Immigration and Government Expenditures

    I was curious about some things said regarding immigration during class, specifically about immigration and government services, so I did a little research. One well-regarded, though somewhat dated, study was done by the National Academy of Sciences in 1997. The study, entitled The New Americans: Economic, Demographic, and Fiscal Effects of Immigration, found that most immigrants paid more in new taxes than they received in new government services in their lifetime. As the study brief points out, part of this is due to the fact that they receive protection from high fixed-cost services (national defense, roads, interest on national debt) without requiring additional expenditures on those items. In effect, they pull down the average cost per citizen of providing those services. A piece by the Cato Institute further expands on immigration and this study, saying that the study shows the average immigrant family pays $80,000 more in government services than it receives in a lifetime. Even better, those immigrants with college degrees (likely those who benefit from the H1-B visas) constitute a net gain in revenue of $198,000 (Cato, p. 3). Keep in mind that not only are immigrants making our fiscal situation better, but also we are giving them a much better opportunity to make a decent living, an effect that many would argue would be worth paying for.

    Two other thoughts struck me as I was doing this research. First, if we amended our immigration policies to allow anyone who wants to come here, the net benefit of the average immigrant would probably decrease. At present, we are probably keeping out many low-skilled workers who want to come here. Thus, while the current 'typical' immigrant represents a net gain of $80,000, much of that is inflated by our current policy which allows high-skilled workers yet it more restrictive of low-skilled. That said, there is still a lot of play in that area. Even if a new immigrant was neutral financially or even a small loss, the gain he represents for economic growth is not negative, nor is the benefit conferred by giving him more opportunities. The second thought was that by drastically reducing border patrol along the U.S.-Mexico border, we could save $3 billion, or at least a significant portion of that, each year (Cato, p. 12). Thus, even if we somehow allowed enough low-skilled immigrants to enter that the net benefit was negative, we could pay for part of that with these reduced expenditures.

    Finally, in a somewhat unrelated thought, I was wondering how Carens' argument, especially regarding Rawls or utilitarianism, would apply to protectionist policies. Wouldn't Rawls, under the 'veil of ignorance,' say we should buy the most efficiently produced item, regardless of unimportant contingencies such as nationality? And in this same vein of thought, are attacks on outsourced labor wrong? This is just a brief thought, and I don't have time to expand on it, but I was wondering if anyone had any thoughts.

Feel free to post any thoughts on whether these immigration statistics affected your thinking, or if you had any thoughts on Carens, Rawls, and outsourcing.