Cato classifies K–12 education as a fixed cost and therefore argues that children of immigrants born in America are free to educate because schools have excess capacity — despite education being one of the costliest and most capacity-constrained government services. Once U.S.-born children of immigrants are included as a cost, Table 13 shows the estimated fiscal benefit drops by roughly 50% (about $6.5 trillion!).

The study does not measure how many illegal immigrants use welfare; instead, it assigns them only a small share (5%) of per-capita welfare costs for programs they are ineligible for. In reality, 61% of illegal immigrant households use welfare.

The paper acknowledges that immigrants’ net fiscal contribution turns negative as they retire and age out of the workforce. But because the analysis is backward-looking (1994–2023), it captures peak working-age years more fully than the later, benefit-heavy retirement years. That weakens any implicit “lifetime surplus” impression readers might draw from the topline results.

If an illegal immigrant goes to the ER and the hospital absorbs the loss (which eventually leads to higher insurance premiums for everyone else), it doesn’t appear in Cato’s “government budget” ledger.

Since Census data doesn’t reliably track legal status, Cato uses “Non-Citizens” as a proxy for illegal immigrants. This bucket includes high-earning H-1B tech workers and legal residents. By averaging these high-earners with undocumented laborers, the fiscal contribution of the “average non-citizen” is pulled upward. It describes those assumptions as “directionally accurate, if imprecise.”

In their allocation table, federal interest on debt ($17.7T) and federal defense spending ($21.1T) are assigned entirely to the US‑born and $0 to immigrants. If the US military protects the land and the economy immigrants are participating in, the idea that they “consume” $0 of that protection is a significant modeling flaw, and that single modeling decision shifts tens of trillions off the immigrant ledger. Cato openly concedes that “the treatment of this spending matters more than any other single assumption.”

Cato classifies infrastructure spending (roads, bridges, highways, and sanitation) similarly to national defense: as a “fixed cost” that does not scale with population. They argue that because a bridge already exists, an immigrant crossing it costs the government nothing. This ignores accelerated depreciation and maintenance costs caused by increased usage. Furthermore, it ignores “lumpy” capital expenditures—when a city’s population grows by 20%, it eventually must build new water treatment plants, expand highways, and increase public transit fleets. By assigning $0 of these long-term capital costs to immigrants, Cato makes the native-born population responsible for 100% of the cost of the physical country the immigrants are utilizing daily.

The “$14.5T” headline is not a measured fiscal surplus. It’s net fiscal flow and a counterfactual add‑on. The paper’s Table 1 splits the result into net fiscal flow ($10.6T) plus “interest saved” ($3.9T) to reach $14.5T. Treating a modeled counterfactual (“interest saved”) like cash flow is a framing move, not standard budget accounting.

The paper focuses on “benefits received” but excludes administrative and enforcement costs induced by the presence of a large illegal population. The multi-billion-dollar annual budgets for ICE, CBP, and the immigration court system are “induced costs”—spending that would not exist if the population were not there—and should be attributed to illegal immigrants.

Cato accounts for remittances only by subtracting a flat $1,250 (1994 dollars, inflation-adjusted) from immigrants’ income and assumes that amount is remitted abroad, shrinking the base they use to estimate excise/sales-type consumption taxes. This is too low. Research indicates that undocumented migrants frequently remit 15% to 45% of their post-tax earnings. By ignoring this outflow, Cato effectively “double-counts” billions of dollars as domestic consumption that never actually enters the U.S. retail market or state sales tax coffers. Notably, Cato itself has used a much bigger remittance adjustment elsewhere: its 2023 fiscal-impact model includes scenarios that reduce immigrants’ consumption/sales taxes by 20% to reflect remittances.

(http://www.autoadmit.com/thread.php?thread_id=5834124&forum_id=2.#49666259)