President Donald Trump’s immigration objectives, as articulated during his 2024 campaign and second term, reveal a restrictive immigration policy centered on mass deportation, completion of the U.S.-Mexico border wall, termination of programs like Deferred Action for Childhood Arrivals (DACA), and the implementation of a merit-based immigration system.
These policies aim to prioritize national security and American workers by significantly reducing both legal and illegal immigration. This essay analyzes the potential economic consequences of achieving these objectives by the end of Trump’s second term in 2028. It evaluates the fiscal costs, labor market effects, macroeconomic impacts, and social ramifications, drawing on available data and economic modeling to provide a comprehensive assessment.
Overview of Trump’s Immigration Objectives
President Trump’s immigration agenda includes several key components:
Mass Deportation: Trump has pledged to execute the “largest domestic deportation operation in American history,” targeting an estimated 11 million undocumented immigrants, including those with temporary protections like DACA and Temporary Protected Status (TPS). The policy involves expanding detention capacity, increasing Immigration and Customs Enforcement (ICE) personnel, and utilizing expedited removal processes.
Border Wall Completion: The administration aims to complete 701 miles of primary walls and 900 miles of river barriers along the U.S.-Mexico border, with significant funding allocated for construction and enhanced border security measures.
Termination of DACA and Other Humanitarian Programs: Policies like DACA, TPS, and humanitarian parole are targeted for elimination, stripping protections from over 530,000 DACA recipients and 860,000 TPS holders, potentially subjecting them to deportation.
Merit-Based Immigration System: The plan seeks to shift legal immigration from family-based to merit-based criteria, prioritizing high-skilled workers and reducing family reunification pathways, including the Diversity Visa Lottery.
These policies, if fully implemented by 2028, would represent a seismic shift in U.S. immigration policy, with profound economic implications. The following sections analyze these impacts across key economic dimensions.
Fiscal Costs of Implementation
Direct Costs of Mass Deportation
The logistical and financial burden of mass deportation is substantial. Estimates suggest that deporting 11 million undocumented immigrants could cost over $315 billion, with annual costs for deporting 1 million immigrants reaching approximately $88 billion. Congress has approved unprecedented funding, including $29.9 billion for ICE’s enforcement operations and $45 billion for detention facilities, tripling ICE’s annual budget. Additional costs include $46.6 billion for border wall construction and $10 billion for border security initiatives.
These expenditures would strain federal budgets, requiring reallocation of resources from other programs. For instance, the funding could divert resources from education, healthcare, or infrastructure, as seen with proposed cuts to Head Start and Medicaid. The use of military resources, including 10,000 service members and $376 million in expenditures for border enforcement, further escalates costs. Legal challenges, such as those anticipated against the use of the Alien Enemies Act or restrictions on birthright citizenship, could add millions in litigation expenses.
Loss of Tax Revenue
Undocumented immigrants contribute significantly to federal, state, and local taxes. In 2022, they paid $46.8 billion in federal taxes and $29.3 billion in state and local taxes, totaling $96.7 billion annually. Their removal would result in a substantial loss of tax revenue, undermining funding for essential services like Social Security and Medicare, to which undocumented workers contribute without receiving benefits. The collective loss of this revenue could exacerbate budget deficits, potentially necessitating tax increases or further cuts to public services.
Labor Market Disruptions
Labor Force Reduction
Mass deportation would significantly shrink the U.S. labor force, particularly in industries reliant on immigrant labor. The Peterson Institute for International Economics estimates that deporting 8.3 million undocumented workers could reduce employment by 7% and GDP by 7.4% by 2028. Key sectors like agriculture, construction, and hospitality would face acute labor shortages. For example, agriculture could lose up to 225,000 workers, and construction could lose 1.5 million workers, leading to reduced output and higher prices.
The assumption that native-born workers would replace deported immigrants oversimplifies labor market dynamics. Historical data, such as from the 1956 “Operation Wetback,” shows that mass deportations do not significantly increase wages or job opportunities for U.S.-born workers. Employers often face challenges filling low-wage, labor-intensive roles, as native workers may not seek these positions due to lower pay or undesirable working conditions.
Impact of Ending DACA and TPS
The termination of DACA and TPS would remove protections for over 1.39 million individuals, many of whom are integrated into the workforce. DACA recipients, often employed in professional and technical fields, contribute to sectors like STEM and healthcare.
Their deportation would disrupt industries already facing labor shortages, particularly as the U.S. workforce ages with the retirement of baby boomers. Similarly, TPS holders from countries like Haiti and Venezuela fill critical roles in low-wage sectors, and their removal would exacerbate labor shortages in these areas.
Merit-Based Immigration System
A shift to a merit-based immigration system could attract high-skilled workers, potentially benefiting sectors like technology and healthcare. However, restricting family-based immigration and eliminating the Diversity Visa Lottery would reduce the overall immigrant labor supply, particularly for low-wage jobs. This could lead to labor market imbalances, as high-skilled immigration may not offset losses in sectors reliant on less-skilled workers. The Center for American Progress estimates that comprehensive immigration reform with a pathway to citizenship could boost GDP by $1.7 trillion over a decade, suggesting that restrictive policies may forgo significant economic gains.
Macroeconomic Consequences
GDP and Economic Growth
The Peterson Institute projects that mass deportation could reduce U.S. GDP by 1.2% to 7.4% by 2028, depending on the scale of deportations. In the high-end scenario, GDP growth could stagnate, with no net growth during Trump’s second term.
The American Immigration Council estimates a GDP loss of 4.2% to 6.8%, comparable to the 4.3% contraction during the Great Recession. These projections reflect the dual role of immigrants as workers and consumers, whose removal would reduce both labor supply and demand for goods and services.
Inflation and Consumer Prices
Labor shortages from mass deportation would drive up costs, particularly in agriculture and construction. Deporting 1.3 million immigrants could increase prices by 1.5% by 2028, while deporting 8.3 million could raise prices by 9.1%. Food prices could rise by over 10% due to reduced agricultural output. These inflationary pressures would affect all Americans, increasing the cost of living and potentially triggering economic instability.
Housing Market Impacts
Undocumented immigrants play a significant role in the housing market, with 1.5 million households holding mortgages. Mass deportation could lead to defaults on these mortgages, destabilizing the housing market and causing ripple effects similar to those observed during the 2007-2009 foreclosure crisis. Reduced consumer spending by deported immigrants would further depress housing demand, potentially lowering property values and affecting local economies.
Social and Economic Costs to Communities
Family Separation and Social Services
Mass deportation would affect mixed-status households, where 7 million undocumented individuals live with U.S. citizens. Approximately 4.1 million U.S. citizen children live with undocumented parents, and their deportation could lead to family separations, increasing the financial burden on social services. The cost of raising U.S.-born children left behind is estimated at $116.5 billion. These disruptions could lead to negative mental and physical health outcomes, increased poverty, and strained community resources.
Impact on States and Local Economies
States like California, Texas, and Florida, with large immigrant populations, would face the most significant economic impacts. Texas alone could see a 10% economic contraction. Local economies dependent on immigrant labor and consumer spending would face reduced tax revenues and business activity, potentially leading to layoffs and business closures.
Legal and Policy Challenges
Constitutional and Legal Barriers
Several proposed policies face significant legal hurdles. The attempt to end birthright citizenship via executive order has already been blocked by a federal judge, citing violations of the 14th Amendment. The use of the 1798 Alien Enemies Act for expedited deportations could face challenges for overreach, as it was intended for wartime scenarios. Restrictions on asylum access and the closure of the CBP One app have prompted lawsuits from organizations like the ACLU, arguing violations of due process and international obligations.
Congressional and Funding Constraints
While Republican majorities in Congress facilitate funding, the scale of Trump’s agenda requires sustained appropriations. Legal challenges and public opposition could delay implementation, as seen during Trump’s first term with the Muslim ban and DACA termination attempts. The cap on immigration judges at 800, despite a backlog of nearly 4 million cases, could hinder efficient processing, prolonging detentions and increasing costs.
Potential Economic Benefits and Counterarguments
Proponents argue that mass deportation and border security measures could enhance job opportunities for native-born workers and reduce strain on public resources. However, historical evidence suggests that deportations do not significantly improve wages or employment for U.S.-born workers. The merit-based system could attract high-skilled talent, but its benefits may be limited without addressing low-wage labor shortages. The sharp decline in illegal border crossings since January 2025 suggests that enforcement measures may deter unauthorized migration, potentially reducing costs associated with border apprehensions. However, these savings may be offset by the high costs of deportation and wall construction.
Conclusion
Achieving President Trump’s immigration objectives by 2028 would fundamentally reshape the U.S. economy, with significant costs outweighing potential benefits. The fiscal burden of mass deportation, estimated at over $315 billion, coupled with the loss of $96.7 billion in annual tax revenue, would strain public finances. Labor shortages in critical industries like agriculture and construction would drive inflation, with prices potentially rising by up to 9.1%. GDP could contract by 4.2% to 7.4%, stalling economic growth. The housing market and social services would face destabilization, particularly in states with large immigrant populations. Legal challenges and public opposition could further complicate implementation, increasing costs and delays.
While a merit-based system may attract high-skilled workers, it would not offset the economic disruptions caused by deportations and restricted legal immigration. The social costs, including family separations and community upheaval, would compound these economic challenges, potentially undermining social cohesion.
Policymakers must weigh these consequences against the stated goals of national security and economic protection, considering alternative approaches like comprehensive immigration reform that could boost GDP and stabilize the labor market. The path forward requires balancing enforcement with economic realities to ensure the long-term prosperity of the United States.
