Immigration Laws and Their Effect on the Economy of California

 

Immigration laws in the United States have been in place since the founding of the nation and these have been changed to suit the various circumstances that it has faced. One of the most significant issues in the contemporary world, immigration has received both support and opposition from various sections of American society. Immigration policies, especially within the Trump administration have become such a controversial issue that it has the potential of affecting various parts of the country, especially the economy. One of the states that is likely to experience some economic effects if the Trump administration’s immigration laws and rules are implemented to their fullest is California. In this paper, there will be a discussion of the impact that immigrants have in the local economy, how they affect taxation, and the potential effects of the Trump administration immigration policies on California’s economy.

Studies have shown that the state of California is one of the biggest beneficiaries of immigration in the country. This is because a considerable number of immigrants, especially undocumented ones, have settled in the state. These individuals take on those jobs that many locals would not take and this ensures that some sectors continue running.[1] In addition, because they demand lesser pay than their American counterparts, they act as a fuel for the local economy because employers have more money at hand to ensure that they make investments that not only expand their businesses, but also create jobs. Business expansion makes it possible for employers to create jobs that Americans are able to take; showing that immigration does not have to be seen in a negative light since it plays a role in creating local employment. Most immigrants are also consumers, meaning that they make purchases of what they need while at the same time promoting the local economy because of their expenditures.

Moreover, they are also important contributors to the government revenues at all levels, including the local, state, and federal levels.[2] This is an extremely important factor because one of the major points that are made against immigration is that the government tends to spend more on these individuals than on the average American. However, a study conducted by the Trump administration, which was later rejected because of significant pressure from the White House, shows the considerable benefits that refugees and immigrants have on the economy.[3] The study shows that despite the considerable government expenditure that the government commits towards these individuals, the latter brings in billions more in revenues. A result is that a decision to curb immigration would have a negative effect not only on the economy, but also on government revenues. Rather than creating jobs for Americans, it has the potential of leading to a situation where those jobs that Americans do not want to undertake would be left undone; creating a negative economic impact on the nation.

The development of immigration policy in the United States is often driven by interest groups. This is especially the case considering that these groups often lobby in Congress to ensure that laws favoring their positions are adopted. Among the most influential interest groups in the country are unions, which have essentially driven the narrative of the need to take a hard line when it comes to immigration.[4] These unions have done so because of the belief that immigrants take on jobs that rightfully belong to Americans and that there is need to impose lower caps on the number of immigrants allowed into the country. Another interest group that is influential in the formulation of immigration policy is made up of businesses, which benefit the most from immigrant workers.[5] These promote the idea that it is essential for immigration levels to be increased for the sake of the economy. However, in the current administration, it seems that unions have an upper hand when it comes to promoting the development of immigration policies.

In conclusion, the discussion above has sought to bring about an understanding of the benefits of immigration to the United States through an analysis of the impact that immigrants have in the local economy, how they affect taxation, and the potential effects of the Trump administration immigration policies on California’s economy. It has shown that immigrants are an integral part of the economy, and despite their status, they are important in helping in the advancement of the nation. Immigrants are also important because they not only spend their income in the country, but also pay taxes that increase government revenues.

---

[1] Jeffrey S Passel and D Cohn, "Size of Us Unauthorized Immigrant Workforce Stable after the Great Recession," Pew Research Center Hispanic Trends  (2016): 8.

[2] Julie Hirschfeld Davis and Somini Sengupta, "Trump Administration Rejects Study Showing Positive Impact of Refugees," The New York Times  (2017).

[3] Ibid.

[4] Giovanni Facchini, Anna Maria Mayda, and Prachi Mishra, "Do Interest Groups Affect Us Immigration Policy?," Journal of International Economics 85, no. 1 (2011): 118.

[5] Jens Hainmueller and Daniel J Hopkins, "The Hidden American Immigration Consensus: A Conjoint Analysis of Attitudes toward Immigrants," American Journal of Political Science 59, no. 3 (2015): 531.