Republicans should build a wall around the welfare state
Congress is hurtling toward a colossal showdown over the federal budget. The House budget blueprint instructed the Committee on Energy and Commerce to find $880 billion in spending cuts, which requires reforming Medicaid. However, some Republicans like Sen. Josh Hawley (Mo.) oppose “anything that results in cuts to actual work beneficiaries.”
Even President Trump said that Medicaid won’t be touched. But without the cuts, Congress could not continue with the Trump tax cuts enacted in 2017.
Before any of this can materialize, the Senate must first agree to the House budget resolution, with both chambers resolving their differences. That’s where the politics get complicated. But the politics can be simple: Focus on excluding non-citizens from welfare programs.
Non-citizens include illegal immigrants, legal immigrants on green cards and other migrants here on work permits or other visas. The call for $880 billion in cuts is not specific to components of Medicaid or other welfare programs; the number is merely a target that the Energy and Commerce Committee needs to hit. The committee could meet much of this goal and assuage Hawley’s worry by cutting all non-citizens from Medicaid and other welfare and entitlement programs.
Non-citizens don’t use much Medicaid, but they shouldn’t be using any. Our recent research published at the Cato Institute found that non-citizens used about $2,100 per year in Medicaid on average, over 16 percent below the more than $2,500 consumed by native-born Americans annually.
In 2022, non-citizens received an estimated $50.3 billion of Medicaid benefits — about $35.6 billion in federal money and the rest from state coffers. Ideally, no non-citizens should receive any Medicaid from state or federal funding, but states do have that discretion with their own state funds. Our back-of-the-envelope calculation suggests that kicking all non-citizens off Medicaid would save about $355.9 billion over ten years.
Still, the Senate could go further by restricting all non-citizen access to other federal welfare programs. We estimate that non-citizens consumed about $59.8 billion in other welfare benefits in 2022 — far below what native-born Americans do per capita, but a substantial sum nonetheless. Removing non-citizens from all welfare and entitlement programs, not just Medicaid, would save about $1 trillion over the next decade.
Cutting non-citizens out of Medicare and Social Security could be politically tricky, so it may be best to start by cutting them off from means-tested welfare. That easier move would save $461.2 billion over ten years.
To remove all non-citizens from welfare rolls, the committee wouldn't need to start from scratch. They could simply adopt Rep. Glenn Grothman’s (R-Wis.) Safeguarding Benefits for Americans Act from the last Congress.
Immigrants generally pay more in taxes than they consume in benefits, partly because they consume less welfare than native-born Americans. Kicking all non-citizens off welfare would boost those fiscal benefits even higher by reducing the outlays.
Immigrants also have positive economic effects beyond government budgets. The U.S. population would start declining in the mid-2030s without immigration, which would have negative economic, demographic and social implications — so their presence staves off that day. The other economic benefits of immigration are enormous, from a larger economy to higher wages and world-class firms started by immigrants like Jensen Huang, Elon Musk and many others.
The House budget blueprint supports pouring an extraordinary $200 billion into border security and interior immigration enforcement over the next decade. Such a move is fiscally irresponsible and will have little impact on border security as the number of border encounters has declined precipitously over the last year. Instead of being distracted by a phantom border problem, Congress should build a wall around the welfare state instead of around the country.
Alex Nowrasteh is the vice president for economic and social policy studies at the Cato Institute. Jerome Famularo is a research associate at the Cato Institute.
-
Cuts to Medicare, Medicaid Would Be ‘Catastrophic for Women’s Health,’ Says Chelsea Clinton
Republicans want to slash $880 billion from the agency overseeing Medicaid. There’s no way to do so without touching benefits.Inc. - Mar. 10 -
The UK is cutting welfare spending to urge people to work. Critics say it will hurt the vulnerable
Britain’s Labour Party government has announced an overhaul of the welfare system it says will save the cash-strapped administration 5 billion pounds, or $6.5 billionABC News - 5d -
Rachel Reeves insists changes to welfare needed
Labour MPs have been expressing unease about the proposed cuts to welfare, ahead of announcements next week.BBC News - Mar. 14 -
Cutting Medicaid?
How Republicans could change the program.The New York Times - Mar. 10 -
Louisiana voters in Speaker Johnson’s district react to Medicaid cut threats
Residents of Vinton, La., which is part of House Speaker Mike Johnson’s district, are concerned that Republicans will make cuts to Medicaid to reduce government spending. NBC News’ Melanie Zanona ...NBC News - Mar. 12 -
G.O.P. Spending Bill Would Force $1 Billion Cut to D.C. Budget
Republicans omitted a standard provision approving the District’s budget in a stopgap funding measure needed to avert a shutdown before the end of the week. The result would be a 16 percent cut.The New York Times - Mar. 11 -
UK’s devolved governments can learn from each other on welfare reform
There is no reason why the four countries can’t share information to see which approach is workingFinancial Times - 6d -
With Medicaid cuts looming, misinformation about immigrants, especially Latinos, spreads
As Republican lawmakers move to cut Medicaid spending, misinformation about immigrants, especially about Latinos, is spreading on social media.NBC News - Mar. 13 -
Starmer to drive through welfare cuts that could affect UK’s most severely disabled
PM faces backlash over plans to tighten eligibility, potentially leaving more than 600,000 claimants £675 a month worse off. Keir Starmer is to defy growing anger by driving through welfare cuts ...The Guardian - 6d
More from The Hill
-
Allure of higher office could hinder House Democrats' midterm hopes
House Democrats vying to flip control of the lower chamber in next year’s midterm elections may face a new challenge: the exodus of battleground incumbents seeking higher office. A number of ...The Hill - 1h -
Trump jokes about 'backdating' NCAA March Madness bracket
President Trump joked with Fox News White House correspondent Peter Doocy about “backdating” an NCAA March Madness bracket after the college tournament has seen several upsets. Trump spoke with ...The Hill - 1h -
Live updates: Homan on migrant flights; Sanders acknowledges Trump’s efforts on border, fentanyl
President Trump is dealing with backlash from Democrats in Congress, activists and judges as he ramps up deportations of migrants from the U.S. U.S. District Judge James Boasberg recently imposed a ...The Hill - 1h -
Canadian PM Mark Carney calls for snap election, says Trump won’t 'break us'
Canadian Prime Minister Mark Carney called for a federal election to take place next month, noting that President Trump won’t “break” Canadians. “I have just asked the Governor General to dissolve ...The Hill - 2h -
Kentucky Lt. Gov. on running for McConnell's seat: 'Lord, no'
Kentucky Lt. Gov. Jacqueline Coleman (D) said Sunday that she isn’t running for Sen. Mitch McConnell’s (R-Ky.) seat. “We're going to hear a lot more from Democrats nationally trying to get you or ...The Hill - 2h
More in Politics
-
Allure of higher office could hinder House Democrats' midterm hopes
House Democrats vying to flip control of the lower chamber in next year’s midterm elections may face a new challenge: the exodus of battleground incumbents seeking higher office. A number of ...The Hill - 1h -
Trump jokes about 'backdating' NCAA March Madness bracket
President Trump joked with Fox News White House correspondent Peter Doocy about “backdating” an NCAA March Madness bracket after the college tournament has seen several upsets. Trump spoke with ...The Hill - 1h -
Live updates: Homan on migrant flights; Sanders acknowledges Trump’s efforts on border, fentanyl
President Trump is dealing with backlash from Democrats in Congress, activists and judges as he ramps up deportations of migrants from the U.S. U.S. District Judge James Boasberg recently imposed a ...The Hill - 1h -
Canadian PM Mark Carney calls for snap election, says Trump won’t 'break us'
Canadian Prime Minister Mark Carney called for a federal election to take place next month, noting that President Trump won’t “break” Canadians. “I have just asked the Governor General to dissolve ...The Hill - 2h -
Kentucky Lt. Gov. on running for McConnell's seat: 'Lord, no'
Kentucky Lt. Gov. Jacqueline Coleman (D) said Sunday that she isn’t running for Sen. Mitch McConnell’s (R-Ky.) seat. “We're going to hear a lot more from Democrats nationally trying to get you or ...The Hill - 2h