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Don't Blame Immigrants for Bloated Welfare State

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Alex Nowrasteh and Robert Orr

The Trump administration is in the process of writing new regulations to guarantee that certain immigrants won’t consume too many welfare or entitlement benefits. The welfare state is certainly a problem, but it’s a home-grown one, not an imported one. Welfare’s benefits are too large and too many people receive them. But the Trump administration should not blame this problem on immigrants.

In fact, immigrants use fewer welfare and entitlement benefits in than native-born Americans.

These were the results of a new study we produced for the Cato Institute. We examined data from 2016 on programs for the poor, such as Medicaid and food stamps, and also the entitlement programs of Social Security and Medicare. The latter two are the largest portion of the welfare state and twice as large as all welfare programs for the poor combined. We found that immigrants use 39 percent fewer welfare and entitlements benefits per person than native-born Americans. Immigrants are less likely to use the individual programs in most cases and, when they do, the benefits they receive tend to be smaller.

In fact, immigrants use fewer welfare and entitlement benefits in than native-born Americans.

Social Security retirement benefits provide a good example. Based on the data, adult immigrants are 47 percent less likely to receive Social Security benefits than native-born American adults. Furthermore, the average amount they receive in benefits is about $1,427 below that of natives in 2016. The net effect is that immigrants individually consumed 48 percent fewer Social Security retirement benefits than natives.

Supplemental Security Income provides another example. Lower immigrant use rates and benefits mean that the average adult immigrant consumes about 22 percent less in SSI benefits than the average native-born American adult.

Welfare and entitlement programs are generally intended to aid the poor and support the elderly, but only some Americans and immigrants fall into those categories. In another section of my study, we compare poor and elderly immigrants who meet the poverty and age requirements for those programs with native-born Americans who are also eligible. In this section, immigrants consume 27 percent fewer benefits than native-born Americans.

One reason why immigrants use fewer benefits is because they are often not eligible for them. Legal immigrants cannot get welfare for their first five years of residency, with few exceptions, mostly at the state level. Illegal immigrants are not eligible for welfare except for rare circumstances like emergency Medicaid.

Immigrants are drawn to America’s labor markets, not to welfare benefits. The number of illegal immigrants apprehended on the Southwest border, a good proxy measurement for the number who want to come here, is down by 82 percent in 2017 compared to 2000. During that time, Congress has increased the number of welfare programs available for new immigrants.

If they were coming for welfare, there would be more illegal immigrants entering the country than ever. But there aren’t. Murder, the chaotic drug war in Central America, and a recovering economy here, combined with a faltering one there, is the main driver of asylum seekers and some illegal immigrants coming from that part of the world.

The fact that immigrants are in fact less likely to receive welfare benefits should dampen the fears of conservatives and libertarians who would support more legal immigration if it weren’t for welfare and entitlement programs.

Still, Congress needs to address the high cost of welfare and entitlement programs. The best option would be to severely cut the size and accessibility to the welfare and entitlement state for everybody here — immigrants and natives. The benefits are unaffordable and push millions of people out of the labor market.

Congress should pass a simple law that makes all people ineligible to receive welfare and entitlement programs until they become U.S. citizens. Building expensive walls around the country, cutting legal immigration, or putting more faith in government technology to stop illegal immigration are fool’s errands. Reducing immigrant access to welfare and cutting the size of benefits are, by contrast, achievable and popular policies.

The good news is that even without a higher wall around the welfare state, immigrants are a welfare bargain compared to native-born Americans.

Alex Nowrasteh is a senior immigration policy analyst at the Cato Institute. Robert Orr is a research assistant working on welfare policy at the Cato Institute.

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