My grandparents came to America legally after World War I. Back then, immigration was a relatively straightforward process. If you had a trade and a sponsor, you could enter the country and build a new life. There were no complex visa lotteries, long waitlists, or massive bureaucracies. The system wasn’t flawless, but it was functional—and fundamentally aligned with the idea that immigrants were coming to work, not collect benefits.
Fast forward to today, and everything feels more complicated.
We often think of immigration as a moral or political issue, but at its core, it’s also an economic one. The key difference between the immigration system of the early 20th century and the one we see today is the presence of an expansive social welfare state—programs like Medicaid, SNAP, housing assistance, and public education, which didn’t exist or were much more limited a hundred years ago.
The Role of Social Welfare in Shaping Immigration Policy
When someone immigrates legally today, they eventually gain access to government services funded by U.S. taxpayers. These services are designed to help the vulnerable—but they also create a different cost structure than in the past. In effect, legal immigration today comes with a price tag for existing citizens, particularly the middle and upper-middle class who fund much of the welfare system through taxes.
Contrast that with illegal immigration. Unauthorized immigrants, particularly those from Mexico and Central America, are primarily here to work. They pay sales taxes, contribute to Social Security using fake or borrowed numbers (which they’ll never collect from), and buy food, gas, and rent homes—contributing meaningfully to the economy. Yet, because they’re undocumented, they are largely excluded from programs like Medicaid and SNAP.
An Uncomfortable Truth: Jobs vs. Welfare
There is a fundamental difference between immigration for jobs and immigration for welfare. Many legal immigrants do work hard, but once legalized, they become eligible for benefits—even if their income remains below the taxable threshold. This shifts the cost burden to higher-earning Americans, many of whom feel squeezed by rising taxes and stagnant services.
This economic tension fuels some of the backlash against legal immigration. It’s not just cultural—it’s fiscal. When we open the door to legal immigration without adjusting the economic framework, we’re effectively asking a shrinking number of high earners to subsidize a growing number of low-income households. That doesn’t scale well.
Why Illegal Immigration May Offer a Better ROI
From a purely economic standpoint—not a moral or legal one—illegal immigration can appear beneficial to the U.S. for several reasons:
Labor demand: Many undocumented immigrants take jobs Americans won’t or can’t fill easily—agriculture, construction, hospitality.
Low public cost: They rarely use welfare benefits because they aren’t eligible.
Consumption-driven growth: They still buy food, pay rent, and support the local economy.
Silent taxpayers: Millions pay into Social Security without the ability to ever collect a return.
In contrast, legal immigrants, while equally hardworking, enter into a system that provides not only opportunities but also entitlements. This means the same person, once legalized, could become a net fiscal cost, depending on income level and access to benefits.
What Happens If We Legalize Everyone?
A common response to the above logic is, “Let’s just legalize everyone.” That sounds fair and inclusive. But doing so without reforming the welfare state could flip many current net contributors into net recipients. The U.S. would effectively absorb millions more low-income households eligible for benefits, placing further strain on schools, hospitals, and social programs—unless taxes are raised significantly or benefits are cut for others.
This is the hard truth that rarely gets discussed in immigration debates.
Is There a Better Path Forward?
One potential solution is to create a tiered or guest worker system—allowing foreign nationals to work in the U.S. legally for a set period, without granting immediate access to social programs. Middle East countries operate a system known as the Kafala system, which is similar to how our system worked when my grandparents immigrated to the US. Alternatively, reforming the welfare system to focus more narrowly on need, regardless of status, could relieve some of the fiscal burden without sacrificing compassion.
But as long as legal status is tied to broad welfare access, we will continue to see a perverse incentive: undocumented immigrants contribute more and cost less, while legal immigrants are increasingly framed—rightly or wrongly—as a cost center.
How do you think the U.S. should balance economic benefits with social equity when it comes to immigration policy?
