Warren’s new proposal, which purports to achieve universal and generous single-payer coverage without raising taxes on middle-class families, would mostly be funded by a tax on employers in place of what they already spend on health care for employees, as well as taxes on corporations and the wealthy. It would be facilitated by an aggressive effort to curb health-care costs and recouped government expenditures on other health programs.
Warren argues that this would decrease costs for most ordinary Americans, since it would do away with premiums and co-pays entirely. For detailed overviews of the issues raised here, see this David Dayen piece or this Huffington Post analysis.
But I wanted to focus on a relatively minuscule aspect of the pay-for. As Warren’s plan notes, she would seek to generate hundreds of billions of dollars through comprehensive immigration reform — which would legalize many millions of undocumented immigrants already here, boosting revenue by an estimated $450 billion — and through increased immigration.
This has already elicited chortles about how unrealistic this is, since it implies that Warren hopes Congress will pass a Medicare-for-all plan and immigration reform in one fell swoop. And others have noted this would amount to barely 2 percent of the funding.
But there’s actually an underpinning of realism about this aspect of her proposal: It points to basic overarching demographic realities that both deserve more discussion and serve as an important rebuttal to Trumpism.
The bottom line is that more immigrants would help fuel the workforce of the future, and with it, the revenue that will sustain the future welfare state.
There’s a supreme irony at the core of this political moment, and one that was ably captured by Ronald Brownstein: While Trump spends all his time thrilling his aging white base with his demagoguing of immigrants and his efforts to slash legal immigration, those voters need immigrants to fund the government programs they will rely on in retirement.
The basic issue is that without more immigrants, the current native-born workforce would be set to decline in size in coming years as its growth slows amid the movement of the baby boomer generation into retirement. As a recent Pew analysis documented, future immigrants and their children will be responsible for all of the growth in the workforce that we’ll see through 2035.
Warren’s immigration proposal includes legalizing millions of undocumented immigrants here and vows to “expand” and “grow” legal immigration. No details are offered on that latter point, so it’s hard to game out what this might mean.
But the bottom line is that a discussion of expanding legal immigration should be part of our discussion over our fiscal future, and so should the ways in which more immigrants would help to fund proposals like Medicare-or-all or other welfare state programs.
Trump loves to demagogue immigrants as a drain on public benefits. But in reality, more immigrants would almost certainly result in more revenue over time to fund government programs that benefit everyone, according to William H. Frey, a well-known demographer at the Brookings Institution.
“We’re becoming an older population,” Frey told me. “To the extent that we are able to grow our economy and labor force, it will be by cultivating a younger population, largely from immigration.”
Frey cautioned that more immigrants would also mean investing public money in them — through education and so forth — but Frey noted that, overall, more immigration would likely result in a net fiscal positive. Studies support this notion.
“If we legalize the people who are here and increase immigration to the U.S.,” Frey said, “it will increase our tax base, which will allow us to contribute more to the welfare state and to the safety net and other programs we’ll need.”
Medicare-for-all proposals are often derided as unrealistic (and are often held to a higher standard of “realism” than other proposals are). But Warren is trying to show that a broad suite of pay-fors can be assembled to show how it might be funded, and such proposals are statements of the values and priorities that animate a larger vision.
The immigration piece may be a very small aspect of her proposal. But talking about increased immigration as a way to help fortify the fiscal underpinnings of the welfare state of the future actually adds a small dose of realism to the discussion.