ICE Raids Broke Los Angeles’ Economy –– Journalistic Hilarity Ensues

quote:

---

ICE Raids Broke Los Angeles’ Economy. Shouldn’t ICE Pay for That?
The economic impact of the immigration crackdown is quantifiable, and could be written down and sent to Washington as a demand for payment.
by David Dayen
August 5, 2025

... But one important issue has been pushed off to the side: the predictable economic impact of ICE’s terror campaign against immigrant communities.

This will have long-term macroeconomic consequences. Net immigration, which provides a steady supply of available workers in key fields, is way down this year. Employers are scrambling to find substitute workers and worrying about productivity losses. Remittance payments to Mexico have plummeted, suggesting a decline in these workers’ economic contributions, not only to their relatives, but to industries like home care, agriculture, and construction. Recent drops in residential construction could result from a lack of available workers as well.

But there are already visible microeconomic impacts today, not just in the future. The 2,800 arrests in Los Angeles since June, outside Home Depots and car washes and homeless shelters, massively understate the chilling effect of ICE raids on the largest city in the largest state in the union. A report from the University of California, Merced’s Community and Labor Center released last month found that 3.1 percent of the entire private-sector labor force in California didn’t show up for work between May 11 and June 8, just as ICE activity was ramping up in L.A. These numbers resemble the losses from the Great Recession and the COVID pandemic, and if anything, they’ve grown as raids intensify.
...

California’s job cliff is not yet reflected elsewhere around the country, suggesting that it’s a direct result of ICE’s focus on the state. The raids, though, are set to go national as the agency reaps billions of dollars from the recent Republican mega-bill. But the state is big enough for a large fall in the labor force to have a pronounced effect on national hiring.
...

But the damage has certainly been done. And Los Angeles will suffer the consequences imposed on them through no fault of their own. After laying off 600 workers and canceling city services to close a nearly $1 billion deficit this year, any pain from ICE-related slowdowns will have to be dealt with next year.

So, the question should be: Can Los Angeles, or California, simply ask the federal government for the money back?

After all, the city and state played no role in the federal raids that triggered the economic loss. Each missing worker impacts a California business, and each empty shop reduces state and local tax receipts. You could quantify this, as there was a fairly specific start date (when the raids began in earnest in early June) and approximate end date (with the temporary restraining order on roving patrols in mid-July). And then, you can just charge the federal government.

LINK

---