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Economy

The Lifetime Fiscal Impact of Immigrants-By enacting a selectionist immigration policy‐the U.S. could reduce future federal debt by trillions of dollars

2024-09-25

[ManhattanInstitute] EXECUTIVE SUMMARY
This report estimates the lifetime fiscal impact of immigrants, of various ages and educational attainment, to the United States. It offers a methodological upgrade over similar analyses and estimates and evaluates the fiscal impact of various proposed immigration reforms.

A clear picture of the fiscal cost of immigrants is particularly important, given the ongoing border crisis. The Congressional Budget Office estimates that the border surge will number 8.7 million unlawful immigrants between 2021 and 2026. The original analysis in this report finds that the border crisis will cost an estimated $1.15 trillion over the lifetime of the new unlawful immigrants—a cost larger than the entire U.S. defense budget and almost equal to the cost of Social Security in 2023.

Looking at immigrants more broadly, this report shows that the average new immigrant (lawful or unlawful) has a positive fiscal impact and reduces the federal budget deficit by over $10,000 during his lifetime. For comparison, the average native-born citizen is expected to cost over $250,000 to the federal government. Despite the average immigrant reducing the budget deficit, immigrants without a college education and all those who immigrate to the U.S. after age 55 are universally a net fiscal burden by up to $400,000. The large positive fiscal impact of young and college-educated immigrants pulls up the overall average. Each immigrant under the age of 35 with a graduate degree reduces the budget deficit by over $1 million in net present value during his lifetime.

Therefore, for policymakers considering the fiscal impact of immigrants to the U.S., the characteristics of people seeking entry into the country are crucial. Certain immigrants are fiscally beneficial; others are fiscally detrimental.

This report quantifies the fiscal impact of common immigration reform proposals:

Mass deportations would significantly reduce the national debt over the long run, but a policy of selective legalization, coupled with mass deportations, would be even more fiscally beneficial, reducing the debt by about $1.9 trillion.

Given the education, age, and earnings of H-1B visa recipients, doubling the number of H-1B visas for just one year would reduce the budget deficit by $70 billion over the long run—and by another $70 billion each year thereafter.

The most beneficial immigration policy change would be to exempt STEM graduate degree holders from green-card caps, increasing immigration by some 15,000 people per year and reducing the visa backlog; this would reduce the deficit by $150 billion in the first year and $25 billion each year thereafter.

Eliminating refugee resettlement and permanent immigration by parents of U.S. citizens would reduce the debt by a combined $40 billion in net present value every year.

Congress could upskill the existing immigration flow by eliminating the diversity visa category and increasing the visas available to the top employment-based categories, and requiring immigrants to have earned a high school diploma to be eligible for a family visa, reducing the national debt by over $60 billion per year.

By enacting a selectionist immigration policy—which requires securing the border from unlawful immigration, reducing low-skilled immigration, and expanding high-skilled immigration—the U.S. could reduce future federal debt by trillions of dollars over the long run. This report proposes a legislative package that provides over $2 trillion in net present value during the first year and over $200 billion each subsequent year, without accounting for the additional productivity growth resulting from high-skilled immigration. Furthermore, under these reforms, the annual number of immigrants who are new permanent residents decreases by about 15% after a temporary legalization program and a partial clearing of the employment-based visa backlog. Over the long term, annual legal immigration decreases under this plan from approximately 1 million in FY 2019 to approximately 860,000.

Posted by:NoMoreBS

#1 Immigration expert warns Black Americans are being impacted by migrants 'flooding their communities'

Posted by: Skidmark 2024-09-25 11:56

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