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June 11, 2004

The Costs of Unskilled Immigration

Open borders libertarians and neoconservatives often speak of the great benefits of having a large supply of "cheap labor." The problem with "cheap labor" is that it is not really cheap labor at all, but subsidized labor. For example, in California, education alone costs nearly $7,000 per kid, per year.[1] Given that the typical Hispanic mother has 3 kids (it is probably higher for the poorest Hispanics), we're already talking about a cost of $21,000+, more than many unskilled immigrants make in salary, much less pay in taxes.[2] This doesn't include other services, both "welfare" type services such as health care and housing assistance, and other services, such as law enforcement (including police, courts, and jails), and transportation (new roads and highways, public transportation). Increased population also means that pollution will increase and/or stricter environmental controls will need to be enacted, which can also be expensive. Another problem with immigration and population increase in general is that it helps to push housing prices higher.

NRC (National Research Council) data bears this out:

The most comprehensive research on this subject was done by the National Research Council (NRC), which is part of the National Academy of Sciences. The study, conducted in 1997, found that more-educated immigrants tend to have higher earnings, lower rates of public service use, and as a result pay more in taxes than they use in services. In contrast, the NRC found that because of their lower incomes and resulting lower tax payments coupled with their heavy use of public services, less-educated immigrants use significantly more in services than they pay in taxes. The NRC estimates indicated that the average immigrant without a high school education imposes a net fiscal burden on public coffers of $89,000 during the course of his or her lifetime. The average immigrant with only a high school education creates a lifetime fiscal burden of $31,000. In contrast, the average immigrant with more than a high school education was found to have a positive fiscal impact of $105,000 in his or her lifetime. The NAS further estimated that the total combined fiscal impact of the average immigrant (all educational categories included) was a negative $3,000. Thus, when all immigrants are examined they are found to have a modest negative impact on public coffers. These figures are only for the original immigrant, they do not include public services used or taxes paid by their U.S.-born descendants.

In the mid 1990s, immigration cost each California household nearly $1200[Control-F+"measures"]. If one takes out skilled immigration, and takes into account the large increase in the immigrant population in California since the mid 1990s, the figure would probably be subtantially worse.

Hispanic immigrants and their children also, on average, have low levels of education, persisting through the second, third, and fourth generations.

Another problem with libertarian/neoconservative position in favor of loose or open borders is that immigrants often bring ideas that are very different from those promoted by libertarians and neocons (and conservatives in general). Though immigrants cannot vote immediately, once they and their children *DO* become voters, they tend to vote heavily Democratic. This not only increases the power of the Democrats but pushes Republicans to run panderers and big spenders like George W. Bush. Republicans may also pander and spend because of the "necessity" of attracting future Hispanic voters in addition to today's Hispanic voters. Immigrants, given poverty and a tendency to cluster in ethnic enclaves, are likely to move in Democratic areas. When redistricting comes up, this means that the number of Democratic districts is likely to go up--even if many new residents are non-voters, children or even illegal aliens. The bottom line is that there is no getting around the tendency of immigrants to empower those who are very much opposed to libertarianism and conservatism in all its forms.

[1]Abiola's argument about this:

As for the frequent claims that, say, each immigrant schoolchild costs the taxpayer $5,000 (or some other outrageous figure) a year, that is an out and out falsehood, based on the confusion (whether deliberate or otherwise) of average costs with marginal costs; just because per capita expenditure on elementary education is $5,000 a year does not mean that the marginal cost of educating an extra schoolchild, illegal immigrant or otherwise, will be $5,000 or anything close to it. After all, a school once built is a sunk cost, whether it houses 1 child or 1,000, so charging the price of adding child 901 to the 900 already in the building at average cost is a manifest absurdity - but that is just the sort of argument anti-immigration nuts routinely make.

This is a largely spurious argument. What happens when the immigrant children are numbers 901 through 1100? Immigrant children are not somehow immune to needing new schools. Additionally, when immigrants move into already densely populated areas, building new schools can become quite expensive because it is so difficult to find or create a site for a school (think Belmont). School construction is also not the only education cost--teacher and administrator salaries are also major costs, if not the main costs, associated with education. These costs will tend to rise (and/or standards will tend to fall) as the student population increases relative to the teacher population due to simple supply and demand, thus increasing per-child costs (and/or lowering the quality of education).

[2]The illegal aliens legalized under the 1986 Immigration Act were especially poor and had especially low levels of education:

An Immigration and Naturalization Service study found that after ten years in the United States, the average amnestied illegal alien had only a seventh grade education and an annual salary of less than $9,000 a year.1 Unlike immigrants with a sponsor who guarantees they will not become a burden on the public, when Congress enacts an amnesty, it makes the American public financially responsible for those amnestied.

Posted by bb at 08:35 AM