Illegal AliensNational Net Cost Estimates Vary Widely Gao ID: HEHS-95-133 July 25, 1995
In recent years, growing public concern about illegal aliens in the United States has focused on their use of public benefits and their overall cost to society. The three national studies that GAO reviewed represent the initial efforts of researchers to estimate the total public fiscal impact of illegal aliens. The limited data available make it hard to develop reasonable estimates on such a broad subject. Moreover, the national studies varied considerably in the range of items they included and their treatment of some items, making their estimates difficult to compare. As a result, a great deal of uncertainty remains about the national fiscal impact of illegal aliens. Obtaining better data on the illegal alien population would help improve the national net cost estimates. Such data should focus on characteristics of illegal aliens, such as geographic distribution, age distribution, income distribution, labor force participation rate, tax compliance rate, and school participation, that are helpful in estimating the largest net cost items. Clearer explanation of which costs and revenues are appropriate to include would also help improve the usefulness of the estimates. The expert panel convened by the U.S. Commission on Immigration Reform could serve as a forum for discussing some of these data and conceptual issues.
GAO found that: (1) illegal aliens in the United States generate more in costs than revenues to federal, state, and local governments combined; (2) estimates of the national net cost of illegal aliens vary greatly, ranging from $2 billion to $19 billion; (3) a great deal of uncertainty remains about the national fiscal impact of illegal aliens, because little data exists on illegal aliens' use of public services and tax payments; (4) displacement costs and revenue estimates account for much of the variation in the estimates of the national net costs of illegal aliens; (5) the estimates are difficult to assess because the studies do not always clearly explain the criteria used to determine which costs and revenues are appropriate to include in the estimates; and (6) the cost estimates could be improved by recognizing the difficulties inherent in collecting data on a hidden population, focusing on key characteristics of illegal aliens, and explaining more clearly which costs and revenues are appropriate to include in such estimates.