September 22, 2014

Reform would make sense if new immigrants weren’t eligible for welfare

Tracy C. Miller
Guest columnist
The U.S. House and Senate are considering an immigration reform bill. Critics of the legislation say that it will not do enough to secure our borders and that it grants amnesty to illegal immigrants. The bigger issue, which has been an important part of the debate, is how increased legal immigration will affect the cost of entitlement programs and the government budget.
The Border, Security, Economic Opportunity and Immigration Modernization Act of 2013 includes some steps to make immigrants less of a burden on government budgets, but it could include more. As noted by the Heritage Foundation, America’s immigration system has serious flaws that this legislation fails to address. Nevertheless, some of its provisions should be part of any legislation to reform immigration because the requirements make it easier for those willing to work to enter the U.S. and to make a productive contribution to our economy.
The immigration reform bill provides a way for illegal immigrants to obtain legal status and also opens a path for citizenship. It takes a step in the right direction by excluding some newly legal immigrants from receiving federal welfare benefits. The bill creates new categories of immigrants, designating some as registered provisional immigrants and others as blue-card holders. If they are classified as members of one of these new groups they will not be permitted to receive welfare benefits. The proposed legislation also creates new rules for guest workers.
Opponents argue that these changes do not do enough to limit immigrant eligibility for government benefits. Although the bill forbids registered provisional immigrants from receiving welfare benefits for 10 years, the present value of the benefits they will eventually receive as legal residents is expected to exceed what they pay in taxes. This is because immigrants have lower incomes than the average American so they are expected to collect more benefits from Social Security and Medicare than they will pay in payroll taxes.
Immigration is mutually beneficial as long as immigrants work and pay their fair share of taxes. The benefits include more output production in the United States, and the immigrants often earn higher wages than they could earn in their home countries, with many sending money back home to relatives. Although current welfare eligibility rules result in low-income immigrants collecting more in government benefits than they contribute in taxes, these rules could be changed.
Some critics of immigration reform argue that we should enforce existing immigration law and not reward those who broke it. Citizens and legal immigrants have a right to certain benefits; however, these benefits can and should be denied to those who are currently undocumented. Nevertheless, instead of deporting them as required under current law, those who are undocumented could be given an opportunity to stay subject to payment of a fine for their past violation of the law. In addition, the federal government must tighten welfare eligibility rules so that immigrants should not expect to collect more government benefits than what they pay in taxes—no matter how long they stay in the United States. It is important to distinguish between immigrants who have sought to obey the law and those who have flouted it. Those who have disobeyed the law in the past should be required to bear additional costs and scrutiny in order to remain in the country legally.
We need bipartisan efforts to craft a good solution to immigration problems. Immigrants coming to work in the United States contribute to a more prosperous economy. Low-income immigrant families, however, put a strain on government budgets by enrolling their children in government schools, receiving emergency medical care they may not pay for, and in some cases, collecting other welfare benefits. Immigrants should either be denied access to entitlement programs that American citizens qualify for or be charged a fee to account for the cost of government benefits and emergency medical care they qualify for if they reside in the country. If reform made it possible for undocumented immigrants to live in the country legally, it would be easier to require them to pay income taxes and their employers to pay payroll taxes. More legal immigration could actually increase tax revenue that the federal government could use to reduce the deficit.
Immigrants can help enhance the prosperity of our nation. Immigration should be encouraged as long as immigrants are required to pay enough to compensate for any benefits they may receive. The Border, Security, Economic Opportunity and Immigration Modernization Act of 2013 takes steps to reduce welfare benefits for newly established classes of immigrants, but the bill does not do enough. Congress must devise alternative legislation that makes it easier for those who can find employment to immigrate legally, while increasing restrictions on immigrants’ eligibility for welfare programs.
Tracy C. Miller is an associate professor of economics at Grove City College.

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