United States Immigration and Customs Enforcement: at what economic cost?

Sunday 22 February 2026

In the American imagination the border is often depicted as a line on a map — a place where the state’s power is sharpest, and where certainty is supposed to prevail. Yet for the ordinary foreign visitor the United States is not first encountered at the Rio Grande. She is encountered at an airport desk, a secondary inspection room, a holding cell, a phone call that does not go through. It is in these liminal spaces that immigration policy becomes lived experience — and where over-zealous enforcement can, without a single change in statute, chill lawful travel, lawful study, lawful work and even ordinary tourism.

Recent reporting has described cases in which foreign nationals with facially valid travel permission have nonetheless been detained, sometimes for extended periods, in circumstances that appear difficult to reconcile with any sensible public interest in enforcement prioritisation. When such stories circulate — amplified by social media and then recycled by traditional press — they function as warnings. Not merely warnings to irregular migrants, for whom deterrence is the policy’s stated aim, but to the compliant majority: the tourist considering a family holiday, the academic invited to a conference, the business traveller debating whether to route through New York or Frankfurt. In a global travel market that is increasingly substitutable, fear itself becomes an economic factor.

The mechanism of the chill — law as theatre

A chill does not require mass error. It requires only a credible perception of arbitrariness.

Immigration law gives border officers wide discretion. In the United States this discretion is magnified by the practical reality that border processes are rapid, fact-finding is imperfect and the traveller often lacks immediate access to counsel. When enforcement culture leans towards suspicion, a visitor’s normal behaviour can be reinterpreted as a breach — a text message suggesting a friend might offer accommodation becomes ‘unauthorised support’; a retiree accompanying a spouse becomes ‘complicit’; a traveller whose plans change becomes ‘inconsistent’. Once routed into detention, the logic can become self-reinforcing — the state has acted, therefore the state must have had a reason.

For tourism, the deterrent effect is not confined to the person detained. It is transmitted through networks — families, professional circles, diaspora communities — and through the press. A single widely shared detention story can do more to deter lawful visitors than any formal travel advisory.

Incentives — from rumour to documentation

The most corrosive allegation is not simply that mistakes occur, but that mistakes are rewarded.

Claims that individual ICE officers receive “bonuses per person detained” are circulating, including in recent reporting. That precise formulation should be treated with care — it is easy for a complex system of overtime, performance pay and programme-specific awards to be simplified into a crude ‘bounty’ narrative.

However there is documented evidence of financial incentive schemes connected to immigration enforcement outputs in recent years. In August 2025 reporting based on internal communications described a short-lived ICE pilot offering cash bonuses tied to how quickly people were deported after arrest — a programme that was then rapidly withdrawn. And in early February 2026 FactCheck.org reviewed claims about ICE-related monetary awards, describing task-force officer awards in the hundreds of dollars linked to assistance in locating ‘illegal aliens’ and furthering ICE’s mission. 

Even if one puts the most sinister interpretation to one side, two points remain.

First, incentive structures matter — they shape organisational behaviour at the margin, and margins are where discretionary decisions live.

Secondly, the public cannot easily distinguish between a narrowly defined award programme and a general bounty system — and in politics, perception often has the economic consequences of fact.

Tourism as a form of trade — and why the United States cannot shrug this off

Inbound tourism is not merely leisure. It is an export — foreigners bring money into the country in exchange for services consumed on American soil. The US government’s own travel and tourism export data show the scale: in November 2025, international visitors spent nearly $20.7 billion in the United States that month alone, and year-to-date spending was reported at about $228.9 billion. That is not marginal economic activity — it is a material services export stream, supporting airlines, hotels, restaurants, retail, entertainment, conference venues and the local tax base.

Because the sector’s costs are largely domestic — wages, rents, local procurement — a fall in inbound visitors hits employment quickly. It also hits unevenly. The damage concentrates in gateway cities, conference towns and tourism-dependent regions — and then spreads through suppliers.

Recent reporting has put numbers to the drift. The Financial Times reported that international visitors to the United States fell by 4.2 per cent in 2025, in part linked to restrictive immigration policies, with hospitality firms explicitly watching 2026 mega-events as a hoped-for reversal. Other reporting, citing union analysis, described a 2025 decline in international tourists of 2.5 million and associated revenue weakness in local economies. 

Estimating the economic damage — what a plausible range looks like

Any estimate must be framed honestly: inbound travel varies by region of origin, purpose of visit and length of stay, and not every lost visitor represents a wholly lost trip (some will defer, some will substitute to later years, some will go elsewhere). Still, the broad magnitude can be sketched from available statistics.

One approach is to translate percentage declines into spending losses:

• NTTO (the National Tourism and Travel Office, a US federal government agency) reported nearly $228.9 billion in international visitor spending year-to-date in 2025. 

• If inbound visitor spending falls in line with the 4.2 per cent decline in international visitors reported for 2025, a rough-order spending impact could be around 4 per cent of that annualised scale — on the order of $9–10 billion (noting that visitor numbers and spending per visitor do not move perfectly together). 

Another approach is to use industry rules-of-thumb. The US Travel Association argues that each 1 per cent drop in international visitor spending translates to $1.8 billion less in export revenue. On that basis a fall of roughly 4 per cent implies about $7.2 billion in lost spending — again, a directional estimate rather than a forensic accounting.

Either way we are not talking about a symbolic penalty. We are talking about billions — and the knock-on effects, in payroll and local commerce, will be larger than the first-round spending loss suggests.

The deeper cost — reputation, predictability and the 2026 test

There is a further category of harm that is harder to price but easier to recognise: reputational damage to the country’s predictability.

Tourists do not merely buy hotel nights. They buy a sense of safety in the bureaucratic as well as the physical sense — the confidence that if they follow the rules, the state will treat them as guests rather than suspects. If that confidence weakens high-value travellers are the first to reroute: conference organisers, tour groups, older travellers, families. And once a destination acquires a reputation for capriciousness, it takes years, not months, to repair.

This matters because the United States is approaching a period in which she intends to monetise global attention — the 2026 World Cup, and the broader calendar of major events already being discussed by the travel industry. If the enforcement posture creates enough anxiety that lawful visitors stay away, the country risks the worst of both worlds — the costs of securitisation, without the benefits of the tourist dividend.

A view — enforcement that feels like profiteering becomes self-defeating

A state has the right to enforce her immigration laws. But enforcement that is experienced as arbitrary becomes, in practice, a tax on lawful movement. If there is any truth — even partial, even bureaucratically qualified — to the idea that officers or affiliated task forces can receive monetary awards linked to enforcement outputs, the state must recognise the predictable consequence: outsiders will infer that detention is not merely a legal measure but an institutionalised revenue stream. 

Once that inference takes hold, tourism and legitimate travel will decline at the margin — and when the base is tens or hundreds of billions of dollars of annual visitor spending, marginal effects become macroeconomic losses. 

The rational policy goal should be simple — robust enforcement against genuine abuse, coupled with demonstrable protection for lawful visitors, including clear guidance, transparent review and meaningful accountability when detentions are mistaken. Without that the United States risks teaching the world a lesson she cannot afford: that even when you have permission to visit, you may still be treated as if you do not.