Is Illegal Immigration Good or Bad for the Economy? Alan Greenspan on Economics (2009)

• Report rights infringement
• published: 13 Jan 2016
• views: 69

George J. Borjas, an economist at Harvard University, has argued that illegal immigration may reduce the economic status of U.S. poor while benefiting middle class individuals and wealthier Americans. The presence of illegal immigrants and the exploitation of them may drive down wages for certain sectors of the American populace, further widening the socioeconomic gulf between rich and poor.[100] Professor emeritus Stephen J. Unger from the University of Columbia, explains that this results from employers who hire illegal immigrants that are exploited or willing to work for lower wages, instead of raising wages to attract legal citizens. Thusly, wages are kept flat or depressed and the employment rates for legal U.S. citizens decrease at the same time.[101] Additionally, illegal immigrants may displace work opportunities that would otherwise be available to citizens, thereby inducing native-born citizens to commit crimes.[102] Research by Borjas, Jeffrey Grogger, and Gordon H. Hanson suggests that a 10-percent immigrant-induced increase in the supply of a particular skill group reduced the black wage by 4.0 percent, lowered the employment rate of black men by 3.5 percentage points, and increased the incarceration rate of blacks by almost one percent.[103] A 2002 study of the effects of illegal immigration and border enforcement on wages in border communities from 1990 to 1997 found little impact of border enforcement on wages in U.S. border cities, and concluded that their findings were consistent with two hypotheses, "border enforcement has a minimal impact on illegal immigration, and illegal immigration from Mexico has a minimal impact on wages in U.S. border cities." Illegal immigrants are estimated to pay in about $7 billion per year into Social Security.[105] A paper in the peer reviewed Tax Lawyer journal from the American Bar Association asserts that illegal immigrants contribute more in taxes than they cost in social services.[106] However, The nonpartisan Congressional Budget Office reviewed 29 reports published over 15 years to evaluate the impact of illegal immigrants on the budgets of state and local governments, and found that the tax revenues that illegal immigrants generate for state and local governments do not offset the total cost of services provided to those immigrants, though the report speculated that the impact of illegal immigrants on state and local budgets was likely to be modest. Around 2005, an increasing number of banks saw illegal immigrants as an untapped resource for growing their own revenue stream and contended that providing illegal immigrants with mortgages would help revitalize local communities, with many community banks providing home loans for illegal immigrants. At the time, critics complained that this practice would reward and encourage illegal immigration, as well as contribute to an increase in predatory lending practices. One banking consultant said that banks which were planning to offer mortgages to illegal immigrants were counting on the fact that immigration enforcement was very lax, with deportation unlikely for anyone who had not committed a crime. https://en.wikipedia.org/wiki/Illegal_immigration_to_the_United_States Image By Festival Internacional de Cine en Guadalajara (Salma Hayek 07) [CC BY 2.0 (http://creativecommons.org/licenses/by/2.0)], via Wikimedia Commons