Illegal immigrants make us money

America’s largest libertarian thinktank just produced a study that blows up the Trump administration’s claims about the horrible economic damage immigrants are doing. Specifically that, in the words of our Secretary of Homeland Security, they “suck dry our hard-earned tax dollars” who “snatch the benefits owed to AMERICANS,” as she put it in a post on X in December. She recommended to the president “a full travel ban on every damn country that’s been flooding our nation with killers, leeches, and entitlement junkies.”

They’re not sucking or snatching. They’re not leeches. In fact the reverse. “For years, nativists in Congress and the administration have wrongly claimed that immigrants are behind the growth in debt and that the US immigration system allows foreigners to take advantage of Americans’ generosity,” the summary of the report says. “Our data completely repudiates this view. Immigrants are subsidising the US government.”

Perhaps surprisingly, immigrants on average make more than the typical native born citizen. The reason is that though most work for hourly wages, and not salaries, they work a lot of hours. They epitomize the American ideal, in this case better than many of the native born do.

This includes non-citizen immigrants, including those who are here illegally. Whatever one thinks about their being here at all, they more than pull their own weight economically. They are “fiscally positive” for every level of government, meaning they put into the system more than they get out of it. Surprisingly, they accounted for 44% of all immigrants’ positive net fiscal contribution in the three decades covered by the study, a whopping $6.3 trillion in real terms. Of that, the study estimates that illegal immigrants made a contribution of $1.7 trillion, an also whopping big number. “Unlike the immigrant population generally,” the study explains, “non-citizens have lower-than-average incomes, so the sole reason for non-citizens’ positive net fiscal contribution is lower-than-average benefits receipt.” In other words, they don’t make a lot of money, but they still contribute more than they get.

The study explains: “Non-citizens also received 75 percent less in old-age benefits than the average U.S. resident; were roughly even with other residents on needs-based programs; used half as many educational resources; and were 21% less costly per capita for prisons and felony policing over the 30-year period.”

Take the last of those categories, the one many people may not believe. “Despite the fact that tens of thousands of low-skilled immigrants were detained for immigration offenses that U.S.-born Americans cannot commit, they were about half as likely as the average US-born person to be incarcerated from 1994 to 2023,” the study notes, using US Census data. “This means that they also triggered much less spending on felony policing and courts.”

The administration has certainly worked very hard to make people think a lot of illegal immigrants are monsters. But one aspect of being illegal is trying not to get caught, keeping your head down and yourself out of trouble. Almost all of them are here to make a living and very often to send money home so their families can make a living.

Doing something that might get you arrested and then found out as an illegal immigrant is something they know to avoid. Not that everyone does, of course, because illegal immigrants are people too, with all the problems that includes, including stupidity. But they have even more incentive than the rest of us to obey the law and that, I’m told, has a real effect.

It could be argued that the Cato Institute favors open borders because it speaks for those who will profit from labor competition suppressing wages and from having a vulnerable population who can be hired as needed and then fired as needed. I think that likely to be true — it’s a thinktank for the very wealthy, even more than the Heritage Foundation — but the people there are good at what they do and know to make their case with solid data.

The study doesn’t address other questions, like how important is the illegality of illegal immigration. It answers just one question, whether or not immigrants, including ones here illegally, cost the government and therefore the rest of us money. The answer is that they don’t. They put money into America.