The $96 Billion Lie: How Liberal Economists Manipulate Immigration Statistics to Hide the Truth About America’s Job Crisis

An economic analysis reveals how selective statistics are used to portray illegal immigration as beneficial while obscuring its true impact on American workers.

For years, liberal advocacy groups and complicit media outlets have pushed a narrative that sounds almost too good to be true: illegal immigrants are contributing $96 billion annually in taxes while maintaining higher employment rates than native-born Americans. Like most things that sound too good to be true, this claim crumbles under basic economic scrutiny.

The recent surge in claims about immigrant “tax contributions” and “employment rates” represents a sophisticated misinformation campaign. The cornerstone of pro-illegal immigration propaganda is the claim that undocumented immigrants pay $96 billion in taxes annually. This figure, popularized by the Institute on Taxation and Economic Policy (ITEP) and parroted by countless media outlets, is a masterpiece of statistical deception.

The $96 billion figure lumps together sales taxes paid by everyone, excise taxes on gasoline and utilities, property taxes supposedly “indirectly paid through rent”, which is an economic fallacy, and a small fraction of actual income taxes.

Advocates then present this mix as if undocumented immigrants are dutifully filing tax returns and contributing to Social Security like law-abiding citizens.

They are not.

One of the most egregious manipulations is counting rent payments as “indirect property tax contributions.” This violates basic economic principles. When someone pays rent, they are buying housing services from a landlord. The landlord pays property taxes from rental income, but tenants are no more “paying property taxes” than they are paying the landlord’s mortgage or maintenance costs. That’s why renters cannot claim these deductions on their tax returns.

Another major misrepresentation involves Social Security. Liberal groups claim undocumented workers “pay into Social Security without drawing benefits,” creating a net gain.

The way the scam works: multiple illegal workers use the same borrowed or false Social Security number, a crime, and all earnings are credited to that one legal person’s account. For example, five individuals might use the same SSN to drive for Uber or deliver for Grubhub. At retirement, the person who owns the SSN collects benefits based on all their combined earnings. Liberals argue that only 20% of illegal workers draw benefits, but one person receives payouts inflated by multiple workers’ contributions.

There’s no net gain. Contributions are misattributed, resulting in higher benefits for a single recipient.

While liberal groups exaggerate economic contributions, they downplay the negative impact on the U.S. job market. Basic economics: as labor supply rises and demand stays constant, wages fall. With an estimated 11–18 million undocumented workers, many from countries where U.S. minimum wage is aspirational, the labor supply is artificially inflated, especially in unskilled and semi-skilled sectors.

Foreign-born workers make up over 19% of the U.S. workforce, more than 32 million out of 169 million, and consistently have higher labor force participation rates than native-born Americans. This displaces U.S. workers and puts downward pressure on wages across the employment ladder, pushing some out of the labor force entirely. Due to the lack of Social Security numbers, it’s likely that undocumented immigrants are undercounted in these figures, meaning the actual percentage of foreign-born workers is even higher.

Take California, where the minimum wage is $16.50. Illegals have driven down wages in building trades, where construction workers now earn just $20.66–$24.83 per hour, and in agriculture, where wages average $17.23–$17.75. When people say Americans “don’t want these jobs,” the truth is they don’t want them at those wages. Why do years of hard training for a $22/hour trade job when you can work at Walmart or McDonald’s for $16.50 in air conditioning?

And under current unemployment calculations, working even one hour per week counts as “employed.” So if an American loses a good construction job to an illegal and ends up working part-time at McDonald’s, it doesn’t change the unemployment rate.

Advocates also ignore the massive public costs. Undocumented immigrants’ children strain public schools. Emergency room visits and uncompensated healthcare burden hospitals and taxpayers. Local and state benefits are provided regardless of legal status. Increased wear on roads, utilities, and public infrastructure leads to costly maintenance and expansion. Most importantly, direct competition with American workers in construction, hospitality, and agriculture depresses wages across entire industries.

Liberals claim illegals don’t get welfare and don’t qualify for Social Security or federal programs. But that’s a myth. Undocumented immigrants qualify for a range of benefits, including Emergency Medicaid, WIC, school meals, Head Start, emergency disaster aid, and treatment at Federally Qualified Health Centers. Federal law guarantees access to ER care. Many states go further, 14 states and D.C. provide state-funded healthcare for all children regardless of status, and 7 states plus D.C. extend this to adults. California offers full healthcare to all low-income immigrants, regardless of legal status.

The Federation for American Immigration Reform estimates the net cost of illegal immigration at over $150 billion annually, even after subtracting tax contributions.

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