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June, 2007
"Setting the Record Straight" answers the muddle of
"which costs and when" that Robert Rector, himself,
created in analyses of the Senate's proposed Amnesty Bill......
said to be on its way to a Cloture vote possibly as early as Thursday,June
21.
Rector explains that most of the $2.6 TRILLION in costs from
the Bill would come due when today's amnestied illegal aliens
reached retirement age.
Another, separate tranche is the current annual NET cost of low-skill
immigrant households (both legal and illegal). These "households
now comprise five percent of the U.S. population and impose a
NET (i.e.after subtracting the taxes they pay) cost of $89 billion
per year on the U.S. taxpayer" [see news article].
Rector mentions the congruence of his numbers with those by the
National Research Council in The New Americans [1997]. Rector
may not know that the earliest studies in this vein are by former
Rice University Economics Professor Donald Huddle. In 1995, Huddle
estimated that the average net cost of immigration in the 1996-2006
decade would be $90 billion annually [Archives of Carrying Capacity
Network, Washington D.C.].
Keep calling and e-mailing Senators to vote AGAINST Cloture.
Keep them talking and the Bill will probably die.
Please visit our site www.carryingcapacity.org to support our
work.
.....................
Setting the Record Straight
June 19, 2007
https://www.heritage.org/Research/Immigration/wm1509.cfm
June 18, 2007
Setting the Record Straight: Illegal Immigrants Will Receive Welfare
Under Senate Bill
by Robert E. Rector
WebMemo #1509
In criticizing recent Heritage Foundation research on the cost
of low-skill immigration and amnesty, proponents of the Senate
immigration legislation (S. 1348), including Administration spokesmen,
have falsely claimed that the proposal would not give illegal
immigrants access to the U.S. welfare system.[1]
While provisions of the Senate bill would delay illegal immigrants'
access to welfare for several years, over time nearly all amnesty
recipients would be offered legal permanent residence and access
to more than 60 federal means-tested welfare programs.
Specifically, Z visa holders would immediately be given Social
Security numbers and would begin earning entitlement to Social
Security and Medicare (which are not means-tested welfare programs).
Some ten to thirteen years after enactment, amnesty recipients
would begin to gain access to a wide variety of means-tested welfare
programs, such as Temporary Assistance to Needy Families, public
housing, and Food Stamps. The amnesty process under S.1348, and
the different stages of the process at which amnesty recipients
become eligible for different government benefits, are precisely
described in "Amnesty Will Cost U.S. Taxpayers at Least $2.6
Trillion."[2]
The fact that amnesty recipients will have limited access to means-tested
welfare in the first ten years or so after enactment will have
only a marginal impact on overall costs. As the Heritage study
states:
The initial limitation on receipt of means-tested welfare will
have only a small effect on governmental costs. Welfare is only
part of the benefits received by immigrant families. Moreover,
the average adult amnesty recipient can be expected to live more
than 50 years after receiving his Z visa. While his eligibility
for means-tested welfare will be constrained for the first 10
to 15 years, each amnesty recipient will be fully eligible for
welfare during the last 30 to 40 years of his life. Use of welfare
during these years is likely to be heavy.[3]
The Heritage analysis of the costs of amnesty was a study of the
fiscal costs (benefits received minus taxes paid) of amnesty recipients
during their retirement years. It concluded that amnesty recipients
would impose a likely net cost of $2.6 trillion dollars on the
taxpayers during that period and that these costs would mainly
occur in two non-welfare programs (Social Security and Medicare)
and in one means-tested program (Medicaid). The study explicitly
states that these costs will not commence until 25 to 30 years
after the bill is enacted.[4]
To claim that amnesty recipients will not have access to the welfare
system evidences an unfamiliarity with the provisions of S. 1348
as well as the Heritage analysis.
Defending S.1348 on the grounds that amnesty recipients would
not be eligible for welfare also is hypocritical, because the
position of the Administration has been to reduce the restrictions
in current law on immigrants' use of welfare. For example, the
1996 welfare reform law prohibited legal permanent residents (green
card holders) from receiving welfare for their first ten years
in the country. In 2002, the Bush administration successfully
promoted a change in the law to allow non-citizen green card holders
to receive Food Stamps after five years in the country.[5]
It is also claimed that a second study by The Heritage Foundation,
"The Fiscal Cost of Low Skill Immigrants to the U.S. Taxpayer,"is
an outlier in the field of research.[6]
This study examined the net fiscal cost (total government benefits
received minus total taxes paid) of households headed by immigrants
without a high school degree. It found that these low-skill immigrant
households, on average, receive three dollars in benefits for
every one dollar in taxes paid. Low-skill immigrant households
(both legal and illegal) now comprise five percent of the U.S.
population and impose a net cost of $89 billion per year on the
U.S. taxpayer.
There is one previous study of the fiscal impact of low-skill
immigrants: the National Academy of Sciences' 1997 New Americans
study.[7]
The findings in that study match those of Heritage research: immigrants
without a high school degree imposed a substantial net cost on
the taxpayer, and the initial fiscal burden was so severe that
it was not erased by the earnings and taxes of subsequent generations.
Even when the net taxes paid by the immigrants' descendents over
the next 300 years (roughly 10 generations) were estimated, the
net present value to the taxpayer of low-skill immigrants remained
slightly negative.[8]
The same National Academy of Sciences study also argued that low-skill
immigration produced an economic gain, mainly by reducing prices.
Most Americans, however, would find the reason for this gain unsettling:
"There is a direct correspondence between the fact that some
domestic workers suffer wage reductions and the fact that we gain
as a nation" from immigration.[9]
Low-skill immigration reduces prices of some consumer goods because
it reduces the relative wages of the workers producing those goods,
including the wages of millions of low-skill non-immigrants who
compete with the low-skill immigrants. As the National Academy
of Sciences put it, "Although wage declines are real losses
to the affected [non-immigrant] workers, they are also the source
of a national ‘gain' from immigration."[10]
A national policy that reduces consumer prices by reducing the
wages of the least skilled American workers is hardly a recipe
for long-term social and political stability.
The Heritage studies in question show that while college-educated
immigrants pay more in taxes than they receive in benefits, low-skill
immigrants do not. The best public policy would encourage the
more
high-skill and less low-skill immigration. Unfortunately, S. 1348
moves in the opposite direction.
Robert Rector is Senior Research Fellow in Domestic Policy Studies
at The Heritage Foundation.
--------------------------------------------------------------------------------
[1] Interview with Tony Snow, CNN, American Morning,
7:51 AM, June 12, 2007. "I understand that it's important
to try to total costs and benefits, but you have to take a look
at the actual bill…. this bill does not guarantee; it says
the people do not have access to the welfare system."
[2] Robert Rector, "Amnesty will Cost the
U.S. Taxpayers at least $2.6 Trillion," Heritage Foundation
WebMemo No. 1490, June 6, 2007, at www.heritage.org/Research/Immigration/wm1490.cfm.
Since the publication of this paper, an amendment introduced by
Senator Jeff Sessions and passed by the Senate has modified the
bill to delay a Z visa holder's access to the Earned Income Tax
Credit.
[3] Ibid.
[4] Ibid., p.6.
[5] The White House, Working Toward Independence:
The President's Plan To Strengthen Welfare Reform, February 2002,
p.33, at
www.whitehouse.gov/news/releases/2002/02/welfare-reform-announcement-book.html.
[6] Robert Rector and Christine Kim, "The
Fiscal Cost of Low-Skill Immigrants to the U.S. Taxpayer,"
Heritage Foundation Special Report No.SR-14, May 21, 2007, at
www.heritage.org/Research/Immigration/sr14.cfm.
[7] National Research Council, The New Americans:
Economic, Demographic and Fiscal Effects of Immigration (Washington,
D.C.: National Academy Press, 1997).
[8] Ibid., pp., 334, 342.
[9] Ibid., p. 140.
[10] Ibid., p.141.
"Setting
the Record Straight" answers the muddle of "which costs
and when" that Robert Rector, himself, created in analyses
of the Senate's proposed Amnesty Bill...... said to be on
its way to a Cloture vote possibly as early as Thursday,
June 21.
Note: CCN is anti-mass immigration but NOT anti-immigrant. |