The Oktoberfest of Presidential debates is here and undoubtedly the hot button issue of immigration reform will make it on to the agenda. In one corner of the ring will be the candidate who supports comprehensive immigration reform –the President – and in the other, the candidate who supports self deportation – that is, Mitt Romney.
The sides are clear, never mind the flip flopping by Mitt, his tanner appearance on Univision or his latest talk about how helpful it would be to be Latino. But lost in the talk about immigration reform is the economics or dollars and sense of the left and right policy on the coffers of this country.
So let’s examine the economics of both sides.
Under Romney’s forced self-deportation policy, billions of dollars will have to be added to immigration enforcement to kick out unauthorized immigrants who do not represent any sort of threat to the United States.
As the Center for American Progress posits in the 2010 study, it would cost $200 billion over five years to deport the 10.8 million unauthorized immigrants the Department of Homeland Security claims live in the United States.
Additionally, The Perryman Group in a 2008 report estimates that the long-term negative effect of eliminating the unauthorized workforce would include roughly $245 billion in lost GDP and 2.8 million lost jobs.
Further, Raúl Hinojosa-Ojeda in a 2010 study conducted for the Immigration Policy Center and the Center for American Progress claims that deporting millions of unauthorized workers and consumers would damage the U.S. economy by reducing the U.S. GDP by 1.46 percent annually. This would amount to a $2.6 trillion cumulative loss in GDP over 10 years, not including the actual costs of deportation.
As if that’s not enough, a 2009 Cato report estimates that “a policy that reduces the number of low-skilled immigrant workers by 28.6 percent compared to projected levels would reduce U.S. household welfare by about 0.5 percent, or $80 billion” in 2019.
As for rounding up and incarcerating undocumented migrants – it costs roughly $166 per day for the U.S. Immigration Customs and Enforcement agency to detain one person or $5.5 million per day to detain 33,400 people in over 250 facilities, according to estimates by the National Immigration Forum.
Now you know what Romney’s policy stance will cost, let’s look at the economics on comprehensive immigration reform as proposed by President Obama.
The 2006 immigration reform bill, which included a legalization program, would have more than paid for its reform provisions through increased tax revenue.
The Congressional Budget Office and the Joint Committee on Taxation estimated that, as originally introduced on April 7, 2006, the Comprehensive Immigration Reform Act of 2006 would have generated $66 billion in new revenue during 2007-2016 from income and payroll taxes, as well as various administrative fees.
This additional revenue would have more than offset the $54 billion in new “direct spending” during 2007-2016 for refundable tax credits, Medicaid, Medicare, Social Security, and food stamps for newly eligible immigrants and their families.
Meanwhile, a 2010 study by Raúl Hinojosa-Ojeda, conducted for the Immigration Policy Center and the Center for American Progress, estimates that immigration reform which includes legalization of unauthorized immigrants and the creation of more flexible channels for legal immigration in the future would add at least $1.5 trillion in cumulative U.S. Gross Domestic Product (GDP) over 10 years.
Over the first three years, higher personal income would generate increased consumer spending – enough to support 750,000 – 900,000 jobs in the United States – as well as increased tax revenues of $4.5-$5.4 billion.
The benefits of additional growth in the gross domestic product would be spread broadly throughout the U.S. economy, but immigrant-heavy sectors such as textiles, electronic equipment, and construction would see particularly large increases.
A 2009 report by the libertarian CATO Institute also found that “the positive impact for U.S. households of legalization…would be 1.27 percent of GDP or $180 billion” in 2019.
Further, several past studies have found that immigrants who received legal status under the 1986 Immigration Reform and Control Act went on to acquire more education, earn higher wages, move out of poverty, and buy homes.
A 2009 study by Rob Paral & Associates for the Immigration Policy Center found that “IRCA immigrants age 25-34 years in 1990 experienced an increase of 41 percentage points in home ownership rates by 2006.”
Legal status allows workers to move into higher-paid occupations. For instance, a survey of Mexican men legalized under IRCA found that 38.8 percent had moved up into higher-paying occupations by 1992.
The facts are clear. You be the judge!