Ending DACA is Bad Economics
| Economy Projected to Lose Billions in Taxes and Local Spending
| DACA Quick Facts
• DACA was not a path to citizenship. • DREAMERs not allowed to apply for citizenship. • DREAMERS not eligible for any federal means-tested welfare: including cash assistance, food stamps, Medicaid, health-care tax credits or anything else. • DACA students and Dreamers not eligible for federal student aid. • DREAMers pay taxes and contribute to social security and medicare; but cannot receive benefits.
Economic Impacts
Economic ImpactsA six-month phase out provides a chance for Congress to save the 2012 program – or implement immigration reform. In July of 2017, a group of bi-partisan group legislators introduced the Dream Act of 2017.
Sponsored by Senator Lindsey Graham [Republican, South Carolina], Senate Bill S.1615 was introduced 07/20/2017.
Ending Deferred Action for Childhood Arrivals (DACA) will harm local economies and cost the U.S. a significant amount of lost tax revenue. DREAMers are young, working and paying taxes – which means that they help the economy.
- DREAMers contribute positively to the local economy and pay taxes.
- DREAMers help relieve the economic problems caused by an aging and soon to retire population.
- DREAMers pay taxes but cannot receive assistance from any federal programs; including social security.
If DACA is ended, contributions to programs like Medicare and Social Security could drop by $24.6 billion over the next 20 years.
As the population ages, there are fewer working-age members contributing taxes to pay into Social Security and Medicare. A large group of relatively high-wage, very motivated people mostly in their 20s – likely to pay lots of taxes for decades – is exactly what the doctor ordered to make this issue less severe.
A similar demographic issue (aging population and low birth rates, combined with low immigration) is one reason why the economy of Japan entered an era of zero growth-rate a decade ago.
Immigration Legislation by Congress Needed
Under current laws, DREAMers are not allowed to apply for citizenship. There are number of bills in Congress on this topic.
In July of 2017, a group of bi-partisan groups legislators introduced the Dream Act of 2017. This bill would provide a pathway for Dreamers to become U.S. citizens and allow work permits to be issued; as well as take away the threat of immediate deportation.
Local Economic Impact of Ending DACA
Spending by undocumented immigrants on food, shelter, energy, health, and entertainment – like the rest of the population – boosts local economies and the U.S. economy as a whole.
DREAMers, like other young people, are early adopters of new technologies, smart phones, video games and other high dollar tech purchases.
New research by ITEP suggests that undocumented workers pay $11.6 billion per year in taxes. The Institute on Taxation and Economic Policy (ITEP) is a non-profit, non-partisan research
organization that works on federal, state, and local tax policy issues.
While an influx of American citizens and legal immigrants into jobs previously held by undocumented immigrants may theoretically represent a boon for the U.S. economy, the resulting overall economic impact may only be slightly positive, at best.
What is DACA?
Since 2012, Deferred Action for Childhood Arrivals (DACA), has changed the lives of nearly 800,000 young people who have lived in the United States since their childhood.
DACA provided the opportunity for individuals to come forward, pass rigorous background checks, and obtain permission to live and work in the United States lawfully. DACA has helped its recipients achieve milestones typically associated with the American dream: pursuing higher education, earning better wages to support their families, and buying homes.
Nearly 8 in 10 voters support allowing DREAMers to remain permanently in the country. As research has consistently shown, DACA has not only improved the lives of undocumented young people and their families but has also positively affected the economy generally, which benefits all Americans.
DREAMers Participate in Workforce, Pay Taxes
Data shows that 91 percent of respondents are currently employed. Among respondents age 25 and older, employment jumps to 93 percent.
After receiving DACA, 69 percent of respondents reported moving to a job with better pay; 54 percent moved to a job that “better fits my education and training”; 54 percent moved to a job that “better fits my long-term career goals”; and 56 percent moved to a job with better working conditions.
The data illustrates that DACA recipients continue to make positive and significant contributions to the economy, including earning higher wages, which translates into higher tax revenue and economic growth that benefits all Americans.
In addition, DACA recipients are buying cars, purchasing their first homes, and even creating new businesses. At least 72 percent of the top 25 Fortune 500 companies employ DACA recipients. Available data shows that 97 percent of those granted protection by DACA are currently employed or enrolled in school.
Visa or Immigration Questions? Please Contact VERDIN
Isaul Verdin has extensive experience advising multinational companies and entrepreneurs on complex US immigration matters involving investments.
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Investment visa business opportunities include real estate, aviation, technology, manufacturing, retail, luxury goods, and professional services. Additionally, he litigates deportation defense matters throughout the US.
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Article Sources
https://krugman.blogs.nytimes.com/2017/09/05/the-very-bad-economics-of-killing-daca
http://fortune.com/2017/09/08/trump-undocumented-immigrants-daca
https://www.americanprogress.org/issues/immigration/news/2015/04/02/110045/assessing-the-economic-impacts-of-granting-deferred-action-through-daca-and-dapa
http://fortune.com/2017/08/31/daca-dreamers-jobs-donald-trump
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