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We can view this problem of illegal immigration either in its entirety, or in the components. One component being the act of immigration, legal or illegal. Another component being eventual citizenship that is the end result of immigration. I don't think one can seperate the two with regard to the proposals being offered in DC today.
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I think these are rather distinct features and not as intertwined as some may think. I guess most united statians think all immigrants want to become US citizens, but the INS data suggests some immigrants are more interested in this than others and that Hispanic immigrants are the least likely to pursue citizenship. I've met many undocumenteds in California and New York who despite being in the US for decades and eligibility by marriage, time there, relatives who are citizens and other developments -have not become citizens. This is attractive to the degree it facilitates living there, immigrants opt for citizenship not because they want to be citizens rather to avoid the hassles of being foreign in the US.
There is no contradiction in maintaining illegal immigration was not in issue until the mid fifties and that the US encouraged illigal immigration during the Cold War. This is because the "illegal" part of the immigration being encouraged by the US related to how the immigrant fled and got to the US. Its illegal (in Cuba for example) to migrate to the US, thus the US is encouraging illegal immigration, but it certainly isn't illegal to flee Cuba under US law.