Newcomers Fill Public Coffers
Watch this brief video where Zeke Hernandez discusses how immigrants contribute to public finances and debunks the myth that they drain public resources.
Key Insights on Immigrants’ Fiscal Contributions
- Tax Contributions: Immigrants pay more in taxes at all levels of government—federal, state, and local—than they consume in public services. The average immigrant makes a net positive contribution of $260,000 (in NPV) in the US.
- Short vs. Long-Term, Local vs. Federal: There are short-term costs of integrating newcomers, like public education, housing, infrastructure, and food assistance. Those costs are borne disproportionately by local governments (states and cities) and unevenly distributed across the country. The costs are outweighed by the long-term taxes paid by immigrants and their descendants.
- Unauthorized immigrants reliably pay taxes (using an ITIN), contrary to common misconceptions.
- Preventing a Fiscal Apocalypse: Without immigration, public programs like Social Security, Medicare, and Medicaid would quickly become defunded. The population in most countries, including the US, isn’t growing enough to keep up with high aging and low birth rates. Most new taxpayers will come through immigration.
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How To Talk About Immigration
Conversations about immigration can be challenging due to its politicization, leading to avoidance, echo chambers, or confrontations.
This guide offers principles based on expert research and the author’s experiences, aimed at facilitating constructive discussions about immigration.
Case Studies / Examples
- Megan K. Stack, “El Paso Shows Migrant Buses Aren’t Just for Republican Politicians,” New York Times, October 20, 2022, https://www.nytimes.com/2022/10/20/opinion/el-paso-migrant-buses-republicans.html.
- Eric Holcomb and Spencer Cox, “To Solve Our National Immigration Crisis, Let States Sponsor Immigrants,” Washington Post, February 21, 2023, https://www.washingtonpost.com/opinions/2023/02/21/eric-holcomb-spencer-cox-states-immigration/.
Prompting Meaningful Dialogue
Use these questions to spark thoughtful conversations about undocumented immigration, its impacts, and potential solutions.
- How do immigrants contribute to public finances at various government levels?
- What are the short-term costs and long-term benefits of integrating immigrants?
- In what ways do immigrants help sustain essential public services in your community?
- How much does your community spend on welcoming immigrants each year? Should the federal government help with those costs?
Further reading and research:
Ready to learn more? Access detailed studies, articles, and reports that provide a factual, in-depth look at the contributions and impacts of immigrants in our society.
- National Academies of Sciences, Engineering, and Medicine, The Economic and Fiscal Consequences of Immigration (Washington, DC: National Academies Press, 2017).
- Ana Maria Santecru and Heting Zhu, “Today’s Immigrants Are More Educated than 50 Years Ago,” On the Economy (blog), Federal Reserve Bank of St. Louis, August 27, 2017, https://www.stlouisfed.org/on-the-economy/2017/august/todays-immigrants-more-educated.
- CBO’s 2022 Long-Term Projections for Social Security,” Congressional Budget Office, December 16, 2022, https://www.cbo.gov/publication/58870.
- Board of Trustees, Centers for Medicare and Medicaid Services, “2023 Annual Report of the Boards of Trusteers of the Federal Hospital Insurance and Federal Supplementary Medical Insurance Trust Funds,” March 31, 2023, https://www.cms.gov/oact/tr.
- “Immigrant Share of the U.S. Population and Civilian Labor Force, 1980–Present,” Migration Policy Institute, accessed August 16, 2023, https://www.migrationpolicy.org/programs/data-hub/charts/immigrant-share-us-population-and-civilian-labor-force.
https://docs.iza.org/dp15592.pdf