Q: Presently the U.S. immigration law gives any Cuban who can make it to our doorstep a free pass, practically the same for Haitians. And in the past century (or so) we allowed Armenians, Italians and many, many others to come to our country with no documentation. Yet, we don't allow Iraqis who have assisted our war efforts to come to the United States, and all the Mexican and Central American nationals who come here to prevent starvation of their families are condemned for having "broken the rule of law." Why are our immigration laws so arbitrary and discriminating that we can't permit certain people to come here, yet others are welcomed with no documentation? In New York's harbor we have the Statue of Liberty welcoming all such peoples. Should we just tear down the statue and claim America no longer stands for the ideals it represents?
-- Gary Page, Naples, Fla.
Immigration attorney Daniel M. Kowalski answers:
A: Since the 1880s, our immigration laws have been an increasingly haphazard patchwork of provisions welcoming this group while banning that group, and setting qualitative, numerical and temporal limits on visa categories that made sense at one time but no longer work. The very existence of an entire federal bureaucracy (USCIS) and thousands of immigration lawyers -- not to mention at least 12 million aliens in the United States without legal status -- testify to the complexity and the inefficacy of the current law.
The good news is that laws can be changed, and given the right combination of political will, commitment and common sense, it is (theoretically) possible to fashion a new body of immigration law that can do justice to our traditions as well as to our current economic and cultural needs.
The bad news is that immigration seems to trigger such strong emotions in voters, pundits and legislators that cool reflection and reasoned lawmaking seem difficult in the extreme.
What sectors are most dependent on illegals?
Q: What sectors of the American economy are most dependent on illegal alien workers? Are there any figures on what effect shutting off the illegal alien pipeline would have on America's economy?
-- Kathleen Sweebe, Flagstaff, Ariz.
Economist Madeline Zavodny answers:
A: Illegal immigrant workers compose about 5 percent of the labor force, or about 8 million workers. They are concentrated in agriculture, construction, landscaping, janitorial work and building maintenance, food service and domestic services (babysitting and housekeeping). Currently, the inflow of illegal immigrants accounts for about one-fifth of new workers each year. They are an important part of the labor force, and labor force growth in particular.
Although agriculture remains a big sector for illegal immigrant workers, its importance has diminished as the illegal immigrant population has become more settled in the United States. The Urban Institute estimates that illegals compose about 19 percent of the workers in farming, fishing, and forestry occupations (with 3 percent of unauthorized workers holding such jobs). Estimates by Jeffrey Passel of the Pew Hispanic Center indicate that unauthorized workers account for about 12 percent of workers in the construction industry. About 10 percent of the leisure and hospitality industry is composed of unauthorized workers. A lot of these workers are in food service jobs; others are maids, groundskeepers, and the like.
If the inflow of illegal immigrants slowed, we would expect wages to increase in those sectors, and prices as well. As discussed in the answer to Marc Tisher’s question, some economic research suggests that wages of low-education workers would increase if illegal immigration ended, but those workers’ purchasing power would not increase by as much because prices would rise for goods and services formerly produced by illegal immigrants. High-education workers who benefit from illegal immigration would pay higher prices without receiving the benefit of higher wages.
What happens to paycheck withholdings?
Q: Although many immigrant workers have found a way to beat withholding tax by claiming way too many dependents, employers are required to withhold 7.65 percent of their gross pay for Social Security and Medicare. Without being able to reconcile these to Social Security numbers, what happens to that money?
-- Kris, Albuquerque, N.M.
Economist Madeline Zavodny answers:
A: The “FICA” tax for Social Security and Medicare is typically 15.3 percent of earnings. Employers “contribute” 7.65 percent and workers have another 7.65 percent withheld from their paychecks. In reality, however, almost all of the burden of the payroll tax falls on workers (if payroll taxes were abolished, wages would rise by close to 15.3 percent, not 7.65 percent). The 12.4 percent tax that goes to Social Security is currently paid only on the first $97,500 in earnings while the 2.9% tax for Medicare is not subject to a cap. Non-wage income is not subject to these payroll taxes at all.
Most illegal immigrants pay these payroll taxes; the Social Security Administration estimates that about three-quarters of unauthorized workers pay FICA taxes. As discussed in the response to Loyd’s question, illegal immigrants who are able to legalize their status currently can claim credit for funds earned under a false SSN if they have appropriate documentation.
If a name and Social Security number don’t match, those funds go into what the Social Security Administration calls the “Earnings Suspense File.” These funds are then credited toward the Social Security surplus (the difference between payments received by the Social Security Administration and benefits it pays out in a given year, also sometimes called the “Trust Fund”) or paid out immediately to existing beneficiaries. There is also a “Nonwork Alien File” for funds paid under what’s called a nonwork Social Security number, which is an SSN issued because someone needs it to obtain a driver’s license, government benefits, or the like but that is not valid for work purposes. These nonwork SSNs have become hard to get in recent years, but some people who hold them are actually working legally and for some reason are not using a valid work SSN.
In essence, the government has to issue less debt because of the Earnings Suspense File. The total cumulative amount in the Earnings Suspense File is reportedly over $585 billion, and it appears to have grown by about $6 billion to $10 billion a year during the early 2000s. (You could compare this to the current U.S. federal debt of $8.8 trillion and this year’s federal budget deficit of about $200 billion to get an idea of the relative magnitude of the Earnings Suspense File.) There actually isn’t a stash of money set aside for the Earning Suspense File (or for the Social Security “Trust Fund,” for that matter). If workers make claims based on those taxes, the funds needed to pay those claims would need to come from the Social Security Administration’s general budget.
Amnesty after public service?
Q: AvengingAngels.org and GRACSP.org both propose two years of service to America along with some other conditions as the ticket and penalty for illegals to become citizens. What do you think about that?
-- Scott Ohlman, Caledonia, Wis.
Border security expert Neville Cramer answers:
I am not familiar with these organizations, and I am definitely not in favor of requiring illegal aliens to do public service in return for legal status and/or eventual citizenship. While the idea may sound good, another huge bureaucracy would have to be created just to monitor the program. We have enough problems running the three immigration-related divisions within Homeland Security.
If and when we have an amnesty or some other type of legalization program, we should concentrate on implementing the program correctly and making certain we never have to do this again.