STUDY: DREAMers Could Add $329 Billion to Economy

ByABC News
October 2, 2012, 11:12 AM

Oct 2,2012— -- On Monday, the Center for American Progress (CAP), a left-leaning think tank, released a study which estimates the economic benefit of passing the DREAM Act -- a bill that would grant a path to legal status for some undocumented students.

The study maintains that this group would contribute $329 billion to the American economy by 2030 if the DREAM Act were passed. The prediction holds that an estimated 2.1 million young people would gain access to higher education, and that their ability to work legally would lead to increased spending from the population.

"This spending ripples through the economy, supporting another $181 billion in induced economic impact, the creation of 1.4 million jobs, and more than $10 billion in increased revenue," the study concludes.

CAP's study isn't the first to try to estimate the economic benefits of passing the DREAM Act. The most recent of these studies was conducted by Dr. Raul Hinojosa-Ojeda at UCLA in 2010. In it, he concluded that DREAMers could contribute up to $3.6 trillion to the U.S. economy in the next 40 years, almost $90 billion a year and .6% of the annual U.S. GDP.

But, as Univision noted after the UCLA study was published, there may be additional costs to consider with the passage of the DREAM Act:

"Steven Camarota, director of research at the Center for Immigration Studies in Washington, D.C. and author of the memorandum, 'Estimating the Impact of the DREAM Act,' doesn't feel it's that simple. A higher number of students in colleges or universities would signify larger tuition subsidies. In his memorandum, Camarota found that on average, each undocumented immigrant that would attend a public institution of higher education would receive a tuition subsidy of $6,000 for each year that they attend, totaling $6.2 billion a year."

Bob Dane, a spokesperson for the Federation for American Immigration Reform (FAIR), which advocates for lower immigration levels says the CAP study contradicts his organization's estimates. "In effect U.S. taxpayers, if the DREAM Act were enacted broadly, would be footing the bill for in-state tuition including loans, grants and scholarships," he said.

The study authors, Juan Carlos Guzmán and Raul C. Jara, admit that their estimate does not include costs incurred from the passing of the legislation. However, they argue the DREAM Act has functions to contain these burdens for taxpayers.

"The DREAM Act itself [has] a safety valve to contain costs, since recipients must wait a ten-year conditional period, by which time we assume the DREAM Act population as a whole will be contributing significantly to the economy," the study authors write.

Guzmán and Jara also add that the "the U.S. economy is not a zero-sum game and increased earnings from DREAMers create greater demand for services among the most important drivers of job growth in the country, expanding opportunities for all Americans."

Lourdes del Rio contributed reporting to this article.