Illegal immigrants in New York are set to get a big windfall from the state. Lawmakers approved one-time payments of up to $15,600 to any undocumented person who lost his or her job during the pandemic.
Supporters say it’s only right, but is it fair to divert $2 billion away from citizens and legal residents who are homeless, struggling to eat, and whose businesses are failing?
The issue
As part of a $212 billion state budget, New York lawmakers created a $2.1 billion relief fund reserved for its illegal immigrant population and other unemployed workers who did not qualify for federal stimulus benefits.
To qualify, undocumented individuals must prove they are New York residents who were ineligible for unemployment benefits and stimulus payments because of their immigration status and that they lost income.
If they can’t prove lost income, they can still qualify to receive $3,200, about the total of the three stimulus checks that each American received over the past year.
An estimated 300,000 undocumented workers may qualify.
Misplaced policies
New York has many pressing issues that demand fiscal attention.
New York has the highest rate of homelessness at 47.3 homeless people for every 10,000 residents according to analysis.
One in six children is hungry and one in nine people overall struggles with hunger in the state according to Feeding America. Interestingly, the organization finds that $1.2 billion more could meet their food needs (about half the size of this new fund).
According to an alliance of New York City restaurants, about 5,000 restaurants have closed and 140,000 jobs have been lost.
The economic loss to residents of New York has been significant. Is this fund the best and fairest way to spend limited resources?
Undocumented workers residing in the state who lost income face difficult financial situations as well, but that does not absolve them from the fact that they are here illegally.
Prioritizing illegal immigrants is unfair to the citizens and legal residents who played by the rules, pay their taxes, and are not breaking the law.
Taxing the hand that feeds you
New York plans to raise taxes by $4 billion to pay for its $212 billion budget, up from $192 billion last year. The burden will disproportionately fall on higher-income households and individuals.
The state income tax rate combined with New York City’s top income tax of 3.88 percent will hike tax rates of high earners to 14.8 percent, surpassing California’s top income-tax rate of 13.3 percent, and Portland, Oregon’s top combined income tax rate of 13.9 percent.
Yet, higher earners are the most able and likely to pack up and move to states like Florida.
As mayoral candidate Andrew Yang—yes, the former Democratic presidential candidate and universal basic income champion—has warned, higher taxes could lead people to “vote with their feet and head to Florida.”
Residents are fleeing New York City and New York, driven out by tax increases, rising costs of living, deteriorating public safety, and pandemic closures.
The irony is that New York does not need to raise taxes because the state took in more income than expected and received federal aid in the recent stimulus package. As Andrew Rein, president of the Citizens Budget Commission, explained: “The simple truth is we have $22 billion more than the state expected when the budget was proposed in January—$22 billion over the next two years.”
Instead of scaling up spending on those who are living in the state illegally, New York should reign in its spending and focus on easing the financial stress on its citizens to stem the bleeding of residents.