Is Illegal Immigration an Economic Burden to America?
General Reference (not clearly pro or con)
Adam Davidson, International Business and Economics Correspondent at National Public Radio (NPR), wrote in his Mar. 30, 2006 article "Q&A: Illegal Immigrants and the U.S. Economy" on www.npr.org:
"[M]any economists say the effect of an estimated 11 million undocumented workers is minimal. While illegal immigrants have a negative impact on unskilled workers — many of whom lack technical training or a high school diploma — economists believe that overall, the American economy benefits a small amount from illegal immigration — a little bit less than 1 percent... That finding... suggests that neither side of the immigration issue has a strong economic argument to make...
Illegal immigration has both negative and positive impacts on different parts of the economy. As noted above, wages for low-skilled workers go down. But that means the rest of America benefits by paying lower prices for things like restaurant meals, agricultural produce and construction. Another negative impact is on government expenditures. Since undocumented workers generally don't pay income taxes but do use schools and other government services, they are seen as a drain on government spending.
There are places in the United States where illegal immigration has big effects (both positive and negative). But economists generally believe that when averaged over the whole economy, the effect is a small net positive. Harvard's George Borjas says the average American's wealth is increased by less than 1 percent because of illegal immigration.
The economic impact of illegal immigration is far smaller than other trends in the economy, such as the increasing use of automation in manufacturing or the growth in global trade. Those two factors have a much bigger impact on wages, prices and the health of the U.S. economy."
Is Illegal Immigration an Economic Burden to America?
The Federation for American Immigration Reform (FAIR) wrote in its Feb. 2011 article "The Fiscal Burden of Illegal Immigration on United States Taxpayers" on www.fairus.org:
"Illegal immigration costs U.S. taxpayers about $113 billion a year at the federal, state and local level… The annual outlay that illegal aliens cost U.S. taxpayers is an average amount per native-headed household of $1,117... Education for the children of illegal aliens constitutes the single largest cost to taxpayers, at an annual price tag of nearly $52 billion...
At the federal level, about one-third of outlays are matched by tax collections from illegal aliens. At the state and local level, an average of less than 5 percent of the public costs associated with illegal immigration is recouped through taxes collected from illegal aliens. Most illegal aliens do not pay income taxes. Among those who do, much of the revenues collected are refunded to the illegal aliens when they file tax returns...
With many state budgets in deficit, policymakers have an obligation to look for ways to reduce the fiscal burden of illegal migration. California, facing a budget deficit of $14.4 billion in 2010-2011, is hit with an estimated $21.8 billion in annual expenditures on illegal aliens. New York's $6.8 billion deficit is smaller than its $9.5 billion in yearly illegal alien costs."
The Center for Immigration Studies (CIS) wrote in its Aug. 2004 article "The High Cost of Cheap Labor: Illegal Immigration and the Federal Budget" on www.cis.org/node/54:
"[T]he net fiscal cost of immigration ranges from $11 billion to $22 billion per year, with most government expenditures on immigrants coming from state and local coffers, while most taxes paid by immigrants go to the federal treasury. The net deficit is caused by a low level of tax payments by immigrants, because they are disproportionately low-skilled and thus earn low wages, and a higher rate of consumption of government services, both because of their relative poverty and their higher fertility. This is especially true of illegal immigration. Even though illegal aliens make little use of welfare, from which they are generally barred, the costs of illegal immigration in terms of government expenditures for education, criminal justice, and emergency medical care are significant. California has estimated that the net cost to the state of providing government services to illegal immigrants approached $3 billion during a single fiscal year. The fact that states must bear the cost of federal failure turns illegal immigration, in effect, into one of the largest unfunded federal mandates."
Jim Gilchrist, MBA, CPA, Founder and President of The Minuteman Project, said in an Aug. 26, 2005 speech titled "The Crushing Economic Burden of Illegal Immigration" and delivered at an immigration conference in Beverly Hills, California [transcript made available on Oct. 10, 2005 in FrontPageMagazine.com]:
"I've tried to figure out the costs since I have this tax background. What is the cost to each of us as taxpayers to support 30 million illegal aliens, many of whom are working in the underground economy and not contributing to the tax system? And yet they're using the system that bona fide taxpayers provide and pay for... I had to make my own estimate, since the government will not give me these numbers, nor does it care to calculate them... I've come up with my own numbers. And I will stand by these numbers. The annual gross cost to U.S. taxpayers to provide schooling, hospitalization, and whatever plethoric benefits are out there for the 30 million illegal aliens is approximately $400 billion per year funded by bona fide U.S. taxpayers. That's $400 billion per year and going up."
B. Lindsay Lowell, PhD, Director of Policy Studies at the Institute for the Study of International Migration at Georgetown University, stated in an Aug. 25, 2004 Center for Immigration Studies' panel discussion titled "The Costs of Illegal Immigration: The Impact of Illegal Aliens on the Federal Budget":
"There is a shadow side to the population that needs to be considered. It's real. U.S. immigration policy... has, with a wink and a nod, encouraged the growth of a low-rate sector that is supplied to a large degree by unauthorized workers. And in that regard, perhaps employers and consumers benefit, but as citizens we're abetting the growth of an underprivileged class, and as taxpayers, we are subsidizing employers... 17 percent, according to best estimate, of those in federal prisons are illegal aliens and they run up a substantial cost. This isn't news at all to the states that seek reimbursement. A roughly similar cost is found in federal courts. And payment for the treatment of the uninsured may run as high as $2.2 billion."
The Colorado Alliance for Immigration Reform (CAIR) wrote in its article "Economic Costs of Legal and Illegal Immigration" on www.cairco.org (accessed Oct. 19, 2011):
"The economic and social consequences of illegal immigration... are staggering... Illegal aliens have cost billions of taxpayer-funded dollars for medical services. Dozens of hospitals in Texas, New Mexico Arizona, and California, have been forced to close or face bankruptcy because of federally-mandated programs requiring free emergency room services to illegal aliens. Taxpayers pay half-a-billion dollars per year incarcerating illegal alien criminals. Immigration is a net drain on the economy; corporate interests reap the benefits of cheap labor, while taxpayers pay the infrastructural cost... $60 billion dollars are earned by illegal aliens in the U.S. each year. One of Mexico's largest revenue streams (after exports and oil sales) consists of money sent home by legal immigrants and illegal aliens working in the U.S... This is a massive transfer of wealth from America - essentially from America's displaced working poor - to Mexico. The total K-12 school expenditure for illegal immigrants costs the states $7.4 billion annually."
Walter Coffey, author of historical fiction and non-fiction, wrote in his June 17, 2011 article "How Illegal Immigration Harms the Economy" on www.teapartytribune.com:
"People routinely look the other way while employers pay illegal aliens low wages to work grueling hours in unsafe conditions. Some argue that illegals do work that Americans won't do, but the fact is that illegals do work that American's can't do because Americans must adhere to minimum wage and labor laws. Illegals don't have to. This is the 21st century equivalent to slavery.
When cheap labor dominates the market, overall wages naturally go down. When wages go down, American workers are harmed. And when American workers are harmed, the poor are always the first hit. In a free market, helping illegal families invariably harms legal families.
Illegal aliens pay little or no taxes, and they send millions of dollars out of the U.S. to their home country. Illegals are also more likely to use taxpayer-funded social services than citizens. They are entitled to free health care, education and food stamps. Nearly $5 billion per year is spent on illegal aliens.
The Roman Empire based its economy on slave labor, which was one of the key reasons why it fell. This is also one of the main reasons why the South lost the Civil War; relying on slave labor, the South could not match northern industrial and military might. Slave labor weakens nations by reducing exports, hindering technological innovation and turning employers lazy since they are virtually guaranteed profit at low cost. History shows that a national economy based on slave labor, in which a non-taxpaying workforce is supported by a taxpaying workforce, cannot prosper. If left unchecked, the economic consequences of illegal immigration could prove disastrous to America's future."
Alan Greenspan, PhD, former Chairman of the US Federal Reserve, stated in his Apr. 30, 2009 testimony before the US Senate Subcommittee on Immigration, Refugees, and Border Security:
"[T]here is little doubt that unauthorized, that is, illegal, immigration has made a significant contribution to the growth of our economy. Between 2000 and 2007, for example, it accounted for more than a sixth of the increase in our total civilian labor force. The illegal part of the civilian labor force diminished last year as the economy slowed, though illegals still comprised an estimated 5% of our total civilian labor force. Unauthorized immigrants serve as a flexible component of our workforce, often a safety valve when demand is pressing and among the first to be discharged when the economy falters.
Some evidence suggests that unskilled illegal immigrants (almost all from Latin America) marginally suppress wage levels of native-born Americans without a high school diploma, and impose significant costs on some state and local governments.
However the estimated wage suppression and fiscal costs are relatively small, and economists generally view the overall economic benefits of this workforce as significantly outweighing the costs."
Francine J. Lipman, MBA, LLM, Professor of Law, Business and Economics at Chapman University, wrote in a Spring 2006 Tax Lawyer essay titled "Taxing Undocumented Immigrants: Separate, Unequal and Without Representation":
"Americans believe that undocumented immigrants are exploiting the United States' economy. The widespread belief is that illegal aliens cost more in government services than they contribute to the economy. This belief is undeniably false... [E]very empirical study of illegals' economic impact demonstrates the opposite: undocumenteds actually contribute more to public coffers in taxes than they cost in social services. Moreover, undocumented immigrants contribute to the U.S. economy through their investments and consumption of goods and services; filling of millions of essential worker positions resulting in subsidiary job creation, increased productivity and lower costs of goods and services; and unrequited contributions to Social Security, Medicare and unemployment insurance programs. Eighty-five percent of eminent economists surveyed [according to the Dec. 1995 study by Julian L. Simon, "Immigration, the Demographic & Economic Facts," of the Cato Institute and the National Immigration Forum] have concluded that undocumented immigrants have had a positive (seventy-four percent) or neutral (eleven percent) impact on the U.S. economy."
Raul Hinojosa, PhD, Associate Professor of Chicana and Chicano Studies at the University of California at Los Angeles (UCLA), wrote in his July 18, 2005 BusinessWeek interview "A Massive Economic Development Boom":
"First and foremost, [illegal immigration] it's a source of value added. The total goods and services that they consume through their paycheck, plus all that they produce for their employers, is close to about $800 billion. They're also producing at relatively lower costs because the undocumented population typically gets about 20% less in wages than if they were legalized. That leads to lower prices for us and higher profits to employers. In addition, they're obviously a huge consumer base. We've seen that 90% of the wages that the undocumented population gets are spent inside the U.S. Remittances are sent abroad, but that only represents about 10% of immigrants' income. The numbers are becoming quite huge. We estimate about $50 billion dollars in remittances this year. That means that total consumptive capacity remaining in the U.S. is $400 billion to $450 billion. If you took away the undocumented population, it would be the worst economic disaster in the history of the U.S."
The Washington Post wrote in its June 4, 2007 editorial article "Immigrants Equal Growth... Reform Isn't Just Humane. It's Self-Interest":
"Amid the blizzard of data concerning immigrants' effects on wages, welfare and municipal budgets, the essential point is this: The latest wave of immigrants -- legal and illegal, skilled and unskilled -- has stimulated enormous economic activity and wealth generation in this country, and it is implausible that the American economy would fare as well without them... Since most immigrants come when they are young and working... they tend not to collect Social Security or Medicare for many years -- even while paying into the systems with payroll taxes, in many cases with phony Social Security numbers (meaning they will contribute but not collect). In fact, illegal immigrants do not get federal welfare benefits of any kind. At the same time they often pay income tax (through paycheck withholdings) and sales tax, thereby helping directly or indirectly to underwrite transportation, health care, education and other services. And while immigrants surely have contributed to some extent to the ranks of the poor, that was also true of previous waves of immigrants; the point is, most of those immigrants didn't stay poor."
The Wall Street Journal, in its "Monthly Economic Forecasting Survey: April 2006," conducted from Apr. 7-11, 2006, obtained the following answers from 46 economists:
It has benefited more than it has been harmed
It has been harmed more than it has benefited
Illegal immigrants often benefit businesses by filling low-wage jobs that are difficult to fill with Americans. But illegal immigrants can add to the costs of U.S. social programs. On balance, has the U.S. economy benefited more than it has been harmed by its current population of undocumented workers?
Jesus Nebot, filmmaker, entrepreneur, and speaker, wrote in an Aug. 14, 2011 email to ProCon.org:
"Economic studies seem to indicate that the contribution of undocumented immigrants to the US economy is greater than their burden.
Undocumented immigrants pay sales tax on their purchases and property tax on their homes. Additionally an estimated three-quarters of undocumented immigrants pay income tax using Individual Taxpayer Identification Numbers or false Social Security numbers. These documents put workers 'on the books,' which means their employers must make required deductions from their pay. Each year, taxpayers who use incorrect or false Social Security numbers (the majority of them undocumented immigrants) contribute approximately $7 billion to Social Security and $1.5 billion to Medicare. Most of these workers were educated in their countries of origin and now the U.S. economy reaps the rewards of their work. Yet, undocumented workers are ineligible for most government benefits.
On average, all immigrants will pay $80,000 more in taxes per capita than they use in government benefits over their lifetime. These facts led the President's Council of Economic Advisers to declare in June 2007 that 'the long-run impact of immigration on public budgets is likely to be positive.'
Undocumented immigration also produces a net benefit at the state level. For example, approximately 13.9% of the nation's undocumented immigrants live in Texas. In 2006, the Texas Comptroller reported that undocumented immigrants paid about $424.7 million more in state revenues – including sales tax and school property tax – than they used in state services, including education and health care."