For whom does the bell toll? The undocumented? People with papers but not naturalized? All non-natives born? Natives born with two undocumented parents?
People hold signs that read “Mass Deportation Now!” on the third day of the Republican National Convention at the Fiserv Forum on July 17, 2024, in Milwaukee, Wisconsin. Delegates, politicians and Republican faithful are in Milwaukee for the annual convention, which culminates in former President Donald Trump accepting his party’s presidential nomination. The RNC runs from July 15-18. (Photo by Alex Wong/Getty Images)
Source: Fox News.
From Fox News:
Calls for increased border security and mass deportations of illegal immigrants were again heard on the third night of the Republican National Convention, as the ongoing border crisis remains a major political issue.
How many people need to be evicted to reach that goal? According to Pew, in 2021, about 10.5 million.
Source: Bench.
DHS The number of illegal immigrants (residues of foreign-born citizens and legal residents) is 11 million, or about 3.3% of the U.S. population.
A Forbes Article Notes:
According to Charlie Savage, Maggie Haberman and Jonathan Swan, “he plans to sweep the country looking for illegal immigrants and deport millions of people every year.” The idea is to use local police and the National Guard in states with Republican governors.
“To ease the strain on ICE detention centers, Mr. Trump wants to build massive camps to hold people while their cases are processed and they await deportation by plane,” The New York Times reports. “And to get around any refusal by Congress to allocate the necessary funds, Mr. Trump would divert money from the military budget, as he did in his first term, to spend more on a border wall than Congress authorized.”
To the extent that concentrating inmates in centralized facilities (also known as “Konzentrationslager”) could reduce the unit costs of mass incarceration, this approach makes good accounting sense. However, I suspect that such a policy will have budgetary consequences, both in terms of increased costs (note that Mr. Trump has suggested using the military and the National Guard to implement this policy), caring for U.S.-born dependents of deported undocumented immigrantsand in the reduction of tax revenues.
In a broader macroeconomic context, such a policy would be disastrous and would lead to major disruption in the labour market. Shapiro/Washington Monthly:
By any measure, a policy that would eliminate 4.5 percent of the current workforce, including large numbers of college and high school graduates, would trigger severe economic shocks. Using Okun’s law of the relationship between rising unemployment and GDP, a 4.5 percent decline in employment is associated with a decline in GDP growth of more than 9 percentage points. This estimate also includes the impact on other jobs. A recent study of much smaller programs to deport immigrants made clear that they cost other Americans jobs. By one calculation, deporting a million immigrants would cost other Americans an additional 88,000 jobs, suggesting that Trump’s program could cost as many as 968,000 American jobs on top of the 7.1 million jobs held by immigrants facing deportation.
I am not a big fan of using Okun’s Law to infer the short-run decline in GDP, but to the extent that there are large complementarities (i.e. little substitutability) between illegal immigrant labor and native labor (there is greater substitutability between incoming immigrant labor and incumbent non-native labor), one could trace the macroeconomic implications using a simple AD-AS model. The mass expulsion policy would act as (1) a reduction in potential GDP by reducing the labor force, (2) a reduction in aggregate demand by reducing consumption, (3) an induction of a temporary cost-push shock as labor has to be reallocated (similar to the 2018-2020 jobs crisis), and (4) an increase in economic policy uncertainty, thereby depressing aggregate economic activity and especially investment.
Essentially, this policy outcome would be a scaled-down (in reverse) version of the effects of increased immigration from 2021, discussed in this article. job.
For more recent and detailed analyses of substitutability and employment/wage changes due to immigration, see Caiumi and Peri (2024).
The above discussion incorporates the number of undocumented immigrants as currently defined. I have not taken into account the implied numbers regarding birthright citizenship, as Mr. Trump advocates in 2023is used for expulsion criteria.
