October 11, 2013
By Derrick Morgan
America is going broke. Our national debt exceeds $17 trillion, and Washington is piling up new debt by the hundreds of billions every year. Now is not the time to saddle the American taxpayer with trillions more in new obligations to folks who broke the law to enter or stay in this country.
Yet that’s exactly what amnesty for illegal immigrants -- such as that included in the “comprehensive” immigration reform bill passed by the U.S. Senate -- would do. And it’s what misguided liberals, including a coalition of business and labor groups, are pressuring the House of Representatives to do.
The Senate-passed bill anticipates granting amnesty to some 11 million people who are living in America illegally. Although proponents of this so-called path to citizenship blithely assure us that it won’t cost the taxpayer a dime, rigorous analysis by The Heritage Foundation reveals that’s just not so. In fact, it will cost at least several trillions.
In urging the House to follow the Senate’s lead with amnesty, many proponents of amnesty argue that bringing millions of illegal immigrants “out of the shadows” will be a boon to the struggling economy.
However, the proper economic lens through which to consider amnesty isn’t whether the nation’s Gross Domestic Product goes up or down; the GDP is bound to rise with more labor. The question is, will amnesty increase the after-tax income of American citizens and other legal residents?
Supporters of the Senate-style amnesty point out that those currently in the country illegally wouldn’t be eligible for citizenship—and to collect the government benefits to which citizenship would entitle them—for 13 years.
Some benefits would start earlier, to be sure, but all a 13-year delay would do is push the major fiscal costs outside the 10-year window used by the Congressional Budget Office to determine the cost of legislative proposals. Essentially, the deferred-citizenship feature keeps the true cost of amnesty “off the books.”
Unfortunately, those long-term costs are huge. Heritage’s Robert Rector examined the fiscal effect of adding amnestied immigrants to the rolls of federal entitlement programs such as Obamacare, Social Security, Medicare and the more than 80 means-tested federal welfare programs.
Some background: More than half of illegal immigrants who head households don’t yet have a high school diploma; about a quarter have only a high school diploma. That contrasts sharply with the native-born population, where under 10 percent of heads of households have less than a high school diploma.
In our modern economy, education usually is the key to higher earnings. Those with less education – whether immigrants or native born – tend to earn less (thus paying less taxes) and receive more in government services and benefits.
Today, the typical illegal immigrant is 34 years old, has a 10th-grade education and lives in a household that already receives $14,387 more in government benefits than it pays in taxes. After an “interim” period of 13 years set by the Senate bill, that typical household would become eligible for the full panoply of welfare and entitlements.
This imbalance would add to the financial stress on the nation’s retirement security programs. These are the same programs that federal actuaries say will be strained soon to the point of collapse, without adding millions of beneficiaries whose claim on the benefits began when they entered or stayed in the country illegally.
Amnesty and the welfare state simply don’t mix. As Nobel Prize-winning economist Milton Friedman once observed: “It is one thing to have free immigration to jobs. It is another thing to have free immigration to welfare. You cannot have both.”
Worst of all, perhaps, is that the Senate-passed “comprehensive” bill won’t actually stop illegal immigration.
Under the bill, the CBO predicts, millions more immigrants would come and stay illegally over the next few decades -- meaning in all likelihood we’d debate amnesty again within a generation.
This finding should not surprise us; it merely fits the historical pattern. We granted amnesty in 1986 to fewer than 3 million illegal immigrants and now have some 11 million. Granting another amnesty would encourage more illegal immigrants who are hoping for the next amnesty.
All of this would be grossly unfair to those who did not enter or stay in the country unlawfully or those who endured our overly bureaucratic immigration system to comply with the law.
America’s unsustainable welfare state needs reform. So, too, does our broken immigration system. But amnesty isn’t an essential element of immigration reform. The American taxpayer can’t afford amnesty’s multi-trillion-dollar price tag.
Derrick Morgan is vice president for domestic and economic policy at The Heritage Foundation.
Originally appeared in the Orange County Register.
Vice President, Domestic & Economic Policy
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