Sanctuary cities, as I have outlined in previous parts of this series, are not just legal loopholes—they are economic black holes sucking billions from taxpayer pockets while delivering dubious benefits. My core thesis holds: These policies are the fatal flaw in our immigration system, creating magnets for illegal crossings that overload resources and perpetuate bipartisan inaction. Here, we will zero in on the fiscal carnage: Ballooning budgets for housing, healthcare, and education; depressed wages for low-skilled Americans; and massive remittances bleeding our economy dry. While proponents tout “stronger economies” through immigrant labor, the data reveals hidden burdens like welfare dependency and uncompensated costs that far outweigh any gains. From Massachusetts’ $1B+ migrant meltdown to New York City’s $4B+ annual hemorrhage, the numbers do not lie—sanctuaries are bankrupting us.
Straining Local and State Budgets: The Billion-Dollar Black Hole
Sanctuary policies do not just shield illegal immigrants from deportation; they invite a flood that drowns public finances. Take Massachusetts, a self-proclaimed sanctuary state since 2017. By mid-2025, the state’s emergency shelter system—swamped by migrants—had already burned through $830 million in fiscal year 2025, with projections hitting $1.064 billion by year’s end. (nationalreview.com) That is over $3,500 weekly per family, covering housing, food, education, legal aid, and more. (foxnews.com) Governor Maura Healey’s administration scrambled, dipping into reserves and slashing other programs, but the crisis persisted into 2026, with long-term welfare costs looming as a “fiscal time bomb.” (repdansena.com)
By 2026, parolees alone could add $4.6 million annually to SNAP benefits, escalating to billions in Medicaid and other entitlements. (cis.org) New York City, the ultimate sanctuary poster child, fares no better. As of November 2025, the city had shelled out $3.02 billion in FY2025 on asylum seekers, with $652.5 million already spent in early FY2026. (osc.ny.gov) Projections for FY2026 hit $1.4 billion, dropping slightly to $1.2 billion in FY2027—but that is optimistic amid ongoing arrivals. (osc.ny.gov) Since 2023, total costs exceed $8 billion, funneled into shelters, healthcare via NYC Health + Hospitals, and education for migrant children. (comptroller.nyc.gov) Mayor Eric Adams repeatedly warned of a $12 billion hit by 2025, forcing cuts elsewhere. (amny.com) These are not abstract figures; they’re real diversions from infrastructure, schools, and public safety for citizens. Nationally, the toll is staggering. The Federation for American Immigration Reform (FAIR) estimates illegal immigration’s net cost at $150.7 billion annually as of 2023, rising with surges. (epicforamerica.org)
A House Homeland Security Committee report pegs it at up to $451 billion yearly, including $66.5 billion in federal expenditures alone. (congress.gov) Housing and shelter devour billions—New York City’s $2.1 billion unemployment fund for illegal aliens exhausted in months back in 2023. (heritage.org) Healthcare adds $25 billion federally, with uncompensated emergency care straining hospitals. (congress.gov) Education? K-12 for children of illegal immigrants costs $70 billion yearly. (congress.gov) The Congressional Budget Office notes the 2021-2024 surge boosted revenues by $387 billion but spiked spending by $101 billion through 2034. (cbo.gov) These costs are not offset by taxes—illegal immigrants pay about $31 billion annually, a mere 17% of the burden they create. (congress.gov)
Depressing Wages for Low-Skilled Americans
Beyond direct spending, sanctuaries distort labor markets, hammering low-skilled Americans. Illegal immigrants, often concentrated in construction, agriculture, and hospitality, flood these sectors—43% of farm workers, 28% of construction. (econofact.org) This surplus depresses wages: Studies show immigration lowers pay for low-skilled natives by clusters around zero, but real impacts hit hardest in saturated markets. (abic.us) In) 2025, real wage growth halved to 2.1%, with low-wage workers dropping to 1.5%—despite reduced immigration competition. (minneapolisfed.org) Job displacement is real: For every half-million deported, 44,000 U.S.-born workers gain jobs. (jec.senate.gov) Deportations reverse this: Trump’s 2025 efforts boosted blue-collar wages fastest in decades, with low-skilled natives seeing up to 5% hikes in sustained policies. (budgetmodel.wharton.upenn.edu) Two million native-born gained employment in 2025, while 662,000 foreign-born lost jobs. (whitehouse.gov) Sanctuaries perpetuate this wage suppression by shielding cheap labor, undercutting Americans in construction (where illegals hold 28% of jobs) and agriculture (42% undocumented). (cmsny.org)
Remittances: Billions Bleeding Out
Then there is the outflow: Remittances siphon $200 billion+ annually from the U.S. economy. (fairus.org) In 2022, outflows hit $80 billion; by 2025, surges pushed it higher before Trump’s crackdown. (npr.org) These funds—sent by immigrants, legal and illegal—don’t recirculate here, starving local economies. Mexico alone saw declines in Q2 2025 ($1.7B drop), tied to deportations. (forbes.com) Sanctuaries enable this drain by providing safe havens, where immigrants earn and export wages without fear of removal. Reduced migration in 2025-2026 could curb outflows by $40-60 billion yearly in consumer spending alone. (brookings.edu) That’s money not spent on U.S. goods, services, or investments—exacerbating economic stagnation.
Countering the “Stronger Economies”
Myth Proponents claim sanctuaries boost economies: Higher median incomes ($4,353 more), lower poverty (2.3%), unemployment (1.1% less). (americanprogress.org) Immigrants contribute 17% of GDP, pay $524B in taxes, with $1.4T spending power. (nilc.org) But these cherry-pick positives while ignoring burdens. Welfare dependency is rampant—60% of illegal households use at least one program, netting $68K lifetime cost per migrant. (manhattan.institute) Uncompensated care, education for citizen children of illegals ($70B/year), and law enforcement ($23B federal) erode gains. (congress.gov) Studies showing no crime spike or economic uplift overlook selection bias: Sanctuaries attract workers but externalize costs to taxpayers. Deportations save $164K per illegal over 30 years, proving the net drain. (manhattan.institute).
California’s conversion from bright red to blue state has come with a few unwelcome statistics: Only DC has a higher unemployment rate. As an exercise, I asked my favorite AI genius expert Grok to compile stats on poverty, unemployment, housing costs, taxes, gas prices, home ownership and the bottom three were: Hawaii, New York and California. Hawaii is essentially a welfare state and who wants to work when you can lay on the beach all day? But clearly New York and California – the two largest and most prosperous states in the US are magnets for illegal immigrants which have resulted in high taxes, gas prices, low home ownership and unemployment and poverty. These states did not look like that prior to 1980 before the Sanctuary City movement. They were bottom half in these metrics – at 35, 36 of 50 states – but the point is that the event of Sanctuary movement sped up their descent to the very bottom.
The Path Forward: End the Economic Madness
Sanctuary cities are not compassionate—they are costly traps draining billions while hurting working Americans. From Massachusetts’ $1B crisis to NYC’s $4B sinkhole, the evidence is irrefutable. Add wage suppression, $200B remittances, and welfare burdens, and the full picture emerges: A system rigged against citizens. Ending sanctuaries isn’t punitive; it’s fiscal sanity. Defund them, enforce laws, and watch economies rebound. Upcoming parts tackle crime (Part 6) and more. Demand change—your wallet depends on it.
Summary: “Sanctuary cities bankrupt us: Billions wasted while Americans struggle.
Economic truth bomb Fox News: Migrant influx pushing Mass. shelter costs past $1B in FY25 (Jun 18, 2025). (foxnews.com)
- National Review: Massachusetts Shelter Program to Cost $1 Billion in 2025 (Jun 18, 2025).
nationalreview.com
- CIS: Massachusetts: A Case Study in Mass Immigration and the Welfare State (Jul 25, 2024).
repdansena.com
- OSC NY: Asylum Seeker Spending Report (2025).
osc.ny.gov
- NYC Comptroller: Accounting for Asylum Seeker Services (2025).
comptroller.nyc.gov
- am NewYork: Mayor says migrant crisis could cost city up to $12B by summer 2025 (Aug 9, 2023).
amny.com
- FAIR: The Fiscal Burden of Illegal Immigration on United States Taxpayers 2023.
epicforamerica.org
- House Homeland Security: Phase4Report (2023).
congress.gov
- CBO: Effects of the Immigration Surge on the Federal Budget and the Economy (Jul 23, 2024).
cbo.gov
- PWBM: Mass Deportation of Unauthorized Immigrants (Jul 28, 2025).
budgetmodel.wharton.upenn.edu
- White House: Mass Deportations Are Improving Americans’ Quality of Life (2026).
whitehouse.gov
- CMS: The Role of Undocumented Workers (Aug 27, 2025).
cmsny.org
- FAIR: Remittances Continue to Grow at America’s Expense (2025).
fairus.org
- Forbes: The Shifting Tide of U.S. Remittances (Aug 20, 2025).
forbes.com
- Brookings: Macroeconomic implications of immigration flows (Jan 2026).
brookings.edu
- Manhattan Institute: The Fiscal Impact of Immigration (Oct 23, 2025).