President Donald Trump’s merit-based immigration reform program, known as the RAISE Act, is designed to put the needs of millions of Americans ahead of those of non-citizens. One the ways in which it will do this is by limiting the number of low-skilled migrants we allow into this country.
When you realize that a legal immigrant without a high school degree typically receives $4 in government benefits for every one dollar he pays in taxes, according to congressional testimony published by the Heritage Foundation, it becomes evident that the RAISE Act has the potential to save U.S. taxpayers trillions of dollars in future years just by limiting entry to those who will truly contribute in a positive way to our society.
According to the report, “There are 12.8 million low-skill legal immigrants with a high school degree or less currently residing in the U.S. The households headed by these low-skill legal immigrants impose a net fiscal cost (total government benefits received minus total taxes paid) of $150 billion each year.”
The $150 billion tax burden is equivalent to a $1.04 tax on every gallon of gas purchased by U.S. motorists every year for the foreseeable future.
Nearly 400,000 legal immigrants enter the U.S. each year through chain migration (families following each other into the country), the visa lottery, and the current low-skill worker allotment, and the majority of these new citizens have few marketable skills. With that in mind, the RAISE Act seeks to eliminate these channels of entry. The Act also will put a cap on the future flow of refugees and asylum seekers.
The bill’s reforms to chain migration are particularly important. The first step in chain migration is for a foreign citizen to be given a green card. This individual is then permitted to bring in his or her nuclear family, consisting of a spouse and minor children.
Once the original immigrant and his or her spouse become U.S. citizens, they can then petition for their parents, adult sons and daughters, and adult siblings and brothers and sisters-in-law to also enter.
This second group can bring their minor children. Once they become citizens, the brothers and sisters-in-law and parents can petition for their siblings, in-laws, and parents to legally enter the U.S.
The RAISE bill limits future chain migration. Each future migrant can only bring nuclear family members into the country.
Parents can be brought to the country on a guest visa, but they will not be given access to government benefits or citizenship status. Instead, the sponsors must demonstrate that they have purchased insurance to cover the future medical costs of their parents.
The U.S. tax and benefit system is redistributive, which means that it provides extensive benefits to less skill/low-wage individuals while asking them to pay comparatively less in taxes. On average, low-skill individuals, whether non-immigrants, legal immigrants, or illegal immigrants, impose substantial costs on U.S. taxpayers.
Analysis presented by the National Academy of Sciences in its comprehensive report, “The Economic and Fiscal Consequences of Immigration,” was released in September of last year. In determining the fiscal cost of low-skill immigrants, the report estimated the costs of government benefits and services received by immigrants and non-immigrants from federal state and local government and weighed them against the amount of taxes paid.
Taking into consideration government benefits from routine services, such as police and fire protection, highways and sewers, and public education costs, in addition to benefits from more than 80 means-tested welfare programs such as Medicaid, food stamps, the earned income tax credit, and housing vouchers, as well as other government-direct benefits, including Social Security, Medicare, and Unemployment Insurance, the report shows that less-educated individuals, whether immigrants or nonimmigrants, receive far more in government benefits than they pay in taxes.
Based on the National Academy of Sciences’ estimates, the average low-skill immigrant (with a high school degree or less) who enters the country imposes a net present value on taxpayers of negative $142,000.
This means the government would need to immediately raise a lump sum of $142,000 and put it in a high-yield bank account to cover the future net fiscal cost (total benefits minus total taxes) of that immigrant.
In addition, a rough estimate of the future net outlays to be paid by taxpayers (in constant 2012 dollars) for low-skill immigrants appears to be around $397,000 per immigrant over 75 years.
The National Academy of Sciences’ cost figures represent a mixture of costs for legal and illegal immigrants, but the RAISE Act is focused directly on low-skill legal immigrants.
The future net outlays (benefits given less taxes paid) for the inflow of 4.7 million low-skill immigrants will be around $1.9 trillion (in constant 2012 dollars). More than half of these costs are connected to future low-skill legal immigration, so by limiting future legal, low-skill immigration, the RAISE Act has the potential to save taxpayers at least $1 trillion.
An even greater cost savings will be realized just by limiting future illegal immigration. For every million illegal aliens in the country, there is a lifetime fiscal drain of $65.3 billion on public coffers. If we assume there are 11.43 million illegal aliens in the country — a number that has reportedly remained steady for the past eight years — then the total fiscal costs they create during their lifetimes is estimated to be $746.3 billion. So, the savings associated with removing or causing even a small fraction of the 11 to 12 million illegal aliens in the country to return home would be significant.
Another way in which low-skill immigration hurts Americans economically is the fact that it reduces the wages of similar U.S.-born workers. An increase in the low-skill labor force consisting of 10 percent immigrants can reduce the wages of low-skill non-immigrant labor by 3 to 10 percent.
Some studies show wage losses as high as 17 percent. Black male wages and employment are especially hard hit. By reducing wages of less skilled non-immigrants, low-skill immigration increases economic inequality in the U.S., redistributing income from the least advantaged Americans to the more affluent.
Low-skill immigration also affects the political balance of power in our country.
According to Cooperative Congressional Election Survey, the political alignment of immigrants is much further to the left than that of non-immigrants. Immigrants, in general, are twice as likely to identify with and register as Democrats than as Republicans. And that number tends to rise in the case of immigrants who never graduated from high school. Those people are nearly three times more likely to register as Democrats than as Republicans.
The RAISE Act is designed to appropriately address all of these issues, which will subsequently raise the quality of life for all Americans, including immigrants.