Sunday, January 13, 2019

Why is there so little discussion of an economic justification for building The Border Wall?

January 12, 2019 | rlmorel 

I find it interesting that there seem to be few analysis pieces that show the cost of illegal immigration to this country annually, and compare it to the cost of a wall, never mind just $5 Billion of the wall Trump is asking for in the 2019 budget.

I tried to construct an analogy that might resonate more with normal people...when you talk about billions here or trillions there, it tends to lose impact. The numbers are too big for us to relate to. Also, I tried to think of it from a business perspective.

Imagine you were a farmer with a rodent problem that was causing you to lose money. So you bring in a consultant, and after looking at your situation, they come to you and say this to you:


"Farmer Smith...on your property, there is a breeding area of rodents that cost you approximately $5,400 per year in lost crops, various rodent damages, lawsuits from customers with rodent feces in their product, inspections to monitor rodent feces in your crops.

We have a your operations statement that shows these losses annually, and you have not only lost $5,400 worth of crops this year, you have lost that much each year for the last 10 years, and will lose that much each year for for the next ten years. Over twenty years, you will lose over $108,000 on this problem

My propose to reduce the money you pay on this issue will be a solution that will cost us a total of $500 this year and each year for the next four years after that for a total of a $2,500 capital outlay, but your problem will cost you annually only $250 a year after that to maintain it.

That means: that once the solution is in place, you will still be losing money to rodents (our estimate that at worst, you will only lose a third of what you normally do (to all the loss and mitigation, inspector fees, etc. which will save you, even after annual maintenance costs, $3,314 every year.

What do you say, Farmer Smith? Do you want to spend the money to fix this issue and increase your financial situation, or do you simply want to lose more and more money each year?"



What person in their right mind wouldn't look at that and say "Hell Yeah, let's do that. Let's spend that money on the solution. I know it won't eliminate the issue, but it makes it far more manageable. I'll have to kick in the money each year to pay the bill to keep the solution working, but...it will be worth it."

I tried to use those numbers above for a specific reason...because the $500 translates to $5 Billion, the amount Trump wants in the budget. So, the study at the Heritage Foundation on the costs of illegal immigration (which I think lowballs the number but just for the sake of the argument, we will go with a low estimate) says that the USA spends $54 Billion in just money on illegals each year. Over twenty years, that is over $1.08 Trillion dollars.
Trump is asking for $5 billion to begin the wall, and one estimate from an analyst at Fox news pegged the total cost to build the wall at $25 Billion. I'll use that number.
If the wall brings illegal immigration to a third of what it was in the first year it is complete and operational, we would save $32.5 Billion right off the top in year one.
$32.5 Billion dollars saved by increasing our security, decreasing crime and incarceration by illegals, all those things that go along with it.
And these are lowball numbers. I believe the cost of illegal immigration is between $100-200 Billion a year when you add medical care, schooling, incarceration, bilingual education, you name it, so I think realistically it is 2-4x the low estimate. So we could potentially save $68 billion to $136 billion a year, even if the cost of the wall is $50 billion to $200 billion, once it is spent, we still save that money each year, and each going forward.
Why on God's Earth would we NOT build this wall?
NOTE: The Heritage Foundation study "The Fiscal Cost of Unlawful Immigrants and Amnesty to the U.S. Taxpayer" that put the number I used at $54 billion a year is a good read and well done one, even if I do think it low-balls the cost to taxpayers. I am guessing it is close to $200 billion dollars a year.

If I made a mistake in constructing this analogy and screwed up moving a comma and missing by a factor of ten somewhere...I apologize!

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