NYT Decides to Recycle Greenspan on Social Security and Immigration

Catherine Rampell with the Economix blog at the New York Times recycles the same discredited logic used by Alan Greenspan in the 1990's when he first floated the idea that more immigration would have an impact on Social Security's solvency. At the time, FAIR produced a publication, A Ponzi Problem: The U.S. Dependency Ratio, Social Security Solvency and the False Panacea of Immigration (2000). "Part of what has saved the United States from some of the entitlement-funding problems plaguing our peers in Japan and Western Europe is immigration, says Stephen Ansolabehere, a professor of government at Harvard. "Immigrants are younger than the typical American," Professor Ansolabehere told me in an interview about the long-term fiscal challenges facing the United States. "These people are entering the work force and paying taxes, Social Security taxes, that sustain these programs."

As comments at the NYT site pointed out, "At least some of those immigrants are displacing American workers. So even if the immigrant is paying taxes, they aren't adding to the tax base - they're just paying into the tax base while the American worker is not. And also, immigrants have pushed down the average wage for many jobs." And, "If Social Security requires an ever-growing population of new workers to remain solvent, then it is a pyramid scheme. It is not sustainable."

Interested readers should also check out the Pension Tsunami blog for more information about not just Social Security but other public pension programs. States and municipalities face staggering pension costs that go far beyond the anticipated draw down of the Social Security trust fund, and with more cities and counties facing bankruptcy due to pension costs it seems unwise to push more immigration as a panacea.