Economic Impact of Illegal Immigrants in The United States - Weighing Benefits Against Costs

Weighing Benefits Against Costs

During 2007, the nonpartisan Congressional Budget Office reviewed 29 reports published over 15 years on the impact of unauthorized immigrants on the budgets of state and local governments. While cautioning that the reports are not a suitable basis for developing an aggregate national effect across all states, they concluded that:

• State and local governments incur costs for providing services to unauthorized immigrants and have limited options for avoiding or minimizing those costs;
• The amount that state and local governments spend on services for unauthorized immigrants represents a small percentage of the total amount spent by those governments to provide such services to residents in their jurisdictions;
• The tax revenues that unauthorized immigrants generate for state and local governments do not offset the total cost of services provided to those immigrants, although the impact is most likely modest; and
• Federal aid programs offer resources to state and local governments that provide services to unauthorized immigrants, but those funds do not fully cover the costs incurred by those governments.

Professor of Law Francine Lipman writes that the belief that illegal migrants are exploiting the US economy and that they cost more in services than they contribute to the economy is "undeniably false". Lipman asserts that "undocumented immigrants actually contribute more to public coffers in taxes than they cost in social services" and "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."

Aviva Chomsky, a professor at Salem State College, states that "Early studies in California and in the Southwest and in the Southeast...have come to the same conclusions. Immigrants, legal and illegal, are more likely to pay taxes than they are to use public services. Illegal immigrants aren't eligible for most public services and live in fear of revealing themselves to government authorities. Households headed by illegal immigrants use less than half the amount of federal services that households headed by documented immigrants or citizens make use of."

Editorialist Robert Samuelson points out that poor immigrants strain public services such as local schools and health care. He points out that "from 2000 to 2006, 41 percent of the increase in people without health insurance occurred among Hispanics", although he makes clear that these facts are true of legal as well as illegal immigrants.

According to a 1998 article in The National Academies Press, "many represented not science but advocacy from both sides of the immigration debate...often offered an incomplete accounting of either the full list of taxpayer costs and benefits by ignoring some programs and taxes while including others," and that "the conceptual foundation of this research was rarely explicitly stated, offering opportunities to tilt the research toward the desired result." One survey conducted in the 1980s found that 76 percent of economists felt recent illegal immigration had a positive effect on the economy.

National Public Radio (NPR) wrote in 2006: "Supporters of a crackdown argue that the U.S. economy would benefit if illegal immigrants were to leave, because U.S. employers would be forced to raise wages to attract American workers. Critics of this approach say the loss of illegal immigrants would stall the U.S. economy, saying illegal workers do many jobs few native-born Americans will do."

The Center for Immigration Studies, an organization that advocates Immigration reduction in the United States, reported in 2004: "Households headed by illegal aliens imposed more than $26.3 billion in costs on the federal government in 2002 and paid only $16 billion in taxes, creating a net fiscal deficit of almost $10.4 billion, or $2,700 per illegal household."