Tuesday, January 12, 2010

Universities, Immigration, Innovation

James Fallows is an American print and radio journalist who has been associated with The Atlantic Monthly for many years. He is a graduate of Harvard College (editor of the Harvard Crimson) and a Rhodes Scholar. He has lived and worked in China the past three years. Coming back to the United States last year, he was written an article in the January/February 2010 issue of The Atlantic Monthly entitled “After the Crash: How America Can Rise Again.” The article reflects on Fallows’ observations and understanding of China while working and writing over the three year period. The article points out three important and unique elements to American culture that are cornerstones of our strength and our ability for renewal.

The first element is our university system. Of the top 20 universities in the world, 17 are located in the United States (the remaining three are Cambridge, Oxford, and the University of Tokyo). China may have all those engineers and scientists – but guess how many Chinese universities are in the top 100? Try zero. We have the best and most admired university system in the world – with a tremendous talent to attract the best and brightest from all over the globe. We need to make sure that our university system remains #1 and, this is a big and, we need to ensure that the foreign students educated in the U.S. stay in the U.S.

The next element is our receptiveness to immigration. We need to attract talented outsiders, especially as we enter an era of declining birthrates in the developed world. Fallows points out the importance and need for open and welcome immigration policies:

America will be better off if China does well than if it flounders. A prospering China will mean a bigger world economy with more opportunities and probably less turmoil – and a China likely to be more cooperative on environmental matters. But whatever happens to China, prospects could soon brighten for America. The American culture’s particular strengths could conceivably be about to assume new importance and give our economy new pep. International networks will matter more with each passing year. As the one truly universal nation, the United States continually refreshes its connections with the rest of the world – through languages, family, education, business – in way no other nation does, or will. The countries that are comparably open – Canada, Australia – aren’t nearly as large; those whose economies are comparably large – Japan, unified Europe, eventually China and India – aren’t nearly as open. The simplest measure of whether a culture is dominant is whether outsiders want to be part of it. As the height of the British Empire, colonial subjects from the Raj to Malaya to the Caribbean modeled themselves in part on Englishmen: Nehru and Lee Kuan Yew went to Cambridge, Gandhi, University College, London. Ho Chi Minh wrote in French for magazines in Paris. These days the world is full of businesspeople, bureaucrats, and scientist who have trained in the United States.

The last element is innovation - and it is closely related to our university system and our immigration policies. Our innovation engine is linked to the universities – look at the businesses and innovation in the cities in close proximity to our major universities. Be it Boston and MIT or San Francisco and Stanford – growth and innovation are fueled by this linkage. Several recent books and articles have commented on the Israeli model of immigration and innovation. Tel Aviv has become one of the world’s foremost entrepreneurial hot spots. Israel has more high-tech start-ups per capital than any other nation on earth. It leads the world in civilian R&D spending per capita. It ranks second behind the U.S. in the number of companies listed on the NASDAQ. Israel, with seven million people, attracts as much venture capital as France and Germany combined. It is a beacon for Jews immigration, entrepreneurs, and culture – regardless of the geopolitical uncertainty associated with the Middle East.

We are not without a wide range of problems and issues. Fallows does a fine job in outlining them. They range from our declining investment in public infrastructure to huge budget deficits to a sort of “triumph of tactics over strategy” mindset with respect to some of our larger long-term national problems. Our biggest problem, according to Fallows, is our dysfunctional political institutions that appear incapable of self-correcting - - government’s progressive loss of the ability to adapt. The true wealth of any nation should be measured not in money or power but rather in the ability to change and adapt. As Fallows explains:

What I have been calling “going to hell” really means a failure to adapt: increasing difficulty in focusing on issues beyond the immediate news cycle, and an increasing gap between the real challenges and opportunities of the time and our attention, resources, and best efforts.

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