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U.S. News and Commentary



Thursday
Jun202013

CBO: Effect of immigration bill S. 744 on federal budget ‘complicated’ and ‘uncertain’

Traffic at the southern U.S. border. (Photo: Gerald Nino/CBP)Most media have reported snippets of the Congressional Budget Office Report on S. 744, the  Border Security, Economic Opportunity, and Immigration Modernization Act. Theoretical cost savings have been routinely touted.

However, in media there has been little mention of concerns expressed in the 63-page CBO report about S. 744, a bill that comprises more than 800 pages.

CBO did express concerns and cautions in the report. Among those concerns is a warning—“The effects of immigration policies on the federal budget are complicated and uncertain, and they become even more so as they extend farther into the future.”

CBO could offer nothing about the impact on state and local budgets.

Among the more troubling complications and uncertainties are [boldface added]:

─ “The substantial increase in population that would occur if S. 744 is enacted would have many other effects (both negative and positive) on the budgets of state, local, and tribal governments, but CBO does not estimate the overall effects of legislation on the budgets of those governments.”

─S. 744 increases federal direct spending over the 2014-2023 period, mostly for “increases in refundable tax credits stemming from the larger U.S. population…and in spending on healthcare programs—particularly for the Medicaid program and for subsidies provided through insurance exchanges created under the Affordable Care Act” [commonly referred to as ObamaCare].

─Under existing law, the number of green cards is capped. S. 744 “would allow immediate family members (spouses and unmarried children under the age of 21) of LPRs [legal permanent residents] to become LPRs themselves without any limit on the number of people who can do so each year.

─Although it’s not possible to estimate all the costs on “private entities,” the report said that “probably by 2016” the costs of mandates “would total at least $700 million…probably by 2016.” CBO said those costs “would exceed the private-sector threshold” of $150 million as of 2013.

A matter of great concern is the increase in refundable tax credits. Those credits take income from taxpayers who report income that we would consider upper middle class or more and give money to those who report low incomes. The tax credit program has already been subject to billions in fraud and there is no reason to believe increasing them will do anything but increase the fraud.

With so many variables, unknowns and potential negative impacts of ObamaCare, there is also no way to gauge the impact of the bill once a sizable population becomes eligible. The US Report has suggested ObamaCare was an essential cog in President Barack Obama’s plans for amnesty.

It is impossible to conclude that the government will abide by S. 744 when different administrations did not abide by the terms of the 1986 amnesty (Immigration Reform and Control Act). We do know that after that amnesty, over a 27 year period, our illegal alien population more than tripled. IRCA promised border security; the promise was not kept.

Most media and supporters of the bill have not shared a major caution expressed by CBO:

“[T]he actual outcomes would surely differ from these estimates in one direction or another. The projections of the budgetary impact and other effects of immigration legislation are quite uncertain because they depend on a broad array of behavioral and economic factors that are difficult to predict.”

Sen. Chuck Schumer (D-N.Y.) was a principal architect of IRCA, a bill that made numerous promises that were not kept. The New York liberal is also a key player in S. 744.

The Black American Leadership Alliance plans to protest the bill because of concerns over the impact on minority workers. Black unemployment is currently approximately 13 percent.

Republican Sen. Marco Rubio (R-Fla.) has worked on the immigration bill and he has confronted a great deal of criticism from his base although some corporate sectors would likely benefit. Politico said Rubio understands the concerns—“given failures by the government in the past, he sees why conservatives aren’t happy with immigration reform efforts.” (Analysis by Kay B. Day/June 20, 2013)

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