Despite arguments that undocumented immigrants are harmful to the U.S. economy, a recent analysis from the CATO Institute, a libertarian think tank founded by Charles G. Koch and funded by the Koch brothers, shows that a repeal or roll-back of the Deferred Action for Childhood Arrivals (DACA) program would ultimately cost the federal government over $60 billion and reduce economic growth over the next decade by $280 billion.
Since its 2012 creation through an Obama administration executive action, DACA has provided a way for undocumented immigrants who were brought to America as children to receive work permits and temporary protection from deportation. Individuals are eligible if they have been in the U.S. for five years or longer and do not have a criminal record. As of June 2016, U.S. Citizenship and Immigration Services had received 844,931 DACA applications and accepted 741,546 applications, with the rest either pending approval or denied. As of September 2016, the number of approved DACA applications rose to 752,000 recipients, according to the Migration Policy Institute (MPI).
According to the CATO report, DACA recipients tend to be more productive members of society, earn higher wages than other undocumented immigrant groups, and are better educated, though they are ineligible for federal financial aid and, in most states, are unable to attend public institutions. Still, data from MPI show that 50 percent of DACA recipients are enrolled in some form of postsecondary education, and 70 percent of them are enrolled in a bachelor’s degree program.
DACA students are “active and welcome members of our university community,” University of California President Janet Napolitano said during a January 27 event hosted by MPI. “Educators have become so involved [in the debate around DACA] because they see the worth and merit of these young people and we feel it would just be wrong to subject them to deportation after all that they have done.”
But their ability to stay in the U.S., and DACA’s very existence, is under threat from President Donald Trump, who included among his campaign promises a total nullification of Obama’s executive actions on immigration, including DACA. Trump has since walked back from that pledge, saying his administration is “going to work something out.” He has yet to take action on the program. Meanwhile, a bipartisan group of legislators introduced the Bar Removal of Individuals who Dream and Grow our Economy (BRIDGE) Act, which would extend key legal protections and work permits to DACA recipients.
In an effort to determine the potential economic impact of deporting the nearly 750,000 DACA recipients, CATO researchers compared them to immigrants with H-1B visas, the group that most closely resembles the demographic characteristics of DACA recipients. H-1B visas are only offered to skilled workers who are invited into the U.S. to fulfill specific economic needs. CATO used the June 2016 data on the number of DACA recipients in its analysis.
Though the comparison is not flawless, the two groups are similar in age, education level, and earnings, allowing CATO to estimate the fiscal impact of deporting DACA recipients and eliminating the program. For example, the average DACA recipient is 22 years old, employed and earning about $17 per hour. The majority of DACA recipients are currently students, with 17 percent pursuing an advanced degree. H-1B visa holders, similarly, are between 25 and 34 years old and hold either a bachelor’s degree or a master’s degree.
“In short,” the CATO report states, “they appear to be a close reflection of what DACA recipients will look like a few years from now as they complete their educations.”
Using previous analyses and research into the economics of the H-1B visa program, CATO determined that the DACA program represents an estimated $215 billion increase to the gross domestic product and $50 billion in tax revenues over the next 10 years. On the flip side, the total deportation cost for current DACA recipients would be $7.5 billion, based on an analysis done by the Center for American Progress that estimated the marginal deportation costs to be just over $10,000 per removal.
According to CATO’s analysis, the combined figures result in a total cost estimate of $283 billion over 10 years if the DACA program were immediately eliminated and its recipients deported.
“In other words, the United States economy would be poorer by more than a quarter of a trillion dollars if President Trump were to make good on his threat to repeal it,” the CATO report states.
The evidence also “suggest that the mere presence of undocumented workers, especially non-criminals like those covered under DACA, is not nearly as detrimental to the economy as most people suppose, and may actually be a net benefit,” CATO adds. “Legalizing unauthorized immigrants and allowing them to participate in society as legal workers dramatically reduces government enforcement costs and generates broader economic benefits.”
Publication Date: 1/30/2017