“Audacious Epigone” (who has his own blog) directed me to a Heritage Foundation paper which has more extensive analysis of the “cost of low-skill households” than I’ve been able to do by myself (given the time I’ve been willing to put into it).
Households headed by persons without a high school diploma are roughly 15 percent of all U.S. households. Overall, these households impose a significant fiscal burden on other taxpayers: The cost of the government benefits they consume greatly exceeds the taxes they pay to government. Before government undertakes to transfer even more economic resources to these households, it should have a very clear account of the magnitude of the economic transfers that already occur.
The substantial net tax burden imposed by low-skill U.S. households also suggests lessons for immigration policy. Recently proposed immigration legislation would greatly increase the number of poorly educated immigrants entering and living in the United States. Before this policy is adopted, Congress should examine carefully the potential negative fiscal effects of low-skill immigrant households receiving services.
The paper reports that the average household headed by a high school dropout receives $32,183 per year of direct benefits spending and population-based spending and an additional $10,901 as their share of public goods and interest spending. The conclusion is that a person earning $10/hour is not only paying less in taxes than their share of government spending, they actually earn less money than their share of government spending. And that’s a salary which is significantly higher than the current minimum wage of $6.55/hour or the new minimum wage of $7.25/hour which will go into effect on July 24, 2009. Furthermore, people in these wage brackets are likely to spend substantial periods of their post-high school life not working at all.
The paper also has a dim view of the return of public education spending on those least educatable, which is something I came upon independently in a recent blog post.
In my recent post on Post-Marxism, I identified the lowest class as the parasite class.
[The parasite class] creates a negative value for society because they suck up more value from society than they create through their labor. It includes not just people in prison and people collecting welfare, but the working poor as well.
According to the Heritage Foundation paper, 15% of the population are high school dropouts, so perhaps this is a good estimate of the size of the parasite class, 15% of the population. Thus, the parasite class is much larger than the “lumpenproletariat” described by Marx as “swindlers, confidence tricksters, brothel-keepers, rag-and-bone merchants, beggars, and other flotsam of society.”
Obama’s plan to offer citizenship to currently illegal aliens will increase the size of the parasite class, which is why, among other reasons, that it’s such a bad idea.