OUR OWN GOVERNMENT CLEARY KNOWS WHAT THE COST OF THE MEXICAN INVASION, OCCUPATION AND EVER EXPANDING WELFARE FOR ILLEGALS SYSTEMS COSTS! THEY ALSO KNOW THAT IT IS A LIE THAT THERE ARE ONLY 12 MILLION OF THESE ILLEGALS (INCLUDING ONE MILLION MEX GANG MEMBERS). MOST NON-GOV SOURCES PUT THE NUMBER AT 38 MILLION AND BREEDING FAST.
THE BELOW WAS WRITTEN BEFORE THE CURRENT ECONOMIC MELTDOWN CAUSE BY THE BANKSTERS, MOST OF WHICH LIKE WELLS FARGO, AND BANK of AMERICA, ARE GENEROUS DONORS TO THE MEX FASCIST PARTY of LA RAZA, AND HAVE EXPLOITED ILLEGALS WITH THEIR SCAM MORTGAGE PRODUCTS AND BANK FEES TO WIRE MONEY BACK TO NARCOMEX.
EVEN WITH STAGGERING UNEMPLOYMENT, MEX WELFARE COSTS ($20 BILLION A YEAR IN CA FOR SOCIAL SERVICES TO ILLEGALS --- LOS ANGELES COUNTY PUTS OUT $600 MILLION PER YEAR IN WELFARE TO ILLEGALS)
WE ARE MEXICO’S WELFARE, “FREE” BIRTHING CENTERS, FREE EMERGENCY ROOM HEALTHCARE, JOBS AND JAILS PLAN! NO WONDER THE ILLEGALS KEEP COMING OVER OUR BORDERS AND RIGHT INTO OUR JOBS, WELFARE LINES, AND VOTING BOOTHS!
Unfettered Immigration = Poverty
By Robert Rector
Heritage.org | May 16, 2006
This paper focuses on the net fiscal effects of immigration with particular emphasis on the fiscal effects of low skill immigration. The fiscal effects of immigration are only one aspect of the impact of immigration. Immigration also has social, political, and economic effects. In particular, the economic effects of immigration have been heavily researched with differing results. These economic effects lie beyond the scope of this paper.
Overall, immigration is a net fiscal positive to the government’s budget in the long run: the taxes immigrants pay exceed the costs of the services they receive. However, the fiscal impact of immigrants varies strongly according to immigrants’ education level. College-educated immigrants are likely to be strong contributors to the government’s finances, with their taxes exceeding the government’s costs. By contrast, immigrants with low education levels are likely to be a fiscal drain on other taxpayers. This is important because half of all adult illegal immigrants in the U.S. have less than a high school education. In addition, recent immigrants have high levels of out-of-wedlock childbearing, which increases welfare costs and poverty.
An immigration plan proposed by Senators Mel Martinez (R-FL) and Chuck Hagel (R-NE) would provide amnesty to 9 to 10 million illegal immigrants and put them on a path to citizenship. Once these individuals become citizens, the net additional cost to the federal government of benefits for these individuals will be around $16 billion per year. Further, once an illegal immigrant becomes a citizen, he has the right to bring his parents to live in the U.S. The parents, in turn, may become citizens. The long-term cost of government benefits to the parents of 10 million recipients of amnesty could be $30 billion per year or more. In the long run, the Hagel/Martinez bill, if enacted, would be the largest expansion of the welfare state in 35 years.
Current Trends in Immigration
Over the last 40 years, immigration into the United States has surged. Our nation is now experiencing a second “great migration” similar to the great waves of immigrants that transformed America in the late 19th and early 20th centuries. In 2004, an estimated 35.7 million foreign-born persons lived in the U.S. While in 1970 one person in twenty was foreign born, by 2004 the number had risen to one in eight.
About one-third of all foreign-born persons in the U.S. are illegal aliens. There are between 10 and 12 million illegal aliens currently living in the U.S. Illegal aliens now comprise 3 to 4 percent of the total U.S. population. Each year approximately 1.3 million new immigrants enter the U.S. Some 700,000 of these entrants are illegal.
One third of all foreign-born persons in the U.S. are Mexican. Overall, the number of Mexicans in the U.S. has increased from 760,000 in 1970 to 10.6 million in 2004. Nine percent of all Mexicans now reside in the U.S. Over half of all Mexicans in the U.S. are illegal immigrants, and in the last decade 80 to 85 percent of the inflow of Mexicans into the U.S. has been illegal.
The public generally perceives illegals to be unattached single men. This is, in fact, not the case. Some 44 percent of adult illegals are women. While illegal men work slightly more than native-born men; illegal women work less. Among female illegals, some 56 percent work, compared to 73 percent among native-born women of comparable age. As well, Mexican women emigrating to the U.S. have a considerably higher fertility rate than women remaining in Mexico.
Immigrants and EducationOn average, immigrants have low education levels relative to native-born U.S. citizens. One-quarter of legal adult immigrants lack a high school degree, compared to 9 percent among the native-born population. However, there is a well educated sub-group within the legal immigrant population. Some 32 percent of legal immigrant adults have a college degree, compared to 30 percent of native-born adults.
The education levels of illegal aliens are lower than those of legal immigrants. Half of all adult illegal immigrants lack a high school degree. Among Latin American and Mexican immigrants, 60 percent lack a high school degree and only 7 percent have a college degree. By contrast, among native-born workers in the U.S., only 6 percent have failed to complete high school degrees and nearly a third have a college degree.
Decline in Immigrant Wages
Over the last 40 years the education level of new immigrants has fallen relative to the native population. As the relative education levels of immigrants have declined, so has their earning capacity compared to the general U.S. population. Immigrants arriving in the U.S. around 1960 had wages, at the time of entry, that were just 13 percent less than natives’. In 1965, the nation’s immigration law was dramatically changed, and from 1990 on, illegal immigration surged. The result was a decline in the relative skill levels of new immigrants. By 1998, new immigrants had an average entry wage that was 34 percent less than natives.’ Because of their lower education levels, illegal immigrants’ wages would have been even lower.
The low-wage status of recent illegal immigrants can be illustrated by the wages of recent immigrants from Mexico, a majority of whom have entered the U.S. illegally. In 2000, the median weekly wage of a first-generation Mexican immigrant was $323. This was 54 percent of the corresponding wage for non-Hispanic whites in the general population.
Historically, the relative wages of recent immigrants have risen after entry as immigrants gained experience in the labor market. For example, immigrants who arrived in the U.S. in the 1960s and 1970s saw their relative wages rise by 10 percentage points compared to natives’ wages during their first 20 years in the country. But in recent years, this modest catch up effect has diminished. Immigrants who arrived in the late 1980s actually saw their relative wages shrink in the 1990s.
Immigration and Welfare Dependence
Welfare may be defined as means-tested aid programs: these programs provide cash, non-cash, and social service assistance that is limited to low-income households. The major means-tested programs include Food Stamps, Temporary Assistance to Needy Families, public housing, the earned income credit, and Medicaid. Historically, recent immigrants were less likely to receive welfare than native-born Americans. But over the last thirty years, this historic pattern has reversed. As the relative education levels of immigrants fell, their tendency to receive welfare benefits increased. By the late 1990s immigrant households were fifty percent more likely to receive means-tested aid than native-born households. Moreover, immigrants appear to assimilate into welfare use. The longer immigrants live in the U.S., the more likely they are to use welfare.
A large part, but not all, of immigrants’ higher welfare use is explained by their low education levels. Welfare use also varies by immigrants’ national origin. For example, in the late 1990s, 5.6 percent of immigrants from India received means-tested benefits; among Mexican immigrants the figure was 34.1 percent; and for immigrants from the Dominican Republic the figure was 54.9 percent. Ethnic differences in the propensity to receive welfare that appear among first-generation immigrants persist strongly in the second generation. The relatively high use of welfare among Mexicans has significant implications for current proposals to grant amnesty to illegal immigrants.
Some 80 percent of illegal immigrants come from Mexico and Latin America. (See Chart 1) Historically, Hispanics in America have had very high levels of welfare use. Chart 2 shows receipt of aid from major welfare programs by different ethnic groups in 1999; the programs covered are Medicaid, Food Stamps, public housing, Temporary Assistance to Needy Families, General Assistance, and Supplemental Security Income. As the chart shows, Hispanics were almost three times more likely to receive welfare than non-Hispanic whites. In addition, among families that received aid, the cost of the aid received was 40 percent higher for Hispanics than for non-Hispanic whites. Putting together the greater probability of receiving welfare with the greater cost of welfare per family means that, on average, Hispanic families received four times more welfare per family than white non-Hispanics.
1. Part, but not all, of this high level of welfare use by Hispanics can be explained by background factors such as family structure. It seems likely that, if Hispanic illegal immigrants are given permanent residence and citizenship, they and their children will likely assimilate into the culture of high welfare use that characterizes Hispanics in the U.S. This would impose significant costs on taxpayers and society as a whole.
Welfare use can also be measured by immigration status. In general, immigrant households are about fifty percent more likely to use welfare than native-born households. Immigrants with less education are more likely to use welfare. (See Chart 3)
The potential welfare costs of low-skill immigration and amnesty for current illegal immigrants can be assessed by looking at the welfare utilization rates for current low-skill immigrants. As Chart 4 shows, immigrants without a high school degree (both lawful and unlawful) are two-and-a-half times more likely to use welfare than native-born individuals. This underscores the high potential welfare costs of giving amnesty to illegal immigrants.
1. All categories of high school dropouts have a high utilization of welfare. Immigrants who have less than a high school degree are slightly more likely to use welfare than native-born dropouts. Legal immigrants who are high school dropouts are slightly more likely to use welfare than native-born dropouts. Illegal immigrant dropouts, however, are less likely to use welfare than native-born dropouts mainly because they are ineligible for many welfare programs. With amnesty, current illegal immigrants’ welfare use would likely rise to the level of lawful immigrants with similar education levels.
Illegal Immigration and Poverty
1. According to the Pew Hispanic Center, 4.7 million children of illegal immigrant parents currently live in the U.S. Some 37 percent of these children are poor. While children of illegal immigrant parents comprise around 6 percent of all children in the U.S., they are 11.8 percent of all poor children.
This high level of child poverty among illegal immigrants in the U.S. is, in part, due to low education levels and low wages. It is also linked to the decline in marriage among Hispanics in the U.S. Within this group, 45 percent of children are born out-of-wedlock. (See Table 1.) Among foreign-born Hispanics the rate is 42.3 percent. By contrast, the out-of-wedlock birth rate for non-Hispanic whites is 23.4 percent. The birth rate for Hispanic teens is higher than for black teens. While the out-of-wedlock birth rate for blacks has remained flat for the last decade, it has risen steadily for Hispanics. These figures are important because, as noted, some 80 percent of illegal aliens come from Mexico and Latin America.
In general, children born and raised outside of marriage are seven times more likely to live in poverty than children born and raised by married couples. Children born out-of-wedlock are also more likely to be on welfare, to have lower educational achievement, to have emotional problems, to abuse drugs and alcohol, and to become involved in crime.
5. Poverty is also more common among adult illegal immigrants, who are twice as likely to be poor as are native-born adults. Some 27 percent of all adult illegal immigrants are poor, compared to 13 percent of native-born adults.
Economic and Social Assimilation of Illegal Immigrant OffspringOne important question is the future economic status of the children and grandchildren of current illegal immigrants, assuming those offspring remain in the U.S. While we obviously do not have data on future economic status, we may obtain a strong indication of future outcomes by examining the educational attainment of offspring of recent Mexican immigrants. Some 57 percent of current illegal immigrants come from Mexico, and about half of Mexicans currently in the U.S. are here illegally.
First-generation Mexican immigrants are individuals born in Mexico who have entered the U.S. In 2000, some 70 percent of first-generation Mexican immigrants (both legal and illegal) lacked a high school degree. Second-generation Mexicans may be defined as individuals born in the U.S. who have at least one parent born in Mexico. Second-generation Mexican immigrants (individuals born in the U.S. who have at least one parent born in Mexico) have greatly improved educational outcomes but still fall well short of the general U.S. population. Some 25 percent of second-generation Mexicans in the U.S. fail to complete high school. By contrast, the high school drop out rate is 8.6 percent among non-Hispanic whites and 17.2 percent among blacks. Critically, the educational attainment of third-generation Mexicans (those of Mexican ancestry with both parents born in the U.S.) improves little relative to the second generation. Some 21 percent of third-generation Mexicans are high school drop outs. Similarly, the rate of college attendance among second-generation Mexicans is lower than for black Americans and about two-thirds of the level for non-Hispanic whites; moreover, college attendance does not improve in the third generation.
These data indicate that the offspring of illegal Hispanic immigrants are likely to have lower rates of educational attainment and higher rates of school failure compared to the non-Hispanic U.S. population. High rates of school failure coupled with high rates of out-of-wedlock childbearing are strong predictors of future poverty and welfare dependence.
Immigration and Crime
Historically, immigrant populations have had lower crime rates than native-born populations. For example, in 1991, the overall crime and incarceration rate for non-citizens was slightly lower than for citizens.
On the other hand, the crime rate among Hispanics in the U.S. is high. Age-specific incarceration rates (prisoners per 100,000 residents in the same age group in the general population) among Hispanics in federal and state prisons are two to two-and-a-half times higher than among non-Hispanic whites. Relatively little of this difference appears to be due to immigration violations.
Illegal immigrants are overwhelmingly Hispanic. It is possible that, over time, Hispanic immigrants and their children may assimilate the higher crime rates that characterize the low-income Hispanic population in the U.S. as a whole. If this were to occur, then policies that would give illegal immigrants permanent residence through amnesty, as well as policies which would permit a continuing influx of hundreds of thousands of illegal immigrants each year, would increase crime in the long term.
The Fiscal Impact of Immigration
One important question is the fiscal impact of immigration (both legal and illegal). Policymakers must ensure that the interaction of welfare and immigration policy does not expand the welfare-dependent popula_tion, which would hinder rather than help immi_grants and impose large costs on American society. This means that immigrants should be net contributors to government: the taxes they pay should exceed the cost of the benefits they receive.
In calculating the fiscal impact of an individual or family, it is necessary to distinguish between public goods and private goods. Public goods do not require additional spending to accommodate new residents. The clearest examples of government public goods are national defense and medical and scientific research. The entry of millions of immigrants will not raise costs or diminish the value of these public goods to the general population.
Other government services are private goods; use of these by one person precludes or limits use by another. Government private goods include direct personal benefits such as welfare, Social Security benefits, Medicare, and education. Other government private goods are “congestible” goods. These are services that must be expanded in proportion to the population. Government congestible goods include police and fire protection, roads and sewers, parks, libraries, and courts. If these services do not expand as the population expands, there will be a decrease in the quality of service.
An individual makes a positive fiscal contribution when his total taxes paid exceed the direct benefits and congestible goods received by himself and his family.
The Fiscal Impact of Low Skill Immigration
The 1997 New Americans study by the National Academy of Sciences (NAS) examined the fiscal impact of immigration. It found that, within in a single year, the fiscal impact of foreign-born households was negative in the two states studied, New Jersey and California. Measured over the course of a lifetime, the fiscal impact of first-generation immigrants nationwide was also slightly negative. However, when the future earnings and taxes paid by the offspring of the immigrant were counted, the long-term fiscal impact was positive. One commonly cited figure from the report is that the net present value (NPV) of the fiscal impact of the average recent immigrant and his descendents is $83,000.
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