Creating Opportunities for Immigrant Students and Supporting the U.S. Economy

July 13, 2010

Each year, approximately 65,000 undocumented students graduate from high school, many at the top of their classes, but cannot go to college, join the military, work, or otherwise pursue their dreams. They belong to the 1.5 generation—any (first generation) immigrants brought to the United States at a young age who were largely raised in this country and therefore share much in common with second generation Americans.

These students are culturally American, growing up here and often having little attachment to their country of birth.  They tend to be bicultural and fluent in English.  Many don’t even know that they are undocumented immigrants until they apply for a driver’s license or college, and then learn they lack Social Security numbers and other necessary legal documents. 

According to Professor Roberto Gonzalez of the University of Washington:

[t]he experiences of undocumented children belonging to the 1.5 generation represent dreams deferred.  Many of them have been in this country almost their entire lives and attended most of their K-12 education here.  They are honor roll students, athletes, class presidents, valedictorians, and aspiring teachers, engineers, and doctors.  Yet, because of their immigration status, their day-to-day lives are severely restricted and their futures are uncertain.  They cannot legally drive, vote, or work.  Moreover, at any time, these young men and women can be, and sometimes are, deported to countries they barely know.  They have high aspirations, yet live on the margins.  What happens to them is a question fraught with political and economic significance.

Because of the barriers to their continued education and their exclusion from the legal workforce, many undocumented students are discouraged from applying to college.  It is estimated that only between 5 and 10 percent of undocumented high-school graduates go to college—not because they don’t want to, but because they cannot afford it or because some schools will not allow them to enroll.  Even worse, there is often little incentive for them to finish high school, leading to high drop-out rates and the potential for them to become involved in gangs and illegal activities.

The Development, Relief, and Education for Alien Minors Act, or “DREAM Act,” would provide a pathway to legal status for the thousands of undocumented students who graduate from high school each year.  On March 26, 2009, Senators Richard Durbin (D-IL) and Richard Lugar (R-IN) and Representatives Howard Berman (D-CA), Lincoln Diaz-Balart (R-FL), and Lucille Roybal-Allard (D-CA) introduced the DREAM Act as S. 729 and H.R. 1751, respectively.  To date, the DREAM Act has at least 39 co-sponsors in the Senate and 124 in the House.

Organizations and individuals from across the country—from California to Kentucky, Oklahoma to New York—have joined together to support the DREAM Act.  Thousands of undocumented students and their supportive classmates and teachers have met with their members of Congress, sent letters, held rallies, and staged hunger strikes and other activities in pursuit of making the DREAM Act a reality.  Following the detention of an undocumented Harvard student in early June, Harvard President Drew Faust stated that the DREAM Act serves as a “lifeline to these students who are already working hard in our middle and high schools and living in our communities by granting them the temporary legal status that would allow them to pursue postsecondary education."

Research has shown that the DREAM Act would be a boon to the economy and the U.S. workforce.  Moreover, as the Migration Policy Institute (MPI) has pointed out, “The DREAM Act would create an unprecedented opportunity for many young people to step onto a path to permanent legal status, a path that would require them to demonstrate either a significant investment in their human capital or service to the United States through membership in the armed forces.”  The DREAM Act presents an opportunity that should not be wasted.

What Would the DREAM Act Do?

The DREAM Act addresses the plight of young undocumented immigrants growing up in the United States who wish to go to college and obtain lawful employment.  The bill allows current, former, and future undocumented high-school graduates and GED recipients a pathway to U.S. citizenship through college or the armed services.

  •  An undocumented high-school graduate or GED recipient would be eligible to adjust to conditional lawful permanent resident (LPR) status if they have been physically present in the United States for at least five years and were younger than 16 when they first entered the country.
  • This LPR status would be granted on a conditional basis and valid for six years, during which time the student would be allowed to work, go to school, or join the military.
  • The “conditional” status would be removed and the person granted LPR status after six years once the student has either completed two years in a program for a bachelor’s degree or higher degree or has served in the armed services for at least two years and, if discharged, has received an honorable discharge. 
  • DREAM Act students would not be eligible for federal education grantsStudents would, however, be eligible for federal work study and student loans, and individual states would not be restricted from providing financial aid to the students.

Who Would Benefit from the DREAM Act?

There are approximately 1.5 million undocumented children in the United States, and each year tens of thousands graduate from primary or secondary school, often at the top of their classes.  For many of these children, the United States is the only home they know, and English is their first language.  In fact, many assist their parents in becoming more acclimated to U.S. society by serving as interpreters and cultural guides.  They have the potential to be future doctors, nurses, soldiers, teachers, and entrepreneurs, but they experience unique hurdles to achieving success in this country.  Through no fault of their own, their lack of status may prevent them from attending college, joining the military, or working legally. The DREAM Act would provide an opportunity for them to live up to their full potential and make greater contributions to the U.S. economy and society. 

  • Each year approximately 65,000 undocumented students graduate from high school and would be eligible under the Dream Act for conditional status and eventual permanent status.
  • Approximately 114,000 potential beneficiaries with at least an associate’s degree would be immediately eligible for conditional LPR status.
  • Another 612,000 potential beneficiaries would be immediately eligible for conditional status because they already have a high-school diploma or GED (and would have the incentive to complete two years of college or two years of military service to be eligible for permanent status).
  • 934,000 children under 18 could be eligible for conditional LPR status in the future under the DREAM Act, which would provide them with incentives to finish high school and pursue a post-secondary education or join the military.
  • DREAM Act-eligible immigrants live in all 50 states, but some states have far more potential beneficiaries than others.  The top ten states with the largest number of potential DREAM Act beneficiaries are California (26% of the national total), Texas (12%), Florida (9%), New York (7%), Arizona (5%), Illinois (4%), New Jersey (4%), Georgia (3%), North Carolina (2%), and Colorado (2%).  All other states combined are home to one-quarter of potential DREAM Act beneficiaries.

According to MPI, roughly 2.1 million individuals would meet the DREAM Act’s basic age, length of residence, and age of arrival requirements upon enactment.  However, it is difficult to estimate the number of individuals who would obtain permanent resident status because it depends on their ability to complete high school, two years of college, or two years of military service.

What are the Economic Benefits of the DREAM Act?

  • The DREAM Act gives individuals the opportunity to increase their standard of living and tax contributions: If legalized, these students would have access to greater educational opportunities, and better jobs, which in turn means more taxable income.   As of 2006, workers without a high-school diploma earned $419 per week and had an unemployment rate of 6.8 percent.  Workers with a bachelor’s degree earned $962 per week and had an unemployment rate of 2.3 percent, while workers with a doctoral degree earned $1,441 per week and had an unemployment rate of 1.4 percent.  A study by the College Board found that over the course of their working lives, the average college graduate earns in excess of 60 percent more than a high-school graduate, and workers with advanced degrees earn two to three times as much as high-school graduates.  The U.S. Department of Labor found that the wages of immigrants in the 1986 legalization increased 15 percent over five years, and that the immigrants move on to “significantly better jobs.”
  • The DREAM Act would allow legalized immigrants to invest in the U.S. economy: Dr. Raul Hinojosa-Ojeda of the University of California, Los Angeles, and others have studied the impact of legalization and found important long-term improvements among previously undocumented immigrants. Specifically, removing the uncertainty of undocumented status allows legalized immigrants to earn higher wages and move into higher-paying occupations, and also encourages them to invest more in their own education, open bank accounts, buy homes, and start businesses.
  • The DREAM Act would save taxpayers money: A RAND study from 1999 shows that raising the college graduation rate of Hispanics to that of non-Hispanic whites would increase spending on public education by 10 percent nationwide, but the costs would be more than offset by savings in public health and benefits, as well as increased tax revenues resulting from higher incomes.  For example, a 30-year-old Mexican immigrant woman with a college degree will pay $5,300 more in taxes and use $3,900 less in government expenses each year compared to a high-school dropout with similar characteristics.
  • The DREAM Act would likely reduce the drop-out rate for immigrant students by creating a strong incentive for undocumented students to remain in school until graduation. Currently, most undocumented children are forced to work illegally in the cash economy as domestic servants, day laborers, and sweatshop factory workers.  The DREAM Act would make these children lawfully eligible to work, and help fill positions like teachers, nurses, and service employees—positions that have long been in demand in the United States.
  • The DREAM Act keeps talented students in the United States: Letting the talent of DREAM Act students go to waste “imposes economic and emotional costs on undocumented students and on U.S. society as a whole.”  The DREAM Act would also stop brain drain by allowing our most talented students to remain in the country.  Currently, only 5-10 percent of undocumented high-school graduates go to college. 

What are the Additional Benefits of the DREAM Act?

The DREAM Act would help universities.  The 10 states which, since 2001, have passed laws allowing undocumented students to qualify for in-state tuition have not experienced a large influx of new immigrant students that displaces native-born students. These states (Texas, California, Utah, Washington, New York, Oklahoma, Illinois, Kansas, New Mexico, and Nebraska) are home to about half of the nation’s undocumented immigrants.  The measures actually tend to increase school revenues as students who would not normally attend college start to pay tuition.

The DREAM Act would aid military recruiting.  The DREAM Act would help the military find new recruits—almost 8 percent of the current armed forces are foreign-born, and the military relies heavily on the translation and cultural expertise of immigrants.  According to West Point Professor Lt. Col. Margaret Stock, the DREAM Act “would be tremendously beneficial to the military.  It gives the opportunity to enlist hundreds of thousands of high-quality people.”  DREAM Act students are so desirable that the Department of Defense has supported the bill to help enlist new recruits and maintain the strength of the military. Deputy Undersecretary of Defense for Military Personnel Policy, Bill Carr, supports the DREAM Act and stated that the law would be “good for readiness” and would help to recruit “cream of the crop” students.

The DREAM Act in Congress

The DREAM Act was first introduced in 2001 by Senators Orrin Hatch (R-UT) and Richard Durbin (D-IL) in the Senate, and by Representatives Howard Berman (D-CA) and Chris Cannon (R-UT) in the House.  While the co-sponsors have changed over the years, DREAM has always enjoyed broad, bipartisan support.  Senator Chuck Hagel (R-NE) replaced Sen. Hatch as the Republican lead sponsor in 2005.  Today, Senator Richard Lugar (R-IN) is the lead co-sponsor with Senator Durbin.   In the House, Representative Berman continues to be the lead sponsor along with Representatives Lincoln Diaz-Balart (R-FL) and Lucille Roybal-Allard (D-CA).  There are three additional Republicans among the original co-sponsors of HR 1751.

In past years, the DREAM Act has come up for a vote several times and has garnered as many as 48 co-sponsors in the Senate and 152 in the House, yet it has failed to become law.  It passed the Senate Judiciary Committee twice, by a 16-3 vote in 2003-2004, and by a voice vote without dissent as an amendment to the comprehensive immigration reform (CIR) bill (S. 2611) in 2006.   After a similar CIR bill failed in 2007, the DREAM Act was considered as a stand-alone bill (S. 2205), which garnered a bi-partisan majority vote of 52-44 in the Senate, but failed to reach the 60 votes needed to invoke cloture.  The DREAM Act has never come up for a vote in the House of Representatives.  A variant of the DREAM Act is included in Comprehensive Immigration Reform ASAP (CIR ASAP), introduced by Congressman Luis Gutierrez (D-IL) in December 2009. 

Why has the DREAM Act Failed to Become Law? 

Some Members of Congress have voted against the DREAM Act because they want to see it pass as part of a broader immigration reform effort and fear that passage of the DREAM Act alone would hamper the possibility of larger reform.  For example, Senator Arlen Specter (R-PA)—then a Republican, now a Democrat—voted against the bill because he thought it would weaken the chances of CIR, not because he disagreed with the contents of the bill.

Recently, many Republicans have come under fire for supporting any form of immigration “amnesty,” including the DREAM Act.  Senator Hatch, the original Republican co-sponsor of the bill, faced criticism in his home state of Utah for being too liberal on the issue.  Despite earlier support for CIR in 2006 and 2007, Senator Hatch joined a group of conservative Senators in late 2009 who criticized DHS Secretary Janet Napolitano for suggesting that CIR (which would include the DREAM Act) would be a “boon” to the U.S. economy.  However, Senator Hatch would likely still support the DREAM Act as a stand-alone bill.

Other former supporters of the DREAM Act have switched their positions.  Earlier this May, five immigrants sat in the office of Senator John McCain (R-AZ) and refused to leave, asking him to sponsor DREAM.  In past years, Senator McCain was a co-sponsor for the DREAM Act, but became more conservative on immigration issues during his 2008 presidential campaign and continues to do so during his 2010 Senate campaign, where he is facing a primary challenge from the right.

Not only does the DREAM Act face flagging Republican support, but it could get caught in what Professor Michael A. Olivas calls the “ironic pincers” of being both too much and too little—catching the ire of conservatives who call it “amnesty”—as well as the frustration of immigration supporters who think it could derail the larger battle for CIR.  For the DREAM Act to pass, it would likely need the support of both the moderate Republicans who supported it in the past, as well as the Democrats who may be holding out hope for CIR.

Who Supports the DREAM Act?

There is a large and growing network of support for the DREAM Act.  Prominent organizations and individuals that support the DREAM Act include ethnic and civil-rights organizations, religious organizations, college and university presidents, labor unions, national education organizations and bloggers.  The National Immigration Law Center (NILC) website includes a list of national, state, and local colleges, businesses, and organizations that have publicly supported the DREAM Act.  This list includes:

  • National Education Association
  • American Association of Community Colleges
  • Coalition of Urban and Metropolitan Universities
  • National Parent Teacher Association
  • National Association for College Admissions Counseling
  • American Federation of Teachers

In recent months and weeks, these coalitions have stepped up their activities in the hopes of moving the DREAM Act in Congress.  For example, in May activists in California sponsored a rally in support of the DREAM Act.  In Indiana, students staged a mock graduation to draw support for DREAM.  Immigration activists in Boston have delivered more than 1,500 letters to the office of Senator Scott Brown (R-MA), urging him to support the DREAM Act.  And four students from Florida’s Students Working for Equal Rights (SWER) walked 1,500 miles from Miami, Florida to Washington, DC for four months to urge President Obama to stop the separation of families and the deportation of DREAM Act-eligible students.  In September of 2009, United We Dream hosted over 100 coordinated events in 26 states to bring greater awareness of the plight of undocumented students and the need for the DREAM Act.

DREAMs Coming True in the States

Some states have already made it possible for undocumented students to pursue their college dreams.  While states cannot legalize the status of undocumented immigrants, they may allow undocumented students to attend their universities and qualify for in-state tuition.  Colleges and universities each have their own policies about admitting undocumented students; some deny them admission while others allow them to attend.  However, even when undocumented students are allowed to attend college, the tuition is often prohibitively expensive.  If they cannot prove legal residency in a state, they must pay the much higher out-of-state or international-student tuition rates, and they do not qualify for federal student loans, work study, or other financial assistance. 

Without financial aid or in-state tuition, it is extremely difficult for undocumented students to afford to attend a public university.  Almost 40 percent of undocumented children live in families below the federal poverty line, compared to just 17 percent of native-born children.  The average income of undocumented immigrant families is 40 percent lower than both their native-born and legal-immigrant counterparts.

To help undocumented students afford to attend college, 10 states have passed laws that provide undocumented students with the opportunity to receive in-state tuition.  California, Illinois, Kansas, Nebraska, New Mexico, New York, Texas, Utah, Washington, and Wisconsin permit undocumented students who have attended and graduated from the state’s primary and secondary schools to pay the same college tuition as other state residents.  Note that four of these states are among the top 10 states that have the most potential DREAM Act beneficiaries.  The laws in these 10 states require undocumented students to: 1) attend a school in the state for a certain number of years; 2) graduate from high school in the state; and 3) sign an affidavit stating that they will apply to legalize their status as soon as they are eligible to do so. 

These laws are in compliance with federal law.  Section 505 of the Illegal Immigration Reform and Immigrant Responsibility Act of 1996 (IIRIRA) prohibits states from providing any higher education benefit based on residency to undocumented immigrants unless they provide the same benefit to U.S. citizens in the same circumstances.  Therefore, the 10 states also provide that U.S. citizens or LPRs who meet these requirements, but who no longer live in the state, are able to qualify for the in-state tuition rates as well.


The plight of the DREAM Act students encapsulates many facets of today’s immigration crisis.  Caught in a system where there is little, if any, means for legalizing their status, smart, hard-working kids face an uncertain future because of their inability to continue their education, work, or join the military.  Since 1996, when draconian immigration reforms eliminated many of the traditional forms of relief from deportation, a generation of young people caught between worlds has grown up without legal status. The loss of potential, productivity, and hope for these individuals is also a loss for this country.  The United States is missing out on talented workers and entrepreneurs, and is losing vital tax revenues and other economic contributions.  While fixing this particular problem will hardly resolve the need for CIR, it will unlock the door to the American dream for thousands of young people each year.

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