Wednesday, May 5, 2010

A Mistake I Hope To Never Make

Came across this in a rather drawn out discussion about immigration at the Economist's DIA blog. This page contains an assumption that is obviously wrong from the information contained within the post. This isn't new but hadn't seen it before and was a bit floored by it. Below are the relevant sections:

The Net Retirement Costs of Amnesty

Giving amnesty to illegal immigrants will greatly increase long-term costs to the taxpayer. Granting amnesty to illegal immigrants would, over time, increase their use of means-tested welfare, Social Security, and Medicare. Fiscal costs would rise in the intermediate term and increase dramatically when amnesty recipients reach retirement. Although it is difficult to provide a precise estimate, it seems likely that if 10 million adult illegal immigrants currently in the U.S. were granted amnesty, the net retirement cost to government (benefits minus taxes) could be over $2.6 trillion.

The calculation of this figure is as follows. As noted above, in 2007 there were, by the most commonly used estimates, roughly 10 million adult illegal immigrants in the U.S. Most illegal immigrants are low-skilled. On average, each elderly low-skill immigrant imposes a net cost (benefits minus taxes) on the taxpayers of about $17,000 per year. The major elements of this cost are Social Security, Medicare, and Medicaid benefits. (The figure includes federal state and local government costs.) If the government gave amnesty to 10 million adult illegal immigrants, most of them would eventually become eligible for Social Security and Medicare benefits or Supplemental Security Income and Medicaid benefits.

However, not all of the 10 million adults given amnesty would survive until retirement at age 67. Normal mortality rates would reduce the population by roughly 15 percent before age 67. That would mean 8.5 million individuals would reach age 67 and enter retirement.

Of those reaching 67, their average remaining life expectancy would be around 18 years.[17] The net cost to taxpayers of these elderly individuals would be around $17,000 per year.[18] Over 18 years, the cost would equal $306,000 per elderly amnesty recipient. A cost of $306,000 per amnesty recipient multiplied by 8.5 million amnesty recipients results in a total net cost of $2.6 trillion.

The report also contains this:

Education of Illegal Immigrants.Illegal immigrants generally have very low education levels. As Chart 3 shows, 61 percent of illegal immigrant adults lack a high school diploma, 25 percent have only a high school diploma, 5 percent have attended some college, and 9 percent are college graduates, according to the Center for Immigration Studies' estimates.[4] The Pew Hispanic Center estimates slightly higher education levels: 49 percent without a high school diploma, 25 percent with a high school diploma only, 10 percent with some college, and 15 percent with college degrees.[5] Overall, 49 to 61 percent of adult illegal immigrants lack a high school diploma, compared to 9 percent of native-born adults.

Thus, using solely the information from the report itself, at a minimum between 14% and 25% of illegal immigrants are not low skilled (assuming anyone with a college education is not low skilled, which I believe conforms with most definitions of the term). Yet, this page did the calculation as if all illegal immigrants were low skilled.

The bias here is so thick it is unreal. It gives the automatic assumption all illegal immigrants are low skilled. Furthermore, to give the appearance of balance, the article presents some of the weaker arguments made by pro-immigration groups to easily dismiss them. To stick with the original example, a notable sign of bias is trying to give the appearance of a balanced assessment by taking out the normal mortality rate. This accounts for a single, obvious objection giving the appearance of trying to do some real math, while leaving out much more significant issues with real skill levels and long term economic mobility, it simply assumes these immigrants will stay poor and that they have no skills.

There are plenty of other issues with additional information that I think would be necessary. What I can't get past though, is that this would be put up with such an obvious error in assumptions, proven wrong by information within the report itself, by a think tank. A politician's website I could understand but this is the kind of error you'd expect a freshman poli sci student to notice. It's unbelievable they'd let something that is such an obvious hack job go up. This sort of obvious mistake should be an embarrassment to anyone that is trying to be professional. A personal blog, sure, we say crazy stuff all the time. But this is paid work that an unpaid undergraduate intern should have been able to call the error on. Or, in this case, a guy sitting at home in front of his computer in pyjamas.

No comments:

Post a Comment