Can there be an Economic Stimulus through Legalization?

The William C. Velasquez Institute (WCVI) released a White Paper on Economic Stimulus through Legalization. This paper makes three arguments on including immigrants in the national priority of passing a national economic stimulus bill.

1) Legalization of the nation’s undocumented workers is now an economic necessity, as well as a moral and civil rights imperative. Legalization increases short-term incomes, job creating consumption and net tax revenues in the low wage segments of the labor market, as well as sets the long-term foundation for an expanding middle class and a more sustainable economic recovery. The experience of the Immigration Reform and Control Act of 1986 (IRCA) is very instructive in this regard, producing both wage and consumption gains, and enhanced tax-revenue collection in the midst of a recession of the late 1980’s and early 1990’s, as well as decades of very high rates of educational, home and small business investments by newly legalized families. If Congress and President Obama legalized the current 10-12 million undocumented persons in the U.S. an economic stimulus of $30-36 billion in personal income, 750,000-900,000 new jobs, and $4.5 to $5.4 billion in net tax revenue would result!

2) Movement now towards legalization and naturalization of the roughly twenty million legal permanent residents and undocumented persons would create local and state regional mini-booms in civic engagement. Furthermore, enabling civic participation of these previously excluded groups will substantially intensify public support for an inclusive and humane tenor with regard to immigration reform as well as public policies aimed at providing support to low income and socially disadvantaged socioeconomic profiles.

3) The national security outcome desired by Washington, D.C. of declining undocumented migration is attainable under existing law and there is no need for further legislation expanding security-related provisions related to undocumented migration. Indeed, we must begin to recognize that the current approach is very costly (in money, rights and lives), and increasingly yielding diminishing returns. Massive security-related expenditure growth now yields lower numbers of apprehensions as migration from Mexico to the US (both undocumented and legal) has been dropping due to security measures, the climate of repression in immigrant communities, and the declining regional economy. The unintended consequences of further pursuing the current enforcement only approach include generating a vulnerable underground economy and maintaining an artificially low wage floor, actually encouraging the demand for vulnerable undocumented workers.

(HT: ImmigrationProf Blog)