Illegal Immigrants’ Effects on the Economy

Visual Argument

Alphabetic Argument

How to Handle the Economic Impact of Illegal Immigration

Immigration is a difficult issue.  America has changed its mind about it time and time again.  Since it has such a wide scope, I’ve decided to narrow my argument to one of economics.  So are illegal immigrants and migrant workers helpful or harmful to the economy, or somewhere in between?  From what I have read there are many disagreements over the same information.  People begin with an opinion regarding immigration and then use similar evidence to try to support wildly differing views.  I of course, have my own opinions about potential solutions to the illegal immigration problem, however first I feel we should see how big a problem it truly is.

The main reason for immigrating to America, it seems, is for work (4).  Most of the workers are young to middle aged adults and if they have families they often stay behind.  The fact that the immigrants take certain jobs has become a point of contention for many Americans.  The two talking points that you’ll often hear are that the immigrants are stealing jobs away from Americans (in other words, the straw man Republican side) and the other argument being that they take jobs that no American wants (the straw man Democrat) (2).  These arguments, though they are a false dichotomy, crop up a lot when the discussion of illegal immigration comes up.

Legality of the migrant workers aside (more on that later), there seems to be some truth to the Democratic argument.  The comedian Stephen Colbert had a guest on his show who promoted a group called “Take our Jobs” which offered the jobs that migrant workers do to unemployed Americans.  At that point only a handful of American workers had taken the offer. Colbert proceeded to take a job as a farm worker and show just how tiresome and unappealing the task can be (3).  Of course he exaggerated the whining involved, but the point stands: Americans do not generally want the blue-collar jobs that immigrant workers take.

So if undocumented or falsely documented workers are taking the jobs that should technically be going to legal citizens then what is the effect of those workers on the economy? Surely it must be negative right?  Well it turns out there are good aspects and there are bad aspects.  Like everything else the issue is not so clear-cut.

One important economic aspect that illegal immigrants alter is social security (5).  In order to appear legal, the workers must have a social security number or they will not be able to get a job.  So they create fake social security numbers or have someone else create numbers for them.  The employers do not often check whether the numbers are real or not and so the immigrants are able to go to work.  Because the workers have fake social security numbers, money gets taken out of their payroll and there is more money for social security.  The second half of this is that the workers never receive the benefits of what they put into social security because they still do not have real social security numbers.  Another factor in this is that the workers often return home after they are done working.

I am of the opinion that this is great for citizens of America.  We can get more money in retirement, which is handy given that the baby boomers are retiring in mass and there will be less money to go around.  There are some who may disagree based on the fact that the money is coming from illegal immigrants and therefore it’s bad simply because it means we have undocumented workers (6).  It is easy to see where the argument comes from, but I feel just getting rid of something because it is illegal instead of reasoning through why it is illegal and why it is happening does no address the issue well.

Like with social security, many other tax issues are brought up in the illegal immigration debate.  One such issue is Medicaid.  Some feel that illegal immigrants mooch off the Medicaid system as a form of cheap healthcare.  However, this is just not true (4).  Illegal immigrants are not eligible for non-emergency care, so in other words they would have to pay out of their own pocket in order to stay healthy.  Also, since the immigrants tend to be neither very young nor elderly, they are less likely to have many medical emergencies, which helps to further lessen their impact on the system.

In fact, this seems to be a major trend when it comes to economic issues (1).  There is no clear correlation between illegal immigrants and changes in credit for example.  This may all be because illegal immigrants make up only about 5 percent of the work force.  While that is a much larger number than it has been historically, most of them do not have a large negative effect on the economy because as far as most economic policies are concerned they don’t exist.  Also any costs the immigrants create can potentially be offset by the taxes they generate since, quite opposite of some people’s belief, most of the immigrants do pay taxes.  The costs that are generated by illegal immigrants may seem like a lot, estimates are in the millions, but they also pay a lot too seven billion dollars in social security for example.

So it seems that illegal immigrants do not have too much impact on the United States economy for good or bad.  Their costs are offset by their benefits.  This means that most arguments regarding the economic impact of illegal immigrants fall a little short.  There are far bigger economic factors to worry about than simply worrying about paying for those who frankly cost much less than, say, unemployed American citizens.  If we can handle (hopefully) the much bigger recession issues than we can handle any “burden” the illegal immigrants put on us.

The larger issue of immigration reform still needs to be addressed I believe.  Deporting all illegal immigrants is not only impractical and unfair; it can be more of a harm to our economy than anything.  We would lose many of our taxpayers.  I’m not sure amnesty is the best solution either.  I do not think we should spend too many resources on that.  We need to change the way immigration works (again).  With the partisan nature of the federal government recently this may take a very long time, but legislation like the new law in Arizona shows that there needs to be some changes made.

Research Narrative (final)

Immigration has always been an issue.  This is true for many developed and undeveloped countries.  This is no different in the United States, a country founded by immigrants who were trying to escape their home countries for a myriad of reasons: religious persecution, debt, discovery, etc. They laid the foundations for what would later become this country.  Today many people in the country can find ancestors with a similar story.  Members of my family came over from what is now Germany in the 1800s as homesteaders.  This was about the time America became known to the rest of the world as the “Land of Opportunity” and Ellis and Angel Islands were about to receive many more tired, poor, huddled masses at either coast.

Today Ellis Island is a museum, it’s last visitor passed through a long time ago.  The United States’ history with immigration did not end there though. Today immigration to the United States still keeps going.  An issue that comes with this (and in fact has been around since the beginning) is illegal immigration.  People come into America for different reasons in order to make their lives better somehow, but they do not arrive and stay through legal means.  This usually happens because the legal means to enter the United States (with a work visa and a green card) are simply not feasible for them or unknown to them.  Many of these illegal immigrants are from Mexico or coming up through Central America.

For a long time I did not worry about this issue too much.  It did not really affect my life at the time.  My interest was finally piqued last semester however, when I enrolled in one of the required 392 Honors seminars.  At the time I merely signed up because it fit with my schedule and I heard good things about the professor.  It turned out (surprise, surprise) that the seminar was about immigration.  We learned about the history of immigration to the United States and ended with a debate on current issues.  In this debate I actually wound up on the opposite “side” of what my actual views were as I am more of a liberal myself.  While it made it difficult for me to debate against my own “side” (I use quotation marks because simply boiling it down to two sides would be a false dichotomy), I did learn quite a bit from the seminar.  The amount that I learned helped me gain the interest to learn more.

One of the main factors that made the issue of illegal immigration get back on the national radar was the passing of a law in the state of Arizona that states in a nutshell that persons can be questioned and detained by the police if they suspect them of being illegal immigrants and finding no papers on them.  This raised issues of racial profiling and invasion of privacy.  Since the issue had once again become exigent I decided it could be a possibility for one of the class blogs for writing arguments.  Things worked out in favor of that.

The overall topic of illegal immigration goes, it can be pretty broad.  It is not as broad as something such as education might be, but there is still a lot to argue about.  I chose to focus on one of the aspects that often come up in a debate about illegal immigrants: the economic impact.  Do illegal immigrants have a positive or a negative impact on our nations economy?  I decided to find out.

Early on I found out about one aspect of the economy that many people care about and illegal immigrants have an effect on: social security.  It appears that illegal immigrants can be a huge source of income for social security.  Because many illegal workers have fake social security numbers that allow them to enter the United States undetected, they do not reap the benefits of social security later in life.  The immigrants’ payroll taxes allow money to accumulate and be distributed to legal citizens of the United States.  There are several opinions on whether this is necessarily a good thing or not.

Another main concern I have found in my research, related to the previous issue, is tax dollars being used to keep illegal immigrants healthy.  I have found that this really should not be that big of a concern as the main demographic for illegal immigrants currently is male adults in their 20s-40s.  This demographic usually does not require as much medical attention as the elderly (illegal immigrants often return to their country of origin after they can no longer work) or children.

But perhaps the number one complaint that faces illegal immigration is the idea that immigrants take jobs away from actual native born citizens or immigrants who arrived legally (though some native born citizens are not too happy about them either).  As that is essentially can be an economics issue as well, I decided to look into it.  Opinions run wild on this issue, many of which are attached to very unstructured arguments.  One interesting, and rather silly, set of videos I found was from the Colbert Report.  In the videos, comedian Stephen Colbert decides to try his hand at one of the usual manual labor jobs that illegal immigrants often do.  In this case it was tending a farm.  This was all part of a stunt to show an initiative called “Take Our Jobs” where American citizens are asked to take the jobs currently filled by migrant farm workers.  As of the video, only Colbert and three others had taken the offer.   Colbert later testified to congress about it.  This all seemed to support the argument that immigrants take the jobs that American citizens do not want.  I guess more research will have to go into seeing if that is the case.

Other findings that I have for my research include reports and testimonies from various groups that detail the economic impact of illegal immigrants, including a report from Minnesota, which I thought was interesting.  They looked at education, healthcare, and general tax costs.  It was insightful to see the raw data, which few tend to present accurately.

Economically, immigrants seem to be a mixed bag.  They are beneficial in some aspects and detrimental in others.  But they are what help build America and keep her great, and I hope people will try to learn as much as they can about the issue before they make any quick decisions.

Annotated bibliography (Final)

McNatt, By Robert. BusinessWeek – Business News, Stock Market & Financial Advice. Web. 12 Nov. 2010. <;.

–      Overview of the economic impact of Illegal Immigrants.  It specifically talks about costs of illegal immigrants and how they affect credit.  There is also discussion on how changing immigration law would alter those affects.

It’s a pretty short article but it provides a good starting point when learning about the economic impact of illegal immigration or brushing up before a debate.

Numbers, By The. “Q&A: Illegal Immigrants and the U.S. Economy : NPR.” NPR : National Public Radio : News & Analysis, World, US, Music & Arts : NPR. Web. 12 Nov. 2010. <;.

–      A Q&A session by NPR regarding the economic effects of illegal immigrants.  It discusses the effect on wages as well as the overall effect on the economy.  The general tone is that it is not nearly as much of an issue as other economic problems.

The text seems relatively unbiased, which is always a good thing.  It also gives an impression that illegal immigration isn’t that big of a deal when it comes to wages.  There is also very little net impact on unemployment rates.  This article is good because it is calm and collected about the issue and provides a more rational approach.

“Fallback Position – Migrant Worker – Zoe Lofgren – The Colbert Report – 9/22/10 – Video Clip | Comedy Central.” Colbert Nation | The Colbert Report | Comedy Central. Web. 12 Nov. 2010. <—migrant-worker—zoe-lofgren&gt;.

–       Stephen Colbert attempts to do the tasks a migrant farm worker would do.  It is, of course, comedy, but it shows the kind of work they do that many Americans seem to not want to do.  There is a follow up video here:—migrant-worker-pt–2.

The series of videos may seem fairly unimportant, seeing as Colbert provides satire of the whole situation, but behind the humor lies important info on just what kind of things migrant workers do.  It also humanizes them, which is something that many arguments regarding illegal immigration lack.

Cortez, By Nathan. “Immigrants, Health Reform, and “Lies”” The Health Care Blog. Web. 12 Nov. 2010. <;.

–       A short Reuters article on the effects of illegal immigrants on Medicaid.  In North Carolina this comes out to about one percent.  Illegal immigrants are not eligible for benefits for non-emergency situations.

Of course, it also provides info on healthcare reform, which was (and still sort of is) another contentious issue.  The article therefore shows that there are no single, separate issues in our society.  Decisions can have multiple outcomes.  Something to keep in mind for any issue.

Porter, Eduardo. “Illegal Immigrants Are Bolstering Social Security With Billions.” NY Times. 5 Apr. 2005. Web. 11 Nov. 2010. <5.>.

–       A NY Times article from 2005 that discusses how illegal immigrants affect social security.  In fact, they strengthen it by putting in money but never reaping the benefits later in life.  This is because they do not have real social security numbers.

So illegal immigrants aren’t all bad, which should be obvious, otherwise there would be no argument.  The article shows a good reason why rejecting illegal immigrants out of hand might not be the best idea.  Thought provoking, to say the least.

“Congressional Testimony – March 14, 2006.” Social Security Online – The Official Website of the U.S. Social Security Administration. Web. 12 Nov. 2010. <;.

–       An actual testimony regarding the social security issue.  The inspector general talks about how the fake social security numbers can be bad for the SSA.  He also offers ways to change the set up to prevent this from happening.

On the opposite (sort of) angle from the above NYT article, this testimony is against illegal immigration.  While I may not completely agree with it, it is important to know why everyone makes the argument they do.  Ultimately it will help me to form my own argument.

The Office of Strategic Planning & Results Management Minnesota Department of Administration. “The Impact of Illegal Immigration on Minnesota Costs and Population Trends.” Web. <;.

–       Discusses the costs of illegal immigrants in the state of Minnesota.  Of particular notice economically are the education costs, healthcare costs, and tax issues.  The paper also talks about job loss in the state.

A good sum up of everything so far.  Sometimes just knowing the raw numbers is all anyone ever needs to form his or her own opinion.  Yes, it is definitely important to know.  But as everything else on this page (and many other sources) show, that’s not the whole picture.


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