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Harvard Economist: Immigration Costs US Workers $500 Billion A Year

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Immigration effectively redistributes half a trillion dollars from U.S. workers to the businesses that hire immigrants each year, Harvard economist and immigration and wages expert George Borjas testified before Congress Wednesday.

Based on a supply and demand model, Borjas found an increased supply of immigrants competing in the U.S. job market does produce a net gain for current U.S. workers of about $50 billion a year. But that small gain in the context of an $18 trillion economy is far outweighed by a transfer of wealth from U.S. workers to the businesses that hire those immigrants that amounts to $500 billion dollars.

“What immigration really does is not so much increase the pie, as redistribute the wealth,” Borjas testified before the Senate Subcommittee on Immigration and the National Interest. “So what I’ve learned from all this is that immigration happens to come out to be just another government redistribution program.”

Borjas also found it’s nearly impossible to manipulate the supply and demand so the net gain to the U.S. economy is much more than $50 billion. So the necessarily modest net gain is masking an enormous transfer of wealth.

“If one wishes to believe that the immigration surplus is around $50 billion, it follows from the same calculation that the redistribution of wealth from workers to firms is around half a trillion dollars,” Borjas said in prepared testimony.

The U.S. admits about one million new legal permanent residents every year who are eligible to compete for any job in the U.S. economy, as well as about 100,000 refugees and asylum seekers, 700,000 guest workers and students often eligible to compete for jobs during and in the years after their schooling.

“This is not in the people’s interest,” Republican Sen. Jeff Sessions, chairman of the subcommittee, said in his opening statement. “Our goal should be to work every day to create policies that advance the training, and the job prospects of Americans first — lawful immigrant and native-born alike. That is our responsibility.”

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