Tired, Poor, on Welfare

MORE immigrants will enter the United States during the 1990s than in any other decade in the country’s history. We are now admitting over 800,000 legal immigrants annually, and at least 200.000 illegal aliens manage to evade the Border Patrol and settle here permanently. It is not surprising, therefore. that immigration has become a charged political issue. Previous debates revolved around the questions of how well immigrants assimilate and whether they take jobs away from natives. The rapid growth of entitlement programs in the past three decades introduces an additional explosive question: Do they pay their way in the welfare state?

As with all accounting exercises. one’s assumptions effectively determine the answer. Two recent assessments, by Donald Huddle and Julian Simon, reach the conclusions that 1) immigrants are a huge drain on the system (Huddle), or 2) “immigrants are a good investment” (Simon). Huddle. in a report prepared for the Carrying Capacity Network (an anti-population-growth group, concludes that the net costs of immigration exceeded $40 billion in 1992. Simon concludes that immigrants paid over S2 billion more in taxes than they took out of the welfare system.

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George J. Borjas

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MORE immigrants will enter the United States during the 1990s than in any other decade in the country’s history. We are now admitting over 800,000 legal immigrants annually, and at least 200.000 illegal aliens manage to evade the Border Patrol and settle here permanently. It is not surprising, therefore. that immigration has become a charged political issue. Previous debates revolved around the questions of how well immigrants assimilate and whether they take jobs away from natives. The rapid growth of entitlement programs in the past three decades introduces an additional explosive question: Do they pay their way in the welfare state?

As with all accounting exercises. one’s assumptions effectively determine the answer. Two recent assessments, by Donald Huddle and Julian Simon, reach the conclusions that 1) immigrants are a huge drain on the system (Huddle), or 2) “immigrants are a good investment” (Simon). Huddle. in a report prepared for the Carrying Capacity Network (an anti-population-growth group, concludes that the net costs of immigration exceeded $40 billion in 1992. Simon concludes that immigrants paid over S2 billion more in taxes than they took out of the welfare system.