A new Cato Institute study provides a comprehensive overview of the fiscal impact of immigration to the United States over thirty years, and finds that immigrants have reduced budget deficits by a massive $14.5 trillion from 1994 to 2023. Here is the authors' summary of the results:
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Every year from 1994 to 2023, immigrants have paid more in taxes than they received in benefits.
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Immigrants generated nearly $10.6 trillion more in federal, state, and local taxes than they induced in total government spending.
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Accounting for savings on interest payments on the national debt, immigrants saved $14.5 trillion in debt over this 30-year period.
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Immigrants cut US budget deficits by about a third from 1994 to 2023, and fiscal savings grew to $878 billion in 2023 (Figure 1).
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Noncitizens accounted for $6.3 trillion of the $14.5 trillion debt savings.
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College graduate immigrants accounted for $11.7 trillion in savings, while non–college graduates accounted for $2.8 trillion.
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The cohort of immigrants entering from 1990 to 1993, just before data collection began in 1994, was fiscally positive $1.7 trillion, and was still positive after 30 years in 2022–2023 (Table 1).
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Even including the second generation (see Box 1 for definitions), who are mostly still children who will become taxpayers soon, the fiscal effect of immigration was positive every year.
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Immigrants in all categories of educational attainment, including high school dropouts, lowered the ratio of deficit to gross domestic product (GDP) during the 30-year period.
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Without the contributions of immigrants, public debt at all levels would already be above 200 percent of US GDP—nearly twice the 2023 level and a threshold some analysts believe would trigger a debt crisis.
