Discussion: Legalizing illegal aliens and tax revenue

[demolishhollywood]

If the Bush administration succeeds in legalizing millions of illegal aliens, would that cause a significant gain in tax revenue? Most illegal aliens are already employed, so my guess is that thier contribution would be huge. I am off base here?

[newgeezer]

You could have posted this article on your thread.

Absolutely.

[quack]

Until employers are heavily penalized with fines and prison you won't curb the flow of illegals.

I'll go one further.Until American consumers understand the true cost of doing business,you won't curb the flow of illegals.

Let's say you want or need a retaining wall built.I come in(I own a landscaping company) and give you a bid.Mr.Illegal Hirer comes in a underbids me by 35%.Who are you going to hire to do the work?Be honest with yourselves.You're going to hire the lower priced bid almost 90% of the time,unless I was referred to you by someone you trust.Even then,you may go with the lower price.

Mr.Illegal Hirer doesn't pay unemployment insurance,half his employees SSI,a decent wage,or workmans comp.,so he can throw out a very attractive bid for the same work.

[MSM Hater]

The problem isn't that the workers are illegal, the problem is that employers are able to pay below minimum wage with no benefits (social security, worker's comp, unemployment insurance, etc.) If we legalize those already here, the employers will still seek out more illegals to continue paying low wages with no benefits. After the first amnesty under Ronald Reagan, there was a huge influx of new illegals into the country. The solution to the illegal immigration problem is to punish employers who hire them.

[demolishhollywood]

If we legalized the current populus of illegal aliens and combined that with new, tougher border control legeslation, that would be the best of both worlds.
By tough, I mean machine-guns lining the border tough. That's the only way to stop people from crossing. Putting them in a truck and taking them back isn't going to change anything, and putting them in prison just sucks up more tax money.
Legalize the ones that work hard and have lived in the country for a long time, and kick the rest out. Then line the border with machine guns and the problem's solved. ;)

[Patti_ORiley]

What I have read on the subject is this:

No SSN means no employment. To get around this hurdle, illegal alien workers generally utilize SSNs of deceased people to gain employment in the US. Federal and state inc. taxes, FICA, Social Security Taxes, Medicare Taxes, are all withheld from the worker's wages and paid into state and federal coffers.

All those monies paid on behalf of the illegal workers are lost to him because he is unable to file tax returns, collect Social Security benefits upon retirement, or receive Medicare/cade. Surviving spouses are also ineligible for benefits. Governments, both state and Federal, are in no hurry to change the situation for obvious reasons, but this is one of Mexico President Fox's biggest complaints and he has been pushing for years to have this addressed.

That is what I know -- or think I know about it. Regards.

[Dan12180]

If the employee is paid above the table he and the employer pay matching taxes. If the employee agrees to work for $2 under the going rate for cash both he and the employer save - the undocumented gets to work without the paperwork needed (ssi and other identification) and the employer saves on payroll and on his portion of taxes.

Resturants, construction, small business, farming, are all areas that are prone to the cash only options.

Reform is needed. I don't think any elected official will tackle the issue because change will make someone upset. They need people to accept them to get reelected. I think citizen reforms are the best option.

[E. Pluribus Unum]

There are payroll taxes, though (15.3% split evenly between employer and employee).

Great, more FICA money funneled into the Social Security rathole.

[newgeezer]

There are payroll taxes, though (15.3% split evenly between employer and employee).

That "split" is a clever deception. The self-employed get to pay the whole thing. As for the rest of us, just because we don't see it on our paystubs doesn't mean we didn't pay it.

Anyone who disagrees should consider whether it would be a good idea to take a 7.65% pay cut so that their employer can pay all of it. (Surely you'll feel better about your huge tax cut, right? :-)

[raptor29]

If we were to give amnesty to all the current illegals, but signficantly and permanently change the dynamics and the law enforcement for all subsequent illegals, I would be OK with this. It's part two I'm worried about, however.

[wizr]

...or we could stop paying their bills to make babies. It seems that every girl over 14 is pushing a baby carriage, here in California.

[Mister Baredog]

Hispanic voters moving to the Republican party just re-elected our President. This situation needs addressing, oh I know I'm being cynical, so?

[moehoward]

What happened after the first two amnesty's ?

I would expect nothing different from another.

The only guaranteed financial occurrence would be negative. More, now legal, lining up for welfare. And another 20 mil or so fresh Illegals taking their place, willing to work for even less.

Insanity. Knew Bush would bring it up again, but this soon!!

[dalereed]

"I had mexican employees under the clinton administration"

You belong in jail!

[raptor29]

Yeah, but the national security angle this time gives such an easy opportunity to justify clamping down. Bush didn't cause, but inherited the current illegal immigration mess, and clearly, fixing this the 'right way' is pretty much a political and logistical impossibility. So you 'give in' on one end, but you hammer some laws into stone on the other. Not many would oppose this, I can't see why the Administration doesn't do it.

[dalereed]

"There are payroll taxes, though (15.3% split evenly between employer and employee"

Just get rid of the illegals in construction, return wages to where they were 15 years ago with americans holding the jobs on a legitimate payroll and there would not only be a lot more taxes paid but the quality of work would improve drasticly along with production.

The illegals have trashed the construction industry.

[dalereed]

"Hispanic voters moving to the Republican party just re-elected our President"

The majority of hispanics that are here legally are against making the illegals legal, they voted heavilly in favor of prop. 187 here in California.

[Mogollon]

We need to flood our congress-critters with complaints about the hare-brained scheme to legalize illegals.

[kevkrom]

I wasn't commenting on the merits of FICA taxes, just pointing out that they are there in response to the comment that these folks aren't making enough to pay income taxes. Obviously, those being paid cash under the table are skipping out entirely, either as an ilegal or a legal immigrant.

As many of you know, I'm a big proponent of scrapping income and payroll taxes and replacing them with a national sales tax. One of the big advantages, in terms of this discussion, is that the mechanism for making the tax non-regressive (the family consumption allowance which is essentially a refund of taxes paid up to poverty-line spending) is only available to legal residents. So, while everyone's marginal rate is the same, the effective rate for legal residents is less than that marginal rate (and for most people, much, much less) but the effective rate for illegals is the marginal rate.

[the invisib1e hand]

You belong in jail!

I don't get it.

[FastCoyote]

"Let's say you want or need a retaining wall built.I come in(I own a landscaping company) and give you a bid.Mr.Illegal Hirer comes in a underbids me by 35%.Who are you going to hire to do the work?"

That's why increasing the minimum wage should also be called the "Illegal Alien full employment act". Illegals are - well, illegal - and will break minimum wage laws leaving our own low skilled workers unemployed.