Heritage Foundation and Cato Institute square off over amnesty


In 2007, The Heritage Foundation released a report on amnesty that helped kill a bill most politicians thought would pass. The biggest weapon in the amnesty analysis was the estimated net cost to the taxpayers of $2.6 trillion.

Earlier this week, the think tank released a new report, which showed that amnesty today will cost $6.3 trillion. One of the big reasons for this is a loophole regarding who can receive benefits in the immigration bill going through the Senate as well as the massive growth in entitlements since 2007.

The Heritage report is nearly 100 pages long and has received a great deal of criticism. I chatted with Jason Richwine, a Senior Policy Analyst at Heritage, one of the co-authors of the report, and one of the report’s critics, Alex Nowrasteh, immigration policy analyst for the Cato Institute.

According to Nowrasteh, both the 2007 and 2013 Heritage reports suffer from two major problems: first, they do not use  “dynamic scoring” with regards to the legalization of illegal immigrants. Second, he argues that the increase in legalized immigrants will automatically push native-born workers with the same skills plus one – namely, the ability to fluently speak English – up the economic ladder.

Richwine stated this latter point is not an accurate assessment of immigration’s cost-benefit analysis. According to Richwine, the National Academy of Sciences agrees with him that the economic “surplus” of illegal immigrants being legalized is minimal, and primarily goes to the immigrant, not native-born citizens. Given this opinion, Richwine asked “Why would any country support immigration reform that does not benefit current citizens?”

As a Heritage blog post pointed out on Tuesday, of course more immigration will increase the size of the economy. But the benefits should improve the lives of those legally in the nation, which Heritage says is not the case with amnesty.

Nowrasteh also pointed out that former Heritage President Ed Feulner argued for dynamic scoring in 2002. However, I noted that argument was regarding spending and taxes, not immigration. The Cato expert replied that he believes Heritage should apply “dynamic scoring” across the board.

Dynamic scoring is typically used by conservatives and libertarians to look at the effects of spending and tax policies, on the basis that Policy A has Effect B on Person C, based upon Person C’s reaction to Policy A. (This is opposed to “static scoring,” which is used by liberals and typically by the Congressional Budget Office (CBO), which assumes no change in human behavior to these policies.) Ironically, the CBO is going to use dynamic scoring in its assessment of the Gang of Eight’s bill. There is no word on whether this dynamic scoring will include the fiscal consequences of new citizens likely voting for expanded government programs, which is the logical conclusion of this analysis.

Richwine, who opposes dynamic scoring for immigration policy, pointed out that no immigration study has ever looked at the issue with dynamic scoring, at which point Nowrasteh pointed me to a UCLA study “hired out” by Cato that included dynamic modeling. According to Nowrasteh, the study – entitled “Economic Benefits of Comprehensive Immigration Reform,” which he summarized here – found the “indirect” fiscal benefits of immigration reform are very high, and they don’t just accrue to immigrants.

Richwine responded that the UCLA study goes against prevailing academic literature, and was plugged into a model. While he didn’t oppose the latter, he did say the method of the model was not made public enough to understand what was going on inside the study. Nowrasteh subsequently claimed Heritage made “up its own” methodology for its report, as Richwine and his co-authors did not use the methodology the National Academy of Sciences used in its “The New Americans” report.

A final critique offered by Nowrasteh was how the Heritage study looked solely at people already in the nation. Richwine agreed that’s what it did, but noted that’s what amnesty is – making people in the nation legal.

In and among this back-and-forth, Conn Carroll of The Washington Examiner – formerly of Heritage – researched the Cato study, and found many of the results are largely similar to Heritage’s. More importantly, Carroll noted the critical parts of the Cato study are not being implemented in the Gang of Eight’s bill, and the plan itself is not at all libertarian or supportive of limited-government principles.

In the end, the Heritage report did not attempt to examine the Gang of Eight’s bill. It simply looked at the massive costs of amnesty for millions of illegal immigrants living in the nation right now. Additionally, while I am no immigration expert, Nowrasteh’s argument that low-skilled illegal immigrants will automatically push native-born workers up the economic ladder does not make sense considering there are already millions of illegal immigrants living, spending, and working in America. Unless you expect more immigrants to enter the country (which Nowrasteh does) and work – but that ignores how the massive expansion of social welfare in the last decade will likely shift the typical hard-working immigrant to a less productive resident of America.  Historically, flooding the labor market with low-skilled labor lowers wages for both native and immigrant workers, per the laws of supply and demand.

Whether you side with Richwine or Nowrasteh on the Heritage report, the simple fact is that so-called “comprehensive immigration reform” has too many holes in it to support. Richwine, Carroll, and others have pointed this out on many occasions, and with the failed 1986 immigration law as relatively recent evidence, “reform” without border security and border control is merely the first step in another bill a quarter century from now calling for yet more amnesty.