New Report: Evaluating the Lifetime Fiscal Impact of Immigrants

A selectionist immigration policy could reduce future federal debt by trillions of dollars 

NEW YORK, NY – The Biden administration’s border crisis will cost the United States more than $1 trillion over the lifetimes of new, unlawful immigrants, according to new estimates from Manhattan Institute graduate fellow Daniel Di Martino. As the country’s federal debt rises towards unsustainable levels and border crossings rise, policymakers must consider the net fiscal cost of immigration. However, disagreements on immigrants’ contributions to the economy and their fiscal consequences persist due to limited data that focus on short-term effects rather than lifetime contributions.

In his new Manhattan Institute report, Di Martino provides original analyses and findings on the lifetime fiscal impacts of both lawful and unlawful immigrants. Specifically, he finds that the characteristics of those seeking entry into the country, such as their ages and education levels, are crucial to determining their long-term effects on the economy. 

Younger and more educated immigrants, for example, consistently pay more in taxes and receive fewer government benefits throughout their lives than their older and less educated counterparts. By enacting policies that prioritize and expand these types of newcomers, while reducing low-skilled immigration, the U.S. could significantly reduce the national debt over the long term by trillions of dollars.

Further, Di Martino quantifies the fiscal impact of common immigration-reform proposals: 

• A policy of selective legalization, coupled with mass deportations would reduce the debt by about $1.9 trillion.  
• Given the education, age, and earnings of H-1B visa recipients, doubling the number of H-1B visas for just one year would reduce the budget deficit by $70 billion over the long run—and by another $70 billion each year thereafter.  
• Exempting STEM graduate degree holders from green-card caps, increasing immigration by some 15,000 high-skilled newcomers per year, and reducing the visa backlog would reduce the deficit by $150 billion in the first year and by $25 billion each year thereafter. 
• Eliminating refugee resettlement and permanent immigration by parents of U.S. citizens would reduce the debt by a combined $40 billion in net present value every year. 
• Eliminating the diversity visa category and increasing the visas available to the top employment-based categories—and requiring immigrants to have earned a high school diploma to be eligible for a family visa—could reduce the national debt by over $60 billion per year. 

Click here to read the full report.