🧠 Bring more smart people to America!
🧠 Bring more smart people to America!
It's OK to consider the pro-growth economic impact of potential newcomers
A national illegal-immigration deportation plan is unnecessary. Yes, new immigrants often earn less than people born in the US because they might have less education, don't speak English well, or, you know, are working without proper papers. But over time, as immigrants gain experience, they earn more. Kids from poor immigrant families, no matter where they're from, usually grow up to earn average incomes. (Legalization for undocumented kids would be helpful.) Worries about immigrants always staying poor are misguided. What’s more, a global scramble for immigration is about to begin due to sharply declining fertility rates. People are an asset, not a liability — a reality that more and more policymakers will realize in coming years.
A national deportation plan is also an unreasonable policy. A recent piece in The Economist makes a number of relevant points: The sheer scale of deporting millions of people would be enormously expensive, potentially costing $150 billion in direct costs alone. It would also have severe economic consequences, depriving businesses of workers and customers. The plan would face significant legal and logistical hurdles, including resistance from local law enforcement agencies under Democratic control and the need for cooperation from foreign governments to accept deportees. The human cost would be immense, potentially separating millions of American-born children from their parents or homes. Also expect thousands, or even tens of thousands, of American citizens to be accidentally rounded up and deported.
What problem are we trying to solve?
What’s more — and this is the point I really want to dig into — a national deportation plan is a distraction. What the presidential candidates from both parties should be talking about is a true immigrant importation policy when it comes to highly skilled foreigners. I think most Americans can agree that America needs all the smart people it can get.
Certainly economists do. A 2016 economists survey found a whopping zero percent disagreeing with the idea that allowing “many more immigrants with advanced degrees in science and engineering” would make America richer over time. The US has a limited number of such workers because only a small fraction of the population has a very high IQ, observes economist Alex Tabarrok:
The US might be able to place only say 100,000 high-IQ workers in high-IQ professions, if we are lucky. It’s very difficult to run a high-IQ civilization of 330 million on just 100,000 high-IQ workers—the pyramid of ability extends only so far. … [We] also need to draw on high-IQ workers throughout the world—which explains why some of the linchpins of our civilization end up in places like Eindhoven or Taiwan.
If the Biden administration wants more advanced chip manufacturing to be located in the US, the American labor force will require many more very smart workers. I would also point to a new report by the National Academies of Sciences, Engineering, and Medicine that warns America’s broken immigration system is threatening its global leadership in research.
(Of course, we should do more to identify and cultivate the smarties born here. In a new Wall Street Journal essay, Charles Murray highlights research that shows that even among the smartest of the smart, higher test scores correlate with greater STEM achievements in adulthood. A study following gifted youth found those in the top quarter of the top one percent were significantly more likely to earn advanced degrees, patents, and publish in STEM fields. This suggests that focusing on at least the top 0.5 percent of ability to identify potential major STEM contributors, about 650,000 working-age Americans. “Finding and developing one of our rarest and most precious human resources” is a worthy and important goal, Murray writes.)
Pro-growth immigration reform
Immigration reformers often point to Canada’s point-based immigration system as one worth modeling. It aims to identify individuals who can integrate quickly into the Canadian workforce and society by considering such factors as language proficiency, education, and work experience. It prioritizes applicants with skills and experience that meet Canada's labor market needs. The US, on the other hand, places a significant emphasis on family reunification and diversity visas. It also relies heavily on employer sponsorship for skilled workers.
But a recent analysis suggests a different way of thinking about a selective immigration system, specifically Canada’s — although the takeaways are broadly applicable. In “Optimizing Immigration for Economic Growth,” researchers from the C.D. Howe Institute advocate for focusing on GDP per capita growth as the primary goal of immigration policy. They argue that selective immigration based on human capital and productivity is more likely to drive long-term economic growth than simply expanding the labor force. It would also attract desirable immigrants, as per capita GDP seems to influence migration choices. (Note: This approach allows flexibility to address other objectives, like humanitarian goals, through separate immigration streams.)
From the paper:
While no single metric can capture a nation’s economic welfare perfectly, the advantages of targeting GDP per capita are well established. Differences in per capita income are strongly correlated with life satisfaction across countries and between individuals within countries. More contentious is whether increases in per capita GDP within countries over time produce gains in average happiness. Evidence is, however, accumulating that economic growth, even within rich countries, is associated with increases in average levels of subjective well-being. In addition, income growth has been shown to be associated with improvements in longevity, health, education, knowledge, and other beneficial outcomes for individuals and society, regardless of any effect on subjective well-being. And perhaps most significant in the immigration context, differences in countries’ levels of per capita GDP have been shown to be highly influential in determining migrants’ own choices about where they choose to settle.
How would this growth-oriented system work?
The proposed model would emphasize selecting immigrants based on their expected earnings 10 years after arrival, using this as a proxy for human capital.
Expected earnings would be predicted using models based on data from previous immigrant cohorts, looking at factors like education, language skills, and work experience.
Such a system would admit only those economic immigrants whose expected earnings are at or above the average of the full Canadian population.
The number of immigrants admitted each year would be determined by how many applicants meet the earnings threshold, rather than setting fixed targets.
There’s a lot to like here, especially the inherent recognition that there’s a global competition for talent happening. And you have to be in it to win it.
To be clear, my vision of an Up Wing America is a more populous America. With half of US counties losing population, we have ample room to grow. Doubling our population this century would expand the domestic market and counter demographic decline from lower birthrates. It would also spark more innovation. And boosting immigration is simpler than increasing birthrates. (I love the idea of creating a "Department of Promigration" to actively recruit top global talent.) But even less-skilled immigrants contribute valuable ambition and grit to our national character.
More, please!
Micro Reads
▶ Business/ Economics
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The Roots of STEM Excellence - WSJ Opinion
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When heat turns deadly - ABC
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We Tested Wi-Fi on Over 50 Flights. It Often Stinks, but It’s About to Get Better. - WSJ
Moon GPS Is Coming - Wired
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Will Climate Change Starve Us All? - Breakthrough Journal
Post-apocalyptic education - One Useful Thing
I agree with this in principle but under the large proviso that we get a handle on the borders and actually enforce existing immigration law. Yes, a Canadian/Australian system that is based on national need would be optimal but doesn’t seem likely under a Democrat administration.
Lastly, yes a large scale system of deportation would be expensive and unwieldy but what exactly are the penalties for entering the US and flaunting our laws? And please explain why we can’t deport the thousands of illegals that have criminal records, are national security risks and/or commit crimes?!
I agree with you James that Mass deportations is a silly endeavor. What keeps getting lost in this discussion of illegal/legal immigration is that it will never be enough to build a wall, we must expand the legal pathways for immigrants.
The US’s “superpower” has been its ability to attract talent from around the world and give them the freedom they need to be the best version of themselves that they can. If and when the US close this down, the US itself will founder.
However, I disagree with the notion that the government can successfully “pick and choose” which immigrants are going to be the most successful. Who is to say a French Literature PhD is more valuable than a plumber?
As I wrote a long time ago, the simplest solution is an immigration “fee” that scales with age. Young immigrants who have their whole taxpaying and productive lives ahead of them are free. Older immigrants would be charged lot more to prevent the healthcare/pension systems from becoming overburdened. I roughly outlined how this would work here: https://www.lianeon.org/p/toward-an-optimal-immigration-system
The other option is visa auctions, but I can see how that could be abused quite easily by politicians.