that and many people in this room, I know, followed the debate really closely, particularly in 2006 when 23 Republicans stood up and supported a bill that would've legalized most of 11 million undocumented people. It wasn't that many years ago.

But those days are gone, and it's because one by one we've seen the sort of courage, frankly, of John McCain, wither and become just myopic about enforcement. We've seen someone like Lindsey Graham who stood up and drove through the Senate Judiciary Committee with enough Republican votes a bill in '06 and in '07, declare that birth right citizenship, the 14th Amendment, needs to be revisited.

I mean it's just extraordinary the change, the change in real champs and no one could fill Ted Kennedy's shoes, to be perfectly blunt.

So, there was health care, there was the economy, and there was the energy bill, and all those issues took precedenc. And immigration -- unlike if you ever watched the show American Idol, if you're like a great singer and you might be number four, so you don't win, but you still get a great recording contract, with immigration it didn't work out that way for us. We were number four and our plane, which was ready to go, right? We were a full crew, we had all the fuel on the plane, CR was going to take off, we had good ideas to try to make it happen, and the weather never cleared and we never got to take off.

Now is that because Obama was the pilot and he should have stopped health care and he should have not focused on the economy and he should have not had energy go first? Maybe. Some can argue that. I'm not, you know -- I don't think it was all his fault. I would've loved the White House to have leaned into it more and I want that every single day. I mean, this is what -- this is the issue that I live for. So in my perfect world this is the issue that he would live for. But none of us live in a perfect world.

SCHUMACHER-MATOS: If I can follow up. Andy, is there support in the American public for a temporary worker program?

KOHUT: I think under the right conditions there are, yeah, under the right conditions, yeah.

SCHUMACHER-MATOS: Yes maam.

QUESTIONER: Hazel Denton, Johns Hopkins SAIS. In our last session we focused on how the landscape has been changing and so -- you know, as we compete for different migrants. But there is also a changing dynamic here in the U.S. which we haven't touched on. The discussion is immigration, but the focus is on Hispanics.

The Hispanics as a part of the U.S. population is guaranteed to grow. If you look at the fertility rates of whites, blacks, Asians, they're either at or below replacement. Whites are significantly below. Hispanics, though, are above, significantly above.

So as we talk today about the political dimensions we have to bear in mind this group is growing and I don't think we've mentioned that.

KELLEY: Demographics are destiny. The Latino population from 2000 until now has grown by 43 percent. The white population has grown by one percent.

SCHUMACHER-MATOS: We have time for one last question.

Yes, sir.

QUESTIONER: (Off mic) -- Sanchez, from LCLAA, Latino Labor. It seems like labor has, interestingly, been attacked in the room a number of times. Just a couple of comments.

Yes, the Latino population is playing a central role -- 17 percent of the population in the nation right now according to the latest census. We're going to be 30 percent of the population by 2050, so we need to pay critical attention to the Latino community. And this goes to the comment of the gentleman, which is a reflection of the national lack of understanding of the Latino community, how the national conservative media covers the Latino community.

If you see the national marches all over the nation, the biggest numbers probably that this country has seen going to the streets to oppose one single issue because of the Latino and immigrant communities went to the streets. When they say we don't participate, we're not organized, well, maybe somebody should go to the Congress and each one of those offices have seen Latinos advocating for immigration reform. We have met with every single Cabinet from President Obama. And I don't know, we were not welcome with President Bush, but maybe some of the Latino -- I'm talking labor, brother, I'm talking labor. (Laughter.) I'm talking labor. I was never in the White House. Now things have changed.

But it's interesting and it's a very important and critical question to really emphasize the Latino community from that perspective. I'm going to point at an interesting question for this room, and this council on immigration, and I want to emphasize this question from the immigration point of view.

When it comes to the debate of free trade, we need to be very careful from the root causes of immigration and how free trade agreements, especially with Mexico and Central America. CAFTA and NAFTA have been a central place, a central tool to displaced workers in Mexico and Central America. Immigration after NAFTA increased 65 percent and today 80 percent of all undocumented workers are from Mexico and Central America, something that drastically increased once these economic policies started putting in place.

As I say, I just really, honestly want to put it out there, to think about it honestly. This is not just to yell at each other, it's just to think about it from an honest perspective. This has been very interesting conversation, to honestly -- we need to be more honest, both sides, conservatives and progressives, to see what works, what doesn't work and what are some of the root causes of the problem.

SCHUMACHER-MATOS: Alfonso, you get a chance to -- unless someone has really strong feelings, you get a chance to closeus out here.

AGUILAR: I haven't been to the White House under the Obama administration also. (Laughter.)

No, I think that -- look, you know, I think, you know, if it's on NAFTA, you know, that may have been a reason, certainly, that has contributed to the migration of Mexicans into the United States. But I mean there are many economists who think that NAFTA has not been the magic solution to Mexico, but it has certainly provided to the Mexican economy certain stability, and a lot of indicators show that.

There are many reforms, however, that Mexico has to undertake to liberalize its economy to make it grow, and make sure that its middle class grows. But I think NAFTA has been very successful, you know. But yeah, I mean, that may have been a reason that contributes to that.

But again, at the end, and let me finish by agreeing with -- and this is where we agree -- is that, look, I believe in strong border security. I believe in some form of electronic verification that works, e-verify that works. But that is not enough. We need some way to bring people out of the shadows and also to legalize the flow of people so people are encouraged to enter legally and not illegally.

Creating a guest worker program, or a mechanism to legalize that flow and a flow that is reflective of the needs of the market it's absolutely necessary to guarantee border security. We are spending millions, billions of dollars detaining people who our economy actually needs and attracts. So I would argue that we have to do the two things at the same time, and I think that's what the American people want to see.

SCHUMACHER-MATOS: Well, with that, we bring this session to a close. I think our panelists have certainly acquitted themselves very, very well. We even find a lot of agreement across this panel, which is great. And they deserve a round of applause. Thank you. (Applause.)

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THIS IS A RUSH TRANSCRIPT.

RICHARD HAASS (president, Council on Foreign Relations): If we could get started, I want to -- about to do the last session of the conference, and I'd like to think we've saved the best for last. We certainly saved the last for last.

We have with us the mayor of the greatest city, I would think, in the country, if not the world. And one of the reasons the city is so great is because of our mayor. The reason he is here today is not simply because New York has become incredibly livable, and the quantity and quality of life is about as good as it gets, what he's doing with schools, but also how he's using the job and the position as an important platform for public policy, and -- whether it's talking about issues of climate change and the C40 group and looking at how we use energy and climate -- and what we do about climate change around the world, and also the subject of today, immigration.

And where so many people in public life, alas, seem to be running away from issues, however important, that are controversial, one of the many reasons I admire our mayor, in addition to the fact that he actually counts every stroke on the golf course, is -- (laughter) -- this tells a lot about somebody, by the way -- is that he, rather than running away from some of the tougher issues of the day, he's actually embracing them. And he's giving them a degree of attention and degree of focus and degree of serious conversation that, again, makes him, alas, all too, I think, unique in our public debate.

So the subject of the whole day has been immigration. And Mayor Bloomberg is going to give a talk onto the subject. Afterwards he is going to take some questions from Julia Preston.

Julia's been with The New York Times, now, for just over 15 years. She's a national correspondent with a special focus on this set of issues, on immigration. I've known her for even longer than that, from not just her time at the Times, but also her time at The Washington Post, and really not for more than a quarter of a century. She has been, I believe, one of the leading if not the leading journalist in the United States who's been regularly paying attention to developments to our south in this hemisphere and the issues that relate domestically to it.

So let me thank them both for being here. Let me thank you all for, again, showing this degree of interest throughout the day -- sticking it out. Mayor Bloomberg, welcome, and we're thrilled to have you at the council, sir.

MAYOR MICHAEL BLOOMBERG: I will point out that Richard also counts every stroke on the golf course, particularly when I remind him that he was in the woods and I heard five times the branches go whack- whack-whack. (Laughter.) We did play the other day, and he played very well. Hits the ball a long ways -- if they would put the green in the woods on either side -- (laughter) -- it would help, but other than that minor problem -- but we had -- our match did not get as much coverage as the Boehner-Obama match. We didn't have as much security around.

Anyways, it's always nice to come to a city with a baseball team that is below the Mets in the standings -- (boos, laughter) -- hey, you know, as the Cub fans say, it's still early. (Laughter.)

But seriously, it's really a pleasure to be with you today to discuss one of, I think, the most important issues facing our country. Everyone agrees that our broken immigration system is a huge problem, but no one -- certainly not in Washington -- can agree on how to fix it. And today I would like to talk about how I think we can fix it, and how we can do it in a way so that both Democrats and Republicans, or at least enough of them, can sign on in support.

You know, it really is ironic that the immigration issue that divides this city -- is this -- dividing this particular city, because so much of Washington was built by immigrants. The street design was drawn up by Pierre Charles L'Enfant, a French immigrant; the White House was designed by an Irish immigrant named James Hoban; and the U.S. Capitol designed by William Thornton, a British immigrant.

And those buildings are not only monuments to our democracy, they are monuments to the contributions that millions of immigrants have made to America throughout its history.

But our country's greatest national monument perhaps and the American landmark that is really most recognized around the world is not the dome of the Capitol here in Washington or the pillars of the White House or the memorials on the National Mall. It is the Statue of Liberty.

Since 1886 -- what, a 125 years ago this October -- Lady Liberty's torch has brought light to the darkest corners of the earth, beckoning here to America's shores all those, as they say, yearning to breathe free. Yet it's not Lady Liberty's torch or her crown or her broken chains that has inspired so much awe. It is really her location.

The power of her symbol lies in the reality of New York City as a gateway, a golden door to the land of opportunity that is the United States of America and still is the United States of America. We should not forget that. That reality is not just our history, however. It is also our future, and we have to make sure that we can maintain that for our children.

We would not have become a global superpower without the contributions of immigrants who built the railroads and the canals and opened up the West or invented groundbreaking products that have revolutionized global commerce or who pioneered scientific engineering and medical advances that made America the most innovative country in the world.

But make no mistake about it. We will not remain a global superpower if we continue to close our doors to the people who want to come here, to work hard, start businesses and pursue the American dream.

That American dream cannot survive if we keep telling the dreamers to go elsewhere. It's what I call national suicide, and that's not hyperbole -- that every day what we fail -- that we fail to fix our broken immigration laws is a day that we inflict a wound on our economy.

And today, we may just this morning have turned away the next Albert Einstein or Sergey Brin. Tomorrow we may turn away the next Levi Strauss or Jerry Yang. And certainly we will be turning away many of the people who, like my grandparents and no doubt many of yours, came to this country with almost nothing except one thing: a desire to work and work and work and work and work, to build a better life for themselves, and certainly, if not for themselves, for their families.

This morning, the Partnership for a New American Economy released a report that looks at the impact of immigrants on one major sector of the American economy, and that's Fortune 500 companies. The report finds that more than 40 percent of Fortune 500 companies were founded by an immigrant or by the child of an immigrant. These immigrant- rooted companies employ more than 10 million people worldwide, which is a population larger than 43 of our states have, and they generate annual revenue of something like $4.2 trillion. To put that number in context, American companies founded by immigrants or their children have revenues that are greater than the gross national product of every country in the world outside of the United States except two, and that's China and Japan.

And those are just the Fortune 500 companies. When you look at the economy as a whole, immigrants and their children have been responsible for creating millions of jobs in all 50 states. And the reason is simple: Immigrants are dreamers and risk-takers who are driven to succeed because they know that in America, hard work and talent are rewarded like no place else on the globe.

And no city has seen the economic power of immigrants more clearly than New York. Historically immigrants are why New York City became America's economic engine, and in more recent history, they are one of the main reasons why we have rebounded so strongly from the tough times that we faced in the 1970s and the 1980s. Neighborhoods that 25 years ago were abandoned are now thriving, thanks largely to immigrants from the Dominican Republic and Ecuador and Mexico and China and Russia and Ghana, Korea, India, Pakistan, Poland, Egypt, every country in the world.

There's no greater force for economic revitalization of depressed neighborhoods than the influx of immigrants. And that's not just true in New York. Immigrants have been critical to economic rebounding in small towns and big cities across America.

Take Perry, Iowa, for example. A decade ago, it was facing economic stagnation caused by years of population decline. But today, thanks to a influx of immigrant labor and immigrant entrepreneurs who have opened businesses, the town's main street is now bustling. Tiny town -- immigrants make a difference.

The same is true of Livingston, Maine -- Lewiston, Maine, a decaying old mill town that has come back to life thanks to an influx of immigrants from Africa. In Atlanta, a big city, which has worked hard to become a magnet for well-educated immigrants, the purchasing power of Latinos and Asians has skyrocketed. And across the country, city after city, with the largest increase in immigrant workers, has experienced the fastest economic growth. There is just no question about the numbers. And in New York immigrants are a big reason why we have weathered the national recession better than the country as a whole.

Now immigration reform could be an economic engine for our entire country, creating good paying jobs that will speed up our recovery. But both major political parties and both ends of Pennsylvania Avenue say that restoring economic growth is their top priority, and it must be.

And yet they don't come to face the one thing that can do the job.

Yet today, more than three years after our country entered its deepest recession in decades, the single most powerful step that the federal government could take to spur job growth is reforming our broken immigration system. And it, unfortunately, is a casualty of partisan gridlock.

Republicans have tended to focus on border control, and understandably so. It is critically important to our nation's security, and there's absolutely nothing wrong with America being in charge of its borders and deciding who comes here. Right now, the selection process is who wants to come here the most: They either overstay their visa or they'll come and run across the border. We should be deciding who comes here; there's nothing wrong with that.

Democrats, on the other hand, have tried to focus on comprehensive reform, and that's understandable too. It's critically important that we do create a pathway to permanent legal status for the 11 million people who have overstayed their visas or come here illegally.

But by this point, unfortunately, I think one thing is clear: It is clear that the two sides have reached a stalemate, and they are just talking right past each other.

And that leaves us with two choices. Both sides can use the stalemate as a wedge issue to secure political points in 2012, or they can come together and adopt immigration reforms that will spur new companies, strengthen existing ones and help create jobs for the 13.9 million Americans who are unemployed and looking for work.

In the end, the public cares about two things: housing and jobs. My house, my job. And if you want to do something in this country to give people better jobs and more jobs and a better chance to keep their houses, the one thing that we can do that will work is not expensive for this country.

It's not a big stimulus of trillions of dollars. It is immigration reform that will get the best and brightest from around the world, those that are the hungriest and willing to work the hardest, to come here and create exactly what we need.

Now, as the 2012 election begins to take shape, voters across the country, I think, are going to be looking for candidates with an economic plan that is -- that are -- economic plans that are achievable and not aspirational. For independent voters especially, immigration reform will be a key test to whether candidates are willing to put sound economics ahead of election year politics; at least, it will be if I have anything to say about it.

Independent voters will determine the outcomes of the next election, just as they did in 2010 and in 2008. And while they don't hold all the same positions on any one issue, they overwhelmingly want leadership that is pragmatic, not polarizing. They want centralist solutions, not pandering to the special interest. And they want both sides to stop fighting on what they disagree on, and start taking action on the areas where they do agree. And there are actually quite a few areas where they agree if you think about it.

Leaders in both parties recognize that the current system is a drag on our economy. I thought it was encouraging that President Obama recently said that increasing opportunity for immigrants to come is a top priority. And likewise, I thought it was encouraging to see House Republicans put forward a plan for American job creators that includes more visas for the workers we need. And you'd be hard pressed to find a single economist who thinks that the status quo is good for our economy.

And voters understand all these things. A recent survey showed that two-thirds of Americans and three-quarters of business leaders recognize that immigrants play an important role in our economy. And that's why our Partnership for a New American Economy, which I co- founded last year with Rupert Murdoch, has attracted so many CEOs. And I have to tell you, recruiting new members is one of the easiest pitches I have ever made.

And so with all these agreement, the real question you've got to be asking is: Why can't Washington get anything done? Well, I think the answer is that we can get something done. And today I thought I'd outline five key areas where I believe bipartisan agreement largely exists in Congress and where action could be taken immediately and where the impact on our economy would be profound.

First, we must stop providing a first-rate education in science and technology to foreign students and then force them to leave. Students come from around the world to study here. More than 40 percent of our engineering graduates are foreign-born. They lead ground-breaking research at the very frontiers of science, but then many are forced to leave when it becomes clear that a permanent visa will be difficult if not impossible to get.

So instead of staying here to contribute to our economy, they go home and they go to work for companies that compete with our own companies. It just makes no sense. We're investing millions of dollars to educate these students at our leading universities and then giving the economic dividends back to our competitors for free.

The two parties should be able to agree on a policy that allows any university graduate with an advanced degree in an essential field to obtain a green card and a chance to help grow our economy. We must allow those students to stay here and be part of our future, or we will watch our future disappear with them.

Second, we must stop telling foreign entrepreneurs to build their companies in other countries. America is the best place in the world to start a business. But rather than capitalize on our assets by encouraging innovators to come here and stay, we are rejecting immigrant entrepreneurs, even when they're backed by American investors. Just remember, immigrants helped found Google and Yahoo! and eBay and Intel and so many more companies.

In fact, immigrants helped found one-quarter of all high-tech companies over the last 10 years. And across all industries, they are twice as likely as native-born Americans to start companies. We need more of these dynamic entrepreneurs. And if we do not open our doors to them, they will go elsewhere, and the good paying jobs that they create will go with them.

A foreign entrepreneur from American investors should be given a temporary visa to start a company in America. And if, after two or three years, the business has successfully yielded new American jobs, the entrepreneur should be allowed to continue to run his or her business and receive permanent legal status.

We're a nation of entrepreneurs because we are a nation of immigrants. And in the 21st century, the global economy will revolve more and more around those entrepreneurs.

Third, we must stop telling American companies that they cannot hire the high-skilled workers they need. By making it difficult for them to obtain temporary and permanent visas for high-skilled workers, the federal government is slowing growth and worse, promoting the outsourcing of American jobs. Make no mistake about it: If companies can't hire the workers they need here, they will move those operations out of the country. You just have to look at Microsoft's recent decision to open a research park in Vancouver. There's lots of West Coast companies that now have offices in Canada because they can't get the engineers into this company (sic).

In many high-tech companies -- for one -- that you see again and again -- talk to the owners. Talk to the managers. Talk to the stockholders. They are outside of the United States, but they'd prefer to be here. It's just that we won't let them bring in the talent they need.

And we not only lose those jobs, we lose their spending, and we lose their taxes. Again, this just makes no sense. We are stabbing ourselves in the back even as our economy is in critical condition.

The ability to attract and keep high-skilled labor is just essential for American companies competing on the world market.

And that's true not only for high-tech companies but also for banks and insurance companies and pharmaceutical companies, and even manufacturing firms with large research and development operations like Boeing and Caterpillar.

But right now, the cap on H1-B visas and green cards is much too low. And caps on green cards are set by countries, so Iceland actually gets the same number of visas as India. That may be fair to those two countries, but it's certainly not fair to American business and to Americans. We should give -- end these arbitrary limits and end the cap on the high-skilled H1-B visas. Let the marketplace decide. It's basic free-market economics, and both parties ought to be able to get behind it.

Fourth, we must ensure that major industries, such as agriculture and tourism, that rely on those workers just starting up the economic ladder, have access to foreign workers when they cannot fill the jobs with American workers. These employers want a legal workforce, but our current system just makes that extremely difficult. Firms have to go through multiple levels of approvals to do basic hiring, and in Georgia, where they crack down on illegal farm workers, farm owners are experiencing severe labor shortages that's driving up their cost and leaving crops unharvested. At a time when food prices are rising, this is the last thing American consumers and farmers need.

Fifth and finally, we must begin allocating more green cards based on economic needs. Right now, only about 15 percent of all green cards go to employees and their dependents, while the rest go largely to immigrants, families and relatives.

In Canada, those numbers are exactly reversed. Last year, two- thirds of immigrants to Canada came based on economic reasons, and only 21 percent came based on family reasons. Those that come based on economic reasons are creating the economy for all the people in that country.

We're not doing what Canada's doing. Why not? American has to honor our tradition of always being open to the tired and tempest-tossed, no argument about that. We are a land of opportunity because we've always been a country of compassion.

But as we continue to be a place of refuge and reunion, we must open our doors more widely to the talented and hardworking people who can make critical contributions to our economic growth and prosperity. And that means raising green card limits based on our economic needs, so that we can allow the people who will most help our country to come here, work, invest, and start businesses.

Now, the five areas that I've outlined present, I think, real opportunities for bipartisan agreement. And they are steps that can be taken right now to help create jobs and drive prosperity across the country. And remember, everybody says we don't have any money for new programs. Not one of the things that I outlined would cost a penny. It's all contribution, no expense.

So it's pretty hard to think that in the end the American public isn't going to say to Congress: Enough. We've got to do something. I'm worried about my house. I'm worried about my job. And there's a solution that you can't say you can't afford, a solution that we know has worked in many other places, a solution that you could implement very quickly. Do it now. That means more green cards for university graduates, more visas for entrepreneurs, more visas for high-skilled workers, more visas for agricultural and other seasonal laborers and more visas that are distributed based on economic needs.

Now, in the coming weeks Congress is expected to consider again the Dream Act and E-Verify. But pass or fail, I think the time has come to refocus the immigration debate around the most pressing issue facing the country today. And that is creating jobs.

The conversation here in Washington on immigration must be about more than fences and fingerprints.

It must be about what kind of country do we want America to be. Do we want to continue to be the land of opportunity for all and the world's greatest economic power and the nation with the most high-paying jobs and the best quality of life, or do we want to send more jobs overseas and watch other countries rival our economic strength and leave our country -- leave our children a country in decline?

America has always been on a forward march because we have always welcomed more people to march with us. But now the biggest threat to our future lies in denying our past. In New York Harbor, Lady Liberty is stepping forward. And here in her 125th year, so must we. We must honor, I think, the values that made America great. We must embrace the realities of the 21st-century global economy. And we must hold our elected officials accountable for delivering results, not speeches; for seeking consensus, not controversy; for promoting economic growth, not political advantage.

Maybe more than any other major issue in Washington today, there is an opportunity for bipartisan breakthrough on immigration. If both ends of Pennsylvania Avenue seize it -- and it's up to us to push them -- we can help get our economy moving again, and the best days for our country and for the dreamers who define it will still be there to come.

So thank you. And I look forward to having Julia ask me the most penetrating questions that she can possibly come up with, which I will artfully duck. (Laughter.) (Applause.)

JULIA PRESTON: Mayor Bloomberg, there is a counter argument being made, actually today in a hearing on the Hill, about immigration. And that is that we need to focus on illegal immigration and enforcement against illegal immigration, and for every illegal immigrant that we take out of the workforce by enforcement, you're creating a job for an American worker -- you're opening a job for an American worker.

And I think that vision -- it permeates, perhaps, the debate. In a context of very high unemployment in the country, it's a very persuasive idea that an immigrant is competing for -- with an unemployed American for jobs.

So how do you counter that out in the country when people are hurting for work?

MAYOR BLOOMBERG: Well, I think the actuary for Social Security said if you were to deport all 11 million -- and who knows what the number really is -- 11 million undocumented, that Social Security would go bankrupt six years early. Why? Because they pay into Social Security, but they don't get anything back.

I'm not an expert on 11 million undocumented in the country, but I'm a quasi-expert on the 500,000 undocumented in New York City. And we look pretty hard to see what really is going on in our economy. I can tell you this: At least in New York City, undocumented have a very low crime rate because they're scared to death of going near the INS.

Undocumented do not use the schools very much. It tends to be young people leaving their families back home, and they send back their earnings, but they don't bring their children. There are some, but generally speaking, immigrant children in our school system are the children of documented immigrants.

They don't use the hospitals very much, no matter what the naysayers say. Why? Because they're young people, and we use two thirds of our hospital medical expense in the latter years of our life. And these are young people. They're not here for that length of time.

They pay taxes. Something like 75 percent of all undocumented in New York City pay taxes. Why? Their employer witholds. The employer doesn't want to go to jail, so the employer witholds and sends the money in. And then where does the refund go?

There is no refund. So the federal government is actually making money on undocumented.

And lastly, they don't do things like come and use the social services that you think. They don't want to get involved in government; they don't live in public housing; they don't qualify for a lot of federal programs where documentation is something that you have to --

So that's the issue first with what the 11 million do here.

MS. PRESTON: I guess my question is also about the narrative --

MAYOR BLOOMBERG: OK.

MS. PRESTON: -- about immigration. Why shouldn't the public see what you're proposing as another effort by large business to have a channel for cheap and malleable labor coming into the United States? How do you change that?

MAYOR BLOOMBERG: Well, there's a -- you're talking about two different kinds. Large businesses will employ the doctors, lawyers, Indian chiefs. It is small business that will employ the people who don't have a great command of the English language or maybe don't have formal education.

And in the end, if you want to take America out of its doldrums, the only solution is small business. Half the people in the country work in small businesses. If you think about it, automation is something that small businesses don't use.

Small business is very different, and why are they the solution? Small business is the solution because they have nontraditional hiring. They don't look at your grade point average and see where you went to school and check your transcript. They don't even know how to do that. They look at you, and they say, yeah, I think you'd be OK. (Laughter.)

They provide -- that's the process that a small business goes through. They don't have a big HR department. You're just talking about something different. They have flexible hours, so that people that have family responsibilities can work in small businesses. They provide on-the-job training, and people that are unemployed are at an age where they are not going back to school. We talk about it -- there's five people that went back to school, they're on CNN, everybody does a special on them, isn't it wonderful they're going back to school.

But all the studies show older people don't go back to school.

You have to provide on the job training if you're going to employ them. And that's exactly what small businesses do.

So -- you know, and small businesses don't use automation. If you think about -- we talk about innovation and green jobs, and it's great, and we do need those things. But that's not what creates jobs. As a matter of fact, a lot of innovation and automation reduces the demand for people. And you see that in this country today, where it's bottom-line growth in big businesses. They are finding ways to do more with less. That may be great for the stockholders and may be great for the economy way down the road, but it's not good for helping the unemployment situation today.

Whereas small businesses -- you know, they do things with your hands. There's still got to be somebody at the counter when you walk in the store or cooking or serving or making the bed or -- you know, or picking the crops in the fields. And small businesses can employ those kinds of people.

I said -- I was asked: What do you do about the big industrial cities in the heartland that have hollowed out over the last few decades?

And I got in trouble with the major of the city, who didn't like my suggestion. But I said what the federal government should do is create a visa for people. The deal would be you go to that city; you agree you won't take any federal, state or city help whatsoever, because that gets rid of people who are worried about the expense; and you agree to live there for seven years. And that's the only agreement. And at the end of seven years, if you're still living there, we will give you citizenship.

In the meantime, what are those people going to do? They will -- if they have to drive from Detroit to California in the morning, they would do it to work and come back. They will buy the houses, they'll fix them up by hand, they'll create the small businesses, they'll find ways to create businesses where you never thought of businesses before.

And the mayor of the particular city I happened to pick -- and I just picked a city -- (laughter) -- said: Oh, no, no. There's no -- that Bloomberg doesn't understand; there's not enough jobs here.

Yes, there's not enough jobs. And it's going to get worse next year and the year after unless you bring in a new group of people who are going to start businesses. And the governor of this particular state said, hey, you know, Bloomberg's right. And I gather -- I was told this morning -- now they're going to have a conference -- (laughter) -- to try to really see whether there is something there.

But my point is, the history shows -- all the studies show that the jobs that the undocumented tend to take are not jobs that Americans will take. They either don't want them or they don't have the skills for them. And we are using the undocumented, in many cases, for jobs with much less skills than they happen to have. You can have -- you know, you have a college graduate -- in New York City, the percentage of people that are college graduates has continued to go up over -- almost every year in the last 10 years. Why? Because of immigrants. And not just -- (inaudible) -- immigrants from overseas, immigrants from the rest of the country.

But it is those with college educations that have been flocking to New York City because it's a cultural, intellectual capital. And those that are undocumented can't use -- they may be a lawyer back home or an engineer or a doctor -- they don't -- can't use their skills. So maybe they are driving a cab, or maybe they're starting a small business. But they are coming because they want to work, and the jobs they get are not jobs that anybody else would have done.

Also, every study shows that if you, for example, have one farm worker, that low-priced help -- tough to make a living on what you make picking crops. But that one person tends to create -- I think the number is like three other jobs up the food chain: transportation and inspection and distribution of the products. And the same thing is true at the high end. One engineer -- again, the number there is estimates of something like five or six jobs down the chain because they create new businesses and start things.

So the trouble that you have with this is if you tell a lie often enough, people start believing it, particularly in the day of instant news, bloggers and a very struggling, bad economic situation for the press where they have to go with sensationalism.

So the Times would never do that, I know that, but --

MS. PRESTON: Right. (Laughter.)

MAYOR BLOOMBERG: But they don't take jobs is the bottom line, and we need them.

MS. PRESTON: This week we have a menu of options on the Hill. Bills have been introduced, both a mandatory bill that would make the E-Verify employer -- employee verification program mandatory nationwide, and also Congresswoman Lofgren introduced a bill that would do some of the things I think that you have talked about.

First of all, how do you view the mandatory E-Verify bill? And could that be the basis, do you think, of a compromise?

MAYOR BLOOMBERG: Well, remember, I went see the congresswoman this morning, and I had a long conversation with her.

E-Verify -- well, let me stop for a second. The only ways you're going to get control of our borders -- and remember, borders is a logical border, it's not a physical border -- more people overstay visas to be here illegally than come across a border. So -- but, if you want to think about the whole thing as a big border control security issue for the country, the only ways you're going to get control over our borders is if you reduce the number of people trying to get in. And the ways you do that is you enforce the laws that say you can't employ undocumented.

Course, the business owner says, but I can't enforce the law because I don't know how the -- that they showed me a social security card or a green card or even a passport -- it looked good to me; how would I know? And so that's where the E-Verify system comes from.

But if you just put in E-Verify, all of a sudden you're going to have 11 million people that can't make a living here, and the jobs that they take are going to go unfilled. It would be a disaster for the industries that employ those people. And remember, those industries desperately need them, and we need those industries. But you can't stand up and say, yes, I want to keep undocumented here, because I employ a bunch of undocumented.

So there's nobody making the case, even though the case is there. And you just have to say E-Verify -- which I think incidentally is a fraud unless it has a biometric component to it, because, you know, Michael Bloomberg -- I don't know how many Michael Bloombergs there are in the world, but if you call up and say Michael Bloomberg is illegal, there's 20 different Michael Bloombergs that can use the same name on the E-Verify list. You've got to have something where you fingerprint or something like that, really does say, no, it's you; it's Julia Preston, and it's -- and it's this Julia Preston. That's important.

So E-Verify has its place, particularly if you do the biometric part. But you have to do it in conjunction with -- it would get -- help you get control of your borders, but you also have to do something with the people that are there today. And remember, the 11 million undocumented are here because we wanted them. It's true they broke a law, technically, no argument about it. But why did they break the law? Because in 1986, Congress passed a bill the way they always pass legislation. They stood up to their -- you know, their more conservative constituents and said, I just passed this bill and we're not going to let undocumented come here. And then, of course, the businesses that were giving them some money to help their campaign said, hey, don't worry about it; no money for enforcement; it's going to -- (off mic).

And we just have the same problem we had then, except now it's 10 times the size. And if you don't do anything, it's going to be --

MS. PRESTON: But why shouldn't the -- why isn't the American public's -- right to be skeptical that the businesses that are part of your partnership want to do the same thing again?

MAYOR BLOOMBERG: Businesses -- the would be better off employing legal people, because they can't get them into this country. There's the 11 million. But in all fairness, it was -- that 11 million grew over a long period of time. And if the economy ever does improve -- and it's not going to improve unless we fix the immigration system -- at least I don't think it'll improve anywhere near as rapidly or as easily -- they've got to be able to get a supply of labor.

We've got to have people starting businesses. We've got to have the engineers that they need. We've got to have the seasonal workers that they need.

MS. PRESTON: The five points that you articulated -- is the -- these proposals that are on the Hill now -- from the Republican side, a mandatory E-Verify plan, from the Democratic side, STEM degrees. Is there -- do you see a legislative strategy there that you could somehow --

MAYOR BLOOMBERG: You know, I only saw about seven, I think -- one senator and seven congresspeople this morning, mostly Republicans, although Lofgren is a Democrat -- and I will say I walked away with a little more optimism than I had before.

What has to happen is the public has got to say, Pennsylvania Avenue -- both ends, both sides of the aisle -- you are not solving our unemployment problem. We're going back into -- the economy's going in the wrong direction. And we've got to get out there and make the case that this is something that they can do to fix it.

And the attractiveness of immigration reform, while I know it's controversial for a lot of people to take that kind of vote -- it doesn't cost anything. So you can have immigration reform and at the same time not violate if you're one of the people who've, you know, said read my lips, no new taxes. You can still stick with that, but you could have the immigration reform.

And it's got to come from the public. The public's got to sit there and demand it. And we've got to be out there telling the story, again and again and again.

MS. PRESTON: All right. Do I take it that you would favor an approach of trying these smaller pieces first in the near term rather than a comprehensive approach, or what's your view on that?

MAYOR BLOOMBERG: Yes. I think it would be great to have comprehensive immigration reform, but if you look at '06 and '07, it didn't work. And today the situation is even worse to get comprehensive immigration reform. In the interest of having everything, we have nothing.

And you first -- the compromise that it seems to me makes sense, for both sides of the aisle, is you address the economic issue, the things that I outlined which would help the economy. That's one side of the immigration -- that's really visa reform if you want to say it. And then for the other part which I would call family reunification, you say we'll do the Dream Act or a variation of the Dream Act, because it's a little bit easier for those who keep saying, look, these people broke the law and we should not reward anybody who breaks the law. Well -- and it's funny, they say that while they're texting driving through a red light on their way to -- (laughter).

OK. But it's hard to argue the young kids, particularly if the kid served in the Army and, you know, went to -- I mean, you can -- you can -- you can set some criteria with the Dream Act, but it's just -- OK, they were brought here. When we talk about breaking the law, if you're dragged in your mother's arms across a border and you were, you know, an infant, did you break the law? All right, technically, maybe. But (no ?).

So I think that that's the way you say, those who want comprehensive immigration reform, you're not going to get everything you want. We are going to get control of our borders because we're going to have a biometric E-Verify system so that employers won't employ people that are undocumented; and therefore, the demand for undocumented will go down dramatically. They won't be able to get jobs and they won't come here. And then it's easier to get control of your borders.

You have to do something for the 11 million; make them pay a fine, whatever, but something practical. We just -- they're here. I mean, there's a point at which you've got to recognize reality, that you're not going to solve the problem.

But even if you can't do that right now, at least do the immigration reform so we can get the people to start businesses in these cities and take the jobs that we need for farmers or they're going to -- farms are just moving south, outside of America.

If you can't pick your crops, you just can't have a farm here.

And for those who want comprehensive reform or the family reunification side, say the DREAM Act this time, and we'll come back and fight another day for something else. Because if we fight for everything, we have nothing, and the nothing scenario is really bad for this country given the economic situation.

MS. PRESTON: Perhaps the most powerful or one of the most powerful anti-immigration reform arguments in the country is articulated on a daily basis by FOX News. I'm wondering if you have had a discussion with your partner, Mr. Murdoch, about -- (laughter) -- changing the --

MAYOR BLOOMBERG: I knew I should have done something. (Laughter.)

Yeah, I think -- look. Two of the three big newspapers in New York City are -- the publishers are immigrants, one from Canada, one from Australia. I think Rupert really does believe -- and it's in News Corp's interest; they are an international company with a lot of people moving back and forth.

The talking heads -- I don't know that Rupert's going to go and say, don't say that. That's -- there's a market for very conservative -- nice ways to put it -- talking -- rational talking heads. There's less of a market, it would seem, for very rational talking heads on the left, but for reasons I can't quite understand. But NBC -- MSNBC just doesn't get the ratings that FOX does.

On the other hand, I think that a lot of these people have -- might have some second thoughts when they realize that, you know, Rupert Murdoch really is committed to that -- to this and News Corp. as a corporation is really committed to it.

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THIS IS A RUSH TRANSCRIPT.

RICHARD HAASS (president, Council on Foreign Relations): If we could get started, I want to -- about to do the last session of the conference, and I'd like to think we've saved the best for last. We certainly saved the last for last.

We have with us the mayor of the greatest city, I would think, in the country, if not the world. And one of the reasons the city is so great is because of our mayor. The reason he is here today is not simply because New York has become incredibly livable, and the quantity and quality of life is about as good as it gets, what he's doing with schools, but also how he's using the job and the position as an important platform for public policy, and -- whether it's talking about issues of climate change and the C40 group and looking at how we use energy and climate -- and what we do about climate change around the world, and also the subject of today, immigration.

And where so many people in public life, alas, seem to be running away from issues, however important, that are controversial, one of the many reasons I admire our mayor, in addition to the fact that he actually counts every stroke on the golf course, is -- (laughter) -- this tells a lot about somebody, by the way -- is that he, rather than running away from some of the tougher issues of the day, he's actually embracing them. And he's giving them a degree of attention and degree of focus and degree of serious conversation that, again, makes him, alas, all too, I think, unique in our public debate.

So the subject of the whole day has been immigration. And Mayor Bloomberg is going to give a talk onto the subject. Afterwards he is going to take some questions from Julia Preston.

Julia's been with The New York Times, now, for just over 15 years. She's a national correspondent with a special focus on this set of issues, on immigration. I've known her for even longer than that, from not just her time at the Times, but also her time at The Washington Post, and really not for more than a quarter of a century. She has been, I believe, one of the leading if not the leading journalist in the United States who's been regularly paying attention to developments to our south in this hemisphere and the issues that relate domestically to it.

So let me thank them both for being here. Let me thank you all for, again, showing this degree of interest throughout the day -- sticking it out. Mayor Bloomberg, welcome, and we're thrilled to have you at the council, sir.

MAYOR MICHAEL BLOOMBERG: I will point out that Richard also counts every stroke on the golf course, particularly when I remind him that he was in the woods and I heard five times the branches go whack- whack-whack. (Laughter.) We did play the other day, and he played very well. Hits the ball a long ways -- if they would put the green in the woods on either side -- (laughter) -- it would help, but other than that minor problem -- but we had -- our match did not get as much coverage as the Boehner-Obama match. We didn't have as much security around.

Anyways, it's always nice to come to a city with a baseball team that is below the Mets in the standings -- (boos, laughter) -- hey, you know, as the Cub fans say, it's still early. (Laughter.)

But seriously, it's really a pleasure to be with you today to discuss one of, I think, the most important issues facing our country. Everyone agrees that our broken immigration system is a huge problem, but no one -- certainly not in Washington -- can agree on how to fix it. And today I would like to talk about how I think we can fix it, and how we can do it in a way so that both Democrats and Republicans, or at least enough of them, can sign on in support.

You know, it really is ironic that the immigration issue that divides this city -- is this -- dividing this particular city, because so much of Washington was built by immigrants. The street design was drawn up by Pierre Charles L'Enfant, a French immigrant; the White House was designed by an Irish immigrant named James Hoban; and the U.S. Capitol designed by William Thornton, a British immigrant.

And those buildings are not only monuments to our democracy, they are monuments to the contributions that millions of immigrants have made to America throughout its history.

But our country's greatest national monument perhaps and the American landmark that is really most recognized around the world is not the dome of the Capitol here in Washington or the pillars of the White House or the memorials on the National Mall. It is the Statue of Liberty.

Since 1886 -- what, a 125 years ago this October -- Lady Liberty's torch has brought light to the darkest corners of the earth, beckoning here to America's shores all those, as they say, yearning to breathe free. Yet it's not Lady Liberty's torch or her crown or her broken chains that has inspired so much awe. It is really her location.

The power of her symbol lies in the reality of New York City as a gateway, a golden door to the land of opportunity that is the United States of America and still is the United States of America. We should not forget that. That reality is not just our history, however. It is also our future, and we have to make sure that we can maintain that for our children.

We would not have become a global superpower without the contributions of immigrants who built the railroads and the canals and opened up the West or invented groundbreaking products that have revolutionized global commerce or who pioneered scientific engineering and medical advances that made America the most innovative country in the world.

But make no mistake about it. We will not remain a global superpower if we continue to close our doors to the people who want to come here, to work hard, start businesses and pursue the American dream.

That American dream cannot survive if we keep telling the dreamers to go elsewhere. It's what I call national suicide, and that's not hyperbole -- that every day what we fail -- that we fail to fix our broken immigration laws is a day that we inflict a wound on our economy.

And today, we may just this morning have turned away the next Albert Einstein or Sergey Brin. Tomorrow we may turn away the next Levi Strauss or Jerry Yang. And certainly we will be turning away many of the people who, like my grandparents and no doubt many of yours, came to this country with almost nothing except one thing: a desire to work and work and work and work and work, to build a better life for themselves, and certainly, if not for themselves, for their families.

This morning, the Partnership for a New American Economy released a report that looks at the impact of immigrants on one major sector of the American economy, and that's Fortune 500 companies. The report finds that more than 40 percent of Fortune 500 companies were founded by an immigrant or by the child of an immigrant. These immigrant- rooted companies employ more than 10 million people worldwide, which is a population larger than 43 of our states have, and they generate annual revenue of something like $4.2 trillion. To put that number in context, American companies founded by immigrants or their children have revenues that are greater than the gross national product of every country in the world outside of the United States except two, and that's China and Japan.

And those are just the Fortune 500 companies. When you look at the economy as a whole, immigrants and their children have been responsible for creating millions of jobs in all 50 states. And the reason is simple: Immigrants are dreamers and risk-takers who are driven to succeed because they know that in America, hard work and talent are rewarded like no place else on the globe.

And no city has seen the economic power of immigrants more clearly than New York. Historically immigrants are why New York City became America's economic engine, and in more recent history, they are one of the main reasons why we have rebounded so strongly from the tough times that we faced in the 1970s and the 1980s. Neighborhoods that 25 years ago were abandoned are now thriving, thanks largely to immigrants from the Dominican Republic and Ecuador and Mexico and China and Russia and Ghana, Korea, India, Pakistan, Poland, Egypt, every country in the world.

There's no greater force for economic revitalization of depressed neighborhoods than the influx of immigrants. And that's not just true in New York. Immigrants have been critical to economic rebounding in small towns and big cities across America.

Take Perry, Iowa, for example. A decade ago, it was facing economic stagnation caused by years of population decline. But today, thanks to a influx of immigrant labor and immigrant entrepreneurs who have opened businesses, the town's main street is now bustling. Tiny town -- immigrants make a difference.

The same is true of Livingston, Maine -- Lewiston, Maine, a decaying old mill town that has come back to life thanks to an influx of immigrants from Africa. In Atlanta, a big city, which has worked hard to become a magnet for well-educated immigrants, the purchasing power of Latinos and Asians has skyrocketed. And across the country, city after city, with the largest increase in immigrant workers, has experienced the fastest economic growth. There is just no question about the numbers. And in New York immigrants are a big reason why we have weathered the national recession better than the country as a whole.

Now immigration reform could be an economic engine for our entire country, creating good paying jobs that will speed up our recovery. But both major political parties and both ends of Pennsylvania Avenue say that restoring economic growth is their top priority, and it must be.

And yet they don't come to face the one thing that can do the job.

Yet today, more than three years after our country entered its deepest recession in decades, the single most powerful step that the federal government could take to spur job growth is reforming our broken immigration system. And it, unfortunately, is a casualty of partisan gridlock.

Republicans have tended to focus on border control, and understandably so. It is critically important to our nation's security, and there's absolutely nothing wrong with America being in charge of its borders and deciding who comes here. Right now, the selection process is who wants to come here the most: They either overstay their visa or they'll come and run across the border. We should be deciding who comes here; there's nothing wrong with that.

Democrats, on the other hand, have tried to focus on comprehensive reform, and that's understandable too. It's critically important that we do create a pathway to permanent legal status for the 11 million people who have overstayed their visas or come here illegally.

But by this point, unfortunately, I think one thing is clear: It is clear that the two sides have reached a stalemate, and they are just talking right past each other.

And that leaves us with two choices. Both sides can use the stalemate as a wedge issue to secure political points in 2012, or they can come together and adopt immigration reforms that will spur new companies, strengthen existing ones and help create jobs for the 13.9 million Americans who are unemployed and looking for work.

In the end, the public cares about two things: housing and jobs. My house, my job. And if you want to do something in this country to give people better jobs and more jobs and a better chance to keep their houses, the one thing that we can do that will work is not expensive for this country.

It's not a big stimulus of trillions of dollars. It is immigration reform that will get the best and brightest from around the world, those that are the hungriest and willing to work the hardest, to come here and create exactly what we need.

Now, as the 2012 election begins to take shape, voters across the country, I think, are going to be looking for candidates with an economic plan that is -- that are -- economic plans that are achievable and not aspirational. For independent voters especially, immigration reform will be a key test to whether candidates are willing to put sound economics ahead of election year politics; at least, it will be if I have anything to say about it.

Independent voters will determine the outcomes of the next election, just as they did in 2010 and in 2008. And while they don't hold all the same positions on any one issue, they overwhelmingly want leadership that is pragmatic, not polarizing. They want centralist solutions, not pandering to the special interest. And they want both sides to stop fighting on what they disagree on, and start taking action on the areas where they do agree. And there are actually quite a few areas where they agree if you think about it.

Leaders in both parties recognize that the current system is a drag on our economy. I thought it was encouraging that President Obama recently said that increasing opportunity for immigrants to come is a top priority. And likewise, I thought it was encouraging to see House Republicans put forward a plan for American job creators that includes more visas for the workers we need. And you'd be hard pressed to find a single economist who thinks that the status quo is good for our economy.

And voters understand all these things. A recent survey showed that two-thirds of Americans and three-quarters of business leaders recognize that immigrants play an important role in our economy. And that's why our Partnership for a New American Economy, which I co- founded last year with Rupert Murdoch, has attracted so many CEOs. And I have to tell you, recruiting new members is one of the easiest pitches I have ever made.

And so with all these agreement, the real question you've got to be asking is: Why can't Washington get anything done? Well, I think the answer is that we can get something done. And today I thought I'd outline five key areas where I believe bipartisan agreement largely exists in Congress and where action could be taken immediately and where the impact on our economy would be profound.

First, we must stop providing a first-rate education in science and technology to foreign students and then force them to leave. Students come from around the world to study here. More than 40 percent of our engineering graduates are foreign-born. They lead ground-breaking research at the very frontiers of science, but then many are forced to leave when it becomes clear that a permanent visa will be difficult if not impossible to get.

So instead of staying here to contribute to our economy, they go home and they go to work for companies that compete with our own companies. It just makes no sense. We're investing millions of dollars to educate these students at our leading universities and then giving the economic dividends back to our competitors for free.

The two parties should be able to agree on a policy that allows any university graduate with an advanced degree in an essential field to obtain a green card and a chance to help grow our economy. We must allow those students to stay here and be part of our future, or we will watch our future disappear with them.

Second, we must stop telling foreign entrepreneurs to build their companies in other countries. America is the best place in the world to start a business. But rather than capitalize on our assets by encouraging innovators to come here and stay, we are rejecting immigrant entrepreneurs, even when they're backed by American investors. Just remember, immigrants helped found Google and Yahoo! and eBay and Intel and so many more companies.

In fact, immigrants helped found one-quarter of all high-tech companies over the last 10 years. And across all industries, they are twice as likely as native-born Americans to start companies. We need more of these dynamic entrepreneurs. And if we do not open our doors to them, they will go elsewhere, and the good paying jobs that they create will go with them.

A foreign entrepreneur from American investors should be given a temporary visa to start a company in America. And if, after two or three years, the business has successfully yielded new American jobs, the entrepreneur should be allowed to continue to run his or her business and receive permanent legal status.

We're a nation of entrepreneurs because we are a nation of immigrants. And in the 21st century, the global economy will revolve more and more around those entrepreneurs.

Third, we must stop telling American companies that they cannot hire the high-skilled workers they need. By making it difficult for them to obtain temporary and permanent visas for high-skilled workers, the federal government is slowing growth and worse, promoting the outsourcing of American jobs. Make no mistake about it: If companies can't hire the workers they need here, they will move those operations out of the country. You just have to look at Microsoft's recent decision to open a research park in Vancouver. There's lots of West Coast companies that now have offices in Canada because they can't get the engineers into this company (sic).

In many high-tech companies -- for one -- that you see again and again -- talk to the owners. Talk to the managers. Talk to the stockholders. They are outside of the United States, but they'd prefer to be here. It's just that we won't let them bring in the talent they need.

And we not only lose those jobs, we lose their spending, and we lose their taxes. Again, this just makes no sense. We are stabbing ourselves in the back even as our economy is in critical condition.

The ability to attract and keep high-skilled labor is just essential for American companies competing on the world market.

And that's true not only for high-tech companies but also for banks and insurance companies and pharmaceutical companies, and even manufacturing firms with large research and development operations like Boeing and Caterpillar.

But right now, the cap on H1-B visas and green cards is much too low. And caps on green cards are set by countries, so Iceland actually gets the same number of visas as India. That may be fair to those two countries, but it's certainly not fair to American business and to Americans. We should give -- end these arbitrary limits and end the cap on the high-skilled H1-B visas. Let the marketplace decide. It's basic free-market economics, and both parties ought to be able to get behind it.

Fourth, we must ensure that major industries, such as agriculture and tourism, that rely on those workers just starting up the economic ladder, have access to foreign workers when they cannot fill the jobs with American workers. These employers want a legal workforce, but our current system just makes that extremely difficult. Firms have to go through multiple levels of approvals to do basic hiring, and in Georgia, where they crack down on illegal farm workers, farm owners are experiencing severe labor shortages that's driving up their cost and leaving crops unharvested. At a time when food prices are rising, this is the last thing American consumers and farmers need.

Fifth and finally, we must begin allocating more green cards based on economic needs. Right now, only about 15 percent of all green cards go to employees and their dependents, while the rest go largely to immigrants, families and relatives.

In Canada, those numbers are exactly reversed. Last year, two- thirds of immigrants to Canada came based on economic reasons, and only 21 percent came based on family reasons. Those that come based on economic reasons are creating the economy for all the people in that country.

We're not doing what Canada's doing. Why not? American has to honor our tradition of always being open to the tired and tempest-tossed, no argument about that. We are a land of opportunity because we've always been a country of compassion.

But as we continue to be a place of refuge and reunion, we must open our doors more widely to the talented and hardworking people who can make critical contributions to our economic growth and prosperity. And that means raising green card limits based on our economic needs, so that we can allow the people who will most help our country to come here, work, invest, and start businesses.

Now, the five areas that I've outlined present, I think, real opportunities for bipartisan agreement. And they are steps that can be taken right now to help create jobs and drive prosperity across the country. And remember, everybody says we don't have any money for new programs. Not one of the things that I outlined would cost a penny. It's all contribution, no expense.

So it's pretty hard to think that in the end the American public isn't going to say to Congress: Enough. We've got to do something. I'm worried about my house. I'm worried about my job. And there's a solution that you can't say you can't afford, a solution that we know has worked in many other places, a solution that you could implement very quickly. Do it now. That means more green cards for university graduates, more visas for entrepreneurs, more visas for high-skilled workers, more visas for agricultural and other seasonal laborers and more visas that are distributed based on economic needs.

Now, in the coming weeks Congress is expected to consider again the Dream Act and E-Verify. But pass or fail, I think the time has come to refocus the immigration debate around the most pressing issue facing the country today. And that is creating jobs.

The conversation here in Washington on immigration must be about more than fences and fingerprints.

It must be about what kind of country do we want America to be. Do we want to continue to be the land of opportunity for all and the world's greatest economic power and the nation with the most high-paying jobs and the best quality of life, or do we want to send more jobs overseas and watch other countries rival our economic strength and leave our country -- leave our children a country in decline?

America has always been on a forward march because we have always welcomed more people to march with us. But now the biggest threat to our future lies in denying our past. In New York Harbor, Lady Liberty is stepping forward. And here in her 125th year, so must we. We must honor, I think, the values that made America great. We must embrace the realities of the 21st-century global economy. And we must hold our elected officials accountable for delivering results, not speeches; for seeking consensus, not controversy; for promoting economic growth, not political advantage.

Maybe more than any other major issue in Washington today, there is an opportunity for bipartisan breakthrough on immigration. If both ends of Pennsylvania Avenue seize it -- and it's up to us to push them -- we can help get our economy moving again, and the best days for our country and for the dreamers who define it will still be there to come.

So thank you. And I look forward to having Julia ask me the most penetrating questions that she can possibly come up with, which I will artfully duck. (Laughter.) (Applause.)

JULIA PRESTON: Mayor Bloomberg, there is a counter argument being made, actually today in a hearing on the Hill, about immigration. And that is that we need to focus on illegal immigration and enforcement against illegal immigration, and for every illegal immigrant that we take out of the workforce by enforcement, you're creating a job for an American worker -- you're opening a job for an American worker.

And I think that vision -- it permeates, perhaps, the debate. In a context of very high unemployment in the country, it's a very persuasive idea that an immigrant is competing for -- with an unemployed American for jobs.

So how do you counter that out in the country when people are hurting for work?

MAYOR BLOOMBERG: Well, I think the actuary for Social Security said if you were to deport all 11 million -- and who knows what the number really is -- 11 million undocumented, that Social Security would go bankrupt six years early. Why? Because they pay into Social Security, but they don't get anything back.

I'm not an expert on 11 million undocumented in the country, but I'm a quasi-expert on the 500,000 undocumented in New York City. And we look pretty hard to see what really is going on in our economy. I can tell you this: At least in New York City, undocumented have a very low crime rate because they're scared to death of going near the INS.

Undocumented do not use the schools very much. It tends to be young people leaving their families back home, and they send back their earnings, but they don't bring their children. There are some, but generally speaking, immigrant children in our school system are the children of documented immigrants.

They don't use the hospitals very much, no matter what the naysayers say. Why? Because they're young people, and we use two thirds of our hospital medical expense in the latter years of our life. And these are young people. They're not here for that length of time.

They pay taxes. Something like 75 percent of all undocumented in New York City pay taxes. Why? Their employer witholds. The employer doesn't want to go to jail, so the employer witholds and sends the money in. And then where does the refund go?

There is no refund. So the federal government is actually making money on undocumented.

And lastly, they don't do things like come and use the social services that you think. They don't want to get involved in government; they don't live in public housing; they don't qualify for a lot of federal programs where documentation is something that you have to --

So that's the issue first with what the 11 million do here.

MS. PRESTON: I guess my question is also about the narrative --

MAYOR BLOOMBERG: OK.

MS. PRESTON: -- about immigration. Why shouldn't the public see what you're proposing as another effort by large business to have a channel for cheap and malleable labor coming into the United States? How do you change that?

MAYOR BLOOMBERG: Well, there's a -- you're talking about two different kinds. Large businesses will employ the doctors, lawyers, Indian chiefs. It is small business that will employ the people who don't have a great command of the English language or maybe don't have formal education.

And in the end, if you want to take America out of its doldrums, the only solution is small business. Half the people in the country work in small businesses. If you think about it, automation is something that small businesses don't use.

Small business is very different, and why are they the solution? Small business is the solution because they have nontraditional hiring. They don't look at your grade point average and see where you went to school and check your transcript. They don't even know how to do that. They look at you, and they say, yeah, I think you'd be OK. (Laughter.)

They provide -- that's the process that a small business goes through. They don't have a big HR department. You're just talking about something different. They have flexible hours, so that people that have family responsibilities can work in small businesses. They provide on-the-job training, and people that are unemployed are at an age where they are not going back to school. We talk about it -- there's five people that went back to school, they're on CNN, everybody does a special on them, isn't it wonderful they're going back to school.

But all the studies show older people don't go back to school.

You have to provide on the job training if you're going to employ them. And that's exactly what small businesses do.

So -- you know, and small businesses don't use automation. If you think about -- we talk about innovation and green jobs, and it's great, and we do need those things. But that's not what creates jobs. As a matter of fact, a lot of innovation and automation reduces the demand for people. And you see that in this country today, where it's bottom-line growth in big businesses. They are finding ways to do more with less. That may be great for the stockholders and may be great for the economy way down the road, but it's not good for helping the unemployment situation today.

Whereas small businesses -- you know, they do things with your hands. There's still got to be somebody at the counter when you walk in the store or cooking or serving or making the bed or -- you know, or picking the crops in the fields. And small businesses can employ those kinds of people.

I said -- I was asked: What do you do about the big industrial cities in the heartland that have hollowed out over the last few decades?

And I got in trouble with the major of the city, who didn't like my suggestion. But I said what the federal government should do is create a visa for people. The deal would be you go to that city; you agree you won't take any federal, state or city help whatsoever, because that gets rid of people who are worried about the expense; and you agree to live there for seven years. And that's the only agreement. And at the end of seven years, if you're still living there, we will give you citizenship.

In the meantime, what are those people going to do? They will -- if they have to drive from Detroit to California in the morning, they would do it to work and come back. They will buy the houses, they'll fix them up by hand, they'll create the small businesses, they'll find ways to create businesses where you never thought of businesses before.

And the mayor of the particular city I happened to pick -- and I just picked a city -- (laughter) -- said: Oh, no, no. There's no -- that Bloomberg doesn't understand; there's not enough jobs here.

Yes, there's not enough jobs. And it's going to get worse next year and the year after unless you bring in a new group of people who are going to start businesses. And the governor of this particular state said, hey, you know, Bloomberg's right. And I gather -- I was told this morning -- now they're going to have a conference -- (laughter) -- to try to really see whether there is something there.

But my point is, the history shows -- all the studies show that the jobs that the undocumented tend to take are not jobs that Americans will take. They either don't want them or they don't have the skills for them. And we are using the undocumented, in many cases, for jobs with much less skills than they happen to have. You can have -- you know, you have a college graduate -- in New York City, the percentage of people that are college graduates has continued to go up over -- almost every year in the last 10 years. Why? Because of immigrants. And not just -- (inaudible) -- immigrants from overseas, immigrants from the rest of the country.

But it is those with college educations that have been flocking to New York City because it's a cultural, intellectual capital. And those that are undocumented can't use -- they may be a lawyer back home or an engineer or a doctor -- they don't -- can't use their skills. So maybe they are driving a cab, or maybe they're starting a small business. But they are coming because they want to work, and the jobs they get are not jobs that anybody else would have done.

Also, every study shows that if you, for example, have one farm worker, that low-priced help -- tough to make a living on what you make picking crops. But that one person tends to create -- I think the number is like three other jobs up the food chain: transportation and inspection and distribution of the products. And the same thing is true at the high end. One engineer -- again, the number there is estimates of something like five or six jobs down the chain because they create new businesses and start things.

So the trouble that you have with this is if you tell a lie often enough, people start believing it, particularly in the day of instant news, bloggers and a very struggling, bad economic situation for the press where they have to go with sensationalism.

So the Times would never do that, I know that, but --

MS. PRESTON: Right. (Laughter.)

MAYOR BLOOMBERG: But they don't take jobs is the bottom line, and we need them.

MS. PRESTON: This week we have a menu of options on the Hill. Bills have been introduced, both a mandatory bill that would make the E-Verify employer -- employee verification program mandatory nationwide, and also Congresswoman Lofgren introduced a bill that would do some of the things I think that you have talked about.

First of all, how do you view the mandatory E-Verify bill? And could that be the basis, do you think, of a compromise?

MAYOR BLOOMBERG: Well, remember, I went see the congresswoman this morning, and I had a long conversation with her.

E-Verify -- well, let me stop for a second. The only ways you're going to get control of our borders -- and remember, borders is a logical border, it's not a physical border -- more people overstay visas to be here illegally than come across a border. So -- but, if you want to think about the whole thing as a big border control security issue for the country, the only ways you're going to get control over our borders is if you reduce the number of people trying to get in. And the ways you do that is you enforce the laws that say you can't employ undocumented.

Course, the business owner says, but I can't enforce the law because I don't know how the -- that they showed me a social security card or a green card or even a passport -- it looked good to me; how would I know? And so that's where the E-Verify system comes from.

But if you just put in E-Verify, all of a sudden you're going to have 11 million people that can't make a living here, and the jobs that they take are going to go unfilled. It would be a disaster for the industries that employ those people. And remember, those industries desperately need them, and we need those industries. But you can't stand up and say, yes, I want to keep undocumented here, because I employ a bunch of undocumented.

So there's nobody making the case, even though the case is there. And you just have to say E-Verify -- which I think incidentally is a fraud unless it has a biometric component to it, because, you know, Michael Bloomberg -- I don't know how many Michael Bloombergs there are in the world, but if you call up and say Michael Bloomberg is illegal, there's 20 different Michael Bloombergs that can use the same name on the E-Verify list. You've got to have something where you fingerprint or something like that, really does say, no, it's you; it's Julia Preston, and it's -- and it's this Julia Preston. That's important.

So E-Verify has its place, particularly if you do the biometric part. But you have to do it in conjunction with -- it would get -- help you get control of your borders, but you also have to do something with the people that are there today. And remember, the 11 million undocumented are here because we wanted them. It's true they broke a law, technically, no argument about it. But why did they break the law? Because in 1986, Congress passed a bill the way they always pass legislation. They stood up to their -- you know, their more conservative constituents and said, I just passed this bill and we're not going to let undocumented come here. And then, of course, the businesses that were giving them some money to help their campaign said, hey, don't worry about it; no money for enforcement; it's going to -- (off mic).

And we just have the same problem we had then, except now it's 10 times the size. And if you don't do anything, it's going to be --

MS. PRESTON: But why shouldn't the -- why isn't the American public's -- right to be skeptical that the businesses that are part of your partnership want to do the same thing again?

MAYOR BLOOMBERG: Businesses -- the would be better off employing legal people, because they can't get them into this country. There's the 11 million. But in all fairness, it was -- that 11 million grew over a long period of time. And if the economy ever does improve -- and it's not going to improve unless we fix the immigration system -- at least I don't think it'll improve anywhere near as rapidly or as easily -- they've got to be able to get a supply of labor.

We've got to have people starting businesses. We've got to have the engineers that they need. We've got to have the seasonal workers that they need.

MS. PRESTON: The five points that you articulated -- is the -- these proposals that are on the Hill now -- from the Republican side, a mandatory E-Verify plan, from the Democratic side, STEM degrees. Is there -- do you see a legislative strategy there that you could somehow --

MAYOR BLOOMBERG: You know, I only saw about seven, I think -- one senator and seven congresspeople this morning, mostly Republicans, although Lofgren is a Democrat -- and I will say I walked away with a little more optimism than I had before.

What has to happen is the public has got to say, Pennsylvania Avenue -- both ends, both sides of the aisle -- you are not solving our unemployment problem. We're going back into -- the economy's going in the wrong direction. And we've got to get out there and make the case that this is something that they can do to fix it.

And the attractiveness of immigration reform, while I know it's controversial for a lot of people to take that kind of vote -- it doesn't cost anything. So you can have immigration reform and at the same time not violate if you're one of the people who've, you know, said read my lips, no new taxes. You can still stick with that, but you could have the immigration reform.

And it's got to come from the public. The public's got to sit there and demand it. And we've got to be out there telling the story, again and again and again.

MS. PRESTON: All right. Do I take it that you would favor an approach of trying these smaller pieces first in the near term rather than a comprehensive approach, or what's your view on that?

MAYOR BLOOMBERG: Yes. I think it would be great to have comprehensive immigration reform, but if you look at '06 and '07, it didn't work. And today the situation is even worse to get comprehensive immigration reform. In the interest of having everything, we have nothing.

And you first -- the compromise that it seems to me makes sense, for both sides of the aisle, is you address the economic issue, the things that I outlined which would help the economy. That's one side of the immigration -- that's really visa reform if you want to say it. And then for the other part which I would call family reunification, you say we'll do the Dream Act or a variation of the Dream Act, because it's a little bit easier for those who keep saying, look, these people broke the law and we should not reward anybody who breaks the law. Well -- and it's funny, they say that while they're texting driving through a red light on their way to -- (laughter).

OK. But it's hard to argue the young kids, particularly if the kid served in the Army and, you know, went to -- I mean, you can -- you can -- you can set some criteria with the Dream Act, but it's just -- OK, they were brought here. When we talk about breaking the law, if you're dragged in your mother's arms across a border and you were, you know, an infant, did you break the law? All right, technically, maybe. But (no ?).

So I think that that's the way you say, those who want comprehensive immigration reform, you're not going to get everything you want. We are going to get control of our borders because we're going to have a biometric E-Verify system so that employers won't employ people that are undocumented; and therefore, the demand for undocumented will go down dramatically. They won't be able to get jobs and they won't come here. And then it's easier to get control of your borders.

You have to do something for the 11 million; make them pay a fine, whatever, but something practical. We just -- they're here. I mean, there's a point at which you've got to recognize reality, that you're not going to solve the problem.

But even if you can't do that right now, at least do the immigration reform so we can get the people to start businesses in these cities and take the jobs that we need for farmers or they're going to -- farms are just moving south, outside of America.

If you can't pick your crops, you just can't have a farm here.

And for those who want comprehensive reform or the family reunification side, say the DREAM Act this time, and we'll come back and fight another day for something else. Because if we fight for everything, we have nothing, and the nothing scenario is really bad for this country given the economic situation.

MS. PRESTON: Perhaps the most powerful or one of the most powerful anti-immigration reform arguments in the country is articulated on a daily basis by FOX News. I'm wondering if you have had a discussion with your partner, Mr. Murdoch, about -- (laughter) -- changing the --

MAYOR BLOOMBERG: I knew I should have done something. (Laughter.)

Yeah, I think -- look. Two of the three big newspapers in New York City are -- the publishers are immigrants, one from Canada, one from Australia. I think Rupert really does believe -- and it's in News Corp's interest; they are an international company with a lot of people moving back and forth.

The talking heads -- I don't know that Rupert's going to go and say, don't say that. That's -- there's a market for very conservative -- nice ways to put it -- talking -- rational talking heads. There's less of a market, it would seem, for very rational talking heads on the left, but for reasons I can't quite understand. But NBC -- MSNBC just doesn't get the ratings that FOX does.

On the other hand, I think that a lot of these people have -- might have some second thoughts when they realize that, you know, Rupert Murdoch really is committed to that -- to this and News Corp. as a corporation is really committed to it.

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THIS IS A RUSH TRANSCRIPT.

RICHARD HAASS (president, Council on Foreign Relations): If we could get started, I want to -- about to do the last session of the conference, and I'd like to think we've saved the best for last. We certainly saved the last for last.

We have with us the mayor of the greatest city, I would think, in the country, if not the world. And one of the reasons the city is so great is because of our mayor. The reason he is here today is not simply because New York has become incredibly livable, and the quantity and quality of life is about as good as it gets, what he's doing with schools, but also how he's using the job and the position as an important platform for public policy, and -- whether it's talking about issues of climate change and the C40 group and looking at how we use energy and climate -- and what we do about climate change around the world, and also the subject of today, immigration.

And where so many people in public life, alas, seem to be running away from issues, however important, that are controversial, one of the many reasons I admire our mayor, in addition to the fact that he actually counts every stroke on the golf course, is -- (laughter) -- this tells a lot about somebody, by the way -- is that he, rather than running away from some of the tougher issues of the day, he's actually embracing them. And he's giving them a degree of attention and degree of focus and degree of serious conversation that, again, makes him, alas, all too, I think, unique in our public debate.

So the subject of the whole day has been immigration. And Mayor Bloomberg is going to give a talk onto the subject. Afterwards he is going to take some questions from Julia Preston.

Julia's been with The New York Times, now, for just over 15 years. She's a national correspondent with a special focus on this set of issues, on immigration. I've known her for even longer than that, from not just her time at the Times, but also her time at The Washington Post, and really not for more than a quarter of a century. She has been, I believe, one of the leading if not the leading journalist in the United States who's been regularly paying attention to developments to our south in this hemisphere and the issues that relate domestically to it.

So let me thank them both for being here. Let me thank you all for, again, showing this degree of interest throughout the day -- sticking it out. Mayor Bloomberg, welcome, and we're thrilled to have you at the council, sir.

MAYOR MICHAEL BLOOMBERG: I will point out that Richard also counts every stroke on the golf course, particularly when I remind him that he was in the woods and I heard five times the branches go whack- whack-whack. (Laughter.) We did play the other day, and he played very well. Hits the ball a long ways -- if they would put the green in the woods on either side -- (laughter) -- it would help, but other than that minor problem -- but we had -- our match did not get as much coverage as the Boehner-Obama match. We didn't have as much security around.

Anyways, it's always nice to come to a city with a baseball team that is below the Mets in the standings -- (boos, laughter) -- hey, you know, as the Cub fans say, it's still early. (Laughter.)

But seriously, it's really a pleasure to be with you today to discuss one of, I think, the most important issues facing our country. Everyone agrees that our broken immigration system is a huge problem, but no one -- certainly not in Washington -- can agree on how to fix it. And today I would like to talk about how I think we can fix it, and how we can do it in a way so that both Democrats and Republicans, or at least enough of them, can sign on in support.

You know, it really is ironic that the immigration issue that divides this city -- is this -- dividing this particular city, because so much of Washington was built by immigrants. The street design was drawn up by Pierre Charles L'Enfant, a French immigrant; the White House was designed by an Irish immigrant named James Hoban; and the U.S. Capitol designed by William Thornton, a British immigrant.

And those buildings are not only monuments to our democracy, they are monuments to the contributions that millions of immigrants have made to America throughout its history.

But our country's greatest national monument perhaps and the American landmark that is really most recognized around the world is not the dome of the Capitol here in Washington or the pillars of the White House or the memorials on the National Mall. It is the Statue of Liberty.

Since 1886 -- what, a 125 years ago this October -- Lady Liberty's torch has brought light to the darkest corners of the earth, beckoning here to America's shores all those, as they say, yearning to breathe free. Yet it's not Lady Liberty's torch or her crown or her broken chains that has inspired so much awe. It is really her location.

The power of her symbol lies in the reality of New York City as a gateway, a golden door to the land of opportunity that is the United States of America and still is the United States of America. We should not forget that. That reality is not just our history, however. It is also our future, and we have to make sure that we can maintain that for our children.

We would not have become a global superpower without the contributions of immigrants who built the railroads and the canals and opened up the West or invented groundbreaking products that have revolutionized global commerce or who pioneered scientific engineering and medical advances that made America the most innovative country in the world.

But make no mistake about it. We will not remain a global superpower if we continue to close our doors to the people who want to come here, to work hard, start businesses and pursue the American dream.

That American dream cannot survive if we keep telling the dreamers to go elsewhere. It's what I call national suicide, and that's not hyperbole -- that every day what we fail -- that we fail to fix our broken immigration laws is a day that we inflict a wound on our economy.

And today, we may just this morning have turned away the next Albert Einstein or Sergey Brin. Tomorrow we may turn away the next Levi Strauss or Jerry Yang. And certainly we will be turning away many of the people who, like my grandparents and no doubt many of yours, came to this country with almost nothing except one thing: a desire to work and work and work and work and work, to build a better life for themselves, and certainly, if not for themselves, for their families.

This morning, the Partnership for a New American Economy released a report that looks at the impact of immigrants on one major sector of the American economy, and that's Fortune 500 companies. The report finds that more than 40 percent of Fortune 500 companies were founded by an immigrant or by the child of an immigrant. These immigrant- rooted companies employ more than 10 million people worldwide, which is a population larger than 43 of our states have, and they generate annual revenue of something like $4.2 trillion. To put that number in context, American companies founded by immigrants or their children have revenues that are greater than the gross national product of every country in the world outside of the United States except two, and that's China and Japan.

And those are just the Fortune 500 companies. When you look at the economy as a whole, immigrants and their children have been responsible for creating millions of jobs in all 50 states. And the reason is simple: Immigrants are dreamers and risk-takers who are driven to succeed because they know that in America, hard work and talent are rewarded like no place else on the globe.

And no city has seen the economic power of immigrants more clearly than New York. Historically immigrants are why New York City became America's economic engine, and in more recent history, they are one of the main reasons why we have rebounded so strongly from the tough times that we faced in the 1970s and the 1980s. Neighborhoods that 25 years ago were abandoned are now thriving, thanks largely to immigrants from the Dominican Republic and Ecuador and Mexico and China and Russia and Ghana, Korea, India, Pakistan, Poland, Egypt, every country in the world.

There's no greater force for economic revitalization of depressed neighborhoods than the influx of immigrants. And that's not just true in New York. Immigrants have been critical to economic rebounding in small towns and big cities across America.

Take Perry, Iowa, for example. A decade ago, it was facing economic stagnation caused by years of population decline. But today, thanks to a influx of immigrant labor and immigrant entrepreneurs who have opened businesses, the town's main street is now bustling. Tiny town -- immigrants make a difference.

The same is true of Livingston, Maine -- Lewiston, Maine, a decaying old mill town that has come back to life thanks to an influx of immigrants from Africa. In Atlanta, a big city, which has worked hard to become a magnet for well-educated immigrants, the purchasing power of Latinos and Asians has skyrocketed. And across the country, city after city, with the largest increase in immigrant workers, has experienced the fastest economic growth. There is just no question about the numbers. And in New York immigrants are a big reason why we have weathered the national recession better than the country as a whole.

Now immigration reform could be an economic engine for our entire country, creating good paying jobs that will speed up our recovery. But both major political parties and both ends of Pennsylvania Avenue say that restoring economic growth is their top priority, and it must be.

And yet they don't come to face the one thing that can do the job.

Yet today, more than three years after our country entered its deepest recession in decades, the single most powerful step that the federal government could take to spur job growth is reforming our broken immigration system. And it, unfortunately, is a casualty of partisan gridlock.

Republicans have tended to focus on border control, and understandably so. It is critically important to our nation's security, and there's absolutely nothing wrong with America being in charge of its borders and deciding who comes here. Right now, the selection process is who wants to come here the most: They either overstay their visa or they'll come and run across the border. We should be deciding who comes here; there's nothing wrong with that.

Democrats, on the other hand, have tried to focus on comprehensive reform, and that's understandable too. It's critically important that we do create a pathway to permanent legal status for the 11 million people who have overstayed their visas or come here illegally.

But by this point, unfortunately, I think one thing is clear: It is clear that the two sides have reached a stalemate, and they are just talking right past each other.

And that leaves us with two choices. Both sides can use the stalemate as a wedge issue to secure political points in 2012, or they can come together and adopt immigration reforms that will spur new companies, strengthen existing ones and help create jobs for the 13.9 million Americans who are unemployed and looking for work.

In the end, the public cares about two things: housing and jobs. My house, my job. And if you want to do something in this country to give people better jobs and more jobs and a better chance to keep their houses, the one thing that we can do that will work is not expensive for this country.

It's not a big stimulus of trillions of dollars. It is immigration reform that will get the best and brightest from around the world, those that are the hungriest and willing to work the hardest, to come here and create exactly what we need.

Now, as the 2012 election begins to take shape, voters across the country, I think, are going to be looking for candidates with an economic plan that is -- that are -- economic plans that are achievable and not aspirational. For independent voters especially, immigration reform will be a key test to whether candidates are willing to put sound economics ahead of election year politics; at least, it will be if I have anything to say about it.

Independent voters will determine the outcomes of the next election, just as they did in 2010 and in 2008. And while they don't hold all the same positions on any one issue, they overwhelmingly want leadership that is pragmatic, not polarizing. They want centralist solutions, not pandering to the special interest. And they want both sides to stop fighting on what they disagree on, and start taking action on the areas where they do agree. And there are actually quite a few areas where they agree if you think about it.

Leaders in both parties recognize that the current system is a drag on our economy. I thought it was encouraging that President Obama recently said that increasing opportunity for immigrants to come is a top priority. And likewise, I thought it was encouraging to see House Republicans put forward a plan for American job creators that includes more visas for the workers we need. And you'd be hard pressed to find a single economist who thinks that the status quo is good for our economy.

And voters understand all these things. A recent survey showed that two-thirds of Americans and three-quarters of business leaders recognize that immigrants play an important role in our economy. And that's why our Partnership for a New American Economy, which I co- founded last year with Rupert Murdoch, has attracted so many CEOs. And I have to tell you, recruiting new members is one of the easiest pitches I have ever made.

And so with all these agreement, the real question you've got to be asking is: Why can't Washington get anything done? Well, I think the answer is that we can get something done. And today I thought I'd outline five key areas where I believe bipartisan agreement largely exists in Congress and where action could be taken immediately and where the impact on our economy would be profound.

First, we must stop providing a first-rate education in science and technology to foreign students and then force them to leave. Students come from around the world to study here. More than 40 percent of our engineering graduates are foreign-born. They lead ground-breaking research at the very frontiers of science, but then many are forced to leave when it becomes clear that a permanent visa will be difficult if not impossible to get.

So instead of staying here to contribute to our economy, they go home and they go to work for companies that compete with our own companies. It just makes no sense. We're investing millions of dollars to educate these students at our leading universities and then giving the economic dividends back to our competitors for free.

The two parties should be able to agree on a policy that allows any university graduate with an advanced degree in an essential field to obtain a green card and a chance to help grow our economy. We must allow those students to stay here and be part of our future, or we will watch our future disappear with them.

Second, we must stop telling foreign entrepreneurs to build their companies in other countries. America is the best place in the world to start a business. But rather than capitalize on our assets by encouraging innovators to come here and stay, we are rejecting immigrant entrepreneurs, even when they're backed by American investors. Just remember, immigrants helped found Google and Yahoo! and eBay and Intel and so many more companies.

In fact, immigrants helped found one-quarter of all high-tech companies over the last 10 years. And across all industries, they are twice as likely as native-born Americans to start companies. We need more of these dynamic entrepreneurs. And if we do not open our doors to them, they will go elsewhere, and the good paying jobs that they create will go with them.

A foreign entrepreneur from American investors should be given a temporary visa to start a company in America. And if, after two or three years, the business has successfully yielded new American jobs, the entrepreneur should be allowed to continue to run his or her business and receive permanent legal status.

We're a nation of entrepreneurs because we are a nation of immigrants. And in the 21st century, the global economy will revolve more and more around those entrepreneurs.

Third, we must stop telling American companies that they cannot hire the high-skilled workers they need. By making it difficult for them to obtain temporary and permanent visas for high-skilled workers, the federal government is slowing growth and worse, promoting the outsourcing of American jobs. Make no mistake about it: If companies can't hire the workers they need here, they will move those operations out of the country. You just have to look at Microsoft's recent decision to open a research park in Vancouver. There's lots of West Coast companies that now have offices in Canada because they can't get the engineers into this company (sic).

In many high-tech companies -- for one -- that you see again and again -- talk to the owners. Talk to the managers. Talk to the stockholders. They are outside of the United States, but they'd prefer to be here. It's just that we won't let them bring in the talent they need.

And we not only lose those jobs, we lose their spending, and we lose their taxes. Again, this just makes no sense. We are stabbing ourselves in the back even as our economy is in critical condition.

The ability to attract and keep high-skilled labor is just essential for American companies competing on the world market.

And that's true not only for high-tech companies but also for banks and insurance companies and pharmaceutical companies, and even manufacturing firms with large research and development operations like Boeing and Caterpillar.

But right now, the cap on H1-B visas and green cards is much too low. And caps on green cards are set by countries, so Iceland actually gets the same number of visas as India. That may be fair to those two countries, but it's certainly not fair to American business and to Americans. We should give -- end these arbitrary limits and end the cap on the high-skilled H1-B visas. Let the marketplace decide. It's basic free-market economics, and both parties ought to be able to get behind it.

Fourth, we must ensure that major industries, such as agriculture and tourism, that rely on those workers just starting up the economic ladder, have access to foreign workers when they cannot fill the jobs with American workers. These employers want a legal workforce, but our current system just makes that extremely difficult. Firms have to go through multiple levels of approvals to do basic hiring, and in Georgia, where they crack down on illegal farm workers, farm owners are experiencing severe labor shortages that's driving up their cost and leaving crops unharvested. At a time when food prices are rising, this is the last thing American consumers and farmers need.

Fifth and finally, we must begin allocating more green cards based on economic needs. Right now, only about 15 percent of all green cards go to employees and their dependents, while the rest go largely to immigrants, families and relatives.

In Canada, those numbers are exactly reversed. Last year, two- thirds of immigrants to Canada came based on economic reasons, and only 21 percent came based on family reasons. Those that come based on economic reasons are creating the economy for all the people in that country.

We're not doing what Canada's doing. Why not? American has to honor our tradition of always being open to the tired and tempest-tossed, no argument about that. We are a land of opportunity because we've always been a country of compassion.

But as we continue to be a place of refuge and reunion, we must open our doors more widely to the talented and hardworking people who can make critical contributions to our economic growth and prosperity. And that means raising green card limits based on our economic needs, so that we can allow the people who will most help our country to come here, work, invest, and start businesses.

Now, the five areas that I've outlined present, I think, real opportunities for bipartisan agreement. And they are steps that can be taken right now to help create jobs and drive prosperity across the country. And remember, everybody says we don't have any money for new programs. Not one of the things that I outlined would cost a penny. It's all contribution, no expense.

So it's pretty hard to think that in the end the American public isn't going to say to Congress: Enough. We've got to do something. I'm worried about my house. I'm worried about my job. And there's a solution that you can't say you can't afford, a solution that we know has worked in many other places, a solution that you could implement very quickly. Do it now. That means more green cards for university graduates, more visas for entrepreneurs, more visas for high-skilled workers, more visas for agricultural and other seasonal laborers and more visas that are distributed based on economic needs.

Now, in the coming weeks Congress is expected to consider again the Dream Act and E-Verify. But pass or fail, I think the time has come to refocus the immigration debate around the most pressing issue facing the country today. And that is creating jobs.

The conversation here in Washington on immigration must be about more than fences and fingerprints.

It must be about what kind of country do we want America to be. Do we want to continue to be the land of opportunity for all and the world's greatest economic power and the nation with the most high-paying jobs and the best quality of life, or do we want to send more jobs overseas and watch other countries rival our economic strength and leave our country -- leave our children a country in decline?

America has always been on a forward march because we have always welcomed more people to march with us. But now the biggest threat to our future lies in denying our past. In New York Harbor, Lady Liberty is stepping forward. And here in her 125th year, so must we. We must honor, I think, the values that made America great. We must embrace the realities of the 21st-century global economy. And we must hold our elected officials accountable for delivering results, not speeches; for seeking consensus, not controversy; for promoting economic growth, not political advantage.

Maybe more than any other major issue in Washington today, there is an opportunity for bipartisan breakthrough on immigration. If both ends of Pennsylvania Avenue seize it -- and it's up to us to push them -- we can help get our economy moving again, and the best days for our country and for the dreamers who define it will still be there to come.

So thank you. And I look forward to having Julia ask me the most penetrating questions that she can possibly come up with, which I will artfully duck. (Laughter.) (Applause.)

JULIA PRESTON: Mayor Bloomberg, there is a counter argument being made, actually today in a hearing on the Hill, about immigration. And that is that we need to focus on illegal immigration and enforcement against illegal immigration, and for every illegal immigrant that we take out of the workforce by enforcement, you're creating a job for an American worker -- you're opening a job for an American worker.

And I think that vision -- it permeates, perhaps, the debate. In a context of very high unemployment in the country, it's a very persuasive idea that an immigrant is competing for -- with an unemployed American for jobs.

So how do you counter that out in the country when people are hurting for work?

MAYOR BLOOMBERG: Well, I think the actuary for Social Security said if you were to deport all 11 million -- and who knows what the number really is -- 11 million undocumented, that Social Security would go bankrupt six years early. Why? Because they pay into Social Security, but they don't get anything back.

I'm not an expert on 11 million undocumented in the country, but I'm a quasi-expert on the 500,000 undocumented in New York City. And we look pretty hard to see what really is going on in our economy. I can tell you this: At least in New York City, undocumented have a very low crime rate because they're scared to death of going near the INS.

Undocumented do not use the schools very much. It tends to be young people leaving their families back home, and they send back their earnings, but they don't bring their children. There are some, but generally speaking, immigrant children in our school system are the children of documented immigrants.

They don't use the hospitals very much, no matter what the naysayers say. Why? Because they're young people, and we use two thirds of our hospital medical expense in the latter years of our life. And these are young people. They're not here for that length of time.

They pay taxes. Something like 75 percent of all undocumented in New York City pay taxes. Why? Their employer witholds. The employer doesn't want to go to jail, so the employer witholds and sends the money in. And then where does the refund go?

There is no refund. So the federal government is actually making money on undocumented.

And lastly, they don't do things like come and use the social services that you think. They don't want to get involved in government; they don't live in public housing; they don't qualify for a lot of federal programs where documentation is something that you have to --

So that's the issue first with what the 11 million do here.

MS. PRESTON: I guess my question is also about the narrative --

MAYOR BLOOMBERG: OK.

MS. PRESTON: -- about immigration. Why shouldn't the public see what you're proposing as another effort by large business to have a channel for cheap and malleable labor coming into the United States? How do you change that?

MAYOR BLOOMBERG: Well, there's a -- you're talking about two different kinds. Large businesses will employ the doctors, lawyers, Indian chiefs. It is small business that will employ the people who don't have a great command of the English language or maybe don't have formal education.

And in the end, if you want to take America out of its doldrums, the only solution is small business. Half the people in the country work in small businesses. If you think about it, automation is something that small businesses don't use.

Small business is very different, and why are they the solution? Small business is the solution because they have nontraditional hiring. They don't look at your grade point average and see where you went to school and check your transcript. They don't even know how to do that. They look at you, and they say, yeah, I think you'd be OK. (Laughter.)

They provide -- that's the process that a small business goes through. They don't have a big HR department. You're just talking about something different. They have flexible hours, so that people that have family responsibilities can work in small businesses. They provide on-the-job training, and people that are unemployed are at an age where they are not going back to school. We talk about it -- there's five people that went back to school, they're on CNN, everybody does a special on them, isn't it wonderful they're going back to school.

But all the studies show older people don't go back to school.

You have to provide on the job training if you're going to employ them. And that's exactly what small businesses do.

So -- you know, and small businesses don't use automation. If you think about -- we talk about innovation and green jobs, and it's great, and we do need those things. But that's not what creates jobs. As a matter of fact, a lot of innovation and automation reduces the demand for people. And you see that in this country today, where it's bottom-line growth in big businesses. They are finding ways to do more with less. That may be great for the stockholders and may be great for the economy way down the road, but it's not good for helping the unemployment situation today.

Whereas small businesses -- you know, they do things with your hands. There's still got to be somebody at the counter when you walk in the store or cooking or serving or making the bed or -- you know, or picking the crops in the fields. And small businesses can employ those kinds of people.

I said -- I was asked: What do you do about the big industrial cities in the heartland that have hollowed out over the last few decades?

And I got in trouble with the major of the city, who didn't like my suggestion. But I said what the federal government should do is create a visa for people. The deal would be you go to that city; you agree you won't take any federal, state or city help whatsoever, because that gets rid of people who are worried about the expense; and you agree to live there for seven years. And that's the only agreement. And at the end of seven years, if you're still living there, we will give you citizenship.

In the meantime, what are those people going to do? They will -- if they have to drive from Detroit to California in the morning, they would do it to work and come back. They will buy the houses, they'll fix them up by hand, they'll create the small businesses, they'll find ways to create businesses where you never thought of businesses before.

And the mayor of the particular city I happened to pick -- and I just picked a city -- (laughter) -- said: Oh, no, no. There's no -- that Bloomberg doesn't understand; there's not enough jobs here.

Yes, there's not enough jobs. And it's going to get worse next year and the year after unless you bring in a new group of people who are going to start businesses. And the governor of this particular state said, hey, you know, Bloomberg's right. And I gather -- I was told this morning -- now they're going to have a conference -- (laughter) -- to try to really see whether there is something there.

But my point is, the history shows -- all the studies show that the jobs that the undocumented tend to take are not jobs that Americans will take. They either don't want them or they don't have the skills for them. And we are using the undocumented, in many cases, for jobs with much less skills than they happen to have. You can have -- you know, you have a college graduate -- in New York City, the percentage of people that are college graduates has continued to go up over -- almost every year in the last 10 years. Why? Because of immigrants. And not just -- (inaudible) -- immigrants from overseas, immigrants from the rest of the country.

But it is those with college educations that have been flocking to New York City because it's a cultural, intellectual capital. And those that are undocumented can't use -- they may be a lawyer back home or an engineer or a doctor -- they don't -- can't use their skills. So maybe they are driving a cab, or maybe they're starting a small business. But they are coming because they want to work, and the jobs they get are not jobs that anybody else would have done.

Also, every study shows that if you, for example, have one farm worker, that low-priced help -- tough to make a living on what you make picking crops. But that one person tends to create -- I think the number is like three other jobs up the food chain: transportation and inspection and distribution of the products. And the same thing is true at the high end. One engineer -- again, the number there is estimates of something like five or six jobs down the chain because they create new businesses and start things.

So the trouble that you have with this is if you tell a lie often enough, people start believing it, particularly in the day of instant news, bloggers and a very struggling, bad economic situation for the press where they have to go with sensationalism.

So the Times would never do that, I know that, but --

MS. PRESTON: Right. (Laughter.)

MAYOR BLOOMBERG: But they don't take jobs is the bottom line, and we need them.

MS. PRESTON: This week we have a menu of options on the Hill. Bills have been introduced, both a mandatory bill that would make the E-Verify employer -- employee verification program mandatory nationwide, and also Congresswoman Lofgren introduced a bill that would do some of the things I think that you have talked about.

First of all, how do you view the mandatory E-Verify bill? And could that be the basis, do you think, of a compromise?

MAYOR BLOOMBERG: Well, remember, I went see the congresswoman this morning, and I had a long conversation with her.

E-Verify -- well, let me stop for a second. The only ways you're going to get control of our borders -- and remember, borders is a logical border, it's not a physical border -- more people overstay visas to be here illegally than come across a border. So -- but, if you want to think about the whole thing as a big border control security issue for the country, the only ways you're going to get control over our borders is if you reduce the number of people trying to get in. And the ways you do that is you enforce the laws that say you can't employ undocumented.

Course, the business owner says, but I can't enforce the law because I don't know how the -- that they showed me a social security card or a green card or even a passport -- it looked good to me; how would I know? And so that's where the E-Verify system comes from.

But if you just put in E-Verify, all of a sudden you're going to have 11 million people that can't make a living here, and the jobs that they take are going to go unfilled. It would be a disaster for the industries that employ those people. And remember, those industries desperately need them, and we need those industries. But you can't stand up and say, yes, I want to keep undocumented here, because I employ a bunch of undocumented.

So there's nobody making the case, even though the case is there. And you just have to say E-Verify -- which I think incidentally is a fraud unless it has a biometric component to it, because, you know, Michael Bloomberg -- I don't know how many Michael Bloombergs there are in the world, but if you call up and say Michael Bloomberg is illegal, there's 20 different Michael Bloombergs that can use the same name on the E-Verify list. You've got to have something where you fingerprint or something like that, really does say, no, it's you; it's Julia Preston, and it's -- and it's this Julia Preston. That's important.

So E-Verify has its place, particularly if you do the biometric part. But you have to do it in conjunction with -- it would get -- help you get control of your borders, but you also have to do something with the people that are there today. And remember, the 11 million undocumented are here because we wanted them. It's true they broke a law, technically, no argument about it. But why did they break the law? Because in 1986, Congress passed a bill the way they always pass legislation. They stood up to their -- you know, their more conservative constituents and said, I just passed this bill and we're not going to let undocumented come here. And then, of course, the businesses that were giving them some money to help their campaign said, hey, don't worry about it; no money for enforcement; it's going to -- (off mic).

And we just have the same problem we had then, except now it's 10 times the size. And if you don't do anything, it's going to be --

MS. PRESTON: But why shouldn't the -- why isn't the American public's -- right to be skeptical that the businesses that are part of your partnership want to do the same thing again?

MAYOR BLOOMBERG: Businesses -- the would be better off employing legal people, because they can't get them into this country. There's the 11 million. But in all fairness, it was -- that 11 million grew over a long period of time. And if the economy ever does improve -- and it's not going to improve unless we fix the immigration system -- at least I don't think it'll improve anywhere near as rapidly or as easily -- they've got to be able to get a supply of labor.

We've got to have people starting businesses. We've got to have the engineers that they need. We've got to have the seasonal workers that they need.

MS. PRESTON: The five points that you articulated -- is the -- these proposals that are on the Hill now -- from the Republican side, a mandatory E-Verify plan, from the Democratic side, STEM degrees. Is there -- do you see a legislative strategy there that you could somehow --

MAYOR BLOOMBERG: You know, I only saw about seven, I think -- one senator and seven congresspeople this morning, mostly Republicans, although Lofgren is a Democrat -- and I will say I walked away with a little more optimism than I had before.

What has to happen is the public has got to say, Pennsylvania Avenue -- both ends, both sides of the aisle -- you are not solving our unemployment problem. We're going back into -- the economy's going in the wrong direction. And we've got to get out there and make the case that this is something that they can do to fix it.

And the attractiveness of immigration reform, while I know it's controversial for a lot of people to take that kind of vote -- it doesn't cost anything. So you can have immigration reform and at the same time not violate if you're one of the people who've, you know, said read my lips, no new taxes. You can still stick with that, but you could have the immigration reform.

And it's got to come from the public. The public's got to sit there and demand it. And we've got to be out there telling the story, again and again and again.

MS. PRESTON: All right. Do I take it that you would favor an approach of trying these smaller pieces first in the near term rather than a comprehensive approach, or what's your view on that?

MAYOR BLOOMBERG: Yes. I think it would be great to have comprehensive immigration reform, but if you look at '06 and '07, it didn't work. And today the situation is even worse to get comprehensive immigration reform. In the interest of having everything, we have nothing.

And you first -- the compromise that it seems to me makes sense, for both sides of the aisle, is you address the economic issue, the things that I outlined which would help the economy. That's one side of the immigration -- that's really visa reform if you want to say it. And then for the other part which I would call family reunification, you say we'll do the Dream Act or a variation of the Dream Act, because it's a little bit easier for those who keep saying, look, these people broke the law and we should not reward anybody who breaks the law. Well -- and it's funny, they say that while they're texting driving through a red light on their way to -- (laughter).

OK. But it's hard to argue the young kids, particularly if the kid served in the Army and, you know, went to -- I mean, you can -- you can -- you can set some criteria with the Dream Act, but it's just -- OK, they were brought here. When we talk about breaking the law, if you're dragged in your mother's arms across a border and you were, you know, an infant, did you break the law? All right, technically, maybe. But (no ?).

So I think that that's the way you say, those who want comprehensive immigration reform, you're not going to get everything you want. We are going to get control of our borders because we're going to have a biometric E-Verify system so that employers won't employ people that are undocumented; and therefore, the demand for undocumented will go down dramatically. They won't be able to get jobs and they won't come here. And then it's easier to get control of your borders.

You have to do something for the 11 million; make them pay a fine, whatever, but something practical. We just -- they're here. I mean, there's a point at which you've got to recognize reality, that you're not going to solve the problem.

But even if you can't do that right now, at least do the immigration reform so we can get the people to start businesses in these cities and take the jobs that we need for farmers or they're going to -- farms are just moving south, outside of America.

If you can't pick your crops, you just can't have a farm here.

And for those who want comprehensive reform or the family reunification side, say the DREAM Act this time, and we'll come back and fight another day for something else. Because if we fight for everything, we have nothing, and the nothing scenario is really bad for this country given the economic situation.

MS. PRESTON: Perhaps the most powerful or one of the most powerful anti-immigration reform arguments in the country is articulated on a daily basis by FOX News. I'm wondering if you have had a discussion with your partner, Mr. Murdoch, about -- (laughter) -- changing the --

MAYOR BLOOMBERG: I knew I should have done something. (Laughter.)

Yeah, I think -- look. Two of the three big newspapers in New York City are -- the publishers are immigrants, one from Canada, one from Australia. I think Rupert really does believe -- and it's in News Corp's interest; they are an international company with a lot of people moving back and forth.

The talking heads -- I don't know that Rupert's going to go and say, don't say that. That's -- there's a market for very conservative -- nice ways to put it -- talking -- rational talking heads. There's less of a market, it would seem, for very rational talking heads on the left, but for reasons I can't quite understand. But NBC -- MSNBC just doesn't get the ratings that FOX does.

On the other hand, I think that a lot of these people have -- might have some second thoughts when they realize that, you know, Rupert Murdoch really is committed to that -- to this and News Corp. as a corporation is really committed to it.

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THIS IS A RUSH TRANSCRIPT.

RICHARD HAASS (president, Council on Foreign Relations): If we could get started, I want to -- about to do the last session of the conference, and I'd like to think we've saved the best for last. We certainly saved the last for last.

We have with us the mayor of the greatest city, I would think, in the country, if not the world. And one of the reasons the city is so great is because of our mayor. The reason he is here today is not simply because New York has become incredibly livable, and the quantity and quality of life is about as good as it gets, what he's doing with schools, but also how he's using the job and the position as an important platform for public policy, and -- whether it's talking about issues of climate change and the C40 group and looking at how we use energy and climate -- and what we do about climate change around the world, and also the subject of today, immigration.

And where so many people in public life, alas, seem to be running away from issues, however important, that are controversial, one of the many reasons I admire our mayor, in addition to the fact that he actually counts every stroke on the golf course, is -- (laughter) -- this tells a lot about somebody, by the way -- is that he, rather than running away from some of the tougher issues of the day, he's actually embracing them. And he's giving them a degree of attention and degree of focus and degree of serious conversation that, again, makes him, alas, all too, I think, unique in our public debate.

So the subject of the whole day has been immigration. And Mayor Bloomberg is going to give a talk onto the subject. Afterwards he is going to take some questions from Julia Preston.

Julia's been with The New York Times, now, for just over 15 years. She's a national correspondent with a special focus on this set of issues, on immigration. I've known her for even longer than that, from not just her time at the Times, but also her time at The Washington Post, and really not for more than a quarter of a century. She has been, I believe, one of the leading if not the leading journalist in the United States who's been regularly paying attention to developments to our south in this hemisphere and the issues that relate domestically to it.

So let me thank them both for being here. Let me thank you all for, again, showing this degree of interest throughout the day -- sticking it out. Mayor Bloomberg, welcome, and we're thrilled to have you at the council, sir.

MAYOR MICHAEL BLOOMBERG: I will point out that Richard also counts every stroke on the golf course, particularly when I remind him that he was in the woods and I heard five times the branches go whack- whack-whack. (Laughter.) We did play the other day, and he played very well. Hits the ball a long ways -- if they would put the green in the woods on either side -- (laughter) -- it would help, but other than that minor problem -- but we had -- our match did not get as much coverage as the Boehner-Obama match. We didn't have as much security around.

Anyways, it's always nice to come to a city with a baseball team that is below the Mets in the standings -- (boos, laughter) -- hey, you know, as the Cub fans say, it's still early. (Laughter.)

But seriously, it's really a pleasure to be with you today to discuss one of, I think, the most important issues facing our country. Everyone agrees that our broken immigration system is a huge problem, but no one -- certainly not in Washington -- can agree on how to fix it. And today I would like to talk about how I think we can fix it, and how we can do it in a way so that both Democrats and Republicans, or at least enough of them, can sign on in support.

You know, it really is ironic that the immigration issue that divides this city -- is this -- dividing this particular city, because so much of Washington was built by immigrants. The street design was drawn up by Pierre Charles L'Enfant, a French immigrant; the White House was designed by an Irish immigrant named James Hoban; and the U.S. Capitol designed by William Thornton, a British immigrant.

And those buildings are not only monuments to our democracy, they are monuments to the contributions that millions of immigrants have made to America throughout its history.

But our country's greatest national monument perhaps and the American landmark that is really most recognized around the world is not the dome of the Capitol here in Washington or the pillars of the White House or the memorials on the National Mall. It is the Statue of Liberty.

Since 1886 -- what, a 125 years ago this October -- Lady Liberty's torch has brought light to the darkest corners of the earth, beckoning here to America's shores all those, as they say, yearning to breathe free. Yet it's not Lady Liberty's torch or her crown or her broken chains that has inspired so much awe. It is really her location.

The power of her symbol lies in the reality of New York City as a gateway, a golden door to the land of opportunity that is the United States of America and still is the United States of America. We should not forget that. That reality is not just our history, however. It is also our future, and we have to make sure that we can maintain that for our children.

We would not have become a global superpower without the contributions of immigrants who built the railroads and the canals and opened up the West or invented groundbreaking products that have revolutionized global commerce or who pioneered scientific engineering and medical advances that made America the most innovative country in the world.

But make no mistake about it. We will not remain a global superpower if we continue to close our doors to the people who want to come here, to work hard, start businesses and pursue the American dream.

That American dream cannot survive if we keep telling the dreamers to go elsewhere. It's what I call national suicide, and that's not hyperbole -- that every day what we fail -- that we fail to fix our broken immigration laws is a day that we inflict a wound on our economy.

And today, we may just this morning have turned away the next Albert Einstein or Sergey Brin. Tomorrow we may turn away the next Levi Strauss or Jerry Yang. And certainly we will be turning away many of the people who, like my grandparents and no doubt many of yours, came to this country with almost nothing except one thing: a desire to work and work and work and work and work, to build a better life for themselves, and certainly, if not for themselves, for their families.

This morning, the Partnership for a New American Economy released a report that looks at the impact of immigrants on one major sector of the American economy, and that's Fortune 500 companies. The report finds that more than 40 percent of Fortune 500 companies were founded by an immigrant or by the child of an immigrant. These immigrant- rooted companies employ more than 10 million people worldwide, which is a population larger than 43 of our states have, and they generate annual revenue of something like $4.2 trillion. To put that number in context, American companies founded by immigrants or their children have revenues that are greater than the gross national product of every country in the world outside of the United States except two, and that's China and Japan.

And those are just the Fortune 500 companies. When you look at the economy as a whole, immigrants and their children have been responsible for creating millions of jobs in all 50 states. And the reason is simple: Immigrants are dreamers and risk-takers who are driven to succeed because they know that in America, hard work and talent are rewarded like no place else on the globe.

And no city has seen the economic power of immigrants more clearly than New York. Historically immigrants are why New York City became America's economic engine, and in more recent history, they are one of the main reasons why we have rebounded so strongly from the tough times that we faced in the 1970s and the 1980s. Neighborhoods that 25 years ago were abandoned are now thriving, thanks largely to immigrants from the Dominican Republic and Ecuador and Mexico and China and Russia and Ghana, Korea, India, Pakistan, Poland, Egypt, every country in the world.

There's no greater force for economic revitalization of depressed neighborhoods than the influx of immigrants. And that's not just true in New York. Immigrants have been critical to economic rebounding in small towns and big cities across America.

Take Perry, Iowa, for example. A decade ago, it was facing economic stagnation caused by years of population decline. But today, thanks to a influx of immigrant labor and immigrant entrepreneurs who have opened businesses, the town's main street is now bustling. Tiny town -- immigrants make a difference.

The same is true of Livingston, Maine -- Lewiston, Maine, a decaying old mill town that has come back to life thanks to an influx of immigrants from Africa. In Atlanta, a big city, which has worked hard to become a magnet for well-educated immigrants, the purchasing power of Latinos and Asians has skyrocketed. And across the country, city after city, with the largest increase in immigrant workers, has experienced the fastest economic growth. There is just no question about the numbers. And in New York immigrants are a big reason why we have weathered the national recession better than the country as a whole.

Now immigration reform could be an economic engine for our entire country, creating good paying jobs that will speed up our recovery. But both major political parties and both ends of Pennsylvania Avenue say that restoring economic growth is their top priority, and it must be.

And yet they don't come to face the one thing that can do the job.

Yet today, more than three years after our country entered its deepest recession in decades, the single most powerful step that the federal government could take to spur job growth is reforming our broken immigration system. And it, unfortunately, is a casualty of partisan gridlock.

Republicans have tended to focus on border control, and understandably so. It is critically important to our nation's security, and there's absolutely nothing wrong with America being in charge of its borders and deciding who comes here. Right now, the selection process is who wants to come here the most: They either overstay their visa or they'll come and run across the border. We should be deciding who comes here; there's nothing wrong with that.

Democrats, on the other hand, have tried to focus on comprehensive reform, and that's understandable too. It's critically important that we do create a pathway to permanent legal status for the 11 million people who have overstayed their visas or come here illegally.

But by this point, unfortunately, I think one thing is clear: It is clear that the two sides have reached a stalemate, and they are just talking right past each other.

And that leaves us with two choices. Both sides can use the stalemate as a wedge issue to secure political points in 2012, or they can come together and adopt immigration reforms that will spur new companies, strengthen existing ones and help create jobs for the 13.9 million Americans who are unemployed and looking for work.

In the end, the public cares about two things: housing and jobs. My house, my job. And if you want to do something in this country to give people better jobs and more jobs and a better chance to keep their houses, the one thing that we can do that will work is not expensive for this country.

It's not a big stimulus of trillions of dollars. It is immigration reform that will get the best and brightest from around the world, those that are the hungriest and willing to work the hardest, to come here and create exactly what we need.

Now, as the 2012 election begins to take shape, voters across the country, I think, are going to be looking for candidates with an economic plan that is -- that are -- economic plans that are achievable and not aspirational. For independent voters especially, immigration reform will be a key test to whether candidates are willing to put sound economics ahead of election year politics; at least, it will be if I have anything to say about it.

Independent voters will determine the outcomes of the next election, just as they did in 2010 and in 2008. And while they don't hold all the same positions on any one issue, they overwhelmingly want leadership that is pragmatic, not polarizing. They want centralist solutions, not pandering to the special interest. And they want both sides to stop fighting on what they disagree on, and start taking action on the areas where they do agree. And there are actually quite a few areas where they agree if you think about it.

Leaders in both parties recognize that the current system is a drag on our economy. I thought it was encouraging that President Obama recently said that increasing opportunity for immigrants to come is a top priority. And likewise, I thought it was encouraging to see House Republicans put forward a plan for American job creators that includes more visas for the workers we need. And you'd be hard pressed to find a single economist who thinks that the status quo is good for our economy.

And voters understand all these things. A recent survey showed that two-thirds of Americans and three-quarters of business leaders recognize that immigrants play an important role in our economy. And that's why our Partnership for a New American Economy, which I co- founded last year with Rupert Murdoch, has attracted so many CEOs. And I have to tell you, recruiting new members is one of the easiest pitches I have ever made.

And so with all these agreement, the real question you've got to be asking is: Why can't Washington get anything done? Well, I think the answer is that we can get something done. And today I thought I'd outline five key areas where I believe bipartisan agreement largely exists in Congress and where action could be taken immediately and where the impact on our economy would be profound.

First, we must stop providing a first-rate education in science and technology to foreign students and then force them to leave. Students come from around the world to study here. More than 40 percent of our engineering graduates are foreign-born. They lead ground-breaking research at the very frontiers of science, but then many are forced to leave when it becomes clear that a permanent visa will be difficult if not impossible to get.

So instead of staying here to contribute to our economy, they go home and they go to work for companies that compete with our own companies. It just makes no sense. We're investing millions of dollars to educate these students at our leading universities and then giving the economic dividends back to our competitors for free.

The two parties should be able to agree on a policy that allows any university graduate with an advanced degree in an essential field to obtain a green card and a chance to help grow our economy. We must allow those students to stay here and be part of our future, or we will watch our future disappear with them.

Second, we must stop telling foreign entrepreneurs to build their companies in other countries. America is the best place in the world to start a business. But rather than capitalize on our assets by encouraging innovators to come here and stay, we are rejecting immigrant entrepreneurs, even when they're backed by American investors. Just remember, immigrants helped found Google and Yahoo! and eBay and Intel and so many more companies.

In fact, immigrants helped found one-quarter of all high-tech companies over the last 10 years. And across all industries, they are twice as likely as native-born Americans to start companies. We need more of these dynamic entrepreneurs. And if we do not open our doors to them, they will go elsewhere, and the good paying jobs that they create will go with them.

A foreign entrepreneur from American investors should be given a temporary visa to start a company in America. And if, after two or three years, the business has successfully yielded new American jobs, the entrepreneur should be allowed to continue to run his or her business and receive permanent legal status.

We're a nation of entrepreneurs because we are a nation of immigrants. And in the 21st century, the global economy will revolve more and more around those entrepreneurs.

Third, we must stop telling American companies that they cannot hire the high-skilled workers they need. By making it difficult for them to obtain temporary and permanent visas for high-skilled workers, the federal government is slowing growth and worse, promoting the outsourcing of American jobs. Make no mistake about it: If companies can't hire the workers they need here, they will move those operations out of the country. You just have to look at Microsoft's recent decision to open a research park in Vancouver. There's lots of West Coast companies that now have offices in Canada because they can't get the engineers into this company (sic).

In many high-tech companies -- for one -- that you see again and again -- talk to the owners. Talk to the managers. Talk to the stockholders. They are outside of the United States, but they'd prefer to be here. It's just that we won't let them bring in the talent they need.

And we not only lose those jobs, we lose their spending, and we lose their taxes. Again, this just makes no sense. We are stabbing ourselves in the back even as our economy is in critical condition.

The ability to attract and keep high-skilled labor is just essential for American companies competing on the world market.

And that's true not only for high-tech companies but also for banks and insurance companies and pharmaceutical companies, and even manufacturing firms with large research and development operations like Boeing and Caterpillar.

But right now, the cap on H1-B visas and green cards is much too low. And caps on green cards are set by countries, so Iceland actually gets the same number of visas as India. That may be fair to those two countries, but it's certainly not fair to American business and to Americans. We should give -- end these arbitrary limits and end the cap on the high-skilled H1-B visas. Let the marketplace decide. It's basic free-market economics, and both parties ought to be able to get behind it.

Fourth, we must ensure that major industries, such as agriculture and tourism, that rely on those workers just starting up the economic ladder, have access to foreign workers when they cannot fill the jobs with American workers. These employers want a legal workforce, but our current system just makes that extremely difficult. Firms have to go through multiple levels of approvals to do basic hiring, and in Georgia, where they crack down on illegal farm workers, farm owners are experiencing severe labor shortages that's driving up their cost and leaving crops unharvested. At a time when food prices are rising, this is the last thing American consumers and farmers need.

Fifth and finally, we must begin allocating more green cards based on economic needs. Right now, only about 15 percent of all green cards go to employees and their dependents, while the rest go largely to immigrants, families and relatives.

In Canada, those numbers are exactly reversed. Last year, two- thirds of immigrants to Canada came based on economic reasons, and only 21 percent came based on family reasons. Those that come based on economic reasons are creating the economy for all the people in that country.

We're not doing what Canada's doing. Why not? American has to honor our tradition of always being open to the tired and tempest-tossed, no argument about that. We are a land of opportunity because we've always been a country of compassion.

But as we continue to be a place of refuge and reunion, we must open our doors more widely to the talented and hardworking people who can make critical contributions to our economic growth and prosperity. And that means raising green card limits based on our economic needs, so that we can allow the people who will most help our country to come here, work, invest, and start businesses.

Now, the five areas that I've outlined present, I think, real opportunities for bipartisan agreement. And they are steps that can be taken right now to help create jobs and drive prosperity across the country. And remember, everybody says we don't have any money for new programs. Not one of the things that I outlined would cost a penny. It's all contribution, no expense.

So it's pretty hard to think that in the end the American public isn't going to say to Congress: Enough. We've got to do something. I'm worried about my house. I'm worried about my job. And there's a solution that you can't say you can't afford, a solution that we know has worked in many other places, a solution that you could implement very quickly. Do it now. That means more green cards for university graduates, more visas for entrepreneurs, more visas for high-skilled workers, more visas for agricultural and other seasonal laborers and more visas that are distributed based on economic needs.

Now, in the coming weeks Congress is expected to consider again the Dream Act and E-Verify. But pass or fail, I think the time has come to refocus the immigration debate around the most pressing issue facing the country today. And that is creating jobs.

The conversation here in Washington on immigration must be about more than fences and fingerprints.

It must be about what kind of country do we want America to be. Do we want to continue to be the land of opportunity for all and the world's greatest economic power and the nation with the most high-paying jobs and the best quality of life, or do we want to send more jobs overseas and watch other countries rival our economic strength and leave our country -- leave our children a country in decline?

America has always been on a forward march because we have always welcomed more people to march with us. But now the biggest threat to our future lies in denying our past. In New York Harbor, Lady Liberty is stepping forward. And here in her 125th year, so must we. We must honor, I think, the values that made America great. We must embrace the realities of the 21st-century global economy. And we must hold our elected officials accountable for delivering results, not speeches; for seeking consensus, not controversy; for promoting economic growth, not political advantage.

Maybe more than any other major issue in Washington today, there is an opportunity for bipartisan breakthrough on immigration. If both ends of Pennsylvania Avenue seize it -- and it's up to us to push them -- we can help get our economy moving again, and the best days for our country and for the dreamers who define it will still be there to come.

So thank you. And I look forward to having Julia ask me the most penetrating questions that she can possibly come up with, which I will artfully duck. (Laughter.) (Applause.)

JULIA PRESTON: Mayor Bloomberg, there is a counter argument being made, actually today in a hearing on the Hill, about immigration. And that is that we need to focus on illegal immigration and enforcement against illegal immigration, and for every illegal immigrant that we take out of the workforce by enforcement, you're creating a job for an American worker -- you're opening a job for an American worker.

And I think that vision -- it permeates, perhaps, the debate. In a context of very high unemployment in the country, it's a very persuasive idea that an immigrant is competing for -- with an unemployed American for jobs.

So how do you counter that out in the country when people are hurting for work?

MAYOR BLOOMBERG: Well, I think the actuary for Social Security said if you were to deport all 11 million -- and who knows what the number really is -- 11 million undocumented, that Social Security would go bankrupt six years early. Why? Because they pay into Social Security, but they don't get anything back.

I'm not an expert on 11 million undocumented in the country, but I'm a quasi-expert on the 500,000 undocumented in New York City. And we look pretty hard to see what really is going on in our economy. I can tell you this: At least in New York City, undocumented have a very low crime rate because they're scared to death of going near the INS.

Undocumented do not use the schools very much. It tends to be young people leaving their families back home, and they send back their earnings, but they don't bring their children. There are some, but generally speaking, immigrant children in our school system are the children of documented immigrants.

They don't use the hospitals very much, no matter what the naysayers say. Why? Because they're young people, and we use two thirds of our hospital medical expense in the latter years of our life. And these are young people. They're not here for that length of time.

They pay taxes. Something like 75 percent of all undocumented in New York City pay taxes. Why? Their employer witholds. The employer doesn't want to go to jail, so the employer witholds and sends the money in. And then where does the refund go?

There is no refund. So the federal government is actually making money on undocumented.

And lastly, they don't do things like come and use the social services that you think. They don't want to get involved in government; they don't live in public housing; they don't qualify for a lot of federal programs where documentation is something that you have to --

So that's the issue first with what the 11 million do here.

MS. PRESTON: I guess my question is also about the narrative --

MAYOR BLOOMBERG: OK.

MS. PRESTON: -- about immigration. Why shouldn't the public see what you're proposing as another effort by large business to have a channel for cheap and malleable labor coming into the United States? How do you change that?

MAYOR BLOOMBERG: Well, there's a -- you're talking about two different kinds. Large businesses will employ the doctors, lawyers, Indian chiefs. It is small business that will employ the people who don't have a great command of the English language or maybe don't have formal education.

And in the end, if you want to take America out of its doldrums, the only solution is small business. Half the people in the country work in small businesses. If you think about it, automation is something that small businesses don't use.

Small business is very different, and why are they the solution? Small business is the solution because they have nontraditional hiring. They don't look at your grade point average and see where you went to school and check your transcript. They don't even know how to do that. They look at you, and they say, yeah, I think you'd be OK. (Laughter.)

They provide -- that's the process that a small business goes through. They don't have a big HR department. You're just talking about something different. They have flexible hours, so that people that have family responsibilities can work in small businesses. They provide on-the-job training, and people that are unemployed are at an age where they are not going back to school. We talk about it -- there's five people that went back to school, they're on CNN, everybody does a special on them, isn't it wonderful they're going back to school.

But all the studies show older people don't go back to school.

You have to provide on the job training if you're going to employ them. And that's exactly what small businesses do.

So -- you know, and small businesses don't use automation. If you think about -- we talk about innovation and green jobs, and it's great, and we do need those things. But that's not what creates jobs. As a matter of fact, a lot of innovation and automation reduces the demand for people. And you see that in this country today, where it's bottom-line growth in big businesses. They are finding ways to do more with less. That may be great for the stockholders and may be great for the economy way down the road, but it's not good for helping the unemployment situation today.

Whereas small businesses -- you know, they do things with your hands. There's still got to be somebody at the counter when you walk in the store or cooking or serving or making the bed or -- you know, or picking the crops in the fields. And small businesses can employ those kinds of people.

I said -- I was asked: What do you do about the big industrial cities in the heartland that have hollowed out over the last few decades?

And I got in trouble with the major of the city, who didn't like my suggestion. But I said what the federal government should do is create a visa for people. The deal would be you go to that city; you agree you won't take any federal, state or city help whatsoever, because that gets rid of people who are worried about the expense; and you agree to live there for seven years. And that's the only agreement. And at the end of seven years, if you're still living there, we will give you citizenship.

In the meantime, what are those people going to do? They will -- if they have to drive from Detroit to California in the morning, they would do it to work and come back. They will buy the houses, they'll fix them up by hand, they'll create the small businesses, they'll find ways to create businesses where you never thought of businesses before.

And the mayor of the particular city I happened to pick -- and I just picked a city -- (laughter) -- said: Oh, no, no. There's no -- that Bloomberg doesn't understand; there's not enough jobs here.

Yes, there's not enough jobs. And it's going to get worse next year and the year after unless you bring in a new group of people who are going to start businesses. And the governor of this particular state said, hey, you know, Bloomberg's right. And I gather -- I was told this morning -- now they're going to have a conference -- (laughter) -- to try to really see whether there is something there.

But my point is, the history shows -- all the studies show that the jobs that the undocumented tend to take are not jobs that Americans will take. They either don't want them or they don't have the skills for them. And we are using the undocumented, in many cases, for jobs with much less skills than they happen to have. You can have -- you know, you have a college graduate -- in New York City, the percentage of people that are college graduates has continued to go up over -- almost every year in the last 10 years. Why? Because of immigrants. And not just -- (inaudible) -- immigrants from overseas, immigrants from the rest of the country.

But it is those with college educations that have been flocking to New York City because it's a cultural, intellectual capital. And those that are undocumented can't use -- they may be a lawyer back home or an engineer or a doctor -- they don't -- can't use their skills. So maybe they are driving a cab, or maybe they're starting a small business. But they are coming because they want to work, and the jobs they get are not jobs that anybody else would have done.

Also, every study shows that if you, for example, have one farm worker, that low-priced help -- tough to make a living on what you make picking crops. But that one person tends to create -- I think the number is like three other jobs up the food chain: transportation and inspection and distribution of the products. And the same thing is true at the high end. One engineer -- again, the number there is estimates of something like five or six jobs down the chain because they create new businesses and start things.

So the trouble that you have with this is if you tell a lie often enough, people start believing it, particularly in the day of instant news, bloggers and a very struggling, bad economic situation for the press where they have to go with sensationalism.

So the Times would never do that, I know that, but --

MS. PRESTON: Right. (Laughter.)

MAYOR BLOOMBERG: But they don't take jobs is the bottom line, and we need them.

MS. PRESTON: This week we have a menu of options on the Hill. Bills have been introduced, both a mandatory bill that would make the E-Verify employer -- employee verification program mandatory nationwide, and also Congresswoman Lofgren introduced a bill that would do some of the things I think that you have talked about.

First of all, how do you view the mandatory E-Verify bill? And could that be the basis, do you think, of a compromise?

MAYOR BLOOMBERG: Well, remember, I went see the congresswoman this morning, and I had a long conversation with her.

E-Verify -- well, let me stop for a second. The only ways you're going to get control of our borders -- and remember, borders is a logical border, it's not a physical border -- more people overstay visas to be here illegally than come across a border. So -- but, if you want to think about the whole thing as a big border control security issue for the country, the only ways you're going to get control over our borders is if you reduce the number of people trying to get in. And the ways you do that is you enforce the laws that say you can't employ undocumented.

Course, the business owner says, but I can't enforce the law because I don't know how the -- that they showed me a social security card or a green card or even a passport -- it looked good to me; how would I know? And so that's where the E-Verify system comes from.

But if you just put in E-Verify, all of a sudden you're going to have 11 million people that can't make a living here, and the jobs that they take are going to go unfilled. It would be a disaster for the industries that employ those people. And remember, those industries desperately need them, and we need those industries. But you can't stand up and say, yes, I want to keep undocumented here, because I employ a bunch of undocumented.

So there's nobody making the case, even though the case is there. And you just have to say E-Verify -- which I think incidentally is a fraud unless it has a biometric component to it, because, you know, Michael Bloomberg -- I don't know how many Michael Bloombergs there are in the world, but if you call up and say Michael Bloomberg is illegal, there's 20 different Michael Bloombergs that can use the same name on the E-Verify list. You've got to have something where you fingerprint or something like that, really does say, no, it's you; it's Julia Preston, and it's -- and it's this Julia Preston. That's important.

So E-Verify has its place, particularly if you do the biometric part. But you have to do it in conjunction with -- it would get -- help you get control of your borders, but you also have to do something with the people that are there today. And remember, the 11 million undocumented are here because we wanted them. It's true they broke a law, technically, no argument about it. But why did they break the law? Because in 1986, Congress passed a bill the way they always pass legislation. They stood up to their -- you know, their more conservative constituents and said, I just passed this bill and we're not going to let undocumented come here. And then, of course, the businesses that were giving them some money to help their campaign said, hey, don't worry about it; no money for enforcement; it's going to -- (off mic).

And we just have the same problem we had then, except now it's 10 times the size. And if you don't do anything, it's going to be --

MS. PRESTON: But why shouldn't the -- why isn't the American public's -- right to be skeptical that the businesses that are part of your partnership want to do the same thing again?

MAYOR BLOOMBERG: Businesses -- the would be better off employing legal people, because they can't get them into this country. There's the 11 million. But in all fairness, it was -- that 11 million grew over a long period of time. And if the economy ever does improve -- and it's not going to improve unless we fix the immigration system -- at least I don't think it'll improve anywhere near as rapidly or as easily -- they've got to be able to get a supply of labor.

We've got to have people starting businesses. We've got to have the engineers that they need. We've got to have the seasonal workers that they need.

MS. PRESTON: The five points that you articulated -- is the -- these proposals that are on the Hill now -- from the Republican side, a mandatory E-Verify plan, from the Democratic side, STEM degrees. Is there -- do you see a legislative strategy there that you could somehow --

MAYOR BLOOMBERG: You know, I only saw about seven, I think -- one senator and seven congresspeople this morning, mostly Republicans, although Lofgren is a Democrat -- and I will say I walked away with a little more optimism than I had before.

What has to happen is the public has got to say, Pennsylvania Avenue -- both ends, both sides of the aisle -- you are not solving our unemployment problem. We're going back into -- the economy's going in the wrong direction. And we've got to get out there and make the case that this is something that they can do to fix it.

And the attractiveness of immigration reform, while I know it's controversial for a lot of people to take that kind of vote -- it doesn't cost anything. So you can have immigration reform and at the same time not violate if you're one of the people who've, you know, said read my lips, no new taxes. You can still stick with that, but you could have the immigration reform.

And it's got to come from the public. The public's got to sit there and demand it. And we've got to be out there telling the story, again and again and again.

MS. PRESTON: All right. Do I take it that you would favor an approach of trying these smaller pieces first in the near term rather than a comprehensive approach, or what's your view on that?

MAYOR BLOOMBERG: Yes. I think it would be great to have comprehensive immigration reform, but if you look at '06 and '07, it didn't work. And today the situation is even worse to get comprehensive immigration reform. In the interest of having everything, we have nothing.

And you first -- the compromise that it seems to me makes sense, for both sides of the aisle, is you address the economic issue, the things that I outlined which would help the economy. That's one side of the immigration -- that's really visa reform if you want to say it. And then for the other part which I would call family reunification, you say we'll do the Dream Act or a variation of the Dream Act, because it's a little bit easier for those who keep saying, look, these people broke the law and we should not reward anybody who breaks the law. Well -- and it's funny, they say that while they're texting driving through a red light on their way to -- (laughter).

OK. But it's hard to argue the young kids, particularly if the kid served in the Army and, you know, went to -- I mean, you can -- you can -- you can set some criteria with the Dream Act, but it's just -- OK, they were brought here. When we talk about breaking the law, if you're dragged in your mother's arms across a border and you were, you know, an infant, did you break the law? All right, technically, maybe. But (no ?).

So I think that that's the way you say, those who want comprehensive immigration reform, you're not going to get everything you want. We are going to get control of our borders because we're going to have a biometric E-Verify system so that employers won't employ people that are undocumented; and therefore, the demand for undocumented will go down dramatically. They won't be able to get jobs and they won't come here. And then it's easier to get control of your borders.

You have to do something for the 11 million; make them pay a fine, whatever, but something practical. We just -- they're here. I mean, there's a point at which you've got to recognize reality, that you're not going to solve the problem.

But even if you can't do that right now, at least do the immigration reform so we can get the people to start businesses in these cities and take the jobs that we need for farmers or they're going to -- farms are just moving south, outside of America.

If you can't pick your crops, you just can't have a farm here.

And for those who want comprehensive reform or the family reunification side, say the DREAM Act this time, and we'll come back and fight another day for something else. Because if we fight for everything, we have nothing, and the nothing scenario is really bad for this country given the economic situation.

MS. PRESTON: Perhaps the most powerful or one of the most powerful anti-immigration reform arguments in the country is articulated on a daily basis by FOX News. I'm wondering if you have had a discussion with your partner, Mr. Murdoch, about -- (laughter) -- changing the --

MAYOR BLOOMBERG: I knew I should have done something. (Laughter.)

Yeah, I think -- look. Two of the three big newspapers in New York City are -- the publishers are immigrants, one from Canada, one from Australia. I think Rupert really does believe -- and it's in News Corp's interest; they are an international company with a lot of people moving back and forth.

The talking heads -- I don't know that Rupert's going to go and say, don't say that. That's -- there's a market for very conservative -- nice ways to put it -- talking -- rational talking heads. There's less of a market, it would seem, for very rational talking heads on the left, but for reasons I can't quite understand. But NBC -- MSNBC just doesn't get the ratings that FOX does.

On the other hand, I think that a lot of these people have -- might have some second thoughts when they realize that, you know, Rupert Murdoch really is committed to that -- to this and News Corp. as a corporation is really committed to it.

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THIS IS A RUSH TRANSCRIPT.

RICHARD HAASS (president, Council on Foreign Relations): If we could get started, I want to -- about to do the last session of the conference, and I'd like to think we've saved the best for last. We certainly saved the last for last.

We have with us the mayor of the greatest city, I would think, in the country, if not the world. And one of the reasons the city is so great is because of our mayor. The reason he is here today is not simply because New York has become incredibly livable, and the quantity and quality of life is about as good as it gets, what he's doing with schools, but also how he's using the job and the position as an important platform for public policy, and -- whether it's talking about issues of climate change and the C40 group and looking at how we use energy and climate -- and what we do about climate change around the world, and also the subject of today, immigration.

And where so many people in public life, alas, seem to be running away from issues, however important, that are controversial, one of the many reasons I admire our mayor, in addition to the fact that he actually counts every stroke on the golf course, is -- (laughter) -- this tells a lot about somebody, by the way -- is that he, rather than running away from some of the tougher issues of the day, he's actually embracing them. And he's giving them a degree of attention and degree of focus and degree of serious conversation that, again, makes him, alas, all too, I think, unique in our public debate.

So the subject of the whole day has been immigration. And Mayor Bloomberg is going to give a talk onto the subject. Afterwards he is going to take some questions from Julia Preston.

Julia's been with The New York Times, now, for just over 15 years. She's a national correspondent with a special focus on this set of issues, on immigration. I've known her for even longer than that, from not just her time at the Times, but also her time at The Washington Post, and really not for more than a quarter of a century. She has been, I believe, one of the leading if not the leading journalist in the United States who's been regularly paying attention to developments to our south in this hemisphere and the issues that relate domestically to it.

So let me thank them both for being here. Let me thank you all for, again, showing this degree of interest throughout the day -- sticking it out. Mayor Bloomberg, welcome, and we're thrilled to have you at the council, sir.

MAYOR MICHAEL BLOOMBERG: I will point out that Richard also counts every stroke on the golf course, particularly when I remind him that he was in the woods and I heard five times the branches go whack- whack-whack. (Laughter.) We did play the other day, and he played very well. Hits the ball a long ways -- if they would put the green in the woods on either side -- (laughter) -- it would help, but other than that minor problem -- but we had -- our match did not get as much coverage as the Boehner-Obama match. We didn't have as much security around.

Anyways, it's always nice to come to a city with a baseball team that is below the Mets in the standings -- (boos, laughter) -- hey, you know, as the Cub fans say, it's still early. (Laughter.)

But seriously, it's really a pleasure to be with you today to discuss one of, I think, the most important issues facing our country. Everyone agrees that our broken immigration system is a huge problem, but no one -- certainly not in Washington -- can agree on how to fix it. And today I would like to talk about how I think we can fix it, and how we can do it in a way so that both Democrats and Republicans, or at least enough of them, can sign on in support.

You know, it really is ironic that the immigration issue that divides this city -- is this -- dividing this particular city, because so much of Washington was built by immigrants. The street design was drawn up by Pierre Charles L'Enfant, a French immigrant; the White House was designed by an Irish immigrant named James Hoban; and the U.S. Capitol designed by William Thornton, a British immigrant.

And those buildings are not only monuments to our democracy, they are monuments to the contributions that millions of immigrants have made to America throughout its history.

But our country's greatest national monument perhaps and the American landmark that is really most recognized around the world is not the dome of the Capitol here in Washington or the pillars of the White House or the memorials on the National Mall. It is the Statue of Liberty.

Since 1886 -- what, a 125 years ago this October -- Lady Liberty's torch has brought light to the darkest corners of the earth, beckoning here to America's shores all those, as they say, yearning to breathe free. Yet it's not Lady Liberty's torch or her crown or her broken chains that has inspired so much awe. It is really her location.

The power of her symbol lies in the reality of New York City as a gateway, a golden door to the land of opportunity that is the United States of America and still is the United States of America. We should not forget that. That reality is not just our history, however. It is also our future, and we have to make sure that we can maintain that for our children.

We would not have become a global superpower without the contributions of immigrants who built the railroads and the canals and opened up the West or invented groundbreaking products that have revolutionized global commerce or who pioneered scientific engineering and medical advances that made America the most innovative country in the world.

But make no mistake about it. We will not remain a global superpower if we continue to close our doors to the people who want to come here, to work hard, start businesses and pursue the American dream.

That American dream cannot survive if we keep telling the dreamers to go elsewhere. It's what I call national suicide, and that's not hyperbole -- that every day what we fail -- that we fail to fix our broken immigration laws is a day that we inflict a wound on our economy.

And today, we may just this morning have turned away the next Albert Einstein or Sergey Brin. Tomorrow we may turn away the next Levi Strauss or Jerry Yang. And certainly we will be turning away many of the people who, like my grandparents and no doubt many of yours, came to this country with almost nothing except one thing: a desire to work and work and work and work and work, to build a better life for themselves, and certainly, if not for themselves, for their families.

This morning, the Partnership for a New American Economy released a report that looks at the impact of immigrants on one major sector of the American economy, and that's Fortune 500 companies. The report finds that more than 40 percent of Fortune 500 companies were founded by an immigrant or by the child of an immigrant. These immigrant- rooted companies employ more than 10 million people worldwide, which is a population larger than 43 of our states have, and they generate annual revenue of something like $4.2 trillion. To put that number in context, American companies founded by immigrants or their children have revenues that are greater than the gross national product of every country in the world outside of the United States except two, and that's China and Japan.

And those are just the Fortune 500 companies. When you look at the economy as a whole, immigrants and their children have been responsible for creating millions of jobs in all 50 states. And the reason is simple: Immigrants are dreamers and risk-takers who are driven to succeed because they know that in America, hard work and talent are rewarded like no place else on the globe.

And no city has seen the economic power of immigrants more clearly than New York. Historically immigrants are why New York City became America's economic engine, and in more recent history, they are one of the main reasons why we have rebounded so strongly from the tough times that we faced in the 1970s and the 1980s. Neighborhoods that 25 years ago were abandoned are now thriving, thanks largely to immigrants from the Dominican Republic and Ecuador and Mexico and China and Russia and Ghana, Korea, India, Pakistan, Poland, Egypt, every country in the world.

There's no greater force for economic revitalization of depressed neighborhoods than the influx of immigrants. And that's not just true in New York. Immigrants have been critical to economic rebounding in small towns and big cities across America.

Take Perry, Iowa, for example. A decade ago, it was facing economic stagnation caused by years of population decline. But today, thanks to a influx of immigrant labor and immigrant entrepreneurs who have opened businesses, the town's main street is now bustling. Tiny town -- immigrants make a difference.

The same is true of Livingston, Maine -- Lewiston, Maine, a decaying old mill town that has come back to life thanks to an influx of immigrants from Africa. In Atlanta, a big city, which has worked hard to become a magnet for well-educated immigrants, the purchasing power of Latinos and Asians has skyrocketed. And across the country, city after city, with the largest increase in immigrant workers, has experienced the fastest economic growth. There is just no question about the numbers. And in New York immigrants are a big reason why we have weathered the national recession better than the country as a whole.

Now immigration reform could be an economic engine for our entire country, creating good paying jobs that will speed up our recovery. But both major political parties and both ends of Pennsylvania Avenue say that restoring economic growth is their top priority, and it must be.

And yet they don't come to face the one thing that can do the job.

Yet today, more than three years after our country entered its deepest recession in decades, the single most powerful step that the federal government could take to spur job growth is reforming our broken immigration system. And it, unfortunately, is a casualty of partisan gridlock.

Republicans have tended to focus on border control, and understandably so. It is critically important to our nation's security, and there's absolutely nothing wrong with America being in charge of its borders and deciding who comes here. Right now, the selection process is who wants to come here the most: They either overstay their visa or they'll come and run across the border. We should be deciding who comes here; there's nothing wrong with that.

Democrats, on the other hand, have tried to focus on comprehensive reform, and that's understandable too. It's critically important that we do create a pathway to permanent legal status for the 11 million people who have overstayed their visas or come here illegally.

But by this point, unfortunately, I think one thing is clear: It is clear that the two sides have reached a stalemate, and they are just talking right past each other.

And that leaves us with two choices. Both sides can use the stalemate as a wedge issue to secure political points in 2012, or they can come together and adopt immigration reforms that will spur new companies, strengthen existing ones and help create jobs for the 13.9 million Americans who are unemployed and looking for work.

In the end, the public cares about two things: housing and jobs. My house, my job. And if you want to do something in this country to give people better jobs and more jobs and a better chance to keep their houses, the one thing that we can do that will work is not expensive for this country.

It's not a big stimulus of trillions of dollars. It is immigration reform that will get the best and brightest from around the world, those that are the hungriest and willing to work the hardest, to come here and create exactly what we need.

Now, as the 2012 election begins to take shape, voters across the country, I think, are going to be looking for candidates with an economic plan that is -- that are -- economic plans that are achievable and not aspirational. For independent voters especially, immigration reform will be a key test to whether candidates are willing to put sound economics ahead of election year politics; at least, it will be if I have anything to say about it.

Independent voters will determine the outcomes of the next election, just as they did in 2010 and in 2008. And while they don't hold all the same positions on any one issue, they overwhelmingly want leadership that is pragmatic, not polarizing. They want centralist solutions, not pandering to the special interest. And they want both sides to stop fighting on what they disagree on, and start taking action on the areas where they do agree. And there are actually quite a few areas where they agree if you think about it.

Leaders in both parties recognize that the current system is a drag on our economy. I thought it was encouraging that President Obama recently said that increasing opportunity for immigrants to come is a top priority. And likewise, I thought it was encouraging to see House Republicans put forward a plan for American job creators that includes more visas for the workers we need. And you'd be hard pressed to find a single economist who thinks that the status quo is good for our economy.

And voters understand all these things. A recent survey showed that two-thirds of Americans and three-quarters of business leaders recognize that immigrants play an important role in our economy. And that's why our Partnership for a New American Economy, which I co- founded last year with Rupert Murdoch, has attracted so many CEOs. And I have to tell you, recruiting new members is one of the easiest pitches I have ever made.

And so with all these agreement, the real question you've got to be asking is: Why can't Washington get anything done? Well, I think the answer is that we can get something done. And today I thought I'd outline five key areas where I believe bipartisan agreement largely exists in Congress and where action could be taken immediately and where the impact on our economy would be profound.

First, we must stop providing a first-rate education in science and technology to foreign students and then force them to leave. Students come from around the world to study here. More than 40 percent of our engineering graduates are foreign-born. They lead ground-breaking research at the very frontiers of science, but then many are forced to leave when it becomes clear that a permanent visa will be difficult if not impossible to get.

So instead of staying here to contribute to our economy, they go home and they go to work for companies that compete with our own companies. It just makes no sense. We're investing millions of dollars to educate these students at our leading universities and then giving the economic dividends back to our competitors for free.

The two parties should be able to agree on a policy that allows any university graduate with an advanced degree in an essential field to obtain a green card and a chance to help grow our economy. We must allow those students to stay here and be part of our future, or we will watch our future disappear with them.

Second, we must stop telling foreign entrepreneurs to build their companies in other countries. America is the best place in the world to start a business. But rather than capitalize on our assets by encouraging innovators to come here and stay, we are rejecting immigrant entrepreneurs, even when they're backed by American investors. Just remember, immigrants helped found Google and Yahoo! and eBay and Intel and so many more companies.

In fact, immigrants helped found one-quarter of all high-tech companies over the last 10 years. And across all industries, they are twice as likely as native-born Americans to start companies. We need more of these dynamic entrepreneurs. And if we do not open our doors to them, they will go elsewhere, and the good paying jobs that they create will go with them.

A foreign entrepreneur from American investors should be given a temporary visa to start a company in America. And if, after two or three years, the business has successfully yielded new American jobs, the entrepreneur should be allowed to continue to run his or her business and receive permanent legal status.

We're a nation of entrepreneurs because we are a nation of immigrants. And in the 21st century, the global economy will revolve more and more around those entrepreneurs.

Third, we must stop telling American companies that they cannot hire the high-skilled workers they need. By making it difficult for them to obtain temporary and permanent visas for high-skilled workers, the federal government is slowing growth and worse, promoting the outsourcing of American jobs. Make no mistake about it: If companies can't hire the workers they need here, they will move those operations out of the country. You just have to look at Microsoft's recent decision to open a research park in Vancouver. There's lots of West Coast companies that now have offices in Canada because they can't get the engineers into this company (sic).

In many high-tech companies -- for one -- that you see again and again -- talk to the owners. Talk to the managers. Talk to the stockholders. They are outside of the United States, but they'd prefer to be here. It's just that we won't let them bring in the talent they need.

And we not only lose those jobs, we lose their spending, and we lose their taxes. Again, this just makes no sense. We are stabbing ourselves in the back even as our economy is in critical condition.

The ability to attract and keep high-skilled labor is just essential for American companies competing on the world market.

And that's true not only for high-tech companies but also for banks and insurance companies and pharmaceutical companies, and even manufacturing firms with large research and development operations like Boeing and Caterpillar.

But right now, the cap on H1-B visas and green cards is much too low. And caps on green cards are set by countries, so Iceland actually gets the same number of visas as India. That may be fair to those two countries, but it's certainly not fair to American business and to Americans. We should give -- end these arbitrary limits and end the cap on the high-skilled H1-B visas. Let the marketplace decide. It's basic free-market economics, and both parties ought to be able to get behind it.

Fourth, we must ensure that major industries, such as agriculture and tourism, that rely on those workers just starting up the economic ladder, have access to foreign workers when they cannot fill the jobs with American workers. These employers want a legal workforce, but our current system just makes that extremely difficult. Firms have to go through multiple levels of approvals to do basic hiring, and in Georgia, where they crack down on illegal farm workers, farm owners are experiencing severe labor shortages that's driving up their cost and leaving crops unharvested. At a time when food prices are rising, this is the last thing American consumers and farmers need.

Fifth and finally, we must begin allocating more green cards based on economic needs. Right now, only about 15 percent of all green cards go to employees and their dependents, while the rest go largely to immigrants, families and relatives.

In Canada, those numbers are exactly reversed. Last year, two- thirds of immigrants to Canada came based on economic reasons, and only 21 percent came based on family reasons. Those that come based on economic reasons are creating the economy for all the people in that country.

We're not doing what Canada's doing. Why not? American has to honor our tradition of always being open to the tired and tempest-tossed, no argument about that. We are a land of opportunity because we've always been a country of compassion.

But as we continue to be a place of refuge and reunion, we must open our doors more widely to the talented and hardworking people who can make critical contributions to our economic growth and prosperity. And that means raising green card limits based on our economic needs, so that we can allow the people who will most help our country to come here, work, invest, and start businesses.

Now, the five areas that I've outlined present, I think, real opportunities for bipartisan agreement. And they are steps that can be taken right now to help create jobs and drive prosperity across the country. And remember, everybody says we don't have any money for new programs. Not one of the things that I outlined would cost a penny. It's all contribution, no expense.

So it's pretty hard to think that in the end the American public isn't going to say to Congress: Enough. We've got to do something. I'm worried about my house. I'm worried about my job. And there's a solution that you can't say you can't afford, a solution that we know has worked in many other places, a solution that you could implement very quickly. Do it now. That means more green cards for university graduates, more visas for entrepreneurs, more visas for high-skilled workers, more visas for agricultural and other seasonal laborers and more visas that are distributed based on economic needs.

Now, in the coming weeks Congress is expected to consider again the Dream Act and E-Verify. But pass or fail, I think the time has come to refocus the immigration debate around the most pressing issue facing the country today. And that is creating jobs.

The conversation here in Washington on immigration must be about more than fences and fingerprints.

It must be about what kind of country do we want America to be. Do we want to continue to be the land of opportunity for all and the world's greatest economic power and the nation with the most high-paying jobs and the best quality of life, or do we want to send more jobs overseas and watch other countries rival our economic strength and leave our country -- leave our children a country in decline?

America has always been on a forward march because we have always welcomed more people to march with us. But now the biggest threat to our future lies in denying our past. In New York Harbor, Lady Liberty is stepping forward. And here in her 125th year, so must we. We must honor, I think, the values that made America great. We must embrace the realities of the 21st-century global economy. And we must hold our elected officials accountable for delivering results, not speeches; for seeking consensus, not controversy; for promoting economic growth, not political advantage.

Maybe more than any other major issue in Washington today, there is an opportunity for bipartisan breakthrough on immigration. If both ends of Pennsylvania Avenue seize it -- and it's up to us to push them -- we can help get our economy moving again, and the best days for our country and for the dreamers who define it will still be there to come.

So thank you. And I look forward to having Julia ask me the most penetrating questions that she can possibly come up with, which I will artfully duck. (Laughter.) (Applause.)

JULIA PRESTON: Mayor Bloomberg, there is a counter argument being made, actually today in a hearing on the Hill, about immigration. And that is that we need to focus on illegal immigration and enforcement against illegal immigration, and for every illegal immigrant that we take out of the workforce by enforcement, you're creating a job for an American worker -- you're opening a job for an American worker.

And I think that vision -- it permeates, perhaps, the debate. In a context of very high unemployment in the country, it's a very persuasive idea that an immigrant is competing for -- with an unemployed American for jobs.

So how do you counter that out in the country when people are hurting for work?

MAYOR BLOOMBERG: Well, I think the actuary for Social Security said if you were to deport all 11 million -- and who knows what the number really is -- 11 million undocumented, that Social Security would go bankrupt six years early. Why? Because they pay into Social Security, but they don't get anything back.

I'm not an expert on 11 million undocumented in the country, but I'm a quasi-expert on the 500,000 undocumented in New York City. And we look pretty hard to see what really is going on in our economy. I can tell you this: At least in New York City, undocumented have a very low crime rate because they're scared to death of going near the INS.

Undocumented do not use the schools very much. It tends to be young people leaving their families back home, and they send back their earnings, but they don't bring their children. There are some, but generally speaking, immigrant children in our school system are the children of documented immigrants.

They don't use the hospitals very much, no matter what the naysayers say. Why? Because they're young people, and we use two thirds of our hospital medical expense in the latter years of our life. And these are young people. They're not here for that length of time.

They pay taxes. Something like 75 percent of all undocumented in New York City pay taxes. Why? Their employer witholds. The employer doesn't want to go to jail, so the employer witholds and sends the money in. And then where does the refund go?

There is no refund. So the federal government is actually making money on undocumented.

And lastly, they don't do things like come and use the social services that you think. They don't want to get involved in government; they don't live in public housing; they don't qualify for a lot of federal programs where documentation is something that you have to --

So that's the issue first with what the 11 million do here.

MS. PRESTON: I guess my question is also about the narrative --

MAYOR BLOOMBERG: OK.

MS. PRESTON: -- about immigration. Why shouldn't the public see what you're proposing as another effort by large business to have a channel for cheap and malleable labor coming into the United States? How do you change that?

MAYOR BLOOMBERG: Well, there's a -- you're talking about two different kinds. Large businesses will employ the doctors, lawyers, Indian chiefs. It is small business that will employ the people who don't have a great command of the English language or maybe don't have formal education.

And in the end, if you want to take America out of its doldrums, the only solution is small business. Half the people in the country work in small businesses. If you think about it, automation is something that small businesses don't use.

Small business is very different, and why are they the solution? Small business is the solution because they have nontraditional hiring. They don't look at your grade point average and see where you went to school and check your transcript. They don't even know how to do that. They look at you, and they say, yeah, I think you'd be OK. (Laughter.)

They provide -- that's the process that a small business goes through. They don't have a big HR department. You're just talking about something different. They have flexible hours, so that people that have family responsibilities can work in small businesses. They provide on-the-job training, and people that are unemployed are at an age where they are not going back to school. We talk about it -- there's five people that went back to school, they're on CNN, everybody does a special on them, isn't it wonderful they're going back to school.

But all the studies show older people don't go back to school.

You have to provide on the job training if you're going to employ them. And that's exactly what small businesses do.

So -- you know, and small businesses don't use automation. If you think about -- we talk about innovation and green jobs, and it's great, and we do need those things. But that's not what creates jobs. As a matter of fact, a lot of innovation and automation reduces the demand for people. And you see that in this country today, where it's bottom-line growth in big businesses. They are finding ways to do more with less. That may be great for the stockholders and may be great for the economy way down the road, but it's not good for helping the unemployment situation today.

Whereas small businesses -- you know, they do things with your hands. There's still got to be somebody at the counter when you walk in the store or cooking or serving or making the bed or -- you know, or picking the crops in the fields. And small businesses can employ those kinds of people.

I said -- I was asked: What do you do about the big industrial cities in the heartland that have hollowed out over the last few decades?

And I got in trouble with the major of the city, who didn't like my suggestion. But I said what the federal government should do is create a visa for people. The deal would be you go to that city; you agree you won't take any federal, state or city help whatsoever, because that gets rid of people who are worried about the expense; and you agree to live there for seven years. And that's the only agreement. And at the end of seven years, if you're still living there, we will give you citizenship.

In the meantime, what are those people going to do? They will -- if they have to drive from Detroit to California in the morning, they would do it to work and come back. They will buy the houses, they'll fix them up by hand, they'll create the small businesses, they'll find ways to create businesses where you never thought of businesses before.

And the mayor of the particular city I happened to pick -- and I just picked a city -- (laughter) -- said: Oh, no, no. There's no -- that Bloomberg doesn't understand; there's not enough jobs here.

Yes, there's not enough jobs. And it's going to get worse next year and the year after unless you bring in a new group of people who are going to start businesses. And the governor of this particular state said, hey, you know, Bloomberg's right. And I gather -- I was told this morning -- now they're going to have a conference -- (laughter) -- to try to really see whether there is something there.

But my point is, the history shows -- all the studies show that the jobs that the undocumented tend to take are not jobs that Americans will take. They either don't want them or they don't have the skills for them. And we are using the undocumented, in many cases, for jobs with much less skills than they happen to have. You can have -- you know, you have a college graduate -- in New York City, the percentage of people that are college graduates has continued to go up over -- almost every year in the last 10 years. Why? Because of immigrants. And not just -- (inaudible) -- immigrants from overseas, immigrants from the rest of the country.

But it is those with college educations that have been flocking to New York City because it's a cultural, intellectual capital. And those that are undocumented can't use -- they may be a lawyer back home or an engineer or a doctor -- they don't -- can't use their skills. So maybe they are driving a cab, or maybe they're starting a small business. But they are coming because they want to work, and the jobs they get are not jobs that anybody else would have done.

Also, every study shows that if you, for example, have one farm worker, that low-priced help -- tough to make a living on what you make picking crops. But that one person tends to create -- I think the number is like three other jobs up the food chain: transportation and inspection and distribution of the products. And the same thing is true at the high end. One engineer -- again, the number there is estimates of something like five or six jobs down the chain because they create new businesses and start things.

So the trouble that you have with this is if you tell a lie often enough, people start believing it, particularly in the day of instant news, bloggers and a very struggling, bad economic situation for the press where they have to go with sensationalism.

So the Times would never do that, I know that, but --

MS. PRESTON: Right. (Laughter.)

MAYOR BLOOMBERG: But they don't take jobs is the bottom line, and we need them.

MS. PRESTON: This week we have a menu of options on the Hill. Bills have been introduced, both a mandatory bill that would make the E-Verify employer -- employee verification program mandatory nationwide, and also Congresswoman Lofgren introduced a bill that would do some of the things I think that you have talked about.

First of all, how do you view the mandatory E-Verify bill? And could that be the basis, do you think, of a compromise?

MAYOR BLOOMBERG: Well, remember, I went see the congresswoman this morning, and I had a long conversation with her.

E-Verify -- well, let me stop for a second. The only ways you're going to get control of our borders -- and remember, borders is a logical border, it's not a physical border -- more people overstay visas to be here illegally than come across a border. So -- but, if you want to think about the whole thing as a big border control security issue for the country, the only ways you're going to get control over our borders is if you reduce the number of people trying to get in. And the ways you do that is you enforce the laws that say you can't employ undocumented.

Course, the business owner says, but I can't enforce the law because I don't know how the -- that they showed me a social security card or a green card or even a passport -- it looked good to me; how would I know? And so that's where the E-Verify system comes from.

But if you just put in E-Verify, all of a sudden you're going to have 11 million people that can't make a living here, and the jobs that they take are going to go unfilled. It would be a disaster for the industries that employ those people. And remember, those industries desperately need them, and we need those industries. But you can't stand up and say, yes, I want to keep undocumented here, because I employ a bunch of undocumented.

So there's nobody making the case, even though the case is there. And you just have to say E-Verify -- which I think incidentally is a fraud unless it has a biometric component to it, because, you know, Michael Bloomberg -- I don't know how many Michael Bloombergs there are in the world, but if you call up and say Michael Bloomberg is illegal, there's 20 different Michael Bloombergs that can use the same name on the E-Verify list. You've got to have something where you fingerprint or something like that, really does say, no, it's you; it's Julia Preston, and it's -- and it's this Julia Preston. That's important.

So E-Verify has its place, particularly if you do the biometric part. But you have to do it in conjunction with -- it would get -- help you get control of your borders, but you also have to do something with the people that are there today. And remember, the 11 million undocumented are here because we wanted them. It's true they broke a law, technically, no argument about it. But why did they break the law? Because in 1986, Congress passed a bill the way they always pass legislation. They stood up to their -- you know, their more conservative constituents and said, I just passed this bill and we're not going to let undocumented come here. And then, of course, the businesses that were giving them some money to help their campaign said, hey, don't worry about it; no money for enforcement; it's going to -- (off mic).

And we just have the same problem we had then, except now it's 10 times the size. And if you don't do anything, it's going to be --

MS. PRESTON: But why shouldn't the -- why isn't the American public's -- right to be skeptical that the businesses that are part of your partnership want to do the same thing again?

MAYOR BLOOMBERG: Businesses -- the would be better off employing legal people, because they can't get them into this country. There's the 11 million. But in all fairness, it was -- that 11 million grew over a long period of time. And if the economy ever does improve -- and it's not going to improve unless we fix the immigration system -- at least I don't think it'll improve anywhere near as rapidly or as easily -- they've got to be able to get a supply of labor.

We've got to have people starting businesses. We've got to have the engineers that they need. We've got to have the seasonal workers that they need.

MS. PRESTON: The five points that you articulated -- is the -- these proposals that are on the Hill now -- from the Republican side, a mandatory E-Verify plan, from the Democratic side, STEM degrees. Is there -- do you see a legislative strategy there that you could somehow --

MAYOR BLOOMBERG: You know, I only saw about seven, I think -- one senator and seven congresspeople this morning, mostly Republicans, although Lofgren is a Democrat -- and I will say I walked away with a little more optimism than I had before.

What has to happen is the public has got to say, Pennsylvania Avenue -- both ends, both sides of the aisle -- you are not solving our unemployment problem. We're going back into -- the economy's going in the wrong direction. And we've got to get out there and make the case that this is something that they can do to fix it.

And the attractiveness of immigration reform, while I know it's controversial for a lot of people to take that kind of vote -- it doesn't cost anything. So you can have immigration reform and at the same time not violate if you're one of the people who've, you know, said read my lips, no new taxes. You can still stick with that, but you could have the immigration reform.

And it's got to come from the public. The public's got to sit there and demand it. And we've got to be out there telling the story, again and again and again.

MS. PRESTON: All right. Do I take it that you would favor an approach of trying these smaller pieces first in the near term rather than a comprehensive approach, or what's your view on that?

MAYOR BLOOMBERG: Yes. I think it would be great to have comprehensive immigration reform, but if you look at '06 and '07, it didn't work. And today the situation is even worse to get comprehensive immigration reform. In the interest of having everything, we have nothing.

And you first -- the compromise that it seems to me makes sense, for both sides of the aisle, is you address the economic issue, the things that I outlined which would help the economy. That's one side of the immigration -- that's really visa reform if you want to say it. And then for the other part which I would call family reunification, you say we'll do the Dream Act or a variation of the Dream Act, because it's a little bit easier for those who keep saying, look, these people broke the law and we should not reward anybody who breaks the law. Well -- and it's funny, they say that while they're texting driving through a red light on their way to -- (laughter).

OK. But it's hard to argue the young kids, particularly if the kid served in the Army and, you know, went to -- I mean, you can -- you can -- you can set some criteria with the Dream Act, but it's just -- OK, they were brought here. When we talk about breaking the law, if you're dragged in your mother's arms across a border and you were, you know, an infant, did you break the law? All right, technically, maybe. But (no ?).

So I think that that's the way you say, those who want comprehensive immigration reform, you're not going to get everything you want. We are going to get control of our borders because we're going to have a biometric E-Verify system so that employers won't employ people that are undocumented; and therefore, the demand for undocumented will go down dramatically. They won't be able to get jobs and they won't come here. And then it's easier to get control of your borders.

You have to do something for the 11 million; make them pay a fine, whatever, but something practical. We just -- they're here. I mean, there's a point at which you've got to recognize reality, that you're not going to solve the problem.

But even if you can't do that right now, at least do the immigration reform so we can get the people to start businesses in these cities and take the jobs that we need for farmers or they're going to -- farms are just moving south, outside of America.

If you can't pick your crops, you just can't have a farm here.

And for those who want comprehensive reform or the family reunification side, say the DREAM Act this time, and we'll come back and fight another day for something else. Because if we fight for everything, we have nothing, and the nothing scenario is really bad for this country given the economic situation.

MS. PRESTON: Perhaps the most powerful or one of the most powerful anti-immigration reform arguments in the country is articulated on a daily basis by FOX News. I'm wondering if you have had a discussion with your partner, Mr. Murdoch, about -- (laughter) -- changing the --

MAYOR BLOOMBERG: I knew I should have done something. (Laughter.)

Yeah, I think -- look. Two of the three big newspapers in New York City are -- the publishers are immigrants, one from Canada, one from Australia. I think Rupert really does believe -- and it's in News Corp's interest; they are an international company with a lot of people moving back and forth.

The talking heads -- I don't know that Rupert's going to go and say, don't say that. That's -- there's a market for very conservative -- nice ways to put it -- talking -- rational talking heads. There's less of a market, it would seem, for very rational talking heads on the left, but for reasons I can't quite understand. But NBC -- MSNBC just doesn't get the ratings that FOX does.

On the other hand, I think that a lot of these people have -- might have some second thoughts when they realize that, you know, Rupert Murdoch really is committed to that -- to this and News Corp. as a corporation is really committed to it.

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