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The Agenda

NRO’s domestic-policy blog, by Reihan Salam.

Russia’s Demographic Decline and U.S. Immigration Policy



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Nicholas Eberstadt’s portrait of Russia’s steep demographic decline makes for sobering reading. Though Russia’s post-Soviet population decline has halted, Eberstadt maintains that it will start anew in a few years time, due to unusually high death rates from cardiovascular disease and injuries and the after-effects of the post-Soviet baby bust, which will sharply reduce the number of Russian women in their 20s for the next decade or so. Moreover, Eberstadt observes that though Russia produces a relatively large number of university graduates relative to its population (the share of Russian 25-to-64-year-olds with a college degree in the same ballpark as market democracies like Australia and Sweden), crude indicators like patent filings suggest that its not getting much productivity-enhancing knowledge production out of them. Given Russia’s reputation for scientific and mathematical prowess, you’d think that it would fare well in service experts. Yet according to Eberstadt, its exports of computer and information services just barely surpass those of the Philippines.

A few possible reasons for Russia’s knowledge-production deficit come to mind immediately: (a) as Lant Pritchett colorfully puts it, “schoolin’ ain’t learnin’,” and it could be that Russia’s human capital institutions aren’t actually adding value; (b) it could be that societies only yield knowledge production from their educated citizens if they have well-functioning innovation systems in place; or (c) Russia’s most creative citizens could be emigrating in disproportionately large numbers, and they are contributing to knowledge production in the countries in which they settle. My guess is that all of these factors are at work. And my cynical reaction to Eberstadt’s bleak assessment of Russia’s near-term future is that the U.S. and its allies would be wise to systematically ”poach” skilled Russians in the coming years. There are large numbers of Russians who could make substantial contribution to knowledge production in societies with strong innovation systems, like the U.S., yet their potential is greatly limited by Russia’s failing institutions. But systematic poaching of this kind would require some foresight on the part of western governments, and a recognition that market democracies would generally be better served by immigration policies that raise the average skill level, like those in Canada and Australia, rather than policies that lower the average skill level, like those currently in place in the U.S. 

On a separate note, I’ve noticed that when I discuss immigration here at The Agenda, readers are more inclined to focus on the fact that I’m amenable to increasing skilled immigration than on the fact that I favor reducing less-skilled immigration, even if the net result is either not change in net migration or a decrease in net migration. One line of argument I’ve seen is that I favor this approach because pundit jobs can’t be offshored, or something to that effect, i.e., my position is rooted in self-interest. If anything, the opposite is the case. As a professional living in the dense urban core of a high-cost metropolitan area, I benefit from a dense concentration of less-skilled workers, as this concentration makes it cheaper for me to outsource various household production tasks, thus allowing me to work longer hours. And these less-skilled workers don’t compete with me. Raising the number of skilled workers, in contrast, would increase competition in my chosen profession(s), and it would tend to intensify competition for positional goods. It would also have the effect of bidding up the wages of less- and mid-skilled workers who provide these skilled workers with services, thus making it more expensive for someone like me to outsource household production. So if anything I’d be better served by embracing the Bloomberg-Zuckerberg-Schwarzenegger consensus, which is that we ought to increase less-skilled immigration and skilled immigration.

There are, to be sure, other interests at stake; it’s extremely unlikely that my writing will change the ultimate outcome of the immigration debate, so perhaps I profit from my position in some other way. But how? My position is unpopular, particularly among influential people, and so I don’t personally profit from taking it. I would gain more points for embracing the pro-reform consensus (we obviously need more immigration, opposition to the Senate bill is motivated by bigotry, etc.) or straightforward restrictionism (which is more popular on the right). My position could be understood as contrarian, and I could be yielding some “interestingness” points from taking it. Yet the truth is that it’s not all that interesting — it only seems interesting because our public conversation about immigration tends to be so insipid. Nothing could be more basic than arguing that current less-skilled immigrants compete with new less-skilled immigrants while they (and less- and mid-skilled natives) benefit from gaining access to new skilled customers, who complement rather than compete with them. This is not rocket science. It is true that some skilled natives will be negatively impacted by the arrival of skilled immigrants, particularly in the short-run. But this neglects two important facts: (a) the work of skilled professionals can be offshored too; and (b) having a dense concentration of skilled workers in a given region creates spillover benefits, i.e., this concentration is non-zero-sum.

The only interesting thing about my position, if any, is that it is based on the notion that U.S. immigration policy should be based first and foremost on what is best for Americans as a whole — not the demands of global justice, nor the interests of agribusiness or tech companies or software programmers or restaurant owners or restaurant customers. And in my considered judgment, we need to consider a few issues when crafting an immigration policy: automation (the jobs of today might be gone tomorrow, and this is particularly true of jobs for the less-skilled), wage stagnation (less- and mid-skilled workers face steep barriers to upward mobility), intergenerational dynamics (it’s much easier to achieve upward mobility if you are raised in a stable family with parents who have the skills, the knowledge, and the networks to prepare you for school and work), knowledge spillovers (the U.S. is better off when skilled workers are concentrated in U.S. cities and regions, as these concentration yield increasing returns), and cultural cohesion (societies in which people feel invested in governing institutions, and in which those at the bottom and top feel a sense of kinship and shared identity, are better off than societies divided by overlapping lines of culture and class), among others.  



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