Heritage Foundation.. DeMint: Taxpayers Would Pay for Amnesty

Now that the “Gang of Eight” has introduced a comprehensive immigration bill in the U.S. Senate, the cost to taxpayers of implementing amnesty for an estimated 11 million unlawful immigrants has come into focus.

The core problem with amnesty is clear: It encourages more unlawful immigration in hopes of future amnesties, and it treats unlawful immigrants more favorably than more than 4 million law-abiding people who wait outside our borders, following the rules, for their chance to come to contribute to the economic and social well-being of America.

A properly structured lawful immigration system would help our economy. This is why Heritage and conservatives have long argued for reforming the legal immigration system to make the process more efficient, more merit-based. We need an immigration process that attracts high-skilled workers and encourages patriotic assimilation to unite new immigrants with America’s vibrant civil society.

Amnesty for unlawful immigrants is totally different. Amnesty would impose significant tax burdens on Americans that are completely unnecessary to capture the positive economics that would be associated with a properly reformed lawful immigration system.

The Heritage Foundation is one of the only organizations looking at this cost to taxpayers. Our expert, Robert Rector, is one of the nation’s leading authorities on government social programs, and he is currently calculating what amnesty will cost taxpayers over the long term. It is based on a methodology also used by the National Academy of Sciences.

In 2007, when the national debt was about $9 trillion, Heritage research showed that unlawful, low-skilled immigrants paid significantly less in taxes than they received in government assistance, leading to taxpayer costs of more than $2 trillion. Today, we are nearly $17 trillion in debt, and with a massive expansion of government programs and services like Obamacare, we believe the taxpayer cost will be even higher this time. The study will look at the taxes likely to be paid by amnesty recipients and the government assistance likely to be used by amnesty recipients once they are eligible.

As American Enterprise Institute economist Andrew Biggs, a former associate director of President Bush’s National Economic Council, has noted:

In reality, immigrants have below-average earnings and shorter work lives… Since Social Security is progressive, a low earner receives more in benefits than he pays in taxes. That will be the case for Medicare as well and most likely in terms of the trade-off between income tax revenues and means-tested welfare programs… It does matter that, on average, you’re making the population poorer and poor people on average pay less in taxes than they receive back from the government. So could immigration help entitlements and the budget? Sure, if it was principally high-skill, high-earning immigration. But is that the deal on offer? No.

Proponents of the Gang of Eight legislation point to promises in the bill that unlawful immigrants will be barred from certain federal benefits after they are given legal status. Heritage’s Vice President of Domestic Policy Derrick Morgan and I wrote about this façade that could further increase the taxpayer burden:

Some may say we can solve this fiscal problem by granting amnesty without any government benefits. We all know that will never happen. As soon as any of the nearly 11 million unauthorized immigrants are given legal status, the political fight will turn to speeding their transition to citizenship and promises of a full array of federal benefits. Delaying eligibility for federal benefits to newly legalized immigrants merely puts off the day of reckoning. The truly enormous costs come when unauthorized immigrants start collecting retirement benefits. Social Security, Medicare, food stamps and other entitlement programs already impose huge, unfunded liabilities on taxpayers; adding more recipients only makes the fiscal hole we find ourselves in much deeper.

Taxpayers are right to be cautious of another large, incomprehensible bill like Obamacare—which created numerous new federal programs while politicians still falsely claimed it would lower the deficit.

In fact, Section 2524 of the Gang of Eight bill sheds light on the rising taxpayer costs likely to flow from the bill, as it creates a new federal commission specifically designed to promote the use of federal benefits to newly legalized immigrants. “The New Americans Tax Force” mission will be “to provide a coordinated Federal response to issues that impact the lives of new immigrants and receiving communities, including— access to youth and adult education programming; workforce training; health care policy; access to naturalization; and community development challenges; and to ensure that Federal programs and policies adequately address such impacts.”

A recent article in Politico states that liberals are cheering the Gang of Eight’s bill as an “extremely generous legalization program” that they say allows already deported immigrants as well as criminals who were previously denied to apply for legalization, has lower fines to receive legalization than the 2007 amnesty bill, loosened employment requirements, and weak border security triggers that won’t prevent a path to citizenship. They claim it has “a far more expansive version of the DREAM Act than Congress has ever considered” that contains no age cap and allows them to apply for citizenship within five years.

What’s more, the Obama Administration’s Health and Human Services Department until recently was spending our tax dollars to advertise on Spanish talk radio promoting food stamp usage. To be sure, most immigrants who come to this country don’t come looking for a government handout, but it’s clear that this Administration wants to increase what was once a government safety net into a trap of dependency.

We should address immigration in a step-by-step, problem-solving approach so we get the bulk of the benefits from immigration without the heavy fiscal costs of an amnesty and path to citizenship. This win-win scenario—modernizing our immigration system and encouraging high-skilled, college-educated workers to settle here—ought to be pursued without holding them hostage to the divisive and costly issue of amnesty.

Congress should move forward on these areas of broad agreement. Encouraging lawful immigration with an efficient legal system, securing the border, and enforcing workplace laws would benefit the security and economic outlook of American citizens and should not be delayed.


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