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Bloated Estimate of Legalization Costs Ignores Immigration Reform's Broader Economic Benefits

Released on Mon, May 06, 2013

Washington D.C. – Today, the Heritage Foundation released a report which attempts to assess the fiscal costs associated with legalizing the 11 million unauthorized individuals living in the United States. The new report is similar to a 2007 study, which was widely criticized at the time of publication and continues to be re-rejected today by conservatives. As such, this report serves as a reminder of why fiscal cost analyses cannot replace broader economic analyses.

The following is a statement by Benjamin Johnson, Executive Director of the American Immigration Council:

The 2013 Heritage report is a close redux of the 2007 fiscal analysis which they constructed on a foundation of faulty assumptions, and by design offers no analysis of the economic impacts of immigration reform. Instead, the authors take a very narrow look at what the newly legalized would pay in taxes over their lifetime. At the heart of the report is the assumption that everyone who lacks a college degree, including U.S. citizens, is a net drain on the American economy. In this very dark view of workers in the United States, those who build or maintain the houses, offices, cars, and roads for those with college degrees are a drag on our economy and society. In fact, nothing could be further from the truth. People are more than just the taxes they pay, and honest, hardworking people are the backbone of our economy. 

Ironically, Heritage claims to be using the methodology of a 1997 National Research Council study which estimated that “the economic benefits of immigration run as much as $10 billion a year.” Since then, especially in the last few years, we have witnessed a burst in economic research showing the strongly positive net impacts of immigration in general and comprehensive immigration reform in particular. Broad agreement has emerged as to not only the net economic and fiscal benefits of immigration, but the acceleration of those benefits over time. These analyses examine not only fiscal costs, but balance them with the fiscal and economic gains that would come from reform, including increasing tax contributions (full tax participation by legalized immigrants, with increasing tax revenue as their wages rise over time), consumer purchasing power (increasing wages means more money to spend), and an environment that yields gains from greater immigrant entrepreneurship and innovation.

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