The average immigrant pays more in taxes than the average paid by U.S. children, disabled people, retirees, students, and employees, says a cherry-picked report from the Cato Institute.
The cherry-picked report is intended to insert a headline into the minds of busy politicians and lazy reporters who are facing competing pressures from pro-migration corporate lobbyists and from pro-prosperity Americans.
The April 15 Cato report is headlined: “Immigrants Pay More In Taxes Than the Average Person.”
But the key trick in the Cato report is to quietly transfer many migration costs onto Americans. For example, the report celebrates the value of taxes paid by working migrants — but then quietly forces Americans to pay the costs of the migrants’ children, such as welfare and school costs.
Cato’s cherry-picked population of migrants seems more likely to work than Americans, whose population includes everyone from migrants’ infants to citizen adults to the comatose elderly.
The resulting cherry-picked population comparison is acknowledged but not described by the Cato authors:
The primary reason that immigrants pay more in taxes than the average person is that they are far more likely to be employed than the average [American] person. This means that even though they earn lower hourly wages, they work more total hours, so an immigrant’s per-capita earned income is higher than an American’s [including children and retirees].
“By being younger, they’re more likely to be [tax-paying] workers,” said Steven Camarota, the research director at the Center for Immigration Studies. But “they’re also more likely to have children and more likely to use welfare,” whose costs are attributed to Americans, not migrants, he said.
“Here, for some reason, all the aid that immigrants get on behalf of their U.S.-born children has nothing to do with immigrants,” he added.
Steven A. Camarota and Karen Zeigler/Center for Immigration Studies
The half-hidden cherry-picked comparison allows Cato to declare:
From 1994 to 2023, immigrants generated roughly $100,000 [over 29 years] more in taxes per capita than the average US-born person — about 17 percent more over the entire period.
The message is intended to aid the lobby groups that are now pushing a cheap-labor bill by Rep. Maria Salazar (R-FL) that is designed to grow corporate profit via mass migration, not via high-tech mass prosperity.
Cato’s green-eyeshade libertarianism also hides many off-the-books civic and macro-economic costs imposed by Washington’s reliance on migrants.
Cheap migrants deter employers from investing in wage-creating workplace machinery that reduces long-term growth and prosperity.
Migration drags down wages, spikes housing costs, and discourages marriage and family creation in the United States, that help stable economic growth.
Federal migration policy damages nearby countries, reducing democracy, trade, and political stability.
Migration subsidizes companies because legislators borrow funds — that must be paid by taxpayers — to help low-wage migrants buy food, rent apartments, and get education services for their kids.
Migration also promotes chaotic domestic diversity that weakens the ability of ordinary Americans to govern their own society, especially in comparison to the concentrated power of elite-funded lobbying groups in Washington, D.C.
Migrants create political incentives for politicians to ignore the difficult, painful, and slow task of helping Americans become more productive and wealthy. The result is that the Democratic Party — and parts of the GOP — are increasingly eager to transfer future wealth and opportunities from ordinary Americans towards unproductive migrants. That focus on transferring money also reduces Democrats’ ability to help the U.S. economy — and foreign economies — via productivity and trade with other countries.
This accounting sleight-of-hand is rational for Cato because its backers gain enormous short-term economic benefits from the inflow of migrant labor, consumers, and renters, regardless of the damage that the migration does to Americans and America.
For example, a panel of pro-migration economists argued this month that investors gain $20 billion per year from the population of 1.4 million migrants who now have Temporary Protective Status.
“The annual average wage income for [660,000] employed TPS beneficiaries… is $36,039,” the legal brief said, without mentioning that their low wages are supplemented by their large-scale use of taxpayer-funded aid programs.
“Immigrants doing low skill work tend to receive as wages a lower share [emphasis added] of the additional firm revenue caused by their labor, relative to the average U.S. worker,” the economists wrote.
Migration is so lucrative for Cato’s backers that Cato’s libertarian author even treats migration’s costs as benefits.
For example, when migration drives up housing costs and real-estate taxes, Cato regards that as positive economic growth. When legalized migrants work, Cato counts their tax payments — but ignores their future costs in welfare and aid programs as they get older.
When migrants force down Americans’ average wages, Cato blames Americans for their low tax payments. Migrants work, “lower [Americans’] wages, they reduce the [American] income and tax payments, and increase the welfare [spending for Americans],” said Camarota.
Overall, Cato’s response to the civic, economic, and pocketbook costs of migration is to breezily assume Cato has the power to end the spending programs that are supercharged by migration:
If immigrants did increase the deficit, as some subset certainly does, the best solution is to further wall off the welfare state, not the country, so that Americans could still realize these economic benefits without the costs.
Meanwhile, Cato’s apples vs. oranges claim is being magnified by media allies, such as Google and Facebook, while Cato’s political allies try to persuade Congress to block President Donald Trump’s plan for a low-migration, high-tech, high-productivity, high-prosperity economy.
Trump’s plan is a big change for establishment Washington, which decided decades ago that the easiest way to grow the economy and the stock market was to simply import more illegal and legal workers, renters, and consumers from every corner of the world.
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