Power Ball Immigration: The Importance of Education to Economic Development

If you’re looking for an article about closing boarders, building fences, raiding factories or slaughter houses this is not it. We often lose sight of another type of immigrant, one that we have been very effective in keeping out of the United States to our detriment.

I doubt anyone would argue against the fact that for the United States to remain an economic superpower, it will have to be a leader in the twenty-first century world of high technology. China and India recognize this most basic and obvious fact and both countries have devoted a great deal of effort to position themselves to compete for technological leadership.

In my experience, corporations place a very high value on quality education when looking for a location — whether a manufacturing operation or a research facility. With high labor costs, United States manufacturing survival relies on the most sophisticated, efficient, and highly automated operations possible. It is the only way we have any chance of competing with low-labor-cost nations like China, India, Mexico, or Brazil. If American factories are to survive, they will require highly trained workers capable of running computer controlled machines.

Poor education and its impact on job growth are not confined to big-city schools – it is a national problem. I have spent over thirty-five years visiting communities and schools across the country. I am constantly amazed at how often communities that spend huge sums of money on administration costs and/or athletic programs, while ignoring the academic performance of their schools.

As a nation, we are failing our society’s and our children’s educational and economic future. If we step beyond manufacturing into management, and more significantly into research and development, then education geared to the twenty-first century becomes even more critical. Education is the cornerstone of the future of the United States’ ability to compete for jobs. I have seen many communities, states, and even countries by-passed as potential locations for corporate operations due to poor educational achievement.

Sadly, a commonly accepted myth perpetrated throughout America is that if we don’t have enough high-tech people, we can always attract them from overseas. According to the National Bureau of Economic Research, in 1970 the United States was the king of higher education. Approximately 30 percent of the world’s college students were enrolled in the United States and the United States granted half of all doctorates in science and engineering. It is statistics like these that made the United States the world’s technological leader.

Within a thirty-year period, we saw a substantial decrease in the percentage of United States-student enrollment in these fields, a gap which was quickly filled by foreign students. According to a National Science Foundation study in 2005 (the latest available at the time of writing), the foreign student population in the United States earned approximately 34.7 percent of the doctorate degrees in the sciences and approximately 63.1 percent of the doctorate degrees in engineering.

China is now expected to overtake the United States in producing Ph.D.’s in science and engineering in 2010. A Duke University study found that for Bachelor’s degrees in engineering, computer science, and information technology in 2004, the United States produced 137,437, India 112,000, and China 351,537. The question that is often asked is whether the colleges and universities in India and China are comparable to those in the United States.

There is no simple answer. Each country has its leaders that are generally considered of the highest quality. At the same time, each country has lesser quality institutions. The real test of India and China’s educational quality is proven by the fact that so many major international companies have moved or outsourced their research and development operations to these countries. We have educational institutions in the United States that in a matter of days will grant an online Ph.D. based solely on life experience. All you need to do is submit your life experience or if lacking life experience, a thesis on a topic of your choice. Within 15 days of charging your credit card a total of less than $1,000, you will receive your degree from a University.

Numerous business and trade organizations have asked Congress to reform the H-1B visa program. They argue that foreign nationals that have received master’s degrees and Ph.D.’s should be exempt from the requirements of the program’s annual cap. After 9/11, the number of H-1B visas, which allow highly qualified foreign workers to remain in the United States for up to six years, was reduced from 195,000 to 65,000 per year due to security concerns. Attracting these individuals as students, and keeping them here after graduation, is essential to the future economic strength of our nation.

Suppose you were a Nobel laureate with numerous highly advanced technology patents to your credit and wished to come to the United States to live and work. You would think Uncle Sam would buy your ticket and give you a luxury apartment until you found a job and got settled. But let’s say Uncle Sam was not your biological uncle and you had no relatives in the United States, you would have to fall in line behind thousand of uneducated and untrained laborers who had a relative here.

How does the United States select medical doctors and scientists who will develop the drugs and medical technology that may provide a means for early detection or a cure for cancer, diabetes, or the hundreds of other maladies plaguing the world? How do we select the engineers and scientific leaders who will develop the products and technology we desperately need to remain a leader in the twenty-first century global economy? Since not enough Americans are interested and capable, it would be logical for us to open our arms to the scientific and technological leaders of the world. But guess again!

Each year on April Fools Day, 65,000 highly educated foreigners with corporate sponsors receive H1B visas. This leaves hundreds of thousands of other very highly educated individuals with United States sponsors sitting offshore. You would think that we are too smart to leave all this talent offshore for India, China, or the EU to gobble up. By a stroke of political genius, the candidates that don’t make the first round of selection can enter their name in a lottery, from which 55,000 are issued visas. We use “Power Ball” technology to pick a potential Albert Einstein, Enrico Fermi, Jonas Salk, Mies van der Rohe, or Igor Ivanovich Sikorsky (all immigrants).

Is it any wonder that many of these people are saying it’s not worth the effort, and the companies that sponsor them are saying it’s easier to employ this talent offshore? The problem is that offshore they must compete for this talent with foreign competitors, and if this talent decides to start its own companies, these entrepreneurs do so offshore. If scientific and technology jobs cannot be filled with qualified United States citizens, then there should be no limits placed on the number of immigrants, as long as legitimate sponsors are willing to guarantee employment.

Today’s young Chinese college graduates living in Beijing know that a $15,000 – $20,000 income in China will buy a better lifestyle than a $45,000 – $60,000 income in the United States. Indian college graduates, like Chinese grads, see no advantage to moving to a strange land away from friends and family. Why move from their home, which they see as a place with a rapidly expanding economy and opportunity, to a country where the economy is perceived to be in decline and the people hostile?

Why would bright Indian students come to the United States, when India has developed universities that rival the best that the United States has to offer? They also now have the high-tech, twenty-first century companies and jobs necessary to support these universities and hire their graduates. Half of IBM’s 190,000 engineers and technical experts are located offshore, 30,000 of who are in India. General Electric has a similar pattern in manufacturing and in high technology, claiming that if they require a deep technical pool of talent, they can find it in China and India. Bill Gates has said, “The only thing that limits us in India is the speed at which we can recruit.”

China and India recognize that to be an economic force in the twenty-first century, technology will be the key. Both have a vision and are willing to make the necessary effort to achieve their goals.

The United States appears to have neither the vision nor the will to stay competitive.

Geoeconomist Ronald R. Pollina, Ph.D., is the author of Pollina Corporate Top 10 Pro-Business States Study, which is published annually. He is the president and founder of Chicago-based Pollina Corporate Real Estate. The Wall Street Journal, The New York Times, Financial Times, BusinessWeek, Forbes, and Chicago Tribune have quoted his opinion on geoeconomics and corporate location analysis. This article is excerpted from Selling Out a Superpower: Where the U.S. Economy Went Wrong and How We Can Turn It Around with permission of Prometheus Books.