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Friday, June 27, 2008

Benefits of Legalization

Spending on immigration enforcement has been rapidly rising since 1986, when Congress passed the Immigration Control and Reform Act (IRCA). In 1985 Congress appropriated $1 billion for enforcement operations. Today, the federal government – mainly the Department of Homeland Security but also the Justice Department –spends about $13 billion in immigration enforcement and border control. (See my Paying the Price of the Immigration Crackdown.) Rather than attempt to integrate the population of 12-13 million illegal immigrants, the government, following the lead of the immigration restrictionists, has stepped up enforcement in a war of attrition against the immigrant community. Human rights and church activists have long warned of the heavy moral and humanitarian cost of an immigration policy that seeks the removal of this large community of mostly hard-working residents. But the ever-increasing price tag of the administration’s enforcement-only immigration policy should raise new questions about the strictly financial costs and benefits of an immigration policy that focuses exclusively on detention and removal. What is the alternative? Wouldn’t legalization of the unauthorized population result in increased government expenditures, especially in social services such a public health care, social security, food stamps, and Medicare? According to the Congressional Budget Office, the comprehensive reform package considered by the Senate in 2007 that included a pathway toward legalization would cost the country $27.7 billion over ten years in federal expenditures for entitlement programs. But the CBO pointed out that new revenue would also be flowing into the U.S. Treasury since regularized and legalized workers would become more integrated into the U.S. economy. What are now illegal aliens would if legalized begin paying more taxes and would often receive higher wages – adding up to an estimated $48.3 billion in new revenues from immigrants. “The combined effect of the increases in entitlement spending and revenues is to reduce the [federal government’s] deficit over the next ten years by $25.6 billion,” concluded the CBO. In the case of Social Security, legalization would increase expenditures by only $1.2 million over the next ten years because of the relative youth of the undocumented population. In the long run, expenditures would increase as these workers age. But during the ten years after legalization, newly legal workers would contribute $57.1 billion to Social Security. The CBO concluded: “Enactment of the Senate immigration legislation [authorizing a legalization process] is likely to modestly improve the outlook for Social Security trust funds and the ability of Social Security to provide promised benefits to current citizens.”
Photo: Agriprocessors workers arrested by ICE in Postville, Iowa/Postville Register

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