Immigration, Property Rights, and Freedom

ice-raid-santa-ana-calif-jan-17-2007-ap-photo-mark-averyThis is the first in a series on immigration and freedom.

There seems to be a non-trivial number of people- even very high-profile folks such as Ron Paul- who identify as pro-freedom yet have huge blind spots concerning immigration.  We don’t think the government should be used to violate our property rights, either through taxation or otherwise.  We don’t think we should be subject to onerous government surveillance and tracking.  We don’t support the government trashing civil liberties or destroying the environment. Etc. But bring immigration into the picture and suddenly you will hear a number of otherwise pro-freedom people calling for the government to commit all manner of harms and rights violations which they would normally agree are unacceptable.  In the next few weeks through a series of articles on immigration and freedom, I hope to contribute to the dismantling of mental barriers that are driving some of us to back away from a full and passionate advocacy of liberty and justice for all.  Today I’ll begin with the topic that brought this to the front of my mind- taxation and property rights.

Last October, Reason documented the process of legally getting into the United States.  Skilled workers and adult children and siblings of United States citizens and legal permanent residents typically face a five to fourteen year wait just to get into the United States.  For unskilled workers, it is virtually impossible to immigrate here legally.  The problem of fence-hopping- to the extent that it is a problem- is the making of the United States’ anti-immigration policies.  The fix to the problem is to undo these policies- not to extend and institutionalize rights violations committed indiscriminately against a huge and arbitrarily-grouped class of people.

When you own property, that means you may do with that property what you wish so long as you are not violating the rights of others.  If a person sits at my dinner table with me, occupying space on my property at my invitation and of his own volition, neither he nor I are violating anyone else’s rights.  It is my right as the property owner to decide whether or not he is allowed to be there.  It is neither your right, nor any voter’s, nor any government agent’s right to decide otherwise for us.  The same holds true regarding who I may employ on my property and to whom I may sell my property.  As far as I am concerned, the discussion should be over right here.  My property, my choice.  Your property, your choice.  We have no problem recognizing this in other relationships between peaceful and consenting adults, and this should be no exception.

Unfortunately, it isn’t that simple. Some folks believe that an exception should be made in this case.  Until welfare is reduced, the argument goes, we must violate people’s property rights (as well as other rights) via taxation to fund policies and enforcement actions designed to keep out immigrants who, it is assumed, will significantly burden taxpayers through unjust wealth redistribution programs.  I think this excuse is nonsense.  It’s time to kick it to the curb.

Let’s start with the logic of the argument. Taken to its natural conclusion, it leads to some places I don’t think most of us want to go. The general idea, of which this argument is merely a specific case, is that it is generally wrong to violate someone else’s rights, but a vast class-based exception can be made arbitrarily against millions of people as a sort of mass collective defensive measure on behalf of taxpayers.  We could similarly advocate a ban on junk food, tobacco products, alcohol, high risk sports, etc.  After all, some people may suffer detrimental effects as a result of those things and wind up costing the taxpayers who are forced to fund their care.  We could further support a ban on reproduction by people who do not meet some minimum level of government-approved preparation for parenthood.  This would be a defensive measure to ensure that the taxpayers do not wind up paying for the care of children whose parents are unprepared to care for them properly.  There would, of course, have to be penalties imposed on anyone who refuses to comply.  We could all go on for quite a while with these sorts of analogous examples, but I hope we can see why this is a bad path to be going down.  In fact, this is the sort of logic supporting the War on Drugs which I think most of us agree has been incredibly devastating in terms of property rights and other rights as well.  I think we ought to ask ourselves, is this the direction we as pro-freedom advocates want to be going?

Next let’s look at a couple of common but faulty assumptions about the facts of the situation- the assumptions from which that bad argument proceeds.  The first is that immigrants do not contribute significantly to public coffers.  That may seem intuitive, but it’s incorrect.  Even illegal immigrants pay more than just sales tax.  They pay excise taxes such as fuel, alcohol, and tobacco taxes.  They pay property taxes, primarily indirectly through rent.  Millions of undocumented workers are having income taxes withheld and some even file income tax forms and pay additional income tax beyond what is withheld by their employers.  The Social Security Administration estimates that about 3/4 of undocumented workers pay payroll taxes (Social Security/Medicare) to the tune of several billions of dollar annually.

The second is that immigrants are a significant burden on social services.  That may also seem intuitive based on common stereotypes of illegal immigrants, but it’s also incorrect. Let’s look at some rough numbers and do a little back-of-the-envelope calculation.

On the “asset” side of the balance sheet, we have the money we would save by getting rid of three Department of Homeland Security Departments: Immigration and Customs Enforcement (ICE), Customs and Border Protection (CBP), and Citizenship and Immigration Services (CIS).  According to the Department of Homeland Security’s 2010 budget, these divisions add up to more than $20 billion (pdf) out of taxpayers’ pockets which they would be saved with an open borders policy.  Additionally, a rough estimate of the tax contributions of illegal immigrants through payroll and federal income taxes alone is around $11 billion.  By ending the closed borders policy, we’d have a net benefit of at least $31 billion.  This, of course, does not account for all of the tax dollars currently paid by illegal immigrants as detailed above.  Nor does it account for the additional taxes immigrants would pay when they no longer risked deportation for doing so.  Nor does this account for the additional taxes that would be paid by immigrants who would certainly have a much higher standard of living if they were able to compete for wages on an equal basis with legal residents.  Nor does this account for the taxes paid by legal citizens born in the United States who are children of illegal immigrants.  This is clearly a lowball.

On the “liability” side of the balance sheet, we are looking at those public services Lance is worried about immigrants consuming.  However, they are actually quite limited.  In 1996, the Personal Responsibility and Work Opportunity Reconciliation Act (PRWORA) was signed into law effecting numerous changes to taxpayer-funded social programs.  It had significant ramifications for immigrants.  Since its passage, illegal immigrants have not been eligible for participation in most tax-funded social programs with the exception of emergency medical care and public education.  Further, most legal immigrants are not eligible for any but these two social benefits for five years after they arrive in the United States.  So what we are looking at on this side of the balance sheet are primarily emergency medical care and public education.  I take the following rough numbers from two notoriously anti-immigration sources. (Note that the first organization is a spinoff of the second.)  The Center for Immigration Studies’ current estimate for the cost to taxpayers of medical care at all levels of government to be $4.3 billion.  The Federation for American Immigration Reform (FAIR) estimated in 2005 that the national cost for K-12 education for minors in the country illegally plus minors who are citizens but whose parents entered illegally at $28.6 billion.  This was the hardest number to pin down.  I was unable to find more recent data, if it exists.

Now this is a little bit of a case of comparing apples to oranges due to the nature of data I was able to track down.  The negative side of the balance sheet includes the costs of U.S. citizen children born to illegal immigrants but the positive side does not include the tax contributions of those same individuals- and yet the difference is still less than $2 billion.  To put that into context, the projected 2010 budgets for the departments providing social services to United States citizens (Education, Health and Human Services, Housing and Urban Development, Labor, Veterans Affairs, and Social Security) total $251.8 billion meaning that a very conservative estimate for the impact of illegal immigrants on taxpayers is less than 1% of the total taxpayer social services burden.  Evening the balance sheet a little bit, Shikha Dalmia of the Reason Foundation reports that the “National Research Council found that when the taxes paid by the children of low-skilled immigrant families — most of whom are illegal — are factored in, they contribute on average $80,000 more to federal coffers than they consume” over their lifetimes.  In fact, numerous studies over the years since at least 1980 have found that immigrants on average contribute more than they cost.

I acknowledge that the numbers are rough here.  Separating out money for unjust drug war actions and other things entangled with immigration issues is not straightforward.  It’s a bit beyond the scope of this blog post to do an in-depth analysis, but I think I’ve built in significant generosity to the negative side of the balance sheet such that it errs quite a bit out of my favor.  For instance, I believe the FAIR number for K-12 education assumes that all children of immigrants of K-12 age are attending school; that is hardly the case and makes for a ridiculous overestimate.  If anyone would like to discuss numbers more specifically, I invite you to post your comments below.

The problem is not that immigrants aren’t contributing.  Rather you can see the source of the problem from the cost/benefit data above: immigrants’ contributions primarily go to the federal government whereas the services they receive come primarily from state and local governments whose finances reflect this disparity.  Immigrants are paying for benefits they will never receive leaving them with fewer resources to pay for what they do use.

Further, the ability of working illegal immigrants to raise their own standard of living through their own efforts is severely limited by the government policies and enforcement measures that force them to work underground or take away their livelihood altogether.  Note that government enforcement actions are very pointedly focused on stopping immigrants from earning a living via voluntary market transactions.  During the Bush administration, there were several high-profile raids that led to the deportation of hundreds of working immigrants- people who were not sponging off the system but rather whose wages, harder-earned that most folks’, were taken from them to provide to United States citizens benefits these workers are themselves to receive.  The Obama administration has elected to continue raiding the pocketbooks of working immigrants.  This past summer, ICE began an audit of 652 companies looking to weed out working immigrants whose employment is not government-approved.  Minnesota Public Radio reports that in the last couple of months, for example, 1200 workers were fired in the Twin Cities area in Minnesota from janitorial jobs paying good wages.  These workers were put out of their jobs after ICE reviewed their records and found them lacking.  And the abuse extends to lower levels of government as well.  For example, Maricopa County Sheriff Joe Arpaio, America’s Most Abusive Sheriff, is notorious for conducting worksite raids.

Undocumented immigrants must work underground thereby harming their standard of living through lower wages in exchange for employers looking the other way with regard to the paperwork.  They pay taxes that go to fund benefits they are ineligible to receive further harming their standard of living and effectively subjecting them to one of the most regressive tax structures among all workers in the United States.  And then in the face of all that, working immigrants are targeted by law enforcement through worksite raids and pressure on their employers to get rid of them.  Who has a more legitimate claim to being cheated and abused by the system than these people?

The focus on social services paid for by taxpayers as an excuse for discrimination and rights violations by way of government against millions of people, citizens and non-citizens alike, would be laughable were it not so horrifyingly tragic for so many people who put their lives on the line time and again to make an honest living and take care of themselves and their loved ones.  This excuse has worn embarrassingly thin at this point, and it should be abandoned immediately.  It only serves to divert attention away from the rightful focus on wealth redistribution schemes and the vast majority of their dependents who are United States citizens.  The way to deal with excessive taxpayer burden from public social services is not to compound the problem with additional violations via unjust border policy but rather to focus on undoing the rights violations that created that burden in the first place.

My thanks to Brad Taylor for reviewing and commenting on the draft of this post, and to the late Julian Simon whose work was the first to seriously challenge my assumptions about immigrants and immigration.

About the Author

Kirsten blogs at Enjoy Every Sandwich and will be podcasting as part of the 365 Days of Liberty team starting 1 January 2010.