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Rational Middle Podcast: Tony Payan and Pamela Lizette Cruz Explain How ID and Tax Will Help Economic Recovery

The following article was authored by Charles Frantes: In the latest Rational Middle of Immigration podcast, Tony Payan & Pamela Lizette Cruz of the James A. Baker, III Institute for Public Policy at Rice University discuss how an ID and Tax Policy for unauthorized immigrants works and why it will help with the US economic recovery.

Payan explained how our current political environment would not allow for the legislative success of pathways to citizenship or permanent residency for the 10.7 million unauthorized immigrants, but that ID and tax offers a more viable “path to resolution”.

“An ID and Tax solution would be essentially granting some kind of documentation to these unauthorized residents to stay in the United States with their families, to work, to pay taxes, to drive, to live their lives, without necessarily putting them on a path to permanent residency and citizenship because that is an 'unacceptable solution,'” said Payan.

“It’s worked for about 300,000 TPS (Temporary Protected Status) recipients, and it’s worked for around 800,000 DACA recipients, and I think it could work for most of these 10+ million people that have been here for a very long time,” he added.

Pam Cruz said the an ID an Tax policy would have buy in from the unauthorized immigrant population and that similar programs currently in place like DACA show that such policies increase unauthorized immigrants’ abilities to contribute to the economy and thus have economic and fiscal benefits.

"There is broad bipartisan support from the American public to grant some type of conditional legal status for undocumented immigrants…We believe that it would be an acceptable position for undocumented residents primarily because they often just want a legal way to stay in the United States, live and work without fear of abuse, forced labor, coercive work practices, or exploitations. We believe that programs like DACA, TPS, and DED (Deferred Enforced Departure) can be good templates to show that providing some of this undocumented population with legal status to work can have both economic and fiscal benefits,” said Cruz.

Rational Middle Executive Producer Loren Steffy further outlined the specific details of what ID and Tax includes, and that it would lead to an increase of workers paying income taxes and employers paying payroll taxes.

“As I understand it, this would involve issuing an ID Card, the employee would have to go through a background check, they’d be issued some sort of a tamper proof ID…and then in turn an employer would agree to hire them as W2 employees, put them on the payroll, and pay payroll taxes so that they would be actively participating in the economy as well as benefiting from the economy,” said Steffy.

Payan agreed and added that all unauthorized immigrants currently pay taxes like sales tax, and many even pay social security taxes, although they do not qualify for social security benefits. He also added that ID and Tax is focused on fully integrating undocumented immigrants into the economy.

“This is about ID’ing this population, knowing who is in the country, allowing them to work, to pay taxes, to accrue some benefits like any other worker. It’s a kind of economic citizenship, it’s not a political citizenship, they would never be able to vote,” said Payan.

The speakers also discussed how many undocumented immigrants were deemed essential and have worked throughout the COVID-19 pandemic, highlighting the critical roles that they play in our economy.

“A lot of immigrants who are currently working have been deemed essential, particularly those who are working right now to continue the national food supply chain. We have these undocumented immigrant workers being classified as essential, underscoring their role in the economy and how important it is to provide protection to this population that is still working during the pandemic,” said Cruz.

This pandemic has taught us that the so-called lower end of the labor force is actually highly critical to a lot of our lives, much more so than perhaps we realized,” Steffy added.

Payan also said that because unauthorized immigrants do not qualify for public benefits, those who have lost their jobs will get back to work quickly and help restart the economy.

“We underestimate their importance to the recovery. I know there will be a lot of other Americans who are unemployed, who are going to need help from the government. These workers are going to be the first out and are going to be the ones going back to work quickly, even when the conditions are not completely safe just yet. They need the job because they don’t qualify for any public benefits, they don’t qualify for the stimulus the government is sending," said Payan.

Payan also highlighted how the majority of unauthorized immigrants have been here for over ten years and are rooted in our society. Deporting them would destabilize their families, many of which include US citizens, and ultimately negatively affect the overall US economy.

“It is estimated that about 75-76% of all undocumented residents in our country have been here for 10 years, and I know specific cases of residents who have been here for 30 years, their kids are now in their 20’s. I don’t think it’s good for the economy to separate these families, to simply take one member of the family and send them out to Central America or Mexico or wherever, and leave one of the parents without their spouse and the children without their parent who may be the only breadwinner in the house. That’s going to affect the overall economic recovery of American citizens,” Payan said. He added that an ID and Tax policy would help improve unauthorized immigrants’ potential economic contributions and spur the overall economic recovery for the US.

On the issue of border security, Payan said that lawmakers need to define and adopt measurements for what exactly constitutes adequate border security so they can move on to dealing with the unauthorized population in the US.​