Skip to comments.Immigration and Texas' Budget Crisis: The Elephant in the Room
Posted on 12/30/2002 5:37:04 AM PST by SJackson
The coming session of the Texas Legislature has been billed as "the perfect storm" because of the looming $5 to $12 billion-dollar budget shortfall. Although the evidence suggests that immigration, both legal and illegal, is fueling the rapid growth in state spending on social services, this issue is almost entirely absent from the debate.
It is well established that recent immigrants use more in services than they pay in taxes, particularly to state and local governments. The National Research Council, a branch of the prestigious National Academy of Sciences, estimates the net fiscal cost of immigration ranges from $11 billion to $22 billion per year, with most government expenditures on immigrants coming from state and local coffers, while most taxes paid by immigrants go to the federal treasury. This is the result of the relatively low level of tax payments by immigrants, because they are disproportionately low-skilled and thus earn low wages, and a higher rate of consumption of government services, both because of their relative poverty and their higher fertility.
According to 2000 U.S. Census data, some 13.2 percent of immigrants enroll in welfare programs compared with 2.1 percent of native-born Americans. In Medicaid, 18.6 percent of immigrants participate, as opposite 12.1 percent of native-born. Mexican immigrants, who comprise the vast majority of immigrants to Texas, use food stamps at nearly twice the rate of native-born Americans and collect an average welfare payment that is 20 percent higher than those recipients.
The National Research Council found that in California, which has endured a similar flood of Mexican immigration as Texas, each native household is paying about $1,178 a year in state and local taxes to cover the gap between the services used by immigrant households and their tax receipts. Although Texas was not included in this study, there is no reason to think the reality is any different here.
Indeed, during the last three years, the Harris County Hospital District alone spent $330 million to treat and immunize illegal immigrants, estimated to be at least 20 percent of their indigent caseload. The District covers this expense through its escalating tax burden on local taxpayers and through cost-shifting to Medicaid and insured patients. The District provides not only emergency care to illegal immigrants, but also a full range of elective services, even access to its fertility clinic that is not included in the health plan for District employees. While the 700,000 illegal immigrants in Texas are only eligible for welfare if they have worked for at least ten years or received asylum, they receive free health care, food stamps, education, and nearly all other government services.
In 2002, Medicaid represented 22.6% of Texas' budget. That number is expected to increase to 23.7% in 2003 in the wake of an August 19 report by the Health and Human Services Commission concluding that, because of higher-than-planned growth in caseloads, the state's Medicaid and children's health insurance programs will cost $2.4 billion more in the next budget cycle than in the current one. Since 1987, the Texas Medicaid budget has grown 500 percent, due in large part to increased enrollment, much of it undoubtedly the result of immigration.
The growth in state health care spending is just one example of how immigration is contributing to the budget shortfall. All of the school districts in South Texas receive Robin Hood recapture payments. Although these districts would likely be poor regardless of current levels of immigration, they would not be experiencing such large growth in their enrollments. It is this growth that is responsible for the budget crises in both urban and suburban districts that are being forced to send more and more of their local tax revenues to the state, leaving them unable to meet the needs of their own students.
Immigration is also a major factor in the population growth that is responsible for growing traffic congestion and pollution in Texas' major cities.
Ultimately, the Legislature's sensitivity to public opinion is likely to forestall a general tax increase this session, but that may come at the expense of vital funding for transportation and higher education, as well as Robin Hood relief. Unfortunately, even though the state bears most of the cost of immigration, it is virtually powerless to control it because it is the constitutional responsibility of the federal government.
Until Washington fortifies border enforcement to stop illegal immigration and reduces the number of unskilled legal immigrants, Texans will pay for the consequences, whether in higher taxes or the crowding out of important government services. While immigrants continue to contribute much to Texas and the nation, if we attempt to absorb all of the many millions of indigent people throughout the world, we will sacrifice the very quality of life that has led so many people to come here.
Chris Allen is State Chairman of the Young Conservatives of Texas (www.yct.org) and a graduate student at the George Bush School of Government and Public Service at Texas A&M University.
Major issues to be addressed in the upcoming lesislature:
Insurance reform. Homeowner and automobile
Limiting govt/budget issues- driven by Gov Perry(aka Mr Veto) and the "Rebels who had a cause"
Transportation- the last session abandoned "pay-as-you-go"
There's a big chunk of the problem. Sounds pretty straightforward.
Until Washington fortifies border enforcement to stop illegal immigration and reduces the number of unskilled legal immigrants
Well no, that is only part of the solution. A big part would be to work on folks who are already here: 1) kick everybody who ain't supposed to be here OUT and 2) tighten the belt and get hardassical on their a$$es, in the best spirit of the "orphanage" Republican-- you wanna get yourself out of abject poverty? Don't expect food stamps from us... Get a job and better yourself like every other taxpaying American...
This boggles my mind, that it is apparently known just about exactly how many illegal immigrants are in Texas. Well if you know how many, then you presumably know WHERE THEY'RE AT! And if you know where they're at, you could presumably round 'em up and ship 'em back! What's the problem here?!
And they all live in Texas? No, both the burden and the benefit of immigration is sprinkled throughout the nation.
I live in Texas. While Hispanic immigrants are more concentrated here than in other areas of the country, am I really supposed to blame a $5 billion budget shortfall on Hispanic immigrants? Ridiculous. (Notice the article never uses the word "Hispanic"; instead, "immigrant" is code for Hispanic.)
Texas budget woes are complex. With respect to immigrants, immigrants pay rent, purchase gods, pay sales tax, pay gasoline tax, provide labor and services and on an on, and while no one has real stats on the gray/black economy, immigrants are more than likely a net PLUS for the Texas economy.
This article is out of the same Trent Lott school of thought that served him so well. Should our borders be respected? Of course. But the notions expressed and hinted at in this article should be passionately rejected.
Tell us about it...
The Feds is you.
The part you forgot is that illegals send 40 to 50 percent of their check back to their home country. This doesn't do a damn thing for our economy.
Actually they do but it is all wrapped up in the price of their rent. You honestly think the property owner isn't going to get the costs of property taxes out of the renters ?
And deport, deport, deport......after fingerprinting and pictures