Introduction
The Development, Relief, and Education for
Alien Minors (DREAM) Act has gained wide
support this year from legislators attempting
to provide solutions to the national
immigration conflict. First introduced in 2001
by Senators Orrin Hatch (R-UT) and Richard
Durbin (D-IL), the DREAM Act is a
bipartisan bill that would provide
undocumented youths who came to the
United States before the age of sixteen a path
toward legalization on the condition that they
attend college or serve in the U.S. military for
a minimum of two years while maintaining
good moral character. After years of backand-
forth debate on the issue, momentum has
been building to turn the DREAM Act into
law. Despite heavy Democratic losses in the
recent midterm elections, the bill may still
come up in the 2010 lame-duck Congress or
in early 2011, as has been suggested by
Senate Majority Leader Harry Reid (D-NV).
The DREAM Act’s primary goal is to legalize
the more than 2 million undocumented youths
who have resided in the U.S. and attended
schools in this country, but the bill’s
education requirements have an underlying
economic stimulus potential that has largely
gone unnoticed by members of Congress. The
legislation requires undocumented youths to
attain at least an associate-level college
degree to be eligible for legalization. If
implemented, the DREAM Act would
produce thousands of college graduates,
contributing to the pool of higher-income
earners needed by the nation at large. This
study aims to measure the economic impact
of integrating these youths into the national
economy, through the DREAM Act, by
calculating their income over a 40-year
period.
Our study builds on the findings of the 2010
Migration Policy Institute (MPI) report,
DREAM vs. Reality: An Analysis of Potential
DREAM Act Beneficiaries (Betalova and
McHugh 2010). In its analysis, the MPI
estimates that slightly more than 2.1 million
individuals could qualify for legalization
through the DREAM Act (see Table 1).
However, it concludes that only an estimated
38 percent (825,000 individuals) of the 2.1
million would likely apply for and obtain
benefits under the DREAM Act. In this
study, we examine two scenarios. In the first,
we calculate the income that the lower-bound
estimated 825,000 beneficiaries would
generate over a 40-year period, representative
of the work life of a 25- to 65-year-old
employed individual. In our second scenario,
called “No DREAMers Left Behind,” we
analyze the income that would be generated
in the same 40-year period if the entire group
of 2.1 million potential beneficiaries could
successfully meet the education or military
service requirement.
By observing the educational attainment of
the Latino population (which represents over
80 percent of the total potential beneficiary
cohort, according to the MPI) and applying
those trends to the 825,000 eligible
individuals in the MPI scenario, our study
concludes that the income generated over 40
years would be $1.4 trillion in current dollars,
(actual income would be significantly higher
if inflation over 40 years is taken into
account). In the No DREAMers Left Behind
scenario, 2.1 million undocumented
immigrants would become legalized and
generate approximately $3.6 trillion over the
same 40-year period (also in current dollars).
It is important to note that these results
represent only a subset of the full economic
contribution of the DREAM Act beneficiary
cohort. These calculations do not include total
direct value added or indirect value added
impacts (see Hinojosa 2010 for
methodological discussion). An analysis of
full fiscal benefits would have to take these
impacts into consideration, and would
substantially increase the overall economic
contributions of DREAM Act beneficiaries.
Beyond the direct and indirect economic
impacts of a more productive, legal
workforce, the DREAM Act represents an
opportunity for American taxpayers to
significantly increase the return on our
current, and already spent, investment in
youths that the public school system educates
in their K-12 years. It is common sense to
create legislative and policy mechanisms to
better ensure an economic return on this
taxpayer investment. Passing the DREAM
Act enhances national economic earnings by
developing a highly-educated workforce that
will contribute trillions of dollars to the U.S.
economy. A higher supply of skilled students
would also advance the U.S. global
competitive position in science, technology,
medicine, education and many other
endeavors.
Our report is organized into three sections:
1) Data Sources for Estimating Dream Act
Beneficiaries
2) Estimating Educational Attainment
3) Estimating Economic Attainment
The Data Sources section summarizes the
resources used to develop our findings. In
our Estimating Educational Attainment
section, we provide a detailed explanation of
how we built upon these resources to
calculate the economic estimates published
here for the first time. The Estimating
Economic Attainment section presents our
final estimation of the economic impact of the
DREAM Act over the 40-year work life of
potential beneficiaries.
