Comment on FAIR’s Fiscal Cost of Illegal Immigrants Study

July 8, 2010

The Federation for American Immigration Reform (FAIR) released a study yesterday that has garnered quite a bit of attention among conservative circles over the past couple days. (It was released formally yesterday, but Fox News gave it a sneak preview on Tuesday.)

The main takeaway from the study is that illegal immigrants “burden” legal citizen taxpayers to the tune of $113 billion in net costs, mostly at the state/local level in the form of public education for immigrant children.

I’m not going to delve into the methodology of the study on the spending side of the ledger or the general issue of illegal immigration, but I do have three questions for the study’s authors and the organization FAIR.

1. The study appears to make a simple calculation error when it comes to the level of payroll taxes remitted by employers and employees on behalf of illegal immigrant labor. The text of the study cites $7 billion as the employee share and then says that it will double that to account for the employer portion. The study even mentions the number $14,000,000,000 in the Social Security taxes section. However, in the summary page that adds up federal taxes, you only include the employee portion of Social Security and Medicare taxes. This means you would be overestimating the “drain” on the federal government imposed by illegal immigrants by nearly $9 billion. Was this an error, or am I missing something?

2. How important should the net fiscal impact of illegal immigrants be in terms of formulating immigration policy? Suppose the federal government could ignore the 14th Amendment and prohibit immigrants from receiving many excludable government services and transfers, thereby making immigrants have an unambiguously positive impact on government coffers. Would that really change your position on immigration, or do you just use the “fiscal drain” argument to support your pre-existing opposition to immigration?

3. If the fiscal drain of a given individual is important for the issue of immigration, what about existing citizenship? There are a lot of native-born American citizens who are significant drains on government. What should government do about this? If the borders were sealed shut, would you support the existence of these programs like public schooling, Medicaid, EITC, etc.?

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