Mary Johnson, editor
Advocates of immigration reform say that more immigration would help shore up Social Security and Medicare because the programs need more workers. But some of the same people, including President Obama, also say that Social Security's long-term financing is in trouble. In his fiscal 2014 budget, President Obama proposed cutting cost-of-living adjustments (COLAs) and changes that would make millions of seniors pay higher Medicare costs.
Would millions of newly - authorized immigrants boost Social Security's and Medicare's coffers, as proponents say? If so, why the urgency to cut benefits?
The danger is that proponents are miscalculating, and that immigration won't bring in as much new revenue as they are counting on.
In fact, according to the government's own data, there's good reason to believe that an immigration amnesty won’t add much in new revenue, especially in the short term. It would add potentially hundreds of billions in new long-term liabilities to Social Security and Medicare. That's because all that's required to claim benefits under current law is a work-authorized Social Security number (SSN) and about ten years of earnings history. Citizenship is not a requirement to file a claim for benefits.
Immigrants filing for a status change would also have a pressing incentive to find evidence of their prior unauthorized earnings history, like tax returns and W-2s, because reform legislation requires proof of payment of back taxes. Individuals could use the same documents to claim earnings from jobs worked under phony Social Security numbers to be reinstated under new work-authorized Social Security Numbers. Currently the Social Security Administration calculates benefit payments based on all earnings individuals accumulate over their lifetime — including earnings for jobs worked without authorization.
Under immigration reform legislation that passed in the Senate, however, Senators Orrin Hatch (UT) and Marco Rubio (FL) introduced an amendment that would prevent payment of benefits based on prior illegal work. The provision would ban earnings from jobs worked without legal authorization from being used to determine entitlement to Social Security benefits and for calculating the amount of initial benefits, legislation that TSCL and its grassroots members have long supported. But the amendment does not close a related loophole in current law that allows older immigrants who received "non-work" Social Security numbers issued prior to 2004 to claim Social Security benefits without having ever received work authorization.
The CBO estimates that there would be costs both to Social Security and Medicare, primarily for disability benefits starting as early as 2017, assuming enactment into law this year. The CBO said, however, that the new TSCL-supported amendment would save the programs about $6 billion over the first 20 years, with the savings growing greater in the future.
The fate of the provision, however, remains uncertain as Congress continues consideration of immigration reform. TSCL encourages all readers concerned about the future of their Social Security and Medicare benefits to contact your member of Congress. Let's tell Congress to stop paying Social Security based on unauthorized work! Work under invalid and fraudulent Social Security numbers should be invalid for entitlement to Social Security benefits.
