The current U.S. immigration system is broken in numerous ways. Today’s patchwork policies admit illegal immigrants while stopping legal immigrants at the border—all while local policies fragment this socially sensitive and economically critical issue. Comprehensive immigration reform that will both repair the immigration system and encourage social stability and economic growth is possible, but national leaders must find the courage to act.
A Need for Action
Efforts to stop illegal immigration have largely failed. The U.S. Border Patrol budget has increased by nearly 500 percent since 1995, but total apprehensions of illegal immigrants have fallen and apprehensions per unauthorized migrant have not changed. Of the more than 300 million people residing in the United States, 12 million—approximately 4 percent—are illegal immigrants.
At the same time, legal immigrants face piles of bureaucratic red tape as they seek admission to the United States. In October 2009, 2.6 million immigration cases were pending, with over half of cases delayed for at least six months. Despite the significant economic benefits they bring, over 100,000 skilled workers were on the waiting list for visas, while many others face additional administrative roadblocks. Immigration courts are also overwhelmed by record backlogs.
Lacking guidance from the federal government, local and state leaders have pursued their own solutions to these problems. Unfortunately, many of these laws could ultimately be ineffective or counterproductive. For example, the new immigration law in Arizona imposes considerable social costs while bringing uncertain and at best minimal economic benefits.1
National policy is needed to standardize immigration law, though this alone is insufficient to repair the immigration system.
Similarly, current proposals to remove birthright citizenship from the Constitution, though unlikely to succeed, are likely to perpetuate illegal immigrant populations rather than shrink them. “Anchor babies” are largely a myth—children of immigrants cannot sponsor their parents for legalization until they turn 21, and this tactic is only employed by approximately 4,000 immigrants each year. Also, the economic allure of the United States still exists with or without guarantees of citizenship. The median household income in Mexico is one-third that of illegal immigrants’ living in the United States, and even lower in many of the countries that are major sources of illegal immigrants.
Comprehensive Reform is Essential
Without comprehensive reform, ineffective policies will proliferate; even the benefits of good local initiatives will be diluted by bureaucratic inefficiencies and regional inconsistencies. National policies are needed to standardize immigration law, though this alone is insufficient to repair the immigration system. In order to be successful, federal reform must include several other critical elements.
Legalization
Legalizing the existing 8.3 million undocumented workers would improve their wages and working conditions (and those of low-skilled native workers).2 Labor productivity would also rise as immigrant workers become more flexible and more accessible to employers.
More importantly, legalization would allow formerly illegal immigrants to integrate into their schools, workplaces, and communities, and increase their willingness to cooperate with police, thus improving law enforcement. Government finances would likely be only marginally affected, as both tax revenues and immigrants’ consumption of social services would rise.
The effect of legalization on further illegal immigration is unclear. Illegal immigration did not increase after 3 million immigrants were granted amnesty under the Immigration Reform and Control Act of 1986 (IRCA), but survey data suggest that more Mexicans would want to immigrate to the United States if legalization programs were in place.
High-Skilled Immigration
High-skilled immigrants make an important economic contribution to the United States by raising the wages of high-skilled native workers and increasing entrepreneurial talent—immigrants have co-founded more than 50 percent of Silicon Valley companies since the mid-1990s. Nonetheless, only 65,000 visas (H-1B visa) are made available for high-skilled workers each year (though exceptions to this cap frequently allow more workers to enter). Many more people want to come: less than three months into FY 2010, applications for H-1B visas had already reached 98.8 percent of their annual statutory limit.
While securing the border is desirable in theory, it would be extremely hard to carry out without other reforms.
Abolishing this cap could not only generate enormous economic benefits by attracting more high-skilled workers, but would also help retain existing immigrants. Of all high-skilled immigrants who became permanent residents, more than 90 percent did so after living in the United States rather than applying for a green card while residing abroad.
Worker Verification
A worker verification system would reduce the availability of work for illegal immigrants and discourage illegal entry. After IRCA required employers to verify immigration status, illegal immigration fell and surveys found that immigrants had a harder time finding a job, even though only 65 percent of employers complied with the law. More advanced technology would make verification easier on employers and would likely increase the compliance rate.
Border Security
“Securing the border” has become a popular catchphrase for many politicians. While desirable in theory, it would be extremely hard to carry out without other reforms. Increased spending on patrols has failed to stop illegal immigration, and surveys suggest immigrants are not deterred by additional security. In fact, increased border security can intensify the problems surrounding illegal immigration by reducing the likelihood that illegal immigrants will return to their home country, causing many to settle permanently in the United States.
Current Proposals: A First Step, but Improvement is Needed
Over the last year, several ideas for federal immigration reform have been put forward. They include a proposal by President Obama, a House bill introduced by Representative Solomon Ortiz (H.R. 4321), and an outline for a bipartisan bill sponsored by Senators Lindsey Graham and Charles Schumer. All three proposals attempt to correct the administrative failures of the current immigration system, although it is difficult to predict their impact.
All three proposals also include a path for legalization. H.R. 4321 (and likely the other proposals, though they offer no details) would improve on the legalization program established under IRCA by extending eligibility to recent immigrants—IRCA applied only to those in the United States five years prior to implementation. Any bill must also address how those immigrants who do not qualify for legalization can apply later, another shortcoming of IRCA.3
Lawmakers should pass sensible, farsighted, and much-needed reform.
While the proposals provide for increased high-skilled immigration, they are too narrow, focusing primarily on retaining foreign-born students.4 Efforts should be made to attract workers educated abroad as well. Eliminating the H-1B cap would be a better alternative to the current propositions.
All three proposals also include seemingly simple worker verification systems, though the specifics vary. For example, H.R. 4321 establishes an electronic system similar to E-Verify, but skeptics doubt its effectiveness. Graham and Schumer propose introducing national ID cards, but this idea raises legitimate security and privacy concerns. Worker verification programs, however, must ensure that employers do not engage in discriminatory practices, as many did under the IRCA system.
Finding the Courage to Move Forward
Many legislators are now seeking to table immigration reform until the borders are secure. This approach is misguided. Securing the border requires comprehensive reform, not just additional border patrols, more aggressive police enforcement, or a constitutional amendment; delaying reform will only allow more fragmented local initiatives to cause further damage to the immigration system.
Without the support of these policy makers, reform is likely dead until after the presidential election in 2012. This is unfortunate and dangerous. Leaders must recognize the national need for reform and come together to pass a sensible, farsighted law that addresses the current flaws. Without it, significant economic opportunities will be lost and a bad situation will continue to get worse.
Bennett Stancil is a researcher in Carnegie’s International Economics Program.
1. Regardless of the law's effect on Arizona's economy and illegal immigrant population, it will almost certainly intensify social tensions between Hispanics and law enforcement officials, as similar laws have done in other parts of the country. The effect of additional police harassment on illegal immigrants, many of whom have crossed a border at which 350 people die a year, is an open question. Based on population-adjusted estimates from Hanson (2007), removing illegal immigrants could reduce Arizona's GDP by 0.2-0.3 percent and its budget deficit by 0.07-0.1 percent, though the law's implementation costs—which are estimated by some to be significant—could partly counterbalance this reduction in spending. In sum, given that all of these estimates are subject to considerable uncertainty, the economic impact of the law will likely be negligible.
2. According to Hinojosa-Ojeda (2010), immigrants who acquired legal status after the passage of Immigration Reform and Control Act of 1986 saw wages increase by an average of 15 percent in the five years following legalization. For other estimates, see Kossoudji and Cobb-Clark (2002). Tapinos (1999) notes that illegal immigrants often face harsher working conditions. Employers are likely to impose the same conditions, including lower wages, on native-born workers as they aim to remain competitive.
3. For a discussion on IRCA, see Cooper and O’Neil (2005).
4. The Graham-Schumer proposal recommends awarding green cards to students who receive advanced degrees in science and engineering from U.S. universities. H.R. 4321 would provide green cards to high school graduates who meet certain requirements. President Obama comments on the need for high-skilled immigration, but offers no specific proposals.
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