Dan Walters: Illegal immigrants didn't cause California fiscal crisis

With illegal immigration a burning concern among Californians – as demonstrated anew by a recent Public Policy Institute of California poll – and the Capitol's politicians sparring over how to close a whopping budget deficit, it was inevitable that the two issues would be merged.

It happened last week when Republican Assembly members unveiled legislation aimed, they said, at eliminating public services to illegal immigrants, echoing Proposition 187, a 1994-vintage ballot measure that voters enacted only to see it voided in the courts. Republicans claim illegal immigrants cost taxpayers $9 billion a year, just about the remaining budget deficit, citing a 2004 study by the Federation for American Immigration Reform.

And the mother of Republican Assemblyman Sam Blakeslee confronted Gov. Arnold Schwarzenegger during one of his "town hall" events on the budget in San Luis Obispo, asking him how the state should handle fiscal burdens caused by illegal immigrants.

Schwarzenegger replied that it would be a "big mistake" to blame illegal immigrants for the state's fiscal woes and added, "There is, you know, always a time like this where you start pointing the finger at various different elements of what creates the budget mess, and, you know, some may point the finger at illegal immigrants. I can guarantee you, I have been now four years in office in Sacramento, I don't think that illegal immigration has created the mess that we are in."

The exchange and introduction of the GOP bills ignited another round of radio talk show speculation and hyperbole about the impact of illegal immigration, but what's the reality?

No one knows the answer for certain, in part because hard data on illegal immigrants are difficult to obtain. What we do know with reasonable certainty is this:

• About 7 percent of California's 38 million residents are illegal immigrants, somewhere between 2.5 million and 3 million. But the number does not include the U.S. citizen children of illegal immigrant parents.

• The chief public costs of illegal immigration are in public education, prisons and health care. A 1994 report by the state Department of Finance, bolstering then-Gov. Pete Wilson's complaints about illegal immigration costs and his support of Proposition 187, estimated direct public costs of services to illegal immigrants at $2.4 billion, plus another $1 billion as a proportionate share of general public services, such as police protection.

• Updating that 1994 report would put current direct costs at something over $5 billion, perhaps $3 billion for educating 350,000 illegal immigrant children, another $1 billion for the 19,000 illegal immigrants in state prison and another $1 billion-plus for health care, local jail incarceration and so forth.

• Thus, the $9 billion cited by Republicans is probably too high. But whatever the number, it must be adjusted for the taxes that illegal immigrants pay. It's been estimated that 1.8 million illegal immigrants are working in California, and they're generating at least $40 billion a year in personal income.

The 1994 Department of Finance study placed taxes paid by illegal immigrants at between $1 billion and $3.4 billion a year with a median of $2.2 billion, roughly equal to the $2.4 billion in direct public costs they incurred. A reasonable updating of those numbers would put taxes paid by illegal immigrant families at $5 billion-plus. And that doesn't count the corporate and other taxes that are generated by their work for private employers, nor property taxes paid on their rental housing.

All in all, therefore, it's probably close to a fiscal wash. Schwarzenegger is correct in asserting that illegal immigrants aren't responsible for the state's budget crisis. Politicians should look in the mirror if they're looking for scapegoats.

About the writer:

• Call The Bee's Dan Walters, (916) 321-1195. Back columns, www.sacbee.com/walters.