At Friday’s Senate Judiciary hearing on comprehensive immigration reform, Sen. Jeff Flake (R-AZ) — a member of the “Gang of 8″ — tore into a Heritage Foundation study that claims immigration reform would impose a $2.6 trillion cost to the U.S. The analysis, which was produced under the leadership of former Republican Sen. Jim DeMint, has been widely discredited by conservatives for its flawed methodology.
In an exchange with American Action Forum economist Douglas Holtz-Eakin, Flake cited criticisms from Cato Institute, Americans for Tax Reform, and Holtz-Eakin’s own group, which found immigration reform would cut trillions from the deficit.
Holtz-Eakin explained the Heritage study has several fundamental issues, including how it omits a before-and-after scenario of immigration passage and falsely assumes that immigrants draw more from social programs than the native-born. “It is not the case that program participation is higher than in the native-born population on the whole,” he said.
FLAKE: Heritage Foundation came up with a study with a headline that this would cost the taxpayers $2.6 trillion over some time. That study has now been discounted by quite a number of organizations the Wall Street Journal, the Cato Institute and others. I know you have looked at that. What are your feelings on a study like that that purports these kinds of costs to the taxpayers?
HOLTZ-EAKIN: I will resist temptation to turn this into a graduate seminar, but I think the top line is I have reservations on the study […] it leaves out things that I think our most important, the dynamic effects in my testimony and the study I did. Heritage has the capability of doing that analysis, and I would hope they would bring something like that out if the opportunity arose. The second thing I worry about in that study is the basic design does not shed light on immigration reform. There is nothing about that study that says what happens as a result of passing legislation, so it does not inform decisions that Congress might face, and I would like to see studies designed before and after reform.
The last, and I will not the belabor it, the comparisons and that study are between very low-skill immigrants and all of Americans, including by implication Bill Gates, myself, you, whoever. I think that’s not a very meaningful comparison. And you can anticipate they outcome of that comparison without doing any kind of detailed analysis. You know the answer by the way the study’s constructed.
The Wall Street Journal recently echoed these arguments in an editorial on the economic benefits of reform.