Shock Study: Trump’s Wall Would Pay for Itself
New analysis finds stopping even fraction of border-crossers would save taxpayers billions
If a border wall along the Mexican border stops only a fraction of illegal immigrants, taxpayers could save more money than the barrier would cost, according to a study released Thursday.
The Center for Immigration Studies, a Washington think tank that favors stricter border control, crunched figures from last year’s landmark report on the costs and benefits of immigration conducted by National Academies of Sciences, Engineering, and Medicine.
“It pays for itself in the big picture … It doesn’t have to stop everyone to pay for itself.”
That study did not differentiate between legal and illegal immigration. But based on other data, the Center for Immigration Studies estimated that on average, every person who crosses the southwest border illegally costs taxpayers at all levels $74,722 more than he pays in taxes over the course of his life.
If a wall were to stop between 160,000 to 200,000 illegal crossers over a decade — just 9 percent to 12 percent of the projected total — the savings over their lifetimes would equal the estimated $12 billion to $15 billion cost of the wall.
It is important to note that the impact on taxpayers measures spending at all levels of government. Since only the federal government would be on the hook for the wall, a success rate in the 12 percent range would not fully reimburse the federal government. But Steven Camarota, who wrote the report, said residents pay taxes to all levels of government.
“From the taxpayer’s standpoint, it may not matter,” he said. “It pays for itself in the big picture … It doesn’t have to stop everyone to pay for itself.”
[lz_table title=”Fiscal Impact of Border Crossers” source=”Center for Immigration Studies”]Estimated lifetime fiscal costs
< high school,57%,-$66.8K
High school degree,27%,-$15K
The reason for the savings has everything to do with the background of the typical border-jumper. Those immigrants skew heavily toward low skills and less education. An estimated 57 percent have not finished high school, and another 27 percent never went beyond high school.
Camarota, director of research at the think tank, said there is not much dispute that people without advanced education — both immigrants and natives — struggle economically in the United States. They pay relatively little in taxes and receive far more in government services.
Camarota added that those immigrants also are the least likely to get into the country in some other way. Poor residents of Mexico or Central American countries usually cannot qualify for tourist visas to the United States or employment-based visas. Crossing the border often is the only plausible path to America, he said.
“The fiscal drain is enormous for unskilled immigrants, and those are the immigrants most likely to illegally cross the border,” he said.
The study released Thursday is somewhat conservative in its cost estimates. It does not count the costs of U.S.-born children. Doing so would dramatically increase the burden on government, at least in the short run. Illegal immigrants mostly are ineligible for government assistance, but their American children are. And the federal government disproportionately bears those costs.
Camarota said he did not include those costs because it is difficult to determine if those first-generation Americans ultimately might pay more taxes as adults to make up for the assistance the received as children. The National Academies study includes 75-year projections, but Camarota said he considers that timeline too long to be reliable.
The other factor that made the taxpayer costs of illegal immigration more conservative is a discount that economists generally apply to future projections. The idea, Camarota said, is that a liability or a benefit in the future is not the same as one today. A promise to pay $10,000 in 10 years, for instance, is not as valuable as a $10,000 payment up front.
Camarota said there is a good argument that the discount — called “net present value” — does not make sense when estimating the taxpayer burdens of illegal immigration. Without that discount, the average lifetime taxpayer cost per illegal immigrants is $97,759 instead of $74,722.
The study deals with many hypotheticals. The National Academies report, for instance, includes eight different scenarios on the fiscal costs and benefits of immigrants at various education levels. Camarota said he used an average of those eight to make his projections. But he noted that all eight scenarios conclude that high school dropouts impose a net burden.
Camarota said there could be other, less expensive ways to slow illegal immigration without building a wall. President Donald Trump has proposed tracking down people who overstay their visas, ramping up interior enforcement, and making it harder for illegal immigrants to work in America.
But a wall might not only stop people from crossing border but deter them from even trying.
“That’s the group, from a fiscal impact, that you really want to stop,” he said.