Trump crackdown on legal immigrants could damage California economy, experts say

The Trump administration’s new immigration crackdown — which could deny green cards to immigrants who use Medicaid, food stamps, housing vouchers or other forms of public assistance — would have major ramifications on the California economy, experts and advocates said Monday.

Laurel Lucia, director of the healthcare program at the UC Berkeley Labor Center, says the policy could have a damaging effect on California and the country’s overall economy. Many in California who already have a green card or have become citizens may dis-enroll from public benefits such as Medi-Cal or CalFresh out of fear for what the policy may mean for themselves and for their family members, causing a chilling effect on the economy, she said.

“When these Californians dis-enroll that means fewer federal dollars coming into the state supporting not only our healthcare system but our whole economy,” Lucia said.

In a 2018 study by Lucia, Ninez Ponce of the UCLA Fielding School of Public Health and Tia Shimada of California Food Policy Advocates, the authors found the healthcare sector would suffer the biggest economic blow from such a policy change.

Federal law already requires those seeking green cards and legal status to prove they will not become a “public charge,” or a burden on the U.S. But the new rules, made public Monday, outline a broader range of programs that could disqualify them. Officers at U.S. Citizenship and Immigration Services will now weigh public assistance along with other factors such as education, household income and health to determine whether to grant legal status.

Their study, which analyzed proposed changes in “public charge” rules, “the core of which” are the same as those announced Monday, Lucia said, projected lost federal support for Medi-Cal at $1.19 billion and CalFresh at $488 million, as they projected that people would dis-enroll out of concern for losing their legal status. The study found that up to 17,700 California jobs would no longer exist after the changes took effect, and that 47% of those lost jobs would come from the healthcare sector.

If people dis-enroll from Medi-Cal, the biggest loss would be seen in healthcare jobs, but “jobs in other industries would also decline as a result of the economic ripple effect,” Lucia said. Those who lose CalFresh benefits “will likely reduce spending on other basic necessities to shift more of their household budget towards buying food.” This can affect a variety of industries, Lucia said, from retail to real estate.

The study also found that in California, “disenrollment from CalFresh and Medi-cal would most significantly affect Latinos (88%) and Asians (8%).” As people dis-enroll from the programs, Lucia said, the study projects negative effects on many individuals’ and families’ health because people in low-income communities would have less access to affordable food, healthcare, and other necessary resources.

Lucia said immigration would probably shift. The new rule is a “policy to reduce immigration by people who aren’t wealthy, and to shift immigration from Latin America and Asia to Europe,” Lucia said.

In general, she said, “our economy is stronger when everyone has the basics they need.”

Raúl Hinojosa-Ojeda, associate professor in the UCLA department of Chicana and Chicano studies, said Trump’s new public charge policies run directly against the concept of immigrant integration that propels the U.S. economy forward.

“What California’s economy needs is to integrate immigrants as quickly as possible,” he said. “As soon as immigrants become legal and become citizens they dramatically increase their productivity and ability to add to the economy.”

Immigrant integration is an important public benefit to the state, as work labor participation rates among immigrants are extremely high, Hinojosa-Ojeda said. Public assistance is an important gateway to reaching that integration, said the professor, calling most public charge programs temporary solutions that help individuals reach more stable living situations, away from poverty, that allow them to contribute more to the economy.

He said that Trump’s policies have the potential to create an entire class of people that would not be able to reach immigrant integration, leaving them less likely to be productive. Legalization increases immigrants’ income by more than 20% in the couple of years after they gain their legal status, Hinojosa-Ojeda said, and leads to a 50% to 60% increase in income in the five to 10 years after they become citizens. Hinojosa-Ojeda called the Trump administration’s policy changes “self-defeating.”

The biggest users of social services are non-immigrants, something which seems to be lost in a government narrative of public assistance that pushes a view that the policy mostly benefits native workers, Hinojosa-Ojeda said.

“On the contrary, we all lose, the whole society loses,” he said. “This is an attempt to divide the ‘worthy’ and the ‘unworthy,’ putting the immigrants in the ‘unworthy’ category.... We would be locking out people from pathways forward.”