The very bad economics of killing DACA

Trump’s decision to kill DACA — never mind the attempt to obscure things with that meaningless delay — is, first and foremost, a moral obscenity: throwing out 800,000 young people who are Americans in every way that matters, who have done nothing wrong, basically for racial reasons. But it’s also worth noting that Jeff Sessions just tried to sell it with junk economics, claiming that the Dreamers are taking American jobs. No, they aren’t, even if we leave aside the question of who’s an American. DACA is very much a boon to the rest of the U.S. population, and killing it will make everyone worse off.

To see why, first note that whatever you think about the economics of less-educated immigrants — most of the evidence suggests that they don’t depress wages, but that’s another discussion — none of it applies to DREAMers. Their educational and behavioral profile, as Cato notes, doesn’t resemble the average immigrant, let alone the average undocumented immigrant; they look like H-1B visa holders, that is, skilled immigrants we have specifically allowed in because they help the economy.

Beyond that, DREAMers are young — which means that they help the economy in not one but two big ways, because they mitigate the economic problems caused by an aging population.

One of those problems is fiscal: as the population ages, there are fewer working-age members contributing taxes to pay for Social Security and Medicare. A cohort of relatively high-wage, highly motivated people mostly in their 20s, likely to pay lots of taxes for decades, is exactly what the doctor ordered to make that issue less severe.
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