Donald Trump on Immigration: How It Affects the Economy and You

Pros and Cons of Donald Trump's Immigration Policies

Protest against Trump immigration policy
Nevada Senate Majority Leader Aaron D. Ford (D-Las Vegas) (C) joins immigrants and supporters as they march on the Las Vegas Strip during a 'We Rise for the Dream' rally to oppose U.S. President Donald Trump's order to end DACA on September 10, 2017 in Las Vegas, Nevada. Photo by Ethan Miller/Getty Images

On October 17 and 18, 2017, federal courts halted portions of President Trump's travel bans. The judges said that the bans on predominantly-Muslim countries are unconstitutional. They interpreted Trump's own words to infer that his bans on Chad, Iran, Libya, Somalia, Syria, and Yemen were based on religion.

On September 24, 2017, Trump issued restrictions on travel from eight countries. It would have gone into effect on October 18, 2017 and only applied to new visa applications.

The order affected the countries in the following different ways.

  1. Chad - Bans immigrant, business and tourist visas.
  2. Iran - Bans immigrant, business and tourist visas. Allows student and exchange visitor visas.
  3. Libya - Bans immigrant, business and tourist visas.
  4. North Korea - Bans immigrant and tourist visas.
  5. Somalia - Bans immigrant visas except for those with family or an infant needing medical care.
  6. Syria - Bans immigrant, business and tourist visas.
  7. Venezuela - Bans business and tourist visas to government employees and their families.
  8. Yemen - Bans immigrant, business and tourist visas.

The variations depended on well the countries adhered to recommended security measures. 

It replaced the ban Trump signed on March 6, 2017. It prohibited visas for citizens from six countries. They were Syria, Iran, Libya, Somalia, Sudan, and Yemen. They are "countries of concern" according to a 2016 law concerning immigration visas.

The ban did not include 500,000 legal green card holders (permanent resident aliens) and existing visa holders. It also exempted diplomats and members of international organizations. It was supposed to go into effect at 12:01 am on March 16 and remain for 90 days. The ban was stopped by a lower court order.

The order replaced one Trump signed January 27, 2017. 

On June 26, 2017,  the Supreme Court ruled that Trump's travel ban was lawful except for two instances. The ban doesn't apply if travelers are visiting friends, jobs or family in the United States, or if they are students in a U.S. university.  

DACA

On October 8, 2017, the Trump Administration released a list of immigration requests to Congress. The wishlist requests $25 billion in funding for a wall on the border with Mexico. He wants Congress to create a bill that treats unaccompanied minors from Central American the same as those from Mexico. Currently they receive greater protection. Trump asked Congress to withhold federal funds from "sanctuary" cities. Those municipalities don't cooperate with federal immigration agents. 

These immigration policies fly in the face of Trump's September 12, 2017 meeting with Congressional Democrats. In that meeting, he agreed to allow those eligible for Deferred Action for Childhood Arrivals to remain in the United States. That followed his September 5 announcement that he would end the program in six months. (Source: "Trump, Top Democrats Agree to Work on Deal to Save 'Dreamers' from Deportation," The Washington Post, September 14, 2017.)

DACA offers a two-year deferral of deportation for eligible immigrants. Eligible people under 31 who were illegally brought to the United States as children. President Obama launched the program with an executive order in 2012. Since then, it has given 787,580 “Dreamers” a work permit.

Trump could simply end DACA with another executive order. But he wants Congress to create a replacement. (Source: “What Is DACA and Who are the Dreamers?” The Guardian, September 4, 2017.)

The Cato Institute estimated that Trump's move could cost the economy $215 billion over 10 years. That's the amount of lost spending power that these employed young people spend. (Source: "Scrapping DACA Could Cost the Economy $215 Billion," BuzzFeedNews, September 5, 2015.)

Wall on Border With Mexico

President Trump promised to build a wall on the U.S. border with Mexico.

Statistics show a wall alone won't stop illegal crossing from Mexico. Even if it were successful, it would only stop half of illegal immigration.

Trump promised to force Mexico to pay for it. If it refused, he would threaten to change a rule under the USA Patriot Act antiterrorism law. That would confiscate Western Union money transfers sent to Mexico from immigrants in the United States illegally. The Mexican central bank reported that it received $25 billion from abroad. There are no exact figures on how much of that is from U.S. immigrants. (Source: "Standing Up for Our Law Enforcement Community," WhiteHouse.gov, January 21, 2017. "Trump Reveals How He Would Force Mexico to Pay for Border Wall," The Washington Post, April 5, 2016.)

Since Mexico refused to pay for the wall, President Trump asked Congress to appropriate the money. He would ask Mexico to pay for it later. (Source: "Trump Asking Congress, Not Mexico, to Pay for Border Wall," CNN Politics, January 6, 2017.)

Refugees

On March 6,  2017, the administration banned refugees for 120 days unless they were already scheduled for travel. During that time, Homeland Security would have reviewed the application process to prevent any exploitation by terrorists. Trump planned to halve the total number of refugees accepted to 50,000 per year. (Source: "Trump Signs New Order Blocking Arrivals from Six Majority-Muslim Countries," NPR, March 6, 2017.)

Federal judges stayed those orders. That gave the State Department the ability to increase the number of refugees to 70,000 in 2017. That could drop in 2018 if Congress adopts the Trump administration's budget cuts. But even Republicans in Congress admit that won't happen. Trump's United Nations ambassador Nikki Haley urged Congress to ignore the cuts. (Source: "U.S. Quietly Lifts Limit on Number of Refugees Allowed In," The New York Times, May 26, 2017.)

H-1B Visa Program

On April 19, 2017, Trump signed an executive order asking the Department of Homeland Security to review the H-1B visa program. He wants to make sure that only highly-paid skilled immigrants receive the visas. He doesn't want any to go to foreign workers that are paid less than their U.S. counterparts. It could take years for the review to be carried out. (Source: "Trump Signed an Executive Order to Review High-Skilled H-1B Immigration Visas," Recode, April 19, 2017.)

The order is directed at Indian firms like Tata Consultancy, Infosys and Wipro. They are located in the United States, but hire many immigrants from India. Facebook and Qualcomm are also big users of the H-1B visa. Fifteen percent of their workers are immigrants under the program. (Source: "Trump Signs Order That Could Lead to Curbs on Foreign Workers," The New York Times, April 18, 2017.)

Silicon Valley CEOs worry that President Trump might restrict this program. The Immigration Act of 1990 provides temporary visas to 315,000 foreign skilled workers. Two-thirds were for computer-related jobs. These companies would lose valuable employees without the H-1B visa program. That would hurt the success of some of Americas most profitable companies. (Source: "Donald Trump's Anti-immigration Stance Threatens the Heart of American Innovation," The Verge, November 11, 2016. "If Donald Trump Was President, Here's What Would Happen to the U.S. Economy," The Street, March 3, 2016.)

Other Trump Immigration Policies

On June 22, 2017, President Donald Trump asked Congress to prevent all immigrants from receiving welfare for the first five years in the country. But that would take away the authority of states who currently decide who is eligible for assistance programs. Trump would also enforce regulations that deny immigration status to those who seem likely to become "public charges" within the first five years of their arrival. (Source: "President Calls for Barring Immigrants from Welfare for Five Years," Fox News, June 22, 2017.)

On August 2, 2017, the Trump administration endorsed a Senate bill that curbs legal immigration. It would prioritize those who were financially self-sufficient, were highly skilled, and spoke English. It would deny green cards to adult children and extended relatives of current green card holders. 

If the bill became law, it would reduce the number of green cards issued from 1 million to 638,000 in its first year. The number of employment-based green cards would remain at 140,000 a year. Two-thirds of cards go to relatives, and 20 percent are employment-based. The rest are issued via lottery, to refugees and on other grounds.

The program is similar to merit-based systems in Australia and Canada. The bill has little chance of passing. It would need a 60-vote majority in the Senate. Democrats would oppose it. (Source: "Trump Pushes Bill to Cut Number of Green Cards Issued by Half," The Wall Street Journal, August 2, 2017.)

On August 16, 2017, the Trump administration began renegotiating NAFTA with Canada and Mexico. Trump threatened to withdraw from NAFTA if Mexico didn't agree to renegotiate. Trump wants Mexico to lower subsidies to PEMEX, its state-owned oil company. He also wants stronger protection for U.S. digital trade and intellectual properties. NAFTA is the world's largest free trade agreement. For more on the agreement, see NAFTA Fast Facts.

Pros and Cons of Trump's Plans

The Center for American Progress estimated that mass deportation would reduce U.S. gross domestic product by 1.4 percent. This liberal research group estimates that farmers would have a hard time finding replacement workers. Instead, they would be forced to cut their production to fit the reduced labor supply.

The conservative Cato Institute reported that it would cost $60 billion to deport the 750,000 people protected by DACA. They contribute $28 billion a year to the economy. (Source: "Trump Immigration Plans Bad for U.S. Economy and Workers," Business Insider, February 24, 2017.)

Immigration more than pays for itself. Immigrants add $1.6 trillion to the economy each year. Of that, $35 billion is a net benefit to the companies and communities where they live. The rest (97.8 percent) of that growth returns to the immigrant workers as wages. They repatriate $25 billion back to family members in Mexico. They spend the rest in America. 

Native-born workers who compete directly with the immigrants for jobs are hurt the worst. Those are the young, less-educated, and minority workers. Their unemployment rate is higher than for older, college-educated, and white workers. 

Illegal immigration lowers wages by 3 to 8 percent for low-skilled occupations. That averages out to $25 a week for native-born workers without high school diplomas. President Trump promised during his campaign to require companies to offer all jobs to Americans first. (Source: "Immigration Debate," University of Michigan.)

Between 2000 and 2013, the number of native-born workers fell by 1.3 million. Studies show that they left the workforce. Many older workers retired or went on disability. Younger workers went back to school. (Source: "Immigrant Workers Enhance and Expand the U.S. Economy," Immigration Impact, June 29, 2016.)

During that same period, the number of working immigrants rose by 5.3 million. That's out of 16 million immigrants who arrived in America. 

Immigrants cost the U.S. government between $11.4 billion and $20.2 billion each year. That means they use that much more in services than they pay in taxes. On the other hand, they cost the government less than native-born Americans with similar education and work histories. (Source: “The Use of Public Assistance Benefits by Citizens and Non-citizen Immigrants in the United States,” Cato Working Paper No. 13, February 2013.)

Immigrants with college degrees generate $105,000 more in revenue than they receive in services over their lifetimes. Almost 53 percent of immigrants have some college. Of those, 16 percent have a graduate degree. (Source: "Immigration Does More Good Than Harm to Economy, Study Finds," The Wall Street Journal, September 22, 2016.)

Immigrants living in the United States illegally cost the country less than legal ones. That's because they are not eligible for many government programs. If the government granted them amnesty, the costs to society would double. (Source: "The Fiscal and Economic Impact of Immigration on the United States," The Center for Immigration Studies," May 2013.)

Other Trump Policies