REPORT: Amnesty Expected to Overwhelm Social Security and Medicare
REPORT: Amnesty Expected to Overwhelm Social Security and Medicare
Jose Nino
Apr 7, 2021
The Democrat Party’s current mass amnesty fantasies will not come cheaply.
According to Jason Richwine, a resident scholar for the Center for Immigration Studies, legalizing the 11 to 22 million illegal aliens residing in the United States will create an enormous fiscal burden.
Richwine initially noted that “illegal immigrants are net contributors to Social Security and Medicare,” according to the current law. However, upon receiving amnesty, Richwine observed that “amnesty would transform illegal immigrants from net contributors into net beneficiaries, imposing steep costs on the Social Security and Medicare trust funds.”
The CIS resident scholar highlighted several of the costs:
- Amnesty would impose a lifetime net cost on Social Security and Medicare Part A (hospital insurance) of about $129,000 per amnesty recipient. This cost is the present discounted value of benefits received minus new taxes paid.
- If 10 million illegal immigrants receive amnesty, the total cost to Social Security and Medicare Part A would be roughly $1.3 trillion in present value, equivalent to a one-time transfer of 6 percent of GDP.
Richwine explained why amnesty would place huge stress on Medicare and Social Security:
First, both programs have a progressive benefit structure, meaning that lower-income participants receive more benefits relative to their contributions compared to high earners. In the case of Social Security, participants contribute the same 12.4 percent tax on all earnings up to the maximum taxable salary, but their benefits increase at a slower rate as their earnings increase. Medicare is even more progressive because it hardly depends on earnings at all. Once participants have worked for 10 years at a minimal earnings level, they become eligible for the same benefits as high-earning, full-career workers. Because illegal immigrants tend to have lower earnings and work fewer years in the U.S. than the average Social Security and Medicare participant, as a group they will benefit from these programs’ progressive benefit structures — if, that is, they become eligible through amnesty.
The CIS scholar further cautioned why amnesty would collapse both legacy entitlement programs:
A second reason that amnesty would be costly to Social Security and Medicare is that many illegal immigrants are currently paying into the system without accruing any benefits in return. Although the exact percentage is unknown, roughly half of illegal immigrants are thought to be contributing payroll taxes — either because they entered a fake Social Security number (SSN) on employment forms, or because they acquired a real SSN through former legal status or fraud.2 The “free” contributions made by these taxpaying illegal immigrants are a fiscal positive for the U.S., but amnesty would reverse the situation. Once illegal immigrants receive amnesty and become eligible for Social Security and Medicare, they will no longer be net contributors who partially pay in without receiving anything in return. Instead, they will become net beneficiaries who receive more in benefits than they contribute in taxes.
Richwine’s entire findings can be found here.
Mass migration comes with massive financial burdens, along with political and social costs. If Democrats’ current mass amnesty policies get enacted, America’s political system could be radically transformed in an irreversible manner, based on the voting habits of the majority of migrant groups. Not to mention, such a large influx of migrants will generate economic strife based on simple labor economics, wherein an expanded pool of low-wage labor will lead to depressed wages for those Americans who can least afford the hit.
Republicans must hold the line and do everything in their power to stop amnesty in its tracks.
https://bigleaguepolitics.com/report...-and-medicare/
