Illegal Immigration

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William Parker
Malcolm Campbell
UWRT 1103
November 5, 2015

How Much?Illegal Immigration and Your Wallet

Introduction

Consider for a brief moment the human. A human is made up of trillions upon trillions of
cells, and on a cellular level, a human is an ecosystem with multiple different types of cells that
interact with one another. White blood cells, red blood cells, skin cells, hair cells, bone cells, cartilage cells, nerve cells, etcetera, come together to make up a human body, and each of these cells
is a part of something bigger than themselves. Now consider bacteria, tiny micro-organisms that
mean no harm to humans, however, when they find themselves inside of a human body they tend
to cause a disruption in the flow of the system. These disruptions come at great cost to humans,
often resulting in a sickness of which the degree of intensity can vary.

Because of the nature of bacteria, people have a tendency to hold negative opinions about
it, brought about by the looming shadow of the possible negative effects of allowing bacteria in
your system. Does this mean that bacteria is bad? Of course not.

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Now, imagine if there was a way to convert all of the bacteria in a human into regular
cells that work together with the rest of the system. The problems surrounding bacteria would be
gone, and everyone wins.

Similarly, illegal immigrants who find themselves caught in the system often impose
negative effects on all the other people living within the United States. I reiterate, this does not
make them bad people, or any less desirable than any other people; however, their actions tend to
cause lots of problemsproblems that come at great cost to the United States. Political commentator and former congressman Allen West said One of the critical issues that we have to confront
is illegal immigration, because this is a multi-headed Hydra that affects our economy, our health
care, our education systems, our national security, and also our local criminality. Most of the
problems posed by illegal immigration would be fixed by the immigrants coming in legally.

The economic problems caused by illegal immigrants fall into three categories: Government Benefits, Job Displacement, and Remittances to Latin America.

Government Benefits
One of the main costs of illegal immigration comes in the form of government benefits.
These benefits can be arranged into four categories: direct benefits, means-tested welfare benefits, public education, and population-based services. Among these services, direct benefits cost
tax payers the least amount at a rate of $44 per annum per unlawful immigrant household according to a study conducted by the Heritage Foundation. Direct benefits include Social Security,

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Medicare, unemployment insurance, and workers compensationmost of which unlawful immigrants are not eligible to receive (Rector). Although an underwhelming amount of resources are
allocated to direct benefits for unlawful migrants, the aggregate cost of government benefits for
illegal immigrants is much higher.

Moving up the list, the next category is means-tested welfare benefitsprograms offered
to unlawful immigrants by the United States government. There are over 80 means-tested welfare programs in the United States that cost tax payers over $900 billion per annum. These services provide cash, food, housing, medical, and other services to roughly 100 million low-income Americans(Rector). A few programs included in this category are as follows: Medicaid,
Earned Income Tax Credit (EITC), food stamps, Supplemental Security Insurance (SSI), Section
8 housing, Temporary Assistance for Needy Families (TANF), Social Services Block Grant
(SSBG), and many, many more of the like(Rector). Unlawful immigrants are granted access to a
multitude of these services, and each illegal immigrant household costs tax payers $4,497 via
these programs(Rector).

Population based services are not typically thought of as a welfare, however, the typical
unlawful immigrant household has a large disparity in taxes paid versus benefits received. Population based services include things such as fire protection, police, transportation, administrative
services, public safety, and things of the like. The aggregate household cost of illegal immigrants
abusing population based services comes to a total of $6,553(Rector).

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The most expensive category of resources and money allocated to illegal immigrants is
public education. Public education is typically subsidized through county property taxes, however, public school systems often receive multiple federal grants to continue running smoothly as
well as to help cover costs imposed upon the school system that are not covered by the county
property taxes. A typical household headed by an unlawful immigrant receives $13,267 in educational benefits from the county, state, and federal governments(Rector).

Determining the cost of government benefits given to unlawful migrant households is extremely simple once the costs are compiled into these categories; All that needs to be done is
some simple addition. When adding the costs of the four categories of government benefits to
determine how much an average illegal immigrant household receives, we come up with the
number $24,271 per annum (Rector).

Determining the aggregate cost of government benefits given to unlawful migrants is,
unfortunately, a little more difficult. First we must subtract the amount of taxes a typical unlawful migrant household pays, $10,334 according to the Heritage Foundations study, from the total
cost of benefits received, which is $24,271 according to the same study. Simple subtraction gives
us $13,937, which is the disparity in taxes paid versus government benefits receivedmeaning
the cost that the U.S. taxpayer must pick up per illegal household.

The hairy part of determining the aggregate cost is finding out exactly how many unlawful immigrant households are in the U.S. These estimates vary from source to source, and can be

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wildly different. The U.S. Department of Homeland Security estimated that there were 10.5 million illegal immigrants in January, 2005(Hoefer). The Pew Hispanic Center estimated there were
11.1 million unlawful immigrants in March, 2005(Passel). Other institutes such as the New York
Times, the Center for Immigration Studies, the Urban Institute, and the Current Population Survey conducted studies that produced similar results around the same time period(Lowenstein).
The only problem is, one decade later, we are still being told the same number of illegal immigrants are residing within the U.S.(Krogstad).

There is good reason to believe we are mislead in this estimation of illegal immigrants, as
well as a motive for the powers that be to mislead the citizens of the United States. 11 million
illegal immigrants is just small enough of a number for pro-immigration advocates to not raise
too many eyes from the general public, yet just large enough of a number for Republicans to continue a conversation about illegal immigrationand further alienate the Hispanic voting population.

In addition, two Bear Sternsa financial advisory agency analysts, Robert Justich and
Betty Ng, warned clients in 2005 that they found sufficient evidence the census may have undercounted the illegal immigrant population by just under half, and gave a more reasonable (in
their opinion) estimate of 20 million(Justich).

The analysts discounted the census information because it relied on illegal immigrants
answering census surveys. The United States Census Bureau attempted to account for the reluc-

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tance of illegals to fill out the census surveys by adding 10% to the estimated illegal immigration
population. The problem with using this information and, shaky-at-best, math is that they extracted this amount from another survey of Mexican-born illegal immigrants, in which 10% said
they hadnt answered the census survey(Coulter 103); However, 40% of Mexican-born illegal
immigrants asked to help out with the survey refused(Coulter 103).

It seems that the Census Bureau has a problem with chronic underestimation of the
amount of illegal citizens, as in 1990 the Brazilian consulate estimated that just under 100,000
Brazilians were living in New York City. In the same year, the Brazilian Foreign Office put the
number at 230,000, and the United States Census Bureau put the number at 9,200, less than 1/23
of the Brazilian Foreign Office estimate(Margolis).

The Bear Sterns analysts decided to take a look at a more stable resource for calculating
the amount of illegal immigrantsremittances to Mexico. They found that while the number of
Mexican-born immigrants residing within the United States was only supposed to grow by 56%
from 1995 to 2003, remittances to Mexico grew by over 200% during a time period when the
average wage went up by only 10%(Justich).

In addition to looking at remittances, they compared official population statistics with

the growth in housing permits and school enrollment. For example, from 1990 to 2003, the combined population growth rate was 5.6% for Brunswick, Elizabeth, and Newark, New Jersey,
however, the requests for housing permits grew by over 600%, and 80% of these permit requests

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were for multiple dwellings(Justich). Using this method, they found that 20 million illegal immigrants resided in the United States in the year 2005.

In 2006,one year later, and the same year net illegal immigration between the United
States and Latin America was supposedly hovering around 0two Pulitzer-Prize winning investigative journalists, Donald L. Barlett and James B. Steele, conducted their own study for TIME
Magazine that concluded the number of illegal aliens flooding into the U.S. this year will total 3
millionenough to fill 22,000 Boeing 737-700 airliners, or 60 flights every day for a year. It
will be the largest wave since 2001 and roughly triple the number of immigrants who will come
to the U.S. by legal means(qtd. in Barlett). Combining the results found by Justich, Ng, Barlett,
and Steele, and assuming the net flow of illegal immigration has not slowed, we come up with
the number of 50 million.

This is an extremely liberal estimate, however, so we must base our calculations in an

interval of 11 million to 50 million, or use the average of 30.5 million. The Heritage Foundation
study estimated that there were 3.44 million households headed by unlawful immigrants; They
based their estimate off of an estimated 12.7 million illegal immigrants living within those
households. Dividing 12.7 by 3.44 gives us 3.7, or the estimated average illegal immigrant
household size.

To convert our interval of (11 million, 50 million) and our average of 30.5 million into
households instead of individual aliens, we must divide each number by the estimated household

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size3.7 unlawful immigrants per household. This gives us a new interval with the lower portion being 2.98 million illegal households, and the upper portion being 13.5 million illegal
households, with an average of 8.24 million illegal households. To find the aggregate cost of
government benefits given to illegal immigrants we must multiply our interval and average by
the total disparity in taxes paid versus benefits received per household.

This gives us a new interval, which we will call interval x, of the aggregate cost of government benefits received by illegal immigrants, with the lower estimate being $41,532,260,000,
the upper estimate being $188,149,500,000, and an average, which we will call average x, of
$114,840,880,000. Thus, we can conclude that the aggregate cost of government benefits received by illegal immigrants falls within the interval, x, however, it is likely that the number
gravitates towards the average, $114,840,880,000.

Job Displacement

Government benefits given to illegal immigrants are an important factor to consider when
determining the aggregate economic impact of illegal immigration, however, it is not the only
factor. Most illegal immigrants come to the United States of America for the opportunities in the
labor force(Krogstad). An overwhelming majority of unlawful immigrants that fall within the
confines of what is defined to be the labor force are more than happy to get to work, with around
8.1 million unlawful immigrants who have found employment, or are looking for it(Krogstad).

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However, this estimate is also flawed as it bases its conclusions off the null hypothesis
that there are only 11 million illegal immigrants residing within the United States when sufficient
evidence has been provided to reject the null hypothesis in favor of the alternative hypothesis
that the real number falls within the aforementioned interval x, with a likelihood of gravitation
towards the average of 30,500,000.

Accounting for the fault in the original equation as well as the current unemployment statistics for the United States, we come up with the new interval, which we call z, with the lower
extreme being 7,695,000 employed illegal immigrants in the United States and the upper extreme
being 34,010,000 employed illegal immigrants in the United States, with an average of
20,710,000 employed illegal immigrants in the United States. The actual number of employed
illegal immigrants residing in the United States is extremely statistically likely to fall with in the
interval z, with a likelihood of a gravitation towards the average of 20,710,000.

The United States can not afford to hand out jobs to unlawful immigrants from other
countrieswe can barely take care of our own work force. Our current labor force contains
157,098,000 U.S. citizens, 7,908,000 of which are unemployed(United). With a 5% unemployment rate, and labor force participation at the lowest its been since 1978, it is not economically
sound for the United States to continue leaking jobs that couldve been held by citizens(Databases).

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Not only are the unemployed individuals a burden on taxpayers because they need to be
supported by them, but the jobs occupied by illegal immigrants that could've been held by a
United States citizen wouldve generated tax revenue, and thus, lifted some of the burden off of
the tax payer. Subtracting the lower extreme of interval z from the amount of unemployed United States citizens gives us the number 213,000, which represents the amount of unemployed citizens that would remain unemployed had unlawful immigrants not taken the jobs of United States
citizens.

Perhaps the actual number of employed illegal aliens gravitates more towards the average
z, as it likely does, then subtracting the amount of unemployed United States citizens, 7,908,000,
from the average z, 20,710,000 gives us the number 12,802,000, which represents the amount of
jobs that would be open to United States citizens had illegal immigrants notve taken up employment in these positions, all the while accounting for the 7,908,000 unemployed United States
citizens that would now be employed.

Imagine for a brief moment that the worst fears and nightmares of delusional, crazed
right wing nut jobs are considerable threats, and the amount of employed illegal aliens gravitates
towards the upper extreme of interval z, meaning close to 34,010,000 illegal immigrants currently hold employment in the United States. When accounting for the already-unemployed United
States citizens, this would leave 26,102,000 jobs on the table had unlawful immigrants not found
employment in these positions.

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If any of these three scenarios are true, we would be able to (or nearly be able to) completely cut unemployment benefits, a coalescence of programs that cost taxpayers
$520,000,000,000 annually(Luhby).

Unemployment benefits are an extremely important factor to consider when trying to determine the aggregate cost of illegal immigration in the United Stateshowever, it is not the
only factor that falls into the category of job displacement. There are other explicit costs that are
not so patent, such as the forfeited tax revenue that the United States government is unable to
collect from unlawful immigrants that it otherwise would be able to collect had the employment
been given to a United States citizen.

When considering the confidence interval z, meaning the amount of open jobs left on the
table had illegal immigrants never been granted employment in the United States, as well as the
the unemployed United States citizen population of 7,908,000, it may be difficult to see just how
we could fill those positions. Referring to the aforementioned labor force participation rate,
62.4%, one can conclude that the open jobs would cause a surge to the labor force, not unlike the
one seen in the 80s under Reagans tenure as president(Smith).

Assuming we had 100% labor force participation, with current statistics, 94,661,000
United States citizens would be looking for jobsmore than enough to fill all the positions left
open. When subtracting the unemployed citizens population, 7,908,000, from the confidence interval z, we can clearly define the confidence interval y, the lower extreme of which being

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-213,000, with an upper extreme of 26,102,000, and an average of 12,802,000 which represents
the amount of jobs available for growth in the labor force after the unemployed population (people in the labor force without a job that are currently looking for one) found employment. Applying the interval y to current labor force statistics, we could expect up to a 10.3% surge in the labor force participation rate, which would not only create more tax revenue for the government,
but it would lower the unemployment rate as well as potentially getting people off of government
benefits.

Once weve constructed our intervals with the prior statistics, its extremely easy to extrapolate a dollar amount for the amount of missed tax revenue. Multiplying confidence interval
z (the amount of jobs left open had illegal aliens never been granted employment in the U.S.) by
the amount of income taxes paid on the average employed illegal aliens annual wages, $24,800,
which would be $1,714 in 2015 for a single filer with no dependents, gives us the interval w,
with a lower extreme of $13,189,230,000, an upper extreme of $58,293,140,000, and an average
of $35,496,940,000, which represents the confidence interval that the actual amount in increase
of tax revenue is within, with a likelihood of gravitation towards the average(Rector).

Although the extrapolation of the exact cost placed upon tax payers by job displacement
has proven to be incredibly difficult, sloppy, and tedious, it is possible. To determine the aggregate cost of job displacement brought about by illegal immigrants, we must add the interval w to
$520,000,000,000 which gives us the interval b with a lower extreme of $533,189,230,000, an
upper extreme of $578,293,140,000, with an average of $555,496,940,000. Thus, we can con-

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clude the actual aggregate cost of job displacement brought about by illegal immigration falls
within the interval b, with a likelihood of gravitation towards the average.

Remittances to Latin America

The third and final way illegal immigration imposes costs on the United States is also the
most easily quantified. Remittances are easily explained, and basically amount to money sent
from one country to another via the countries national banks(Ratha). U.S. remittances to Latin
America accounted for over three quarters of all remittances received by those nations, for a total
of $41,000,000,000(Cohn). Remittances impose costs not only to United States tax payers, but
all the citizens of the United Statesincluding the ones being propped up by tax payers.

Imagine trying to fill a bucket of water with a hole in the bottom, it would never get full.
Perhaps the water is running at a faster rate than the hole can drain water at, the bucket would get
full eventually, however, it is undoubtedly one of the least efficient ways to fill a pale. When
money is drained out of the United States economy and placed elsewhere, in this case Latin
America, it makes it extremely hard to achieve sustained economic growth.

Conclusion

The aggregate economic cost of illegal immigration to the United States is not one that is
easily calculated. The estimations of the specifics of a population who by and large do not want
to be identified rely on a lot of shaky math, assumptions, and flat-out guessing. The intervals

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constructed in this research essay are meant to paint a more clear picture about just how much
unlawful immigration costs the United States. Although a solid this-is-it number does not exist,
and doubtful ever will exist, it is possible to find a 100% confidence interval in which the actual
cost of illegal immigration lies, as well as give direction in which amount to consider. By adding
the interval b to the interval x, and adding $41,000,000,000 to each extreme as well as the average, we can find the final confidence interval p, which has a lower extreme of $574,721,490,000,
an upper extreme of $766,442,640,000, and an average of $670,582,065,000. The final interval p
represents the aggregate cost of illegal immigration in the United States. The actual cost could be
$574,721,490,000, or $766,442,640,000, or any number in between, however, the most likely
value is the average$670,582,065,000.

$700 billionor nearly 20% of our federal expenditures for the 2015 fiscal year, is not
peanuts. We have a multitude of problems facing the countrychildren starving, homeless veterans, a shortage of help for the disabled, crumbling infrastructure, etcproblems that could be
alleviated with the help of money. However, we lose these resources by not implementing a series of processes to eliminate the waste brought about by illegal immigration.