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by tomhoward 467 days ago
There's an implicit assumption in the article and the comments here that "brain drain the world" is a free lunch.

But does anyone think through to the end-game of that? That when you drain the most smart/productive people away from every other country, all those countries become less wealthy and more dysfunctional, leading to societal decline, poverty, resentment, radicalisation, war, etc?

Aside from anything else, the other countries become less able to trade on good terms, and thus less able to buy US products/services. And so it becomes a self-defeating policy long-term.

Good economists (and to be honest I don't know of many these days) know that there are no free lunches. We need to put as much effort into helping every other country develop and thrive - and by doing that we'll create many more customers for the products/services produced in our own countries, and everyone can end up richer.

After writing this I wonder even if the economic and political dysfunction we're seeing in so much of the world as actually the inevitable consequence of decades of brain-draining, rather than an indication of the need for more of it.

14 comments

I wouldn’t worry about this too much. Brain drain, despite the name, is not really a zero-sum game. The people who move rarely lose all contact with the host country. They gain invaluable experience, know-how, and contacts that some of them eventually bring back to the host country.

I know of more than one example where someone has been “brain-drained” to the states, who has subsequently moved back to start a successful business. Sometimes leveraging gained contacts directly, sometimes leveraging the newfound experience and knowledge.

Whether this works out this way depends on how open the world (or at least the respective countries between each other) is when it comes to movement of people, money, and trade.

The only reason the Chinese solar industry exists is because of so called "brain drain" from China to Australia and Germany.

The reality is far less zero sum. These Chinese scientists learned about and contributed to solar research overseas, and some of them went back to China and made China wealthier.

Do you actually believe Chinese researchers are incapable of figuring out photovoltaics by themselves? China has first-rate universities and thousands of PhDs in every field imaginable. They can make solar cells without our help. Having access to western research only sped up the inevitable. China has a solar industry today simply because the Chinese government decided that energy production was a top priority. They made it happen.
The OP was talking about Shi Zhengrong https://en.wikipedia.org/wiki/Shi_Zhengrong who came to Australia (my country) in the 90s, learned a bunch about photovoltaics, was unable to make a business here due to our failed government policies, then returned to China and made a pv megabusiness.

The truth of the matter is that most cutting edge research is spearheaded by the west. The problem is that the west can't build or prioritise anything useful with it.

China produces more scientific papers than the US or EU. China produces 30% of papers published in the world's top journals. China also produces more top tier scientific papers (1% most cited) than the US.

A decade ago the west was clearly ahead of China in fundamental research. Not anymore.

Why construct a false binary between being incapable of figuring it out by themselves and being capable? Its about velocity and magnitude and matters of degree, not this notion of true or false.
Notice that it's the parent who made the binary and totally false claim that "The only reason the Chinese solar industry exists is because of brain drain".
Exactly.

And that would be a good thing in a world where super-powers aren’t imperialist, and don’t try to one up each other.

Alas.

Yes of course but when articles like this (and the general policy/assumption in the US) just blankly asserts that we can just “brain-drain” our way back to prosperity and dominance, there isn’t much nuanced consideration of the limits, caveats and tradeoffs inherent to that approach, which need much more than an HN comment or brief blog post to fully explore.
I’d be happy if the US policies these days were based on _at least_ an HN comment. A typical HN comment does a much better job of considering at least some of the caveats and trade-offs than a POTUS Truth Social post.

EDIT: Thinking about it, it’s kind of hilarious that it’s called “Truth Social”, given that it’s mostly antisocial lies.

> The people who move rarely lose all contact with the host country. They gain invaluable experience, know-how, and contacts that some of them eventually bring back to the host country.

How many Europeans who emigrated to the USA in the late 19th and early 20th centuries returned to their countries after making it big in America? Is any of Europe's economic development since then attributable to them?

My families original immigrents had many members return to Europe. My Grandfather went back to the old country after WW2 to try to find the family that stayed behind or returned and there was no trace of them.

Our 20th century immigrant experience was that the old country evaporated and there was no longer a connection.

This is a difficult comparison to make, given that Europe experienced a >5% total population loss in that period due to two world wars, and half of Europe remained behind the iron curtain for another ~30 years. For a significant portion of emigrants, there wasn't a whole lot to return to.
I don’t know. But I don’t think that matters to the discussion. The world is a much different place these days. A lot more connected.

Also, most of that emigration was more like “famine-drain”.

My ancestors were fleeing from Russia to USA and certainly wouldn't be looking to return.
> We need to put as much effort into helping every other country develop and thrive - and by doing that we'll create many more customers for the products/services produced in our own countries, and everyone can end up richer.

this was the logic in letting eg China into the WTO and allowing them to become such a big trading partner. turns out, this doesn't necessarily result in liberalization (see Germany's experience with Russia for another example).

we should only be seeking to shift trade from repressive regimes to democracies, not working with everyone equally.

I do not disagree with your point, except, given the current state of US, it is hard to describe it as not repressive. I understand it's a spectrum. I checked on Wikipedia - abortion is legal in China. That's one right that many US women don't have. Which does not mean that China is a free country, but just to gain some perspective. The notion of some place being a dictatorship was many times weaponized to launch invasions and economic sanctions that left that place broken and impoverished.
This is a false equivalence. Whatever you or I personally feel about abortion, its legality in the United States is set through approximately democratic processes. Not perfect by any means, but it very roughly reflects the will of the people - sharply divided, with many geographic concentrations.

The will of the people in China is unknown. There is only the will of the CCP, and increasingly, one person.

Working less with China makes the possibility of a war higher. Obama wanted to have a trading framework which prevents a mutual degradation of trade on America’s term, but Trump didn’t want that, and Americans voted to this again.

I think genie is out of the bottle, and it’s too late to prevent it. But the logical step would have been what Obama wanted. Now, we have dark times ahead of us. These forced shifts in trade just make the process to these bad times quicker. Nobody really benefits them, just make the war a possibility sooner. If not a full out war, but a new Cold War at least.

More to the point, when you write an article like this foretelling the doom of the american economy, why would you think you are able to brain drain any country? What stops the countries you are trying to drain from offering better incentives to stay?
Also consider that the US is now threatening direct (even neighboring) allies with military intervention (Canada, Denmark). It is very hard to drain brain which considers the US an enemy country.

Meanwhile, China is playing the long game and is building infrastructure projects all over the world, including the EU [0]

[0] https://en.wikipedia.org/wiki/Pelje%C5%A1ac_Bridge

>Also consider that the US is now threatening direct (even neighboring) allies with military intervention (Canada, Denmark).

You have a source for this? I haven't heard of any threat of military intervention for Canada and/or Denmark.

"Trump has repeatedly spoken of making the neighbouring country the 51st state of America." [0]

"Trudeau more recently suggested behind closed doors that Trump’s sustained annexation calls may not be just light talk and appear to be “a real thing.”" [1]

"Trump refuses to rule out use of military force to take control of Greenland and the Panama Canal" [2]

"US will take Greenland ‘one way or the other,’ Trump says" [3]

[0] https://www.bbc.com/news/articles/cddy2q2z8dzo

[1] https://apnews.com/article/how-canada-could-become-us-state-...

[2] https://apnews.com/article/trump-biden-offshore-drilling-gul...

[3] https://www.politico.eu/article/us-will-take-greenland-one-w...

Testerday's speech by the Canadian Prime Minister:

"What he wants is to see a total collapse of the Canadian economy," he explains. "Because that will make it easier to annex us."

Source: https://www.bbc.co.uk/news/live/cvgpdk4257zt?post=asset%3A3b...

"Trump has previously spoken of using "economic force" to make Canada the 51st state of America. But he said he was not considering using military force - an assurance he has not given while stating his ambitions of taking the Panama Canal and Greenland."

Source: https://www.bbc.com/news/articles/cddy2q2z8dzo

The US brain drained plenty of people from Nazi Germany and then the Eastern Bloc. The greater the disparity, the greater the motivation to move.
At this point in time, US is the global leader in personal freedoms, culture and financial opportunities. These are the things people are looking to immigrate towards.

Personal freedoms can't be manufactured. They are a product of the underlying system governing a country. The US has very strong institutions and legal framework in the form of the constitution (again, at this point in time; I expect the current admin to weaken those, either directly or by eroding public trust in them).

Culture is something that's very hard to replicate. The language of the world in English, Hollywood is American, Hip hop is American and I can't really think of any other country in a position to globally influence and create an ethos in the same way US can. You can call it branding. US fully controls the societal narrative around the world.

Financial opportunities is the easiest one to manufacture (see Dubai). You can give incentives left and right and in few years attract investors and high earners. But without #1 and #2, you'll just attract transients, not people who want to become influential citizens.

> These are the things people are looking to immigrate towards.

In the academic world, I am definitely seeing brain-drain from the EU towards China now. 10-20 years ago, it was almost exclusively the US. I expect this shift to rapidly continue now. From a European perspective, China appears to be more stable than the US at the moment.

> The language of the world in English, Hollywood is American, Hip hop is American and I can't really think of any other country in a position to globally influence and create an ethos in the same way US can. You can call it branding. US fully controls the societal narrative around the world.

You are describing the world 20 years ago. A large and respected German newspaper (FAZ) had an article today, titled: "Is the US our enemy now?" [0]. The Financial Times had an article last week titled: "The US is now the enemy of the west" [1]. This would have been completely unthinkable just a few weeks ago. 27% of Canadians already see the US as an enemy state [2].

Would you get your daily entertainment from the enemy? China is already the major trading partner for most of the world. Why shouldn't it became the major entertainment provider?

[0] https://www.faz.net/podcasts/f-a-z-podcast-fuer-deutschland/...

[1] https://www.ft.com/content/b46e2e24-ca71-4269-a7ca-3344e6215...

[2] https://www.ctvnews.ca/windsor/article/27-per-cent-of-canadi...

If I've learned anything in my 60 years, it's that China can do the USA better than the USA can. Give it a few more short years, and "Hollywood" will be recognized as Chinese. I used to work at a Los Angeles based Academy Award winning VFX studio, now bankrupt because that is how Hollywood treats it's own, and everyone that remained in the business is now in China, developing their VFX and film industry. They even dropped their personal western names and now use Chinese names. They report life is far better there.
Wether the US is a beacon of freedom is too much of a landmine, I'll just point out that there's about a few dozen countrjes around the world where you'll enjoy enough personal freedom.

> Culture is something that's very hard to replicate.

You are highlighting the global influence of the US. By definition, you'll get access to that global shine almost wherever you live. Nobody will immigrate to the US to watch Disney movies or eat McDonalds. On the other hand, you might need to be in Korea to get most of the Korean culture. You'd need to assert that the US local and exclusive culture is more attractive than other countries own culture, and that sounds like a hard debate.

To your point, it's easier to move to the US if you already know the culture a bit, but that still presumes wanting to move there.

It's called the American Dream rather than American Reality for a reason. People follow this dream into the country. If China had enough of a hold on Western culture, it could too manufacture this perception which would draw immigrants in.
Foreign opinions on the desirability of The American Dream have plummeted quite hard.
> People follow this dream into the country

Or not. Unsurprisingly US immigration dropped a lot during the first Trump presidency, which coincided with COVID making things worse. In numbers Germany was also getting more influx than the US, but they sure weren't happy with it either.

https://www.oecd.org/en/publications/international-migration...

> China [...] would draw immigrants in.

Assuming that China wishes for more population to come in sounds pretty weird to me. They fought an incredibly unpopular fight on their own citizens for decades to reduce population growth, a foreign influx of people is probably the last thing they want IMHO.

As an EU er: fat no on this one, sorry. Personal freedom is available in most western countries. Hollywood is in decline for a while now, with in the EU at least a lot of local productions going mainstream.

The big pros of the USA are 1) the unified market, where everyone shares the language, most laws and regulations, a lot of culture and political vision. Also 2) the ability to take risks. Starting a company is easy, and failing it is not carreer-terminating. You don't need a piece of paper for absolutely everything.

Also, I've learned first French and later English, by osmosis, as that's the language of whatever came into the country. I noticed recently I am starting to osmosis-learn Chinese now, and I am not the only one. Also, I've seen brain drain to the USA in my student years, but today, people also choose to go to China

"At this point in time, US is the global leader in personal freedoms, culture and financial opportunities."

This needs to be past-tensed. In fact, currently, the US is the global leader in regressing with regards to these and other commendable qualities.

> At this point in time, US is the global leader in personal freedoms, culture and financial opportunities.

What metric is this being measured by?

* https://en.wikipedia.org/wiki/Freedom_in_the_World

* https://en.wikipedia.org/wiki/World_Press_Freedom_Index

* https://en.wikipedia.org/wiki/Index_of_Economic_Freedom

* https://en.wikipedia.org/wiki/List_of_freedom_indices

>They are a product of the underlying system governing a country. The US has very strong institutions and legal framework in the form of the constitution

Thought experiment: swap Americans with a country that is dysfunctional, the result would be that there would be only a marginal improvement in the quality of living for the swapped population. On the other hand the originally dysfunctional country with the new Americans occupants will soon strengthen the institutions and legal framework.

The point I'm trying to make is that institutions and legal framework are far less relevant compared to the personal ethics of the population at large.

The cultural dominance is ending quickly. Most American TV shows are re-hashes of British shows from the year prior. Today's hip hop for non-geezers is called Phonk, and it doesn't come from the US. Hollywood is making Yet Another Comic Book Movie, over and over again. The source material for these is almost 100 years old.
Pendantic correction: The comic book movies from Marvel are mostly based on 1960s era source material, so more like 60 years old.
The US is a global leader in personal freedom? According to whom?

Anecdotally I don't consider the US a particularly free country, nor do most people I know. Americans might have all these nice sounding rights on paper but they're all blatantly undermined in practice.

> What stops the countries you are trying to drain from offering better incentives to stay?

Nothing! And that is sort of the point. If the US can provide freedom, rule of law, education, good salary, etc... and the other countries do the same to keep the best at home that's a win for everyone.

this assumes that a smart person would move to US 100% of the time. given the bipolar nature of US i doubt 100% of smart people would move .
I worry that all the replies to my comment will be claims about what percentage of the smartest and most productive people will want to move to the US in practice, thereby avoiding debating the central point.

The first reply asserted that my comment was based on a “ridiculous premise” without addressing the principle.

we are talking about a pure <hypothetical> scenario which is not related to present day reality . If we are talking about reality "skill" is rarely the deciding factor when individuals decide to migrate. it is about risk tolerance you are taking a huge risk by moving to a different country / culture / social circle the ROIC is not always clear. Its not for everyone ( was my point ). Hypothetically if the success of country is based on how many risk takers ( and not skill ) are there then sure your argument makes sense.
> the other countries become less able to trade on good terms, and thus less able to buy US products/services

There is a Kurzgezat video a couple of years back [1] that does understand this. They did the same argument that you are making here. Heck, the prisoners dilemma is about how cooperating is the most viable strategy for global benefits. The world isn't really a zero sum game. We get a tons of energy thanks to our star that is usually the thing that most closed systems desperately look for.

[1]: https://youtu.be/rvskMHn0sqQ

This is basically an argument that China should become more like North Korea rather than the other way around.

Reality is that remittances and the skills that emigrants eventually bring back to their home country far exceeds any negative effects. Policymakers know this which is why they don't deter this from happening. In many countries they actively encourage it, such as is Philippines.

When economists talk about "no free lunch" they are specifically talking about abnormal profits. They are not talking about the fact that voluntary decisions of private actors can lead to positive sum outcomes in utility.

> This is basically an argument that China should become more like North Korea rather than the other way around.

How exactly?

I’m no pro-China advocate (I’m Australian and live with the mixed outcomes of our ties with China, and I have no strong feelings about what Australia or the US should do with respect to China or anyone else).

But (leaving aside arguments about their “true” motives and assuming good faith), China invests in the economic development of many weaker countries and doesn’t try to brain-drain them. The U.S. and western allies invested heavily in the redevelopment of Germany and Japan after WWII, and all countries involved ended up much stronger.

It’s that spirit that I’m talking about.

Because China allows brain drain, seeing it as an eventual source of innovation, but North Korea doesn't. Building walls to keep people in doesn't work. There are many industries in China that only happened because of brain drain. If they followed your argument and stopped people from leaving like North Korea, all those industries wouldn't exist and they'd be a poorer country. Their missile program wouldn't exist or would be much weaker. Many such examples.
That’s not my argument at all. You’re responding to a straw man interpretation of what I wrote.

I’m saying that for a country like the US, the idea that brain-draining the best from the rest of the world will have unmitigated positive outcomes is false.

>That when you drain the most smart/productive people away from every other country, all those countries become less wealthy and more dysfunctional, leading to societal decline, poverty, resentment, radicalisation, war, etc?

Societal decline, poverty, resentment etc.: why should functional people bear the burden of it? Brain drain happens for reasons beyond the simple need to earn more money, it also happens because dealing with those dysfunctional people is extremely draining at several levels. On a larger scale when putting smart people together - be it at a country level or even at a company level, one achieves things that are not normally not possible, which is a net benefit for the world at large even if it creates some populations that are dysfunctional.

> But does anyone think through to the end-game of that? That when you drain the most smart/productive people away from every other country, all those countries become less wealthy and more dysfunctional, leading to societal decline, poverty, resentment, radicalisation, war, etc?

My average IQ (or below) take is that this “brain drain” narrative where absolutely everything collapses—societal decline, war, resentment, aah basically the Apocalypse—because the smart people leave is just the belief here because people put 50% or more of their professional identity into believing they have a high IQ.

Economist here. You’re not considering agglomeration effects. Smart people near other smart people are more effective. So world GDP growth may be faster.

(Economists have pointed out that US growth is slower because SF is so expensive, young smart people cannot agglomerate there and learn tech faster.)

Brain drain happens when the quality of life in a particular country dips below some standard. It's relative to other countries only up to a point. I strongly doubt it is possible to increase quality of life (albeit for a minority) in one country so high to outweigh the utility of staying put in other countries. You certainly can't do it in a democracy: who would vote to increase the quality of life specifically for a small group of immigrants? I'm pro immigration btw but people are not going to vote against their own interests to such an extent.
But smart people stuck in bad countries would not be able to work and thrive or maybe their ideas would get locked somewhere ?
Problem is in these countries there just aren't enough opportunities. There are very, very few places in the world you can get a Stanford PhD - including the atmosphere, colleagues, labs, money.

Before you can even invest the immense time and effort needed to build that kind of environment, you need the will of the people, and in most of the world you don't have that.

Your claim that good economicts "know there is no free lunch" is completely false, unsubstantiated and actively misleading.

Many impressive economists believe there are policies that could massively improve the worlds economy, but that implementating these policies is a coordination problem / hard to overcome lobbying / politically intractable, etc...

Radical Markets is great book on exactly this topic.

> coordination problem / hard to overcome lobbying / politically intractable, etc...

So much for free lunch?

I’m just saying every perceived benefit has some kind of cost or perverse consequence, eventually. Please feel free to point to a specific example of a policy that has been successfully implemented that contradicts this principle.
That when you drain every smart/productive person away from every other country

This is a ridiculous premise.

I edited that sentence to be less absolutist, but still, isn't this essentially what this article and many people are advocating? Attracting all the smartest and most productive people in the world to move to the US? How is that a mischaracterisation of the argument?
geohot is trying to convince himself not to be drained..

See https://geohot.github.io/blog/jekyll/update/2024/11/03/high-...

>Oh and in the IRL mean time, it’s very nice to be physically in a high trust society. Still working on opening an office in Hong Kong for those who want, salaries higher in person.

Personally, I hope he'd flesh out more of that Bretton-Woods vs inflation argument (instead of fixating on gold, build an argument on that energy graph in the middle of it all (blackgold? stargold? hydrogold? datagold? Transmuted silicon ingots?))

What percentage of people do you think are capable of competence?

It would have to be a low number like 10%, with perfect sorting of them into the US, to even start to have the impact you are postulating.