Cato Report Finds Poor Immigrants Use Fewer Public Benefits than Natives

shutterstock_58280260Among the most contentious debates surrounding national immigration reform concerns immigrant use of welfare programs. Opponents of immigration routinely assert low-skilled immigrants consume more public resources than natives, thereby imposing an unfair fiscal burden on U.S. taxpayers.

Such claims, however, have little basis in fact. A new report from the Cato Institute shows that, in reality, non-citizens use public welfare programs at a lower rate than similar low-income native-born citizens.  When immigrant children and adults do receive assistance, moreover, the average benefits value per recipient is almost always lower than for natives.

This lower benefits utilization by low-income non-citizens is  true for a number of public programs that were examined—namely, Medicaid, the Children’s Health Insurance Program (CHIP), Supplemental Nutrition Assistance Program (SNAP), cash assistance (Temporary Assistance for Needy Families and similar programs), and Supplemental Security Income (SSI). Compared to natives, the cost of participating in these benefits is also significantly lower for non-citizens. For Medicaid, for example, the benefits cost of non-citizens is 42 percent lower than that of natives.

These findings are partly attributable to immigrant-related eligibility restrictions for public assistance benefits. In particular, undocumented immigrants and temporary/provisional immigrants (including the beneficiaries of “Deferred Action for Childhood Arrivals”) are generally ineligible for public assistance; and lawful permanent residents must wait at least five years before they become eligible.

Critics of immigration, however, often rely on methodologically flawed studies, including one by the Center for Immigration Studies (CIS), to support the misconception that immigrants use more government assistance than natives. Departing from the CIS, the study by the Cato Institute adjusts for income to ensure that appropriate comparisons are made, does not mistakenly count naturalized citizens as immigrants, and focuses on individuals’ immigration status rather than classifying households by the immigration status of the head – which avoids erroneously counting some U.S. citizen children as immigrants.  Together, these correctives provide a clearer and more accurate picture of welfare receipt, effectively dispelling exaggerated reports that inflate the degree of immigrant use of public benefits.

The results of the study by the Cato Institute are actually consistent with the vast majority of evidence which, according to sociologists Bean, Stevens, and Van Hook, “provides little indication of welfare abuse or dependency among new immigrants.” If we also add the significant economic gains that result from immigration to the equation—including both increases in gross domestic product and tax revenue—we find that the net economic gains from immigration are indeed positive.

Unfortunately, there continues to be a great deal of misinformation about immigrant welfare receipt. According to a recent survey released by the Henry Kaiser Family Foundation, “four in ten Americans wrongly believe that the Affordable Care Act (ACA) offers benefits to undocumented immigrants, and another quarter are not sure how undocumented immigrants are treated under the law.” In spite of the stereotypes reinforced by some anti-immigrant groups, however, the Kaiser study also showed that 63% of Americans believe that if lawmakers pass a new law that allows undocumented immigrants to earn legal status, those who gain legal status should have full access to the health coverage options offered by ACA. Given the small but promising sign that the majority of Americans supports health coverage to legalized immigrants, perhaps more accurate perceptions and openness about immigrant use of public assistance will also follow.

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