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Framing the Debate: Immigration

April 16, 2014
For years, the United States has searched for a solution to the complex problems posed by illegal immigration. In this report, the Policy and Economics Committee of the Penn Wharton Public Policy Initiative Student Association attempts to identify the basic facts relevant to this debate, focusing on the effects of illegal immigration on the U.S. economy and analyzing recently proposed legislation (i.e. the DREAM ACT and S. 744). This report does not seek to present original research, and instead cites nonpartisan organizations such as the Congressional Budget Office, as well as organizations across the political spectrum, focusing on areas of agreement.

EXECUTIVE SUMMARY

The CBO estimates that the DREAM Act would increase the on-budget deficit by $1.4 billion over ten years while decreasing the off-budget deficit by $2.8 billion over the same period. This is a very minor budget deficit effect overall. S. 744, by contrast, is estimated to decrease the deficit by $300 billion from 2024 to 2033, a very substantial effect. Both pieces of legislation have much more nuanced effects than the budget impact, however.

EDUCATION: Proposed legislation would encourage a more educated, productive workforce at a cost and provide a path for citizenship for those who have lived in America since they were young. Undocumented immigrants receive a costly benefit in the form of K-12 public education; however, as documented citizens, the more educated they and their children become, the more likely it will be that they contribute more in taxes than the cost of public education that they receive. Both the DREAM Act and S. 744 would repeal Section 505 of the Illegal Immigration Reform and Immigration Responsibility Act of 1996, which would allow public colleges and universities to provide in-state tuition to undocumented students. While the DREAM Act would encourage the pursuit of a college education as a pathway to citizenship, it would leave many obstacles in place that would prevent a majority of qualified minors from achieving permanent legal status.

HOUSING: Comprehensive immigration reform would spur the growth of the real estate sector, as well as associated consumer-spending sectors. Providing a pathway to citizenship for undocumented immigrants, as under S. 744, could lead to as many as three million new homeowners. Newly legal immigrant populations who gain access to public housing benefits will impose costs on the government, but this may be offset by private sector real estate gains.

LABOR: Undocumented labor has benefitted the American economy. Research suggests that unauthorized workers do not contribute to higher unemployment among American citizens, and they even stimulate economic growth by demanding goods and services. During the most recent recession, the labor market felt the negative repercussions of drastically slowed illegal immigration. Overall, undocumented labor has not hurt, and may have even helped, the American labor market.

WELFARE: Despite fears of undocumented immigrants draining the American welfare system, they actually have very little interaction with these programs. The Personal Responsibility and Work Opportunity Act of 1996 restricted most benefits to citizens, excluding even legal residents. Therefore, since both S. 744 and the DREAM Act entail a long pathway to citizenship, neither plan will impact means-tested welfare programs for over a decade. Accordingly, research shows that undocumented immigrants gravitate towards states based on their work opportunities, not based on the generosity of their welfare system.

ENTITLEMENTS: Entitlement programs, specifically Social Security and Medicare, would benefit from any proposed amnesty plan. Since many undocumented immigrants are young and healthy workers, their tax dollars would help pay for retirees’ benefits for decades before they become eligible themselves. Currently, many unauthorized workers pay taxes with fake Social Security numbers to avoid detection: they are paying into the programs but not causing those programs to pay out. Thus, undocumented immigrants have a positive effect upon both Social Security and Medicare.

HEALTHCARE: Research suggests that undocumented immigrants may have a health advantage over their American-born counterparts, yet this advantage is at risk due to changes in their culture and limited access to healthcare services. Currently, undocumented immigrants affect public healthcare spending almost exclusively through Emergency Medicaid, which reimburses hospitals for emergency services. These services are often related to childbirth. Preventative and prenatal care would reduce these public expenses. With citizenship, these immigrant populations would subsidize older and less healthy patients in insurance pools. If undocumented immigrants are not granted any subsidies, their participation in the exchanges set up by the Affordable Care Act would likely put downward pressure on premiums.

NATIONAL SECURITY: The federal system of border enforcement involves complex and overlapping regulations between the national and state governments. The Patriot Act of 2001 placed an emphasis on immigration enforcement. Heightened border security has increased the rate of apprehensions, but it has made smuggling more profitable.  The cost and efficacy of S. 744’s even greater border security measures are contested, but the effort to further secure the U.S. border alongside any path to citizenship should be considered in light of potential moral hazard concerns.

From education to national security, a broad range of economic issues must be addressed in any discussion of immigration policy. Debates on immigration reform are currently plagued by a lack of central, easily accessible information on the subject. This report seeks to serve as a single resource that makes certain fundamental economic facts clear to all, so as to elevate the level of conversation, but it does not go so far as to make specific policy recommendations. These decisions are beyond the scope of this report. By laying out the facts of the status quo, we hope to frame the debate to allow for productive and informed discourse.

READ THE FULL REPORT HERE

 

 

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RESOURCE SPOTLIGHT:

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  • <h3>Federal Aviation Administration: Accident & Incident Data</h3><p><img width="100" height="100" alt="" src="/live/image/gid/4/width/100/height/100/80_faa-logo.rev.1402681347.jpg" class="lw_image lw_image80 lw_align_left" srcset="/live/image/scale/2x/gid/4/width/100/height/100/80_faa-logo.rev.1402681347.jpg 2x, /live/image/scale/3x/gid/4/width/100/height/100/80_faa-logo.rev.1402681347.jpg 3x" data-max-w="550" data-max-h="550"/>The NTSB issues an accident report following each investigation. These reports are available online for reports issued since 1996, with older reports coming online soon. The reports listing is sortable by the event date, report date, city, and state.</p><p> Quick link: <a href="http://www.faa.gov/data_research/accident_incident/" target="_blank">http://www.faa.gov/data_research/accident_incident/</a></p><p>See all <a href="/data-resources/">data and resources</a> »</p>
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  • <h3>National Center for Education Statistics</h3><p><strong><img width="400" height="80" alt="" src="/live/image/gid/4/width/400/height/80/479_nces.rev.1407787656.jpg" class="lw_image lw_image479 lw_align_right" data-max-w="400" data-max-h="80"/>The National Center for Education Statistics (NCES) is the primary federal entity for collecting and analyzing data related to education in the U.S. and other nations.</strong> NCES is located within the U.S. Department of Education and the Institute of Education Sciences. NCES has an extensive Statistical Standards Program that consults and advises on methodological and statistical aspects involved in the design, collection, and analysis of data collections in the Center. To learn more about the NCES, <a href="http://nces.ed.gov/about/" target="_blank">click here</a>.</p><p> Quick link to NCES Data Tools: <a href="http://nces.ed.gov/datatools/index.asp?DataToolSectionID=4" target="_blank">http://nces.ed.gov/datatools/index.asp?DataToolSectionID=4</a></p><p> Quick link to Quick Tables and Figures: <a href="http://nces.ed.gov/quicktables/" target="_blank">http://nces.ed.gov/quicktables/</a></p><p> Quick link to NCES Fast Facts (Note: The primary purpose of the Fast Facts website is to provide users with concise information on a range of educational issues, from early childhood to adult learning.): <a href="http://nces.ed.gov/fastfacts/" target="_blank">http://nces.ed.gov/fastfacts/#</a></p><p>See all <a href="/data-resources/">data and resources</a> »</p>
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  • <h3>National Bureau of Economic Research (Public Use Data Archive)</h3><p><img width="180" height="43" alt="" src="/live/image/gid/4/width/180/height/43/478_nber.rev.1407530465.jpg" class="lw_image lw_image478 lw_align_right" data-max-w="329" data-max-h="79"/>Founded in 1920, the <strong>National Bureau of Economic Research</strong> is a private, nonprofit, nonpartisan research organization dedicated to promoting a greater understanding of how the economy works. The NBER is committed to undertaking and disseminating unbiased economic research among public policymakers, business professionals, and the academic community.</p><p> Quick Link to <strong>Public Use Data Archive</strong>: <a href="http://www.nber.org/data/" target="_blank">http://www.nber.org/data/</a></p><p>See all <a href="/data-resources/">data and resources</a> »</p>
  • <h3>NOAA National Climatic Data Center</h3><p><img width="200" height="198" alt="" src="/live/image/gid/4/width/200/height/198/483_noaa_logo.rev.1407788692.jpg" class="lw_image lw_image483 lw_align_left" srcset="/live/image/scale/2x/gid/4/width/200/height/198/483_noaa_logo.rev.1407788692.jpg 2x, /live/image/scale/3x/gid/4/width/200/height/198/483_noaa_logo.rev.1407788692.jpg 3x" data-max-w="954" data-max-h="945"/>NOAA’s National Climatic Data Center (NCDC) is responsible for preserving, monitoring, assessing, and providing public access to the Nation’s treasure of <strong>climate and historical weather data and information</strong>.</p><p> Quick link to home page: <a href="http://www.ncdc.noaa.gov/" target="_blank">http://www.ncdc.noaa.gov/</a></p><p> Quick link to NCDC’s climate and weather datasets, products, and various web pages and resources: <a href="http://www.ncdc.noaa.gov/data-access/quick-links" target="_blank">http://www.ncdc.noaa.gov/data-access/quick-links</a></p><p> Quick link to Text & Map Search: <a href="http://www.ncdc.noaa.gov/cdo-web/" target="_blank">http://www.ncdc.noaa.gov/cdo-web/</a></p><p>See all <a href="/data-resources/">data and resources</a> »</p>
  • <h3>Internal Revenue Service: Tax Statistics</h3><p><img width="155" height="200" alt="" src="/live/image/gid/4/width/155/height/200/486_irs_logo.rev.1407789424.jpg" class="lw_image lw_image486 lw_align_left" srcset="/live/image/scale/2x/gid/4/width/155/height/200/486_irs_logo.rev.1407789424.jpg 2x" data-max-w="463" data-max-h="596"/>Find statistics on business tax, individual tax, charitable and exempt organizations, IRS operations and budget, and income (SOI), as well as statistics by form, products, publications, papers, and other IRS data.</p><p> Quick link to <strong>Tax Statistics, where you will find a wide range of tables, articles, and data</strong> that describe and measure elements of the U.S. tax system: <a href="http://www.irs.gov/uac/Tax-Stats-2" target="_blank">http://www.irs.gov/uac/Tax-Stats-2</a></p><p>See all <a href="/data-resources/">data and resources</a> »</p>