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Amnesty & the Bankrupting of America
Posted By Arnold Ahlert On May 7, 2013 @ 12:39 am In Daily Mailer,FrontPage | 10 Comments
A report released by the conservative Heritage Foundation threatens to blow a big hole in the so-called Gang of Eight’s attempt to implement comprehensive immigration reform. An analysis of the costs associated with granting amnesty to 11 million illegal aliens is staggering: according to the report, taxpayers would be forced to shell out $6.3 trillion, even when the 10-year barrier preventing newly legalized individuals from seeking government benefits is factored into the equation. “No matter how you slice it, amnesty will add a tremendous amount of pressure on America’s already strained public purse,” Robert Rector, the Heritage scholar who prepared the report, said in a statement.
The study focuses on four types of government benefits considered relevant to the issue. These include “Direct Benefits,” such as Social Security, Medicare, unemployment insurance, and workers’ compensation; “Means-tested Welfare Benefits” such as Medicaid, food stamps, the refundable Earned Income Tax Credit, public housing, Supplemental Security Income, and Temporary Assistance for Needy Families; “Public Education,” which is subsidized for low-income families; and “Population-based Services” that include police, fire, highways, parks, and similar services, that must be expanded when the population of a community increases.
Heritage directly challenges some of the popular canards surrounding the debate, most notably the idea that illegals are a “net plus” for America’s economy. The report explains that in our “highly-redistributive” system of government “net tax contributors,” who pay more in taxes than they receive in government services, have higher levels of education. “For example, in 2010, in the whole U.S. population, households with college-educated heads, on average, received $24,839 in government benefits while paying $54,089 in taxes. The average college-educated household thus generated a fiscal surplus of $29,250 that government used to finance benefits for other households,” the report explains.
On the other hand, households with lower education levels tend to be “net tax consumers,” who use more government services than they pay for. “For example, in 2010, in the U.S. population as a whole, households headed by persons without a high school degree, on average, received $46,582 in government benefits while paying only $11,469 in taxes. This generated an average fiscal deficit (benefits received minus taxes paid) of $35,113,” says the report.
The report reveals the educational levels of illegals, noting that “the typical unlawful immigrant has only a 10th-grade education,” that 50 percent of illegal households “are headed by an individual with less than a high school degree,” and another “25 percent of household heads have only a high school degree.” As a result, Heritage reveals that in 2010, illegal aliens “received around $24,721 in government benefits and services while paying some $10,334 in taxes,” amounting to an annual fiscal deficit of “$14,387 per household.”
Taxpayers make up the difference. However, if an additional 11 million illegals are added to the system and they become fully integrated after the current waiting period of 13 years–the current version of the bill proposes 10 years for a green card, plus three more years to acquire full citizenship–the fiscal deficit for each immigrant household “would soar.”
However, the 13-year waiting period is hardly sacrosanct. The current bill has something called a “blue card” loophole in it. Someone who has passed a background check and can prove that he has engaged in 575 hours of agricultural work anywhere before December 31, 2012, can be granted a blue card. Furthermore, his spouse and children can be granted one as well, all on the same application.
Yet even that time period is flexible. The Secretary of Homeland Security has the discretion to grant an additional year-and-a-half if “additional time is required,” or for anything else determined to be a “good cause.” If the individual continues to work in agriculture after the rate of 150 days for 5.75 hours per day for three-of-the-five years after the bill passes, he can qualify for permanent resident status. That period can also be reduced to three years, if the individual can demonstrate he was disabled, ill or dealing with the “special needs of a child.”
In addition, another provision provides a fast track for those who entered the country before they were 16, aka the “Dreamers” who, along with their spouses and children, can also gain permanent resident status in five years.
The Heritage report fleshes out such realities. As an additional consequence of legalization, after amnesty recipients become citizens, “they would have the unconditional right to bring their parents to the U.S.” who would then be eligible to obtain citizenship in five years. “As many as 15 to 20 million parents would become eligible for legal permanent residence under an amnesty law,” it explains.
There is little doubt this is true. Both the Center for American Progress, which supports the bill, as well as NumbersUSA, which opposes it, estimate that more than 30 million illegals will be legalized over the next decade. Sen. Jeff Sessions (R-AL), the ranking Republican on the Senate’s banking committee who agreed with that assessment, further noted that there will be an additional inflow of 25 million short-term and long-term low-skill and high-skill workers during the same period. Sessions believes that massive inflow could damage job prospects for Americans. Sen. Marco Rubio (R-FL) disputes that assessment contending that not all of the 11 million waiting for the bill’s passage would be eligible. Yet Rubio omits the reality that it is unlikely those who remain ineligible will be deported.
In an explosive revelation during a Sunday interview with Breitbart News Sunday host Stephen K. Bannon, Sessions upped the political ante, claiming the Gang of Eight didn’t write the immigration bill. “The Gang of Eight claims they wrote it, but really if you saw the news reports Steve, it was always the unions and the Chamber of Commerce was working with La Raza and SEIU and they’re about to reach an agreement. I mean, like, who’s writing this bill?” Sessions asked.
After contending that Congress needs to be “serving the American interest,” Sessions posed the ultimate question. “If you have a choice, and there’s a job out here that pays an unskilled worker a decent wage with a retirement and healthcare benefit, should it go to somebody who came across the border illegally 18 months ago, or to an unemployed American who’s on welfare and food stamps right now and unable to take care of his family?”
Sessions has a point. Despite the media-generated hype surrounding immigration reform, the economy remains issue number one for most Americans. The Heritage Foundation report explains the economic consequences of passing the current bill. “Over a lifetime, the former unlawful immigrants together would receive $9.4 trillion in government benefits and services and pay $3.1 trillion in taxes. They would generate a lifetime fiscal deficit (total benefits minus total taxes) of $6.3 trillion.”
It then addresses the reality of the aforementioned “flexibility” regarding the number of people used to calculated their estimate. “This should be considered a minimum estimate. It probably understates real future costs because it undercounts the number of unlawful immigrants and dependents who will actually receive amnesty and underestimates significantly the future growth in welfare and medical benefits,” the report states.
Heritage further notes that the 1986 amnesty bill produced a fraud rate of 25 percent, and that the industry producing fraudulent documents “has grown vastly larger and more sophisticated.” If the same fraud rate applies to the current bill, an additional lifetime cost of $1.5 trillion would be added to the $6.3 trillion.
Economist and Wall Street Journal writer Stephen Moore contends many economists challenge the notion that immigrants are a net cost to the country, claiming immigrants eventually become more productive and entrepreneurial. Others claim that an aging U.S. population needs an influx of younger immigrants to keep entitlement programs such as Social Security solvent.
Heritage debunks both notions. “Unlawful immigrants, on average, are always tax consumers; they never once generate a ‘fiscal surplus’ that can be used to pay for government benefits elsewhere in society,” the report reveals. And while noting that illegals “currently pay FICA taxes and would pay more after amnesty,” the report contends that when those people retire, each individual on Social Security and Medicare is likely to draw out $3.00 for every $1.00 paid in FICA taxes.
Moreover, the report explains that “taxes and benefits must be viewed holistically,” and when an individual who “pays $3,700 per year into the Social Security trust fund but simultaneously draws a net $25,000 per year (benefits minus taxes) out of general government revenue, the solvency of government has not improved.”
Assuming what the report says it true, Americans might still be convinced that all of the potential economic hardships might be worth it, if the border was sealed once and for all. Unfortunately, as this version of the bill reveals, border security is a farce. In short the bill proposes “triggers” to achieve 90 percent security, “calculated by dividing the number of apprehensions and turn backs in the sector during a fiscal year by the total number of illegal entries in the sector during such fiscal year.” (How those who manage to elude apprehension can be accurately counted remains a mystery.) If the 90 percent figure isn’t achieved, in any year of the next five, a “Border Security Commission” will be established to find out why. In other words, a committee will attempt to determine why a bureaucracy came up short — during which time all of the other processes leading to the legalization of millions will continue to be implemented.
Heritage Foundation president Jim DeMint offers an apt analogy regarding what comprehensive immigration reform legislation is really all about. “I think if people read the bill, that it will be blocked,” he said on ABC’s This Week. “Because once you get into it, just like Obamacare, it is not the way it’s been advertised.”
Americans are only beginning to grasp the travesty that “comprehensive healthcare” represents. Comprehensive immigration reform that would fundamentally alter the character of the nation, even as the rule of law is kicked to the curb for political expediency’s sake, would be far worse.
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