Lobbying groups assert that foreign students benefit the U.S.’s balance of payments. The Institute for International Education (IIE), for instance, states that foreign students contributed a net $14.5 billion to the U.S. economy during the 2006-07 school year through tuition and living expenses with resources from abroad — a net inflow of nearly $25,000 per year, every year, from the average foreign student.

David North of the Center for Immigration Studies evaluates these claims in a new study, “Who Pays? Foreign Students Do Not Help with Balance of Payments.” He admits there are non-financial reasons the U.S. might benefit from foreign students, but assesses the most recent IIE report on foreign students’ monetary contributions and compares it to two other reports. The following are some of North’s findings, which show that that the balance-of-payments claim is totally without merit:

  • The IIE assumes that the only cost to the domestic sources is tuition. However, partially hidden subsidies from U.S. sources, such as endowments and taxpayer contributions to state schools, are not taken into consideration.
  • The IIE report relies on questionable data collection techniques, using foreign student advisers as a primary source for determining whether students’ funding originated overseas or domestically. In the most recent year, little more than half of the foreign student advisers surveyed even responded to the survey’s question on the origin of students’ resources.
  • While the IEE claims that two-thirds or more of foreign students’ funding comes from abroad, other, more rigorous studies that surveyed the students themselves have produced very different results. Only 10.4 percent of the foreign students’ incomes came from overseas, the rest coming from U.S. sources. A multi-agency survey of doctoral students found that only 9.7 percent of foreign students’ resources came from overseas.

CIS renders an important service in alerting taxpayers that they are footing the bill for much funding for foreign students.