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Conservative Economists Agree Immigration Reform Would Boost Economic Growth, Cut The Federal Deficit And Create American Jobs

May 15, 2013 | Comunicados de Prensa

American Action Forum’s Gordon Gray: “Our estimates found that benchmark immigration reform would increase GDP by nearly 1 percentage point, increase per capita income by $1,700, and reduce the federal deficit by $2.7 trillion. Supportive in that narrative, on May 8th, the Office of the Chief Actuary for the Social Security Administration provided a preliminary estimate of the financial effects on the Social Security program that would occur if the “Gang of Eight” immigration reform proposal became law. Included in the estimate were projected changes to the size of the economy (GDP) over the next 11 years. The Chief Actuary estimated that by 2024 the level of GDP would be 1.63 percent higher than would otherwise be the case and by 2023, the end of the current 10-year budget window, GDP would be 1.6 percent higher than would otherwise be the case. Based on this information it is possible to compare baseline growth rates with those necessary to achieve the higher levels estimated by the Office of the Chief Actuary, which works to an annual average difference of about .16 percentage points.” (Gordon Gray, “Based On Social Security Administration Estimates, Growth From Immigration Reform Would Yield Half Trillion More In Budgetary Savings,” American Action Forum, 5/14/13) 

American Action Forum’s Doug Holtz-Eakin: “Immigration reform can raise population growth, labor force growth, and thus growth in Gross Domestic Product (GDP). In addition, immigrants have displayed entrepreneurial rates above that of the native born population. New entrepreneurial vigor embodied in new capital and consumer goods can raise the standard of living.” (Doug Holtz-Eakin, “Immigration Reform, Economic Growth, and the Fiscal Challenge,” American Action Forum, 4/13)

  • Holtz-Eakin: “A benchmark immigration reform would raise the pace of economic growth by nearly a percentage point over the near term, raise GDP per capita by over $1,500 and reduce the cumulative federal deficit by over $2.5 trillion.” (Doug Holtz-Eakin, “Immigration Reform, Economic Growth, and the Fiscal Challenge,” American Action Forum, 4/13)

Larry Kudlow: “The GOP must reclaim the growth-and-optimism message of Reagan and Kemp. Immigration reform is part of that message. … Immigration-reform proposals from Senator Marco Rubio and others land squarely on the growth side of the debate.” (Larry Kudlow, Op-Ed, “Immigration Reform Is Pro-Growth,” National Review Online, 5/10/13)

  • Kudlow: “And let us not forget the economic benefits of opening the door to more brainiacs — foreigners who will boost American technology by filling engineering vacancies. Then there are the immigrant students who get advanced degrees at our best universities. They’ll make enormous contributions to economic growth and innovation if we let them. And if we’re talking 50-year periods, the next Google or Apple or Amazon can employ so many and pay such good wages — creating massive wealth through capital and consumer goods — that the economic dynamism of new immigrants could cover all the costs of immigration reform and then some.” (Larry Kudlow, Op-Ed, “Immigration Reform Is Pro-Growth,” National Review Online, 5/10/13)

Manhattan Institute’s Diana Furchtgott-Roth: “America’s economic growth is hovering around 2 percent, public debt is $16 trillion and rising, and job creation and labor market participation remain low. Embracing a more flexible legal immigration system can dramatically improve this situation.” (Diana Furchtgott-Roth, “The Economic Benefits of Immigration,” Manhattan Institute, 2/13)

  • Furchtgott-Roth: “Immigration benefits the economy, and America must adopt more flexible immigration policies that spur growth.” (Diana Furchtgott-Roth, “The Economic Benefits of Immigration,” Manhattan Institute, 2/13)
  • Furchtgott-Roth: “A growth-oriented immigration policy would allow a greater number of immigrants to legally enter, stay, and work in the United States. Arlene Holen, using Congressional Budget Office methodology, has estimated that if no green card or H-1B visa constraints had existed in the period 2003–07, an additional 182,000 foreign graduates in science and technology fields would have remained in the U.S. Their contribution to GDP would have been $14 billion in 2008, including $2.7 to $3.6 billion in tax payments. Three hundred thousand H-1B visa holders would also have remained in the U.S. labor force, earning $23 billion in 2008 and generating $34—$47 billion in tax revenue over the next decade.” (Diana Furchtgott-Roth, “The Economic Benefits of Immigration,” Manhattan Institute, 2/13)
  • Furchtgott-Roth: “Immigrants increase economic efficiency by reducing labor shortages in low- and high-skilled markets because their educational backgrounds fill holes in the native-born labor market. However, the share of immigrants in the U.S. workforce has declined since its 1991 peak. Increased immigration would expand the American work-force, and encourage more business start-ups. Businesses ranging from Apple Corporation to apple growers would be able to find the workers they need in America. Current law has inhibited such positive developments.” (Diana Furchtgott-Roth, “The Economic Benefits of Immigration,” Manhattan Institute, 2/13)

The Wall Street Journal: “But for today let’s step back and consider the central question that’s been debated since the great wave of Ellis Island immigrants a century ago: Do foreign newcomers contribute more to the economy than they cost? … Immigrants are also generally productive, entrepreneurial and highly motivated. They have a higher labor-participation rate than native-born Americans, and they also create new businesses at a higher rate. Some have specific technical skills the U.S. needs, while even workers with lesser education or lower skills bring a strong work ethic and a willingness to fill low-wage jobs.” (Editorial, “The Immigration Windfall,” Wall Street Journal, 4/16/13)

  • WSJ: “Faster economic growth would in turn drive down the budget deficit over the next 10 years by at least $2.5 trillion. Think of it this way: A more generous and more skill-based immigration system would lower the budget deficit three times more than President Obama’s fiscal-cliff tax increase enacted in January. This is merely a single study and hardly the final word, but the conclusions confirm what many others have found. The most comprehensive modern study was completed by the National Research Council in 1997. It found a net positive, albeit small, economic benefit from immigration.” (Editorial, “The Immigration Windfall,” Wall Street Journal, 4/16/13)

Donald Marron: “At the time [of the 2006 Joint Committee on Taxation immigration scoring], I thought [using dynamic scoring] was a pretty big deal, doing a dynamic score of a major piece of legislation. I expected some reaction or controversy. Instead, we got crickets. It just wasn’t a big deal. The direct economic effects of expanded immigration—bigger population, bigger work force, more wages—were so straightforward that folks accepted this exception from standard protocol. I hope the same is true this time around.” (Donald Marron, “Immigration, Dynamic Scoring, and CBO,” Tax Policy Center, 5/3/13)