Bankrupting America

A Forbidden Look at Unmentionable Causes

April 14 will mark the 102nd anniversary of the sinking of the RMS Titanic, the newest and grandest of the British White Star Line of passenger ships at the time.  Nearly 883-feet long, the Titanic was the largest ship afloat and so formidably designed that many said that she was unsinkable. Proudly cutting through the waves of the North Atlantic on her maiden voyage, steaming for New York at near top speed, she must have been an awesome sight as her passengers and crew enjoyed an evening of carefree celebration. The crew of the Titanic received eight iceberg warnings from six different ships in the area, but they were dismissed as inconsequential. Near midnight, the top lookout, Frederick Fleet, recognized the terrifying image of a huge iceberg looming straight ahead. He immediately rang First Officer William Murdoch on the bridge, but the giant ship could not be turned or slowed enough in time to avoid the iceberg. The starboard (right) side of the Titanic scraped, and bumped along the iceberg, gashing and puncturing 300 feet of the ship’s side below water level, flooding five of the ship’s sixteen water-tight compartments.  In two hours and forty minutes, the great “unsinkable” ship plunged into the icy waves and into the depths. Over 1,500 of the 2, 225 aboard perished.

What has this to do with “bankrupting America?’ We are headed straight towards a colossal fiscal and economic disaster but are heedlessly dismissing the gravity of two of its chief causes: massive uncontested illegal immigration and excessive legal immigration. Both are doing enormous harm to American workers and taxpayers and are placing prodigious but often unrecognized fiscal burdens upon all levels of government.  But today’s social and media climate of political correctness and cultural Marxism tends to suppress public awareness of our dangerous course. For nearly fifty years, since the 1965 Immigration “Reform” Act, we have been fueling a stupendous immigration crisis. Just one more amnesty or misguided immigration bill could throw the nation into a severe fiscal crisis resulting in extensive economic and monetary damage. Moreover, because immigration has become such a sacred cow, intelligent analysis and discussion of immigration policy are generally shunned.

As a result of this climate of thought and speech suppression, most Americans are low-information voters on the subject of immigration. We also have predominantly low-information media, low-information education leaders, and low-information political leaders, a sure formula for blind folly. We have also been teaching our children to prosper in politically correct society by esteeming feeling and avoiding logic, reality, and truth.

Let’s look at some alarming numbers. In the Heritage Foundation’s study of the still pending Schumer-Rubio amnesty and immigration surge bill, Robert Rector revealed that government benefits received by the average of all households in the United States exceed all taxes paid by $1,158 per year in 2010 dollars.  This includes social or community services, like fire and rescue departments, enjoyed by U.S. residents but not huge budget items like national defense. These must be paid for by additional tax revenue to avoid deficit spending. The $1,158 deficit per household indicates that the U.S. has become a welfare state, especially if you look at these numbers: Those households headed by those with less than a high school education have an annual deficit of $35,113 per household; those with a high school diploma have a $14, 815 annual deficit; and those with some college have a $5, 685 annual deficit. Only households headed by college graduates (31 percent) have a positive contribution of $29, 250 per year. Sorted by educational achievement, only 31 percent of U.S. households support all the rest, and are still short $1,158 per year. So education makes a big difference in income and productivity, but those with education and skills support the other 69 percent of the population. We have a welfare state economy! As economist Milton Friedman pointed out, welfare states are not fiscally compatible with open-door immigration.

Let’s look at more numbers. Only 10 percent of native households have less than a high school education, and 31 percent have a college degree or more. The average net deficit is just below break-even with an annual loss of $310. Households with a college degree of better have a positive annual contribution of $30,255.

Lawful immigrant households have an average annual net deficit $4,344. The 36 percent headed by those who have a college degree or better have a positive contribution of  $24,529 per year.

However, 51 percent of illegal immigrant households lack a high school education, and  only10 percent have a college degree. Their net average deficit is $14,387 per year, but those with college degrees make a positive contribution of $5,115.

What happens to the average net deficit of $14,387, if these illegal immigrant households are legalized (given amnesty)? According to Rector, the average deficit goes up, because although they pay more taxes, those taxes are minimal because their lower earning power does not offset the cost of the additional benefits for which they become eligible. The net annual deficit rises to approximately $19,000 per year. The cost of amnesty spread over 50 years is at least $6.3 Trillion.  Studies of the 1986 amnesty indicate that every amnestied illegal immigrant results on average in two to three more illegal immigrants in the next 10 to 20 years. Thus an amnesty has the potential to explode the number of households costing taxpayers an average of $14,387 per year. Amnesty as immigration reform is like scratching poison ivy.

The Schumer-Rubio-McCain-Lindsey Graham “deficit explosion bill” (pardon my sarcasm) is also calling for the importation of another 33 million legal foreign workers to relieve our “labor shortage.” Only there is no labor shortage. More than 20.7 million Americans are looking for a full-time job and cannot find one. If anything close to Schumer-Rubio passes, there will be a lot more than 20 million Americans who can’t find jobs.

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Leonard M. (Mike) Scruggs is the author of Lessons from the Vietnam War: Truths the Media Never Told You, 2009; and The Un-Civil War: Shattering the Historical Myths, 2011.