12/06/2012

Are we there yet? Fiscal cliff fight down to the details

  • More and more, Republicans acknowledge President Obama's advantage
  • Both sides agree the wealthy will pay more
  • Republicans seek to wring concessions from Democrats after their own
  • No formal talks are scheduled with the fiscal cliff less than four weeks away

Washington (CNN) -- Both sides agree the wealthy will pay more, so now fiscal cliff talks come down to how much Republicans can wring out of the White House in return for giving in on taxes.

To President Barack Obama, it's all about first locking in additional revenue from raising taxes on high-income owners, an outcome the GOP has long rejected.

Republicans led by House Speaker John Boehner want to secure commitments on entitlement reforms and spending cuts opposed by Democrats as part of a broader agreement to reduce the nation's chronic federal deficits and debt.

Retiring Republican Rep. Steve LaTourette of Ohio told CNN on Thursday that he sensed a shift in the House GOP approach during a conference meeting the day before.

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"The sense was that there's a growing number of folks in our party that are saying, you know what, the president has won this round relative to the rates, but we need to you to sit down and get the second half of the deal and that's the spending," LaTourette said.

GOP senator backs tax rate hike on wealthy

It remains unclear if a deal will happen before the end of the year -- less than four weeks away -- or if the negotiations will carry over into 2013 after the fiscal cliff of automatic tax hikes and spending cuts takes effect.

While economists warn that going over the fiscal cliff could lead to a recession, the administration has signaled it can delay some of the impacts for month to allow time to work out a deal.

All signs point toward a two-step approach sought by newly re-elected Obama -- an initial agreement that would extend lower tax rates for income up to $250,000 for families, while letting rates return to higher levels from the Clinton era on income above that threshold.

Even conservatives such as Oklahoma Sen. Tom Coburn and Louisiana Gov. Bobby Jindal acknowledge the obvious -- taxes on the wealthy are going up despite opposition by Republicans.

"Whatever deal is reached is going to contain elements that are detrimental to our economy," Jindal wrote Thursday in an opinion piece published by Politico. "Elections have consequences, and the country is going to feel those consequences soon."

Decisions Americans are already making over fiscal cliff

At the same time, Jindal wrote, "Republicans certainly should fight to at least get something done that will matter."\

"At present, any reading of the headlines over the past week indicates that Republicans are fighting to protect the rich and cut benefits for seniors," he added. "It may be possible to have worse political positioning than that, but I'm not sure how."

Coburn, a notorious fiscal hawk, told MSNBC on Wednesday that he would support higher tax rates on wealthier Americans as part of a broader deal to avoid the fiscal cliff and broader deficit crisis.

"I know we have to raise revenue," Coburn said. "I don't really care which way we do it. Actually, I would rather see rates go up than do it the other way, because it gives us a greater chance to reform the tax code and broaden the base in the future."

After meeting with his conference Wednesday, Boehner told reporters that the rich will be paying more, but he still hoped to limit any increase to ending tax deductions and loopholes rather than Obama's demand for higher rates.

"We have got to cut spending and I believe it is appropriate to put revenues on the table," Boehner said. "Now, the revenues that we are putting on the table are going to come from guess who? The rich."

Fiscal cliff could bring paycheck panic

He continued, "There are ways to limit deductions, close loopholes and have the same people pay more of their money to the federal government without raising tax rates, which we believe will harm our economy."

Obama, however, continued to insist that Republicans have to ensure no one except the highest-earning 2% of Americans will face higher taxes before working out a broader agreement on tackling the nation's chronic federal deficits and debt.

In remarks to business leaders on Wednesday, Obama said Boehner and Republicans have to take the first step.

"I think there is recognition that maybe they can accept some rate increases as long as it is combined with serious entitlement reform and additional spending cuts," the president said. "And if we can get the leadership on the Republican side to take that framework, to acknowledge that reality, then the numbers actually aren't that far apart."

He added that "we can probably solve this in about a week -- it's not that tough."

The statements reflected how negotiations on the the fiscal cliff have evolved since last month's election, when Obama won a second term and Democrats made gains in both chambers of Congress.

Republicans opposed to any new revenue in their quest to shrink government now realize Obama's victory and public support for the president's campaign theme of higher taxes on the wealthy leave them with little negotiating leverage.

A new poll Thursday was the third in recent days to indicate most Americans accepted raising taxes on incomes over $250,000 as part of a fiscal cliff deal.

The Quinnipiac University national survey showed 65% of registered voters support higher taxes on the wealthy, though Republican respondents were opposed,53% to 41%.

Also, a Washington Post/Pew Research Center survey released Tuesday showed 53% of respondents would blame Republicans for failure to reach a deal, compared with 27% who would blame Obama. A CNN/ORC International poll released last week showed 45% would blame congressional Republicans compared with 34% who would hold Obama responsible.

Treasury Secretary Timothy Geithner told CNBC Wednesday the Obama administration is "absolutely" prepared to go off the fiscal cliff "if there's no prospect to an agreement that doesn't involve those rates on the top 2%."

Read more: The road to fiscal cliff paved with good intentions

Despite the public stance softening of some Republicans in each house, signs point to a continuing standoff for now.

Obama and Boehner spoke on the phone Wednesday afternoon for the first time in a week, according to a source familiar with the call. However, the source said the conversation didn't lead to any breakthrough. No formal negotiating sessions are known to be scheduled.

The House is scheduled to adjourn for the year on December 14, but Boehner's number two, Majority Leader Eric Cantor, said Wednesday the chamber would remain in session until a fiscal cliff deal gets reached.

Boehner, meanwhile, challenged Obama to talk, saying, "I'll be here and I'll be available at any moment to sit down with the president to get serious about solving this problem."

Obama demands that the House immediately pass a measure already approved by the Senate to extend tax cuts from 2001 and 2003 on income up to $250,000 for families.

He contends that both Democrats and Republicans agree that the 98% of American families making less than $250,000 a year should avoid a tax hike when the lower rates from the Bush administration expire on December 31. They call for the House to guarantee that outcome by passing the Senate measure now.

Once that happens, Obama and Democratic leaders promise, they will work out compromises on other spending cuts sought by Republicans to reduce the deficit, such as reforms to the Medicare and Medicaid entitlement programs.

The latest proposal from House Republicans could reduce federal deficits by $2.2 trillion over 10 years, GOP leaders say.

The GOP proposal includes $800 billion from tax reform, $600 billion from Medicare reforms and other health savings and $600 billion in other spending cuts, House Republican leadership aides said. It also pledges $200 billion in savings by revising the consumer price index, a measure of inflation.

While the Republicans gave ground by calling for more revenue through tax reform, the plan mentioned only unspecified elimination of some deductions and loopholes.

Opinion: Millionaires' tax bracket would be a smart compromise

Obama's broader deficit reduction plan calls for deficit reduction of about $500 billion over 10 years by limiting itemized tax deductions and other benefits for high-income earners. The 28% limit on deductions would apply to families earning more than $250,000 and individuals making more than $200,000, according to the White House.

Jason Furman, an assistant to Obama on economic policy, told reporters Wednesday that the president wants to ensure additional revenue from higher taxes on the wealthy now to help avoid the fiscal cliff.

"What we're seeking to do is to lock in revenue this year, not have some vague process that may or may not add up to something, you know, in the future, and so we're trying to pass something this month," Furman said.

He described the Republican proposal for more revenue as lacking specifics.

"Tell us what it is. Show us a score," Furman said. "Tell us how it locks in revenue because you're trying to actually pass a bill this year, not engage in some long process around tax reform, which we don't have time to do by the end of this year."

The White House has made clear Obama will veto any measure that fails to increase tax rates on the wealthy, but aides have signaled a possible willingness to negotiate the specific rate increase.

In an interview with Bloomberg TV this week, Obama said lower tax rates for the wealthy could be negotiated as part of broader tax reform in 2013, but only after those rates increase now.

Obama's deficit-reduction plan would increase taxes by almost $1 trillion over 10 years, a significant portion of a $4 trillion overall deficit-reduction goal.

It also would close loopholes, limit deductions, raise the estate tax rate to 2009 levels and increases tax rates on capital gains and dividends.

The Obama plan includes $50 billion in stimulus spending for programs intended to create jobs, such as repairing roads and bridges.

Experts have said failing to reach a fiscal cliff deal and devise a framework for a broader deficit reduction package to be negotiated when the new Congress is seated in January would cause economic turmoil.

The non-partisan Tax Policy Center estimates that middle-class families would pay about $2,000 a year more in taxes without action.

House Republicans stick with Boehner on fiscal cliff

CNN's Deirdre Walsh, Ashley Killough, Jessica Yellin, Paul Steinhauser, Dana Bash and Ted Barrett contributed to this report.

Guatemala rejects asylum for McAfee

  • John McAfee had requested asylum, claiming he faced police persecution
  • Guatemala rejected the request on Thursday
  • The software mogul faces deportation to Belize

(CNN) -- Guatemala has rejected software mogul John McAfee's bid for asylum, setting up his impending deportation to Belize, where police want to talk with him about a neighbor's shooting death.

There was no basis for the asylum request, and so it was denied, presidential spokesman Francisco Cuevas said Thursday.

Guatemalan authorities took McAfee into custody Wednesday on accusations of entering the country illegally.

After weeks in hiding, the 67-year-old Internet security pioneer emerged publicly Tuesday in Guatemala's capital, hundreds of miles from the Caribbean island in Belize where his next-door neighbor was found dead.

McAfee had requested asylum in Guatemala, arguing that he left Belize to escape police persecution.

Belize authorities have said they want to talk to McAfee about the November 11 shooting of his neighbor, American businessman Gregory Faull.

McAfee founded his namesake computer security software in 1987, initially running it out of his home in California. He sold his stake in McAfee Associates in 1994 and moved to Belize in 2008.

2012 extremely likely to be hottest year in US

The calendar says December, but no one east of the Rockies is singing "Baby It's Cold Outside" -- most of the U.S. is enjoying unseasonably warm weather.  NBC's Stephanie Gosk reports.

By Miguel Llanos, NBC News

A warm winter, a record warm spring, a record hot July and a warmer than average autumn combined to make it even more likely that 2012 will go down as the warmest year in the contiguous United States on record, the federal government reported Thursday.

Just how likely? 

"For 2012 not to be record warm, December would have to be unprecedented," Jake Crouch, a scientist at the National Climatic Data Center, told NBC News. "December temperatures would need to be more than 1 degree F colder than the coldest December on record, which occurred in 1983."


Based on past numbers, he added, "the odds of that occurring are less than 0.3 percent."

In other words, he said, "2012 has a greater than 99.7 percent chance of being record warm." That's up from Crouch's odds just last month of 90 percent.

January-November was already the warmest first 11 months of any year in records that go back to 1895, according to data released Thursday by the National Oceanic and Atmospheric Administration, which oversees the center. The average national temperature through November was 57.1 degrees F. 

The year has had a string of warm events, Crouch noted. "We had our fourth warmest winter (2011/2012) on record, our warmest spring, a very hot summer with the hottest month on record for the nation (July 2012), and a warmer than average autumn," he said.

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Economic reality marries apprenticeships, college

Christopher Connell

Apprentice ironworkers from Local #86 with their instructors on a steel scaffolding where they learn their craft at Bates Technical College in Tacoma, Wash. The apprentices, who start at nearly $25 an hour, are among more than 200 the union is training as demand for them in the Seattle area picks up after a two-year lull. The apprentices earn college credit for the classes at Bates.

By Christopher Connell, The Hechinger Report

TACOMA, Wash. — Five-foot-two Jesica Bush exudes confidence, whether she's scribbling notes in a 6:30 a.m. class at Bates Technical College here or wrestling 900-pound girders atop a mock two-story building.

With her blond ponytail tucked inside a brown hardhat, the 30-year-old is an apprentice with the ironworkers' union, a job that starts at nearly $25 an hour and will lead her in three years to both a journeyman's card and an associate degree.

Three years back, Bush sat in the state women's prison in Purdy, finishing seven and a half years for an armed-robbery conviction. The former addict dropped out of school in seventh grade — "Me and school, we never saw eye to eye," she says — was convicted of her first felony at 13, had a child at 15, and was sent to prison at 19.

But when it took her just six months to complete her GED in Purdy, the instructors asked her to be valedictorian at the graduation ceremony and to start thinking about college. When she got a chance to fight fires with a prison brigade instead of cleaning toilets, she jumped on it and made the discovery that "I loved hard work. I'd never worked a day in my life. You hike up the forest, you chain-saw trees all day. It's hard — really hard — just like being an ironworker. But I loved coming back and being tired."


Now Bush is one of 209 people learning the ironworking trade through apprenticeships like this one and others run by the Aerospace Joint Apprenticeship Committee, a state-funded partnership among community colleges, industry and the International Association of Machinists and Aerospace Workers, at a time when skilled workers are needed by Boeing and the rest of the aerospace industry in Seattle and to help build a $4 billion replacement for the floating 520 Bridge over Lake Washington.

Christopher Connell

Jesica Bush, 30, who served 7½ years in prison for armed robbery, is now an Ironworkers Local #86 apprentice in Tacoma, Wash., making nearly $25 an hour and earning credits toward a community-college degree.

An age-old doorway into skilled trades and a middle-class life, the apprenticeship is making a comeback, rebounding after all but disappearing in recent decades in the face of a decline in union membership and dwindling demand for skilled labor. And as the economy changes, today's apprenticeships combine the chance for workers not only to master skills while earning a paycheck but to get a college degree at the same time.

From the White House to executive suites, and from think tanks to such industry groups as the National Association of Manufacturers, there's a push to link apprenticeships with conventional education, mostly at community colleges, and produce a better-educated workforce capable of filling the more than 3.6 million skilled jobs the Bureau of Labor Statistics estimates remain vacant in industries such as manufacturing — even at a time when more than triple that number of Americans are looking for work.

Higher education, advocates say, can not only provide these newly minted workers with the critical-thinking skills they need for today's jobs, but also leave them better prepared and more appealing to employers the next time things get tough.

"What works so well about apprenticeships is that workers can gain tailored skills for the workplace along with critical academic learning, all while they earn a paycheck," says Sen. Patty Murray, D-Wash., a champion of federal support for apprenticeship programs.

The 'skills gap' may be your fault, employers

What makes them a model, Murray said at a U.S. Department of Labor ceremony marking this year's 75th anniversary of the National Apprenticeship Act, are those paychecks, plus the programs' reliance on strong public and private partnerships and the combination of academic and on-the-job learning.

Machinists these days have to operate sophisticated, computer-numerical-controlled equipment like the $3 million Makino vertical machining center that Seattle apprentice Irwin Downes has learned to run at JWD Machine in Fife, Wash. The company sent Downes and two other apprentices to Ohio to learn how to run the super lathe, which can cut titanium parts on several axes at once under high heat and jet sprays. Now the three are teaching the factory's other 42 machinists how to use the time-saving machine to make critical parts for the aerospace industry.

Downes, who is 24, also spends four hours in class one night a week at Bates Technical College. "I knew my feeds and speeds for cutting aluminum, but why is it that way?" says Downes, who previously worked in a Chinese fast-food restaurant for a year after high school. "At Bates, they break it down into a math formula and show us where the numbers come from."

Christopher Connell

Ironworkers Union Local #86 instructor Kelly Graves readies a piece of equipment at the union's training center at Bates Technical College in Tacoma, Wash. The four-year apprenticeship now comes with the opportunity to earn an associate degree.

Across the country in Virginia, at the sprawling Newport News Shipyard on the waterfront near where the James River spills into Chesapeake Bay, applications to the apprenticeship program have skyrocketed from barely 540 a dozen years ago to a record 6,300 this year. New apprentices spend two full days each week in college classes, while earning more than $30,000 to start and upwards of $50,000 by their fourth year. They spend the rest of the week on the waterfront learning one of 17 trades and helping build and repair the nation's aircraft carriers and nuclear submarines.

The best move on to advanced classes from which almost half will graduate with an associate degree from nearby Thomas Nelson Community College or Tidewater Community College, which teach some courses inside the shipyard gates and others back on their own campuses. The shipyard's Apprentice School has its own 17-member faculty as well as nearly 70 craft instructors. Of those 6,300 applicants, it takes 260 new apprentices each year — making it more selective than Harvard, Yale or Princeton.

More from The Hechinger Report

The shipyard, owned by Huntington Ingalls Industries, also looks to the Apprentice School for future supervisors, managers and executives. Danny Hunley, who enrolled as an apprentice welder at age 19 in 1974 and is now vice president of operations, says that "human supply chain" is particularly reliant on the community colleges.

"We invest heavily in community colleges, not just for workforce development but for education of our employees," says Hunley. "We rely on a lifetime of learning to prepare our people to create the product that we sell that no one else can."

Hunley says he hopes that when the Apprentice School moves from its World War II-era brick building into a planned glass-and-steel showcase in downtown Newport News, it will even begin to offer bachelor's degrees.

Malachi Underwood, 27, an apprentice in the foundry shop, came to the shipyard in 2010 after being laid off from a job making wheels for railroad freight cars. "The things you do in the classroom here relate to what you do every day on the job. They make them real life," says Underwood, who was recently tapped to leave the foundry and become a nuclear test technician.

Christopher Connell

At the Newport News Shipbuilding Apprentice School in Virginia, new apprentices spend two full days in college classes each week while earning more than $30,000 a year. Director Everett Jordan, an alumnus (he was a shipfitter), says the college classes add "a critical dimension to our education here."

Everett Jordan, director of the Apprentice School and, like Hunley, an alumnus (he was a shipfitter), says the complex theory classes that apprentices take bring "a critical dimension to our education here." Adds training manager David Tilman: "If you're taking AC/DC theory as a freshman in college [elsewhere], you're putting together little boards. When you're doing it here, you're putting together nuclear submarines."

Conversely, employers say the instruction their apprentices get in college classes is broader than what new workers can learn on the job alone. The colleges typically work with local industry to design their classroom programs.

"Not only is the curriculum structured, but it helps the company build that apprentice's skill in all facets," says Jason Mohon, manufacturing director for JWD Machine. "Historically, if you were just an operator or a machinist out on the floor, you might find yourself spending years focusing on one task. This helps the company open their eyes and cross-train them."

Christopher Connell

An Ironworkers Union Local #86 apprentice prepares to hoist a section of a steel beam to the second story of the building skeleton that students practice on at Bates Technical College in Tacoma, Wash.

The same is true of the 6:30 a.m.-to-3:30 p.m. classes that the ironworker apprentices take in Tacoma, which occupy one month each year during their four-year apprenticeships. At the job sites where they spend the other 11 months, much of the trainees' time may be spent carrying or tying rebar, or doing other hard, physical labor, rather than the more complicated work of following codes and blueprints.

In Germany, apprenticeships mean job security

Some foremen and journeymen "have no problem explaining things so the apprentices build up knowledge as they go, but some do not," says instructor Kelly Graves. He tells the apprentices that if they want to be superintendents, they'll need college degrees. "The more education you have, the better off you are," he says.

Washington Gov. Chris Gregoire and the state legislature came up with $3 million to create the aerospace apprenticeship program in 2008, at a time of near-panic among employers about the aging of their skilled workers. Half of Boeing engineers are eligible to retire by 2015, and two-thirds of the company's entire workforce is within a decade of retirement age.

Yet employers have their work cut out to convince a new generation to enter these trades, says Laura Hopkins, the program's executive director. For them, the promise of a college degree can be an inducement.

More on the World of Work

"In this day and age, if I'm trying to recruit young people, we have to have a college degree attached," Hopkins says. "We have to convince their counselors and teachers and parents as well that this is a good career opportunity for them and that if the economy shifts and their industry goes down, they can move on to something else with that college degree."

If apprentices have a college degree and work as machinists for a while but then decide they want to go into engineering, "they now have the opportunity to do that without starting from square zero," says Hopkins, herself a former Boeing aircraft mechanic and dean at South Seattle Community College. "The more pathways we create for folks to go into these different careers, the better it is for everybody."

Back at Bates, Jesica Bush is convinced she's found the right calling. She wants to become a construction supervisor eventually and instruct apprentices herself.

"I'm a bossy person. I envision me running something sooner or later," Bates says. "I grew up in prison. That's where I got educated. I had to learn, and I'm still learning. I am driven — and I refuse to lose again."

This story, "Economic reality marries age-old idea — apprenticeships — with college," was produced by The Hechinger Report, a nonprofit, nonpartisan education-news outlet based at Teachers College, Columbia University. It's one of a series of reports about workforce development and higher education.

Apple to make computers in U.S.

Tim Cook tours a Foxconn plant in Zhengzhou, China, on March 28. The plant's 120,000 workers assemble Apple products.
Tim Cook tours a Foxconn plant in Zhengzhou, China, on March 28. The plant's 120,000 workers assemble Apple products.
  • Apple CEO Tim Cook: Apple will start making a computer in the United States
  • The move next year will cost $100 million, Apple spokesman says
  • Apple has been criticized for working conditions at its factories in China
  • Cook made comments to NBC News' Brian Williams

(CNN) -- Apple will begin manufacturing a computer in the United States next year, says CEO Tim Cook, marking a shift in perhaps the most-criticized element of the company's beloved gadget empire.

"We've been working for years on doing more and more in the United States," Cook said in an interview with Brian Williams on NBC's "Rock Center," scheduled to air Thursday night. "Next year, we will do one of our existing Mac lines in the United States."

Cook did not say which computer he was talking about, but some models of the new iMac have been arriving stamped "Assembled in the U.S.A," prompting speculation that it may be the company's flagship desktop.

An Apple spokesman told CNN that Apple will be investing $100 million in the move. He downplayed the iMac speculation, though, saying Apple has always done some assembly of its computers in the United States and calling the stamps on some 21-inch iMacs "coincidental as part of this story."

Apple CEO Tim Cook has taken some positions that depart from those of his predecessor, Steve Jobs.
Apple CEO Tim Cook has taken some positions that depart from those of his predecessor, Steve Jobs.

Cook shelled out additional details in an interview with Businessweek. He said Apple would not necessarily be the manufacturer of these computer components, "but we'll be working with people, and we'll be investing our money."

In recent years Apple has come under sometimes withering criticism for its supply chain in China, both for shipping U.S. jobs overseas and for the working conditions at plants run by the companies Apple contracts with there.

Former Apple CEO Steve Jobs, who died last year, avoided addressing the supply chain issue in public. But Cook has taken a different tack. He visited China in March to tour a factory owned by Foxconn, which makes electronics for Apple and other companies. And he allowed the Fair Labor Association to do a thorough audit of conditions at the Chinese factories, vowing to improve pay and hours.

Is Apple's iPad Mini really worth it?
Apple unveils the iPad Mini

READ: How Apple has changed under Tim Cook

Cook told NBC that Apple isn't concerned about the higher cost of manufacturing in the United States creating pressure to raise prices. Apple assembled many of its products in the United States until the late 1990s, when it exported that work to Asia where labor costs are lower.

"It's not so much about price, it's about the skills, etc.," he told NBC's Williams. "Over time, there are skills that are associated with manufacturing that have left the United States. Not necessarily people, but the education system has just stopped producing that. It's a concerted effort to get them back."

Cook acknowledged to Businessweek that the move is influenced, at least in part, by a desire to bolster a U.S. unemployment rate that, while slowly rebounding, still hovers around 8%.

"I don't think we have a responsibility to create a certain kind of job," Cook said. "But I think we do have a responsibility to create jobs."

In both interviews, Cook emphasized American jobs Apple has already helped create -- from the companies that make components of its popular iPhone to the developers who have built businesses creating apps for Apple mobile devices.

"The engine in here is made in America," Cook said, holding up an iPhone. "And not only are the engines in here made in America, but engines are made in America and exported. The glass on this phone is made in Kentucky. So, we've been working for years on doing more and more in the United States."

As large as it may sound, a $100 million investment remains a relatively small chunk of Apple's estimated $120 billion cash on hand. It follows other limited steps by electronics companies.

Earlier this year, Google began making its Nexus Q media streamer at a Texas plant -- although that ill-fated device has had a rocky run. Five months after it was unveiled, the Q's page in the Google Play store says it is "not for sale at this time."

Late last year, an analysis by the Boston Consulting Group predicted that 2015 will be a "tipping point" when many tech industries will begin manufacturing in the United States.

"A surprising amount of work that rushed to China over the past decade could soon start to come back -- and the economic impact could be significant," said Harold L. Sirkin, a senior partner and lead author of the analysis. "We're on record predicting a U.S. manufacturing renaissance starting by around 2015."

CNN's Dan Simon contributed to this report.

New data confirm big drop in illegal immigration

By Hope Yen, Associated Press

New census data released Thursday affirm a clear and sustained drop in illegal immigration, ending more than a decade of increases.

The number of illegal immigrants in the U.S. dropped to an estimated 11.1 million last year from a peak of 12 million in 2007, part of an overall waning of Hispanic immigration. For the first time since 1910, Hispanic immigration last year was topped by immigrants from Asia.

Demographers say illegal Hispanic immigration — 80 percent of all illegal immigration comes from Mexico and Latin America — isn't likely to approach its mid-2000 peak again, due in part to a weakened U.S. economy and stronger enforcement but also a graying of the Mexican population.

The finding suggests an uphill battle for the Republicans, who passed legislation in the House last week that would extend citizenship to a limited pool of foreign students with advanced degrees but who are sharply divided on whether to pursue broader immigration measures. 

In all, the biggest surge of immigration in modern U.S. history ultimately may be recorded as occurring in the mid-1990s to early 2000s, yielding illegal residents who now have been settled in the U.S. for 10 years or more. They include migrants who arrived here as teens and are increasingly at risk of "aging out" of congressional proposals such as the DREAM Act that offer a pathway to citizenship for younger adults.

"The priority now is to push a vigorous debate about the undocumented people already here," said Jose Antonio Vargas, 31, a journalist from the Philippines. "We want to become citizens and not face the threat of deportation or be treated as second class," said Vargas, whose campaign, Define American, along with the young immigrant group United We Dream, have been pushing for citizenship for the entire illegal population in the U.S. The groups point to a strong Latino and Asian-American turnout for President Barack Obama in last month's election as evidence of public support for a broad overhaul of U.S. immigration laws.

Earlier this year, Obama extended to many younger immigrants temporary reprieves from deportation. But Vargas, who has lived in the U.S. since 1993 and appeared this year on the cover of Time magazine with other immigrants who lacked legal status, has become too old to qualify.

"This conversation is a question about how we as a nation define who is an American," Vargas said, noting that if politicians don't embrace immigration overhaul now, a rapidly growing bloc of minority voters may soon do it for them. "If you want us to pay a fine to become a citizen, OK. If you want us to pay back taxes, absolutely. If you want us to speak English, I speak English. But we can't tread water on this issue anymore."

Jeffrey Passel, a senior demographer at the Pew Research Center and a former Census Bureau official, said U.S. immigration policies will have a significant impact in shaping a future U.S. labor force, which is projected to shrink by 2030. Aging white baby boomers, many in specialized or management roles, are beginning to retire. Mexican immigration, which has helped fill needs in farming, home health care and other low-wage U.S. jobs, has leveled off.

"Immigration is one way to boost the number of workers in the population," he said, but the next wave of needed immigrants is likely to come from somewhere other than Mexico. "We are not going to see a return to the levels of Mexican unauthorized immigration of a decade ago."

The numbers are largely based on the Census Bureau's Current Population Survey through March 2011. Because the Census Bureau does not ask people about their immigration status, Passel derived estimates on illegal immigrants largely by subtracting the estimated legal immigrant population from the total foreign-born population. The numbers are also supplemented with material from William H. Frey of the Brookings Institution and Mark Mather of the Population Reference Bureau, who reviewed data released Thursday from the Census' American Community Survey.

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The data showed that 11.1 million, or 28 percent, of the foreign-born population in the U.S. consists of illegal immigrants, virtually unchanged since 2009 and roughly equal to the level of 2005. An additional 12.2 million foreign-born people, 31 percent, are legal permanent residents with green cards. And 15.1 million, or 37 percent, are naturalized U.S. citizens.

Fewer Mexican workers are entering the U.S., while many of those immigrants already here are opting to return to their homeland, resulting in zero net migration from Mexico.

In 2007, legal and illegal immigrants made up equally large shares of the foreign-born population, at 31 percent, due to ballooning numbers of new unauthorized migrants seeking U.S. construction and related jobs during the mid-2000s housing boom. Naturalized U.S. citizens then represented 35 percent.

Broken down by geography and race, roughly half of all states last year posted declines or no change in their numbers of foreign-born Hispanics, including big immigrant states such as California and New York as well as economically hard hit areas in Arizona, Georgia and North Carolina, which previously had seen gains.

Foreign-born Asians were a bigger source of population gain than Hispanic immigrants in California, New York, Virginia, Illinois and New Jersey. Newly moving into suburban communities, the Asian population spread out more across the southeastern U.S. and Texas, increasing their share in 93 percent of the nation's metropolitan areas.

As a whole, foreign-born residents are slowly graying, with 44 percent now age 45 or older. They are more likely than in 2007 to be enrolled in college or graduate school (39 percent, up from 32 percent) and to be single (17 percent married, down from 22 percent).

Births to immigrant mothers also are on the decline, driving the overall U.S. birth rate last year to the lowest in records dating back to 1920.

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"At least temporarily, the face of immigration to the U.S. is changing in terms of cultural background, education and skills," Frey said. "The fertility bump provided by past Hispanic immigrants may not be replicated in the future, especially if Asians take over a greater share of U.S. immigrants."

House Republicans, seeking to show they are serious about addressing the immigration issue after being largely rejected by Hispanics in the election, voted last week to make green cards accessible to foreign students graduating with advanced science and math degrees from U.S. universities.

The measure, strongly backed by the high-tech industry and touted as a boost to the U.S. economy, would have a net effect of extending more visas and eventual citizenship to students from India and China. It is opposed by most Democrats, the Obama administration and immigrant rights groups such as the Asian American Justice Center which want to see it packaged with broader legislation that extends legal status for illegal immigrants.

These groups also oppose the proposed new 55,000 visas for foreign students because they would be offset by eliminating a lottery program that provides green cards to people with lower rates of immigration, mainly those from Africa. Senate Democrats on Wednesday blocked Republicans from bringing up the bill.

A bill introduced by Sens. Jon Kyl of Arizona and Kay Bailey Hutchison of Texas, who are retiring at the end of this session, seeks to offer some legal status to young immigrants. Critics say it falls short because it does not provide a path to citizenship, an issue that Sen. Robert Menendez, D-N.J., describes as "non-negotiable."

About 77 percent of Hispanic voters in the November election said they thought people working in the U.S. illegally should be offered a chance to apply for legal status, according to exit polling conducted for the television networks and The Associated Press. That is compared with 71 percent of Asian-Americans and 65 percent of voters overall.

The political implications are great.

Hispanics and Asian-Americans are the nation's two fastest-growing population groups, each increasing by more than 40 percent since 2000. A higher birth rate and years of steadily high immigration have boosted Hispanics to 17 percent of the U.S. population, compared with blacks at 12 percent and 5 percent for Asians.

Even if the nation's estimated 11 million illegal residents do not attain citizenship, the nation's Hispanics, who made up roughly 10 percent of voters in November, are expected to nearly double their share of eligible voters by 2030. Asian-Americans, who now are 3 percent of voters, will also continue to increase.

About 73 percent of Asian-Americans voted for Obama, second only to African-Americans at 93 percent and slightly higher than Latinos at 71 percent, according to exit polling.

Asian-Americans don't strongly identify with either party, but they tend to cite jobs, education and health care as issues most important to them and generally prefer a big government that provides more services. Relatively new to the U.S. and religiously diverse, Asian-Americans also may have been repelled by Republican Mitt Romney's forceful stance during the primaries seeking "self-deportation" of immigrants as well as the GOP's sometimes narrow appeal to evangelical Christians, said Karthick Ramakrishnan, a political science professor at the University of California-Riverside who helps conduct a broad National Asian American Survey.

While Mexicans make up about 55 percent of illegal immigrants and other Latin Americans represent another 25 percent, Asians make up a 10 percent share, many of whom overstay temporary visas.

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Branson: Drug war is massive failure

Karen Goldstein attends a rally in Fort Lauderdale, Florida, in support of legalizing marijuana.
Karen Goldstein attends a rally in Fort Lauderdale, Florida, in support of legalizing marijuana.
  • Richard Branson: Prohibition caused damage in the same way the war on drugs has done
  • Branson says if one of his companies is failing, he doesn't continue with failed strategies
  • U.S. has the most prisoners in the world, he says, 500,000 of them for drug violations
  • Branson: We need alternatives to jail that focus on education, health, taxation, regulation

Editor's note: Richard Branson is the founder of Virgin Group, with global branded revenues of $21 billion, and a member of the Global Drug Commission. Sir Richard was knighted in 1999 for his services to entrepreneurship. Watch today for Branson's interview with CNN/US' Erin Burnett Out Front at 7pm ET and tomorrow (12/7) with CNN International's Connect the World program at 4pm ET

(CNN) -- In 1925, H. L. Mencken wrote an impassioned plea: "Prohibition has not only failed in its promises but actually created additional serious and disturbing social problems throughout society. There is not less drunkenness in the Republic but more. There is not less crime, but more. ... The cost of government is not smaller, but vastly greater. Respect for law has not increased, but diminished."

This week marks the 79th anniversary of the repeal of Prohibition in December 1933, but Mencken's plea could easily apply to today's global policy on drugs.

We could learn a thing or two by looking at what Prohibition brought to the United States: an increase in consumption of hard liquor, organized crime taking over legal production and distribution and widespread anger with the federal government.

Richard Branson

Here we are, four decades after Richard Nixon declared the war on drugs in 1971 and $1 trillion spent since then. What do we have to show for it?

The U.S. has the largest prison population in the world, with about 2.3 million behind bars. More than half a million of those people are incarcerated for a drug law violation. What a waste of young lives.

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In business, if one of our companies is failing, we take steps to identify and solve the problem. What we don't do is continue failing strategies that cost huge sums of money and exacerbate the problem. Rather than continuing on the disastrous path of the war on drugs, we need to look at what works and what doesn't in terms of real evidence and data.

The facts are overwhelming. If the global drug trade were a country, it would have one of the top 20 economies in the world. In 2005, the United Nations estimated the global illegal drug trade is worth more than $320 billion. It also estimates there are 230 million illegal drug users in the world, yet 90% of them are not classified as problematic.

In the United States, if illegal drugs were taxed at rates comparable to those on alcohol and tobacco, they would yield $46.7 billion in tax revenue. A Cato study says legalizing drugs would save the U.S. about $41 billion a year in enforcing the drug laws.

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Have U.S. drug laws reduced drug use? No. The U.S. is the No. 1 nation in the world in illegal drug use. As with Prohibition, banning alcohol didn't stop people drinking -- it just stopped people obeying the law.

About 40,000 people were in U.S. jails and prisons for drug crimes in 1980, compared with more than 500,000 today. Excessively long prison sentences and locking up people for small drug offenses contribute greatly to this ballooning of the prison population. It also represents racial discrimination and targeting disguised as drug policy. People of color are no more likely to use or sell illegal drugs than white people -- yet from 1980 to 2007, blacks were arrested for drug law violations at rates 2.8 to 5.5 times higher than white arrest rates.

Prohibition failed when the American people spoke up and demanded its repeal. Today, the American people are showing their dissatisfaction with the war on drugs by voting for change, often in the face of federal law.

Colorado and Washington recently became the first U.S. states to legalize recreational use of marijuana. Eighteen states and the District of Columbia allow the medical use of marijuana, and 74% of Americans support alternatives to locking people up for marijuana possession.

How would our society, our communities and daily lives improve if we took the money we use running a police and prison state and put it into education and health? Treating drugs as a health issue could save billions, improve public health and help us better control violence and crime in our communities. Hundreds of thousands of people have died from overdoses and drug-related diseases, including HIV and hepatitis C, because they didn't have access to cost-effective, life-saving solutions.

A Pew study says it costs the U.S. an average of $30,000 a year to incarcerate an inmate, but the nation spends only an average $11,665 per public school student. The future of our nations and our children should be our priority. We should be helping people addicted to drugs break their habits rather than putting users in prison.

When it comes to drugs, we should focus on the goals we agree on: protecting our kids, protecting public safety and preventing and treating drug abuse and addiction. To help unlock barriers to drug reform, last June, I joined the Global Commission on Drug Policy, which is bringing global leadership to drug reform to make fact-based research public and draw attention to successful alternative approaches.

As part of this work, a new documentary, "Breaking the Taboo," narrated by Oscar award-winning actor Morgan Freeman and produced by my son Sam Branson's indie Sundog Pictures, followed the commission's attempts to break the political taboo over the war on drugs. The film exposes the biggest failure of global policy in the past 40 years and features revealing contributions from global leaders, including former Presidents Bill Clinton and Jimmy Carter.

It is time we broke the taboo and opened up the debate about the war on drugs. We need alternatives that focus on education, health, taxation and regulation.

If you ignore a serious problem, refuse to debate it and hope it will go away all by itself, you are very naive. The war on drugs has failed. It's time to confront the issue head on.

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The opinions expressed in this commentary are solely those of Richard Branson.