Workers and Welfare Beneficiaries - A realistic portrait of immigrants in the United States

By The Editors
Published in The Social Contract
Volume 26, Number 2 (Winter 2016)
Issue theme: "Immigration Briefing Book"
http://www.thesocialcontract.com/artman2/publish/tsc_26_2/tsc_26_2_editors.shtml




Listening to the debate in the U.S. today, we hear two seemingly inconsistent characterizations of immigrants. In one story, immigrants come to do work—any work at all, no matter how laborious—to make a better life for their families. In the other story, immigrants are heavy users of welfare who rely on American taxpayers to feed, house, and provide medical care for their children. Which story is closer to reality? Although partisans on both sides have sometimes been loath to admit it, both stories are true.

Welfare and work go together in modern America, which is something made clear by a recent report from the Center for Immigration Studies (CIS). Entitled “Welfare Use by Immigrant and Native Households,” the CIS report shows that a remarkable 51 percent of households headed by immigrants used some form of welfare in 2012, versus 30 percent for native households. Even with at least one worker present, immigrant households still use welfare at the same 51 percent rate, while the native rate goes down by only 3 percentage points to 28 percent.

How could this be? Many Americans think of welfare as a payment in lieu of working. Cash payments for non-workers are indeed part of our welfare system, primarily in the form of Temporary Assistance for Needy Families (TANF) and Supplemental Security Income (SSI); but most welfare programs providing food, housing, and medical care are based on income and family size—not employment status.

For example, 41 percent of working immigrant households were on Medicaid in 2012. The primary eligibility factor for Medicaid is poverty, with special categories for pregnancy, disability, etc. Work is not a disqualification. Similarly, 19 percent of working immigrant households were on food stamps, and 12 percent were on the Women, Infants, and Children (WIC) nutrition program. Low-income working households can and do participate in these programs despite generating earned income.

If these welfare use rates still seem surprisingly high, that is because they are more accurate than previous estimates. Earlier studies of immigrant welfare were based on the March Current Population Survey (CPS), a Census dataset designed primarily to measure labor market outcomes. Because the March CPS asks respondents about their welfare use over the whole previous calendar year, substantial undercount of welfare use is inevitable.

The CIS report instead draws from the Survey of Income and Program Participation (SIPP), a Census product specifically designed to measure welfare use. Because the SIPP asks the same households about their welfare use on a monthly basis, undercount is substantially reduced. For example, the CPS indicates that 39 percent of immigrant households and 24 percent of native households used welfare in 2012. The comparable SIPP estimates, as mentioned above, are 51 percent for immigrants and 30 percent for natives.

The one drawback to using the SIPP is its complexity. Partially because of that complexity, and partially because of the explosiveness of the results, CIS took the extra step of having all of its SIPP calculations double-checked by an independent statistical firm called Decision Demographics. Readers see this reassuring note on the report’s first page: “Decision Demographics has verified the methodology and findings reported in the tables and figures of this report.” Of course, that did not stop open-borders advocates from making baseless accusations that the report is “full of errors.” When confronted with irrefutable data that one does not like, a tried-and-true public relations method is to simply prevaricate until the media stop paying attention. That appears to be the method employed by CIS’s opponents.

One of the stranger claims made by those opponents is that immigrants use less welfare than natives of comparable skill. First of all, this is not true at the household level. As the CIS report indicates, 76 percent of households headed by an immigrant without a high school degree used welfare in 2012, versus 59 percent of households headed by a high school drop-out native. Even if the claim were true, however, it would be irrelevant. When low-skill immigrants make heavy use of the welfare system, it would be little consolation to the American taxpayer that immigrants are not using welfare quite as much as the least skilled natives. The obvious response is that we should design an immigration system that selects for people who are highly unlikely to use welfare, not merely settle for the not-as-bad-as-it-could-be option that we are supposedly getting now.

One reason that immigrant households do in fact use welfare at higher rates than comparably educated native households is that immigrants tend to have more children. Having children is a major driver of welfare usage for immigrants and natives alike. For example, 76 percent of immigrant-headed households with children used welfare in 2012, along with 52 percent of native households with children. Some children in immigrant-headed households were born in the U.S., which has led critics of the report to suggest that CIS is inflating the immigrant category with native welfare use. But it makes little sense to exclude U.S.-born children of immigrants. After all, an immigrant who comes to the U.S. and subsequently has children requiring public assistance has clearly placed a burden on American taxpayers.

The truth is that immigrants are neither the up-by-the-bootstraps individualists nor the lazy mooches caricatured by each side of the immigration debate. Immigrants come to the U.S. to work, but they also consume means-tested benefits at high rates. That welfare consumption is a direct result of their relatively low levels of education paired with their relatively large families. Whether a person was born in Kansas or Guatemala, having a low-paying job with a lot of mouths to feed is bound to lead to high levels of welfare use in modern America. Placing special legal restrictions on immigrant welfare use has proven to be difficult, especially because so many of the benefits are consumed by the U.S.-born children of immigrants. As long as we have both a welfare state and low-skill immigration, then immigrant welfare use will be high.

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