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There's a reason Republicans are losing Hispanic voters.

BY JASON L. RILEY
Monday, December 17, 2007 12:01 a.m. EST

With polls showing his lead gone in Iowa and narrowing in other early primary states, Mitt Romney has stepped up attacks on Mike Huckabee in the contest for the Republican presidential nomination.

Social conservatives especially are exercised by our porous borders, and Mr. Romney sees his surging rival's past positions on immigration as an inviting target. When Mr. Huckabee was governor of Arkansas, it turns out, he supported letting the children of illegal aliens, who met the same academic standards required of legal residents, apply for taxpayer-funded college scholarships. Heavens to Betsy!

During a sharp exchange with Mr. Huckabee at a recent debate, Mr. Romney said it's wrong to give illegal aliens access to revenue from hard-working taxpayers. "Mike, that's not your money," said Mr. Romney. "That's the taxpayers' money . . . [and] there's only so much money to go around." Following the debate, the Romney campaign released an ad reiterating the charge. "Huckabee even supported taxpayer-funded college scholarships for illegal aliens," says the narrator in a TV spot now airing in Iowa.

If illegal immigrants didn't pay taxes, Mr. Romney might have a point. But they do pay taxes, and by doing so they subsidize services that only legal residents can access. For starters, more than half and up to three-quarters of illegal immigrants in the U.S. are working "on the books," which means they're paying federal and state income taxes, just like the rest of us. They are also paying Social Security and Medicare taxes, even though undocumented immigrants are ineligible to receive benefits from either program. In testimony before the Senate Finance Committee last year, the Inspector General of the Social Security Administration noted that between 1937 and 2003, contributions to Social Security from unauthorized workers totaled an estimated $520 billion.

But even illegals working in the cash economy can't avoid paying consumption taxes, which are levied on the purchase of goods and services. Nor can they duck property taxes, even if they're renting. Mr. Romney implies that illegal aliens are a net drain on state coffers, but Mr. Huckabee's native Arkansas is an example of immigrants paying their way, and then some.

Between 2000 and 2005, Arkansas had the fastest-growing Hispanic population in the country. Today, some two-thirds of the state's 100,000 immigrants are Hispanic and half are undocumented. Yet a study released earlier this year by the Winthrop Rockefeller Foundation found these newcomers to "have a small but positive net fiscal impact on the Arkansas state budget."

Taking into account both education and health care expenditures, the report found that immigrants "cost" the state $237 million in 2004, but made direct and indirect contributions of $257 million. Immigrant Arkansans also generated some $3 billion in business revenues. According to the authors, without this foreign labor, "the output of the state's manufacturing industry would likely be lowered by about $1.4 billion--or about 8 percent of the industry's $16.2 billion total contribution to the gross state product in 2004."

Mr. Huckabee might have used such data to rebut critics and point out that similar studies done in Texas, North Carolina, Oregon and elsewhere found similar results. Instead, his response was the "Secure America Plan," which involves fencing off Mexico by 2010, hiring more guards to patrol the Rio Grande, and giving the estimated 12 million illegal aliens in the U.S. 120 days to go back where they came from. Like Rudy Giuliani and Mr. Romney, Mr. Huckabee is convinced that tough talk on immigration, however irrational, is necessary to win the nomination. And while such rhetoric may indeed earn you support from nativist groups like the Minutemen, who endorsed Mr. Huckabee last week, there's a danger that it also could consign the GOP to minority status in Washington for some time.

A Pew Hispanic Center poll released this month found that 57% of Hispanic voters now identify with Democrats, while only 23% align with Republicans. That 34-point gap has increased by 21 points in less than 18 months.

The GOP probably can't hold the White House next year without winning swing states like Arizona, New Mexico and Colorado, all of which have large Hispanic populations. Republican presidents in recent decades, from Ronald Reagan to George W. Bush, have received significant backing from Latinos without pandering to race or ethnicity. But these voters can't be expected to support a Republican Party that takes its marching orders from Lou Dobbs populists when it's not taking them from xenophobic fringe outfits animated by reconquista conspiracy theories.

America's illegal immigration mess is born of bad policies that are either unenforceable or not enforced because it's not in our economic interest to do so. Rather than offering voters more of the same, which risks fostering resentment among a fast-growing minority voting bloc, Republican presidential hopefuls would do better to put forward proposals that will bring immigration laws in line with the labor demands of our expanding economy.

Mr. Riley is a member of The Wall Street Journal's editorial board.