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Thursday, June 20, 2013

CBO on the Immigration Bill

Congressional Budget Office Director Doug Elmendorf writes:
The Border Security, Economic Opportunity, and Immigration Modernization Act (S. 744) would revise laws governing immigration and the enforcement of those laws, allowing for a significant increase in the number of noncitizens who could lawfully enter the United States on both a permanent and temporary basis. Additionally, the bill would create a process for many individuals who are present in the country now on an unauthorized basis to gain legal status, subject to requirements specified in the bill. The bill also would directly appropriate funds for tightening border security and enforcing immigration laws, and would authorize future appropriations for those purposes.
How Would the Legislation Affect the U.S. Population?
CBO estimates that, by 2023, enacting S. 744 would lead to a net increase of 10.4 million in the number of people residing in the United States, compared with the number projected under current law. That increase would grow to about 16 million by 2033. CBO also estimates that about 8 million unauthorized residents would initially gain legal status under the bill, but that change in status would not affect the size of the U.S. population.
How Would the Legislation Affect the Federal Budget from 2014 Through 2023?
CBO and JCT estimate that enacting S. 744 would generate changes in direct spending and revenues that would decrease federal budget deficits by $197 billion over the 2014–2023 period. CBO also estimates that implementing the legislation would result in net discretionary costs of $22 billion over the 2014–2023 period, assuming appropriation of the amounts authorized or otherwise needed to implement the legislation. Combining those figures would lead to a net savings of about $175 billion over the 2014–2023 period from enacting S. 744. However, the net impact of the bill on federal deficits would depend on future actions by lawmakers, who could choose to appropriate more or less than the amounts estimated by CBO. In addition, the total amount of discretionary funding is currently capped (through 2021) by the Budget Control Act of 2011; extra funding for the purposes of this legislation might lead to lower funding for other purposes.
How Would the Legislation Affect the Economy?
S. 744 would boost economic output. Taking account of all economic effects (including those reflected in the cost estimate), the bill would increase real (inflation-adjusted) GDP relative to the amount CBO projects under current law by 3.3 percent in 2023 and by 5.4 percent in 2033, according to CBO’s central estimates. Compared with GDP, gross national product (GNP) per capita accounts for the effect on incomes of international capital flows and adjusts for the number of people in the country. Relative to what would occur under current law, S. 744 would lower per capita GNP by 0.7 percent in 2023 and raise it by 0.2 percent in 2033, according to CBO’s central estimates.