A new study published by the Cato Institute asserts that current U.S. immigration laws and policies run counter to the economic wellness of U.S. households and advocates legalization of illegal immigrants through visa-taxing in order to maximize immigration’s benefit.
The methodology utilized in the study consists of seven different simulations, measuring six factors, and forecasts the respective long-run economic effects on the welfare of U.S. households by the year 2019.
The six different effects included in each simulation include:
a) direct effect: the change in U.S. gross domestic product (GDP)
b) occupation-mix effect: the shift in U.S. workers toward low-skilled occupations
c) capital effectt: change in U.S.-ownership of capital
d) U.S.-employment: the aggregate employment of U.S. workers
e) public-expenditure: state-spending on services such as education and health care
f) macro-price effect: movement in global prices for tradable goods and services
Many progressive commentators and Democratic politicians repudiate America’s restriction on immigration based on negative sentiment and criticism from overseas.
The Cato study conducted by Peter Dixon, faculty at Monash University (Australia), and Maureen Rimmer, Senior Research Fellow at Monash University, is based on fiscal concerns. The study’s seven simulations range from tighter border-security, to internal-security (business closures and prosecutions), and liberalized entry with an “optimal visa charge.” Dixon and Rimmer ultimately conclude that increased restriction of illegal immigration would cost U.S. households $80 billion annually, while legalization via temporary visa programs would lead to a $180 billion increase for U.S. households.
“The positive effects on the broader economy from legalization overwhelm the public-expenditure effects,” the report states. This is based upon the assumption that a decreased number in immigrants’ cases causes decreased investment, output, and consumption.
Dixon and Rimmer’s report largely correspond with the libertarian views many share at the institute, which, as illustrated, jibe with conservatives on most but not all policy issues.
The Federation for American Immigration Reform (FAIR) irrefutably opposes any such guest worker legislation. The major non-partisan and non-profit educational organization argues against amnesty due to the exacerbating effect the policies will have, inevitably leading to an even larger influx of illegal immigrants. The difference in long-run effects between Cato’s best policy simulation and FAIR’s estimates equate to greater than $260 billion (in 2009 dollars) disparity. As opposed to the $180 billion net-benefit Dixon and Rimmer estimate for U.S. households by 2019, FAIR forecasts a fiscal-cost of $106.3 billion in 2020 should a guest worker program take effect to just three program areas—education in primary and secondary schools, medical services in emergency rooms, and prison costs.
Mark Krikorian, executive director for the Center for Immigration Studies, who adopts a different approach to the vexing debate, also arrives at the conclusion that the status-quo is detrimental to U.S. households and interests. There are several issues which simply cannot be quantified. Krikorian says that whereas immigrants in the past more or less had to become “American,” due to modern society and technology, now assimilation and integration are no longer desired. Ultimately, Krikorian concludes that mass immigration is simply incompatible with the modern American middle-class, sovereignty, identity, and society.
The primary difference between immigration trends in the past and trends today is the tremendous lack of diversity in immigrants. Krikorian details the differences today at great length, along with its deadly combination of anti-assimilationist sentiment—keeping multiculturalists, ethnic radicals, and the threat of balkanization in business.
The Obama administration in the mean time is preoccupied with completing a massive overhaul to the health care system and is not planning a massive overhaul on U.S. border immigration policy. The administration has requested approximately $800 million for border-security measures. “These funding requests also are entirely consistent with President Obama’s often-stated desire to use technology and personnel at the southwest border to secure it and to reduce the flow of firearms and currency from the U.S. to Mexico,” stated Matt Mayer, a Visiting Fellow at the Heritage Foundation.