Immigration Reform and the Economy

By: Dr. Lynn Reaser

obama-cnn_immigration blog post

The President’s Executive Order to prevent the deportation of four to five million illegal immigrants will bring significant benefits to the economy. The major issue opponents have involves whether the President should have acted alone or if Congress should decide the outcome of this critical issue.

Bringing large numbers of immigrants out of the “underground economy” will produce distinct positives for the economy. These individuals will likely move to higher paying jobs, allowing them to give a bigger boost to consumer spending. With documentation, they will also be able to become homebuyers and will contribute more actively to the tax base.

There will be some negatives. Although some industries, such as hotels and restaurants, could see an increase in their potential job pools, existing employees could see a reduced potential for higher wages. Finally, government benefit costs could rise, ranging from school lunch programs to Medi-Cal.

The major economic shortfall is that the President’s actions do not go far enough. They do not, for example, raise the quota for H-1B visas that companies need to hire technology workers. The Presidential Order prolongs uncertainty as more than half of the 11 million illegal immigrants are not affected and because the actions are only temporary.

Comprehensive immigration reform is still desperately needed and, hopefully, will soon be addressed.


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