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Amnesty: Economic Depressant

Last Thursday, the Senate Judiciary Committee held a hearing entitled Comprehensive Immigration Reform in 2009: Can We Do It and How? where Alan Greenspan, the former Federal Reserve Chairman, testified that the economic benefits of illegal immigrants to the U.S. economy outweigh their cost implying, along with other members of the panel, that amnesty for these immigrants would help the economy and make all Americans better off. This could not be further from the truth. Outlined below are the true effects of amnesty, real policy actions that could get our economy running again, and an immigration plan that will correct our current policies and respect our economy.

The Effects of Amnesty

Amnesty undermines the rule of law, and in doing so, encourages future illegal immigration. Secondly, amnesty legalizes more workers to compete with Americans for jobs. With the unemployment rate at 8.5%, now is not the time to saturate the work force with newly legalized workers. Lastly, amnesty is very costly to the American taxpayer. Proponents of amnesty assume that the immigrants will have jobs that contribute high tax revenue to the government, but statistics prove otherwise.

The illegal immigrants who would be legalized under an amnesty program are typically low-skill workers. Using 2007 numbers, low-skill immigrants receive, on average, three dollars in government benefits for each dollar of taxes paid. This imbalance generates a net cost of $89 billion per year on U.S. taxpayers. Over a lifetime, the typical low-skill immigrant household costs taxpayers $1.2 million. Thus, the cost of amnesty alone would reach $2.6 trillion once the recipients reach retirement age. With the federal debt at $10.7 trillion starting 2009, now is not the time to allow new immigrants, who have not paid into the system, access to the benefits of Americas welfare system.

Economy Stimulants that Work

True economic stimulus comes from the private sector so any effective plan would keep money in the pockets of businesses and families. There are multiple ways to do that:

Make the 2001 and 2003 tax cuts permanent, instead of raising taxes in 2011.

Create new jobs by reducing marginal tax rates for individuals and businesses by 10%. Adopting just this one proposal would create between 500,000 and 1 million jobs in one year!

Repeal the alternative minimum tax (commonly referred to as the AMT) and reduce the death tax to 15% (with a $5 million individual exclusion).

Enact long-term reforms and budgets for entitlement spending, putting long-term obligations from Social Security, Medicare and Medicaid, front and center in the budget process.

Assess and enforce long term spending rules in Congress.

Immigration Reform that Empowers America

Immigration reform should focus on enforcement, enhancing the worker programs we have, partnering with our neighboring countries, and strengthening citizenship programs. We need to secure our borders to stop the flow of illegal immigrants and to tackle the threat of drug cartels directly over the border in Mexico. Helping Mexico train their own law enforcement to take on the cartels is essential to such a plan. Finally, we need to support economic development and good governance in Latin America. Doing so will relieve the supply push of foreign workers into the United States.

Internally, we must enforce our work place immigration laws, including efforts against both employers and employees. But reform is needed at U.S. Citizenship and Immigration Services before we can be completely effective in this effortsuch as changes in its faulty budget model and revenue structure. Finally, we need to improve legal worker programs. A robust and efficient visa system that will meet the needs of employers and immigrants is a better option than illegal immigration. And strengthening citizenship programs, such as the promotion of civics and history education and encouraging English language proficiency, to foster political integration and strengthen commitment to our common principles, are vital to effective immigration reform.

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