I dislike putting requirements on the ability to exercise a right, but we don’t live with a perfect government. In that context I endorse the idea Thomas Friedman discussed earlier this week:
Leave it to a brainy Indian to come up with the cheapest and surest way to stimulate our economy: immigration.
“All you need to do is grant visas to two million Indians, Chinese and Koreans,” said Shekhar Gupta, editor of The Indian Express newspaper. “We will buy up all the subprime homes. We will work 18 hours a day to pay for them. We will immediately improve your savings rate — no Indian bank today has more than 2 percent nonperforming loans because not paying your mortgage is considered shameful here. And we will start new companies to create our own jobs and jobs for more Americans.”
This is not the first time I’ve heard this idea; the first was possibly from Jonathan Rowe. It made sense when I first read it. I haven’t changed my mind.
I disagree with part of Friedman’s conclusion, though. It’s the same short-sighted belief that government can accurately predict all economic factors.
We don’t want to come out of this crisis with just inflation, a mountain of debt and more shovel-ready jobs. We want to — we have to — come out of it with a new Intel, Google, Microsoft and Apple. I would have loved to have seen the stimulus package include a government-funded venture capital bank to help finance all the start-ups that are clearly not starting up today — in the clean-energy space they’re dying like flies — because of a lack of liquidity from traditional lending sources.
Friedman was so close. He is saying that government should (partially) get out of the way of economic growth, but it should get in the way of decisions made to build wealth by those who benefit from better immigration policy. Now we need to require that immigrants buy a house and have skills in politically preferred sectors. A question or three: Would government-backed venture capital have funded Apple when it wanted to build its first home computer in the 1970’s? Would it have funded a company making mainframes? Would a major industry player like IBM have leaned on politicians?
Still, the bulk of this argument is logical, which is why our government will never do it. Our present climate of fear and populism is too strong.