Friday, January 22, 2010

The effects of US immigration policy on its world competitiveness and lessons for the EU

This is my working theory, from a systemics point of view:

1) How has a much more restrictive immigration policy by the US in recent decades affected its competitiveness + exports in recent decades?

2) What lessons are there for the EU?

Those who frequently read my policy analysis tweets and/or my blog posts know that I like to do compare and contrast exercises between the US and the EU, especially from a systems analysis - systemics point of view, in other words, compare and contrast the US and the EU as socio-economic-political-policy-general models. Not that I think that the US should or can "copy" the US (1) (or vice-versa), but I do think that this type of exercise can yield useful insights re potential EU and US "re-modeling".

In my recent 4050 words submission - contribution to the European Commission's public consultation on an EU 2020 Strategy I argued, inter alia:

IMO, part of the competitiveness of the United States, until a few decades ago, was it near open door immigration policy (this has changed in recent decades). For many decades the US was the natural destination for anyone in the world who felt suffocating in the confines of his/her native country. The EU should IMO adopt a much more open door immigration policy towards third country nationals who wish to make the EU the arena of realisation of their ideas and dreams, thus partaking in the “EU Dream”.

I also pointed that the role of the US as an academic and research "powerhouse" pst WWII seems to have done nothing to avert loss of its industrial base to Japan and others and now China.

My thesis/theory is that a major cause for the loss of competitiveness of the US in the world is that its immigration policy in recent decades has largely deprived it of the "wild spirits" (a la Schumpeter, “Mark I”) that it used to attract.

Why is that?

1) whereas providing a home for political - asylum seekers was of course a noble and fully justified policy
2) whereas PhDs and other highly educated specialists did not cease to be given residence status in the US (and to contribute to the US needs for high level expertise)
3) whereas the "US Green Card" lottery may seem a tad strange but does play some role in enriching the make up of the US population

The above 3 could not and did not IMO contribute per se to attracting the "natural" wild spirits, the venturers of all kinds and entrepreneurs, that used to find fertile ground in the US in previous decades and centuries.

Of course some of the persons who qualified under (1), (2) and (3) above may have incidentally fitted that profile too, but eg one does not need a PhD (or even an MBA) or other "objectively verifiable" skills or knowledge or past achievement in order to turn out to be a venturer or a value adding entrepreneur.

Thus, according to my theory, whereas the near open door policy of Ellis Island and later years did allow the wild spirits to relocate in the US and produce their added value as part of the US GDP, including exports, the later immigration policy of recent decades highly restricted that access. And that the "deficit" in such wild spirits "capital" in recent decades has contributed most significantly in its competitive demise.

For Europe, a place where "wild spirits" (men and women) used to flee from right from the early migrations West, because of its suffocating national situations, especially social and related, in the 17th-20th centuries, it has no tradition of attracting wild spirits, as the US had. On the contrary. In addition, in the last decades, via the EEC and then the EU, and now a common immigration policy, the EU offers at present, even fewer avenues than the current US immigration policy does for attracting "wild spirits" (as I described them) from outside the EU.

Should thus the EU formulate a much more open immigration policy as a mean as attracting among the immigrants from outside the, wild spirit capital that can help it innovate, venture and enterprise more, not only intra-EU (inter-MS) but in the world economy and markets of all kinds?

Of course, this alone may or may not do. Where are the hubs or clusters of world class new thinking and venturing in the EU? Does the EU have any? Examples? But that is a topic for a separate post (or posts).

(1) I have actually argued in many tweets and blog posts that the EU could not become a US style "United States of Europe"even if it wanted to (which it seems not to want to anyway).

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