U.S. Blowing Higher Ed Export Opportunity

By Matthew Cameron

With immigration back in the news, it's appropriate that USA Today ran an article yesterday highlighting the consequences of policies that make it difficult for hard-working, high-skill individuals to enter the nation legally:

Cost, distance and lingering fears about visa denials in the post-9/11 era have helped make the USA less attractive to foreign students, threatening a lucrative market that is a source of brain power and diversity for U.S. colleges. [...] From 2000 to 2008, the number of students enrolled in a college outside their home country soared 85% to 3.3 million. During that time the U.S. share shrank, from 24% to 19%, according to the Organization for Economic Co-operative Development.

This is bad for all of the obvious reasons: ambitious foreign-born students have their hopes dashed, American universities risk becoming more homogenous and the overall quality of the nation's student population suffers. But as the article points out, there's a seriously negative economic aspect of this situation as well:

Between tuition and living expenses, they [foreign students] contributed $20 billion to the U.S. economy last year, making higher education among the nation's top service exports. Those who return home after graduating help build a better business environment for U.S. companies, says Sánchez, whose office also has organized recent international missions for the aerospace, water technology and beauty and cosmetics industries.

The U.S. still has the best colleges and universities in the world. In this sense, higher education is like information technology or any number of high-skill services in which the nation specializes. It would be absurd for the U.S. government to erect barriers preventing U.S. companies from providing IT services to foreign firms. Doing so would inhibit the growth of foreign economies and deprive U.S. IT companies of revenue. Similarly, it's a really poor idea to make foreign-born students jump through hoops in order to attend U.S. universities. They are denied the opportunity to buy the high-quality educational services they desire, and U.S. universities lose out on revenue that could be reinvested toward providing an even better educational product. The U.S. economy suffers in the long term, as well, since foreign-born students would be able to produce high-value goods and services if they were to remain in the country upon graduation. Alternatively, they could return home with higher earning potential and a greater likelihood to demand U.S. goods and services. For whatever reason, though, policymakers have decided it's preferable to limit these individuals' access to U.S. higher education.