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January 04, 2005

False Immigration Assumptions for Social Security

The vision of the future painted by the social security crisis mongers is pretty dark: an aging nation unable to produce enough wealth to care for its retiress because there are not enough people of working age population.

The problem with that vision of crisis is that it ignores a basic reality. Our country is not some isolated bubble. The minute our employment needs expand, there are millions of people in other countries pushing to immigrate here to fill any jobs needed.

Any potential problems with social security will be solved by ongoing immigration, a point I've noted in the past.

But here's the remarkable thing about the doom mongers. Not only do they underestimate immigration in the future, they don't even count current immigration correctly.

The 2004 Social Security Trustees report states that "The total level of net immigration (legal and other, combined) under the intermediate projection is assumed to be 1,175,000 persons in 2004." But according to the Census Bureau, the net immigration for 2004 was 1,221,013 persons, over 100,000 more immigrants than was estimated for this year alone.

Even more dramatically, the report estimates that net immigration will drop to just "900,000 persons in 2024 and for each year afterward."

There is no reasonable explanation with a growing overall population of retirees, with expanding need for services on behalf of those non-working adults, to expect a drop in immigration. In fact, expanded immigration is a far more reasonable expectation. Yet maintaining immigration at present levels is actually treated in the report as an extreme alternative estimate.

But a gradual increase in immigration is a far more likely future -- a possibility NOT EVEN DISCUSSED in the Trustees Report. The report has false estimates of immigration this year and doesn't even include reasonable alternative estimates of immigration in the future.

How seriously can you take the doom-mongers when they ignore the simplest solution to any projected lack of workers in the future to support the social security system?

Posted by Nathan at January 4, 2005 07:05 AM