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ETpro's avatar

What are the real costs and benefits of the US Senate's Immigration Reform Bill as written?

Asked by ETpro (34605points) June 30th, 2013

Here is the actual bill. The nonpartisan Congressional Budget Office (CBO) said that the Senate Bill would cut the federal deficit by $175 billion over first 10 years of its enactment and by $700 billion over the decade after that. The CBO also put out a second economic estimate that incorporates the broader economic impact of reform. That showed even bigger gains. In stark contrast, the right-wing think tank, the Heritage Foundation claimed that the Immigration Bill would add $2 trillion to the federal debt over the same 20 year period. Those two estimates are so wildly far apart one has to wonder which report authors were smoking the wild weed when they wrote their version of what immigration reform would do to the budget.

Former Commerce Secretary Robert Reich has made a short video in which he explains why he thinks the CBO’s version of Immigration Reform is closer to the truth. So may the games begin. Who is telling the truth about Immigration Reform’s cost, and who’d blowing smoke? Why do you think those distorting the picture are doing so?

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11 Answers

Jaxk's avatar

Frankly both look to be rather biased and likely way off base.The CBO estimates an annual GDP growth rate from this bill of 3.3% annually. I find that hard to believe. If we are only looking at the current immigrants, they are already cooked into the GDP. They are working and spending, any GDP growth from these guys is already baked in or at least most of it is. The same is true of costs. The heritage Foundation talks about the costs of scholling, roads, public services, etc. which are also already baked into the economy. These people are already here. Both thier GDP contribution and their costs are already being counted. The biggest shift will occur when they become eligible for other benefits (Welfare, Healthcare, SS, etc.). That’s where the Heritage foundation sees the costs rising dramtically and I would think that’s true.

Now we get to government revenues. We don’t really know how many are working under false IDs and as such are already paying taxes. Some are and some aren’t so the neumber in each group will determine how much additional revenue will be created. If the bulk of the illegal immigrants are low income workers (I believe they are) thier contribution to the tax base will be minimal. SS may be a bit more but general taxation probably not.

Basically I don’t think either is trying to lie to you but rather simple looking at different sides of the coin. If we assume the illegal immigrants will take advantage of social programs at the same rate as the general population (the Heritage assumption), costs will rise dramtically once they become eligible. If they do not (the CBO assumption) the costs won’t rise as dramatically.

The real problem with both these analysis is the cost of the extended families (sisters, brothers, mothers, fathers, cousins, etc.) that they will bring in once they are full citizens. And how much immigration is too much? We know (at least I do) that we can’t accomodate everyone in the world, so where is the line between acceptable immigration and too much too fast? It’s one thing to say immigration is good for us but not unlimited immigration. And how do we control that if we don’t control the border?

jerv's avatar

If history is any guide, I would say that the CBO’s numbers are a bit optimistic while the Heritage Foundation’s numbers are based solely on ideology with just enough reality in there to sound at least remotely credible. I base that solely by looking at the past and extrapolating forward.

That said, neither side is telling the truth. The CBO is still a squabbling committee, and any result they put forth is a best-fit estimate of the middle ground between differing views. And that assumes that they are even entirely competent; an assumption I am not willing to make. Still, common sense dictates that a bickering bunch of half-wits will generally find a consensus that is closer to the truth than the “findings” of an entity with an adversarial agenda.

exnick's avatar

It seems Mr. Reich is clueless about immigrant welfare statistics for legals and illegals. Unlike the immigrants of the 80’s/90’s, today’s immigrants have no intention of being productive.

They blame it on “low education”, haha.

jerv's avatar

@exnick According to your source, the numbers for natives follows the numbers for both legal and illegal immigrants.

exnick's avatar

What are you reading?

And your point is what? we need more immigrants to leech on more welfare?

exnick's avatar

In 2009 (based on data collected in 2010), 57 percent of households headed by an immigrant (legal and illegal) with children (under 18) used at least one welfare program, compared to 39 percent for native households with children.

Immigrant households’ use of welfare tends to be much higher than natives for food assistance programs and Medicaid. Their use of cash and housing programs tends to be similar to native households.

Immigrant households with children used welfare programs at consistently higher rates than natives, even before the current recession. In 2001, 50 percent of all immigrant households with children used at least one welfare program, compared to 32 percent for natives.

For all households (those with and without children), the use rates were 37 percent for households headed by immigrants and 22 percent for those headed by natives.

exnick's avatar

And its much more concentrated on specific races. Look at welfare arranged by race link

White 13%
Black 35%
Hispanic 33%
Other 23%

Minorities are outpacing majorities.

jerv's avatar

@exnick I used the graph from your link along with simple statistical analysis that I learned back in 7th grade. As for, “Minorities are outpacing majorities.”, that link has no historical data to establish any sort of pacing for any group.

That leaves us with just the provable facts; that immigrants are more likely to be on public assistance (as are non-white US natives), that we would actually be financially better off to deport the Blacks than the Hispanics since a higher percentage of them are on welfare, and that it’s hard to make the sort of arguments you’re making without sounding racist.

Think about this also; what use is spending many billions to try to secure the border when it’s already been proven that borders cannot be effectively sealed? Are you the type of person who would drive 30 miles out of your way to save 3¢/gallon on your next fill-up? False savings are no savings. Remember when FL tried to save money on welfare by spending millions of taxpayer dollars on drug testing to prove their claim that welfare recipients are all a bunch of druggies? It turned out that the drug use amongst welfare recipients was about half of what it was amongst those not on assistance (96% passed, 2% failed, 2% abstained) so the exclusionary policy wound up costing more than it saved by kicking druggies off of welfare. What makes you think immigration reform will be any different?

exnick's avatar

From your chart link….

“Figure 1 shows the share of immigrant- and native-headed households with children (under age 18) using at least one major welfare program from 2002 to 2009. Overall, the figure shows that immigrant households with children have used welfare programs at consistently higher levels than natives for most of the last decade. In 2001, 50 percent of all immigrant households with children used at least one welfare program, compared to 32 percent for native households. By 2009, that had grown to 57 and 39 percent, respectively. Figure 1 also shows that the rate for Hispanic immigrant households with children is much higher than that for native households and immigrants generally.”

As for welfare, here is historical data: welfare by race It has the same consistency.

You wrote “when it’s already been proven that borders cannot be effectively sealed?”

What is the point of laws if crime persists? Lets stop funding the justice system.

jerv's avatar

@exnick You missed my point in a manner that makes further discussion with you impossible rather than merely unproductive.

@Jaxk You are correct that we need to control the border better than we do. However, look at the logistics involved, compare it to Berlin and Korea (borders which some people did/do cross illicitly anyways), and ask yourself what the most cost-effective way solution is. Some would argue that allowing citizen militias like the Minutemen Civil Defense Corp to engage in target practice on fence-climbers is the best solution since they’ll do it for free, but is that really the sort of solution we want here?

The line is somewhere between zero and current levels. It can never be zero, so attempts to make it zero will be doomed to failure.

tomathon's avatar

Who would you rather listen to: someone who is successful with money during good and bad economic times or a charlatan like Robert Reich who writes books on how to be successful with money for oneself or the country, but has never actually had any success himself other then selling books filled with empty rhetoric?

I choose the former. The correct way to measure the forecasting track record of economists (or any forecaster for that matter) is to measure how consistently they make a profit by betting their own money on their forecasts. This means that the wealthiest economists are likely to be the best forecasters. How many economists have such success? A handful and even pointing that out is called survivorship bias.

So the answer to your question is flip a coin.

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