Reasonable Nuts

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Monday, May 01, 2006

The cost of illegal aliens

One of the most often stated assertions concerning the illegal alien brouhaha is that they (illegals) add far more to the U.S. economy than they take. This study would appear to refute this claim:
Illegals Create Large Net Costs. The bottom portion of Table 2 adds together the total tax payments and costs illegals impose on the federal budget. When defense spending is not considered, illegal households are estimated to impose costs on the federal treasury of $6,949 a year or 58 percent of what other households received. When defense spending is included, their costs are only 46 percent those of other households. However, they pay only 28 percent as much in taxes as non-illegal households. As a result, the estimated net cost per illegal household was $2,736. Whether one sees this fiscal deficit as resulting from low tax payments or heavy use of services is a matter of perspective. As already discussed, illegal households comprise 3.6 percent of the total population, but as Table 2 shows they account for an estimated 0.9 percent of taxes paid and 1.4 percent of costs. Thus, both their payments and costs are significantly less than their share of the total population. Since they use so much less in federal services than other households, it probably makes the most sense to see the fiscal deficit as resulting from low tax payments rather than heavy use of public services.

Total Deficit Created by Illegals. If the estimated net fiscal drain of $2,736 a year that each illegal household imposes on the federal treasury is multiplied by the nearly three million illegal households, the total cost comes to $10.4 billion a year. Whether one considers this to be a large sum or not is, of course, a matter of perspective. But, this figure is unambiguously negative and certainly not trivial. It is also worth remembering that these figures are only for the federal government and do not include any costs at the state or local level, where the impact is likely to be significant.

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