The Giant Sucking Sound

This is the latest installment in what has become a trilogy of sorts on talent and migration. (See also "Out-Migration Devastates Michigan" and "The Outsiders").

When I posited that a critical mass of non-natives is a near prerequisite for civic change, someone noted that the Midwest needed to import more talented people because it was no secret what was really need to change things. In his words, "It takes brains."

I'm sympathetic to this in a sense. In the 21st century economy, attracting top, educated talent is of paramount importance. But I wanted to post a rebuttal as well, because this is not the whole story. In fact, in the long run, it might be of lesser importance than other, more important things that often fail to attract notice. This idea of "attracting the best and brightest" is such a well-established meme that it is seldom subjected to any critique. It's time to change that. Especially as it is the basis of so much urban policy.

I have a colleague in Hamburg, Germany who attributed his country's relative economic stagnation over the last couple of decades to the fact that "we're the children of the people who stayed." That is, faced with a choice about what to do in the face of dire poverty and endless wars in the 19th century, Germans had two choices: stay or leave, usually by emigrating to the United States.

Today's Germany is the inheritance of those who stayed. My friend argues, very persuasively, that this robbed Germany of its entrepreneurial energy. Those who were risk takers, those who were motivated to better themselves, those who weren't afraid to take a chance to get the opportunity for a better future for themselves and their family, left Germany. Those who wanted to play it safe, who preferred the devil they knew, who were in fear of the great unknown, they stayed behind.

Today Germany remains, despite its robust Mittelstand, a place curiously lacking in entrepreneurial energy. I was told that in Germany, to go bankrupt is a moral stigma that ruins you for life in that society. That there are coal mines kept open by subsidies that are higher than the average wage of the workers who are employed there. It would be cheaper simply to pay them their salary for the rest of their life to do nothing than to keep the mine open. Yet these workers insist that they have a right to "earn" a living by mining - and that their children be allowed to become miners too as a sort of hereditary avocation.

The contrast with America could not be more stark. How many coal miners in Kentucky hope that their sons end up in that mine? Maybe, as a last resort. As I noted about visiting foreign countries, you are sometimes made aware of values and beliefs you were never even aware of holding. The idea that one generation should have it better than the next, that children should surpass their parents in income and social status, I guess I always just thought of as being as natural as the air we breathe. But it seems far from the case.

My paternal great-great-etc grandfather came to the United States from Bavaria early in the 19th century. (I still ocassionally get emails from people in Munich with the same last name as me, "Renn"). He was fleeing conscription. My maternal grandfather was the only member of his immediately family born in United States. The rest of them were from Sicily. He was 6'2" but his brothers were very short because they had been so malnourished as children and didn't get enough protein. I'm sure most American families can tell similar stories.

If talent matters so much, how is it that a nation made up largely of Europe's rejects ended up becoming the most powerful economy on earth? While we were able to pick up some great talent in the mid-20th century because of Hitler and WWII, we were not notably the place to be for the European upper crust, whether that be aristocrats or intellectuals.

Maybe education and talent aren't the most important thing in the long run. Maybe the "talent" that matters is a willingness to take risk, to change, and the desire to better one's condition. I won't suggest this is the only thing that matters, but it strikes me as important. To be sure, Europe's more rigid class structure did not give full scope to intellectual capacities for people from the lower classes, so we no doubt got some geniuses we could put to good use that they were underutilizing. But interestingly, that still seems to be the case today in much of the world.

Also, consider: people who are successful in the now are those who are best adapted to today's world. But the world isn't ending in a few weeks, it stretches out into the future. Who will be best adapted to tomorrow? In a world of rapid and increasing change, over-optimization for today's conditions is an economic death sentence. Rather, we've got to be able to change ourselves and adapt to the future. Thus, the willingness to change and to take risk will take on ever greater importance to keep up.

In two absolutely must-read essays called "The Unnaturalness of Human Nature" and "The Role of Undesirables" (available in his masterpiece "The Ordeal of Change"), Eric Hoffer discusses this in his normal penetrating style as he talks about the particular importance of the "unfit" in paving the way to tomorow.

"The inept and unfit also display a high degree of venturesomeness in welcoming and promoting innovations in all fields. It is not usually the successful who advocate drastic social reforms, plunge into new undertakings in business and industry, go out to tame the wilderness, etc. People who make good usually stay where they are and go on doing more and better what they know how to do well. The plunge into the new is often an escape from an untenable situation and a maneuver to mask one's ineptness. To adopt the role of the pioneer and avant-garde is to place oneself in a situation where ineptness and awkwardness are acceptable and even unavoidable, for experience and know-how count for little in tackling the new, and we expect the wholly new to be ill-shapen and ugly."

It isn't just about attracting the talented - usually meaning the educated and already successful - of today. It's about attracting the talented of tomorrow - and those are people we often don't even know are talented yet. Innovation depends on the outcast.

So many places seem to be missing the boat. Canada would be a great example. They are trying to make it easy to immigrate there if you are an educated person with money. They want to exclude others who might prove a "burden" on society. But this fails to take a life-cycle view of talent. It's like have children. Children in the modern economy are a deadweight loss economically for about the first 18-22 years since they produce almost nothing. But without children, where will we be when today's workers retire? (Again, look at Germany to find out). It's similar for other aspects of talent. We need to be replenishing the soil with new risk takers and entpreneurs, not actually self-selecting for the risk averse and depleting the nutrients needed for tomorrow.

In an era of rapid change, playing it safe is actually the riskier course. Putting all your chips on the now, and not spreading some money around the table on speculative bets that may never pay off is a recipe for ruin.

Which would you rather have, a handful of Ph.D.'s with big reputations or a few thousand Mexican peasants who literally risked their lives sneaking across the desert to get into this country?

Ross Perot famous talked about a "giant sucking sound" from jobs headed south of the border. He was completely backwards. The real giant sucking sound is America hoovering up all of the risk takers, entrpreneurs and most motivated citizens of Mexico. We're sending them a few jobs. They're sending us their true "best and brightest". We're sending them some factories, they're sending us their future. They sold us their birthright for a few manufacturing plants.

So I say it takes more than brains - a lot more. As a said in my article, "The Hustler as a Key Component of Urban Success", what really matters is that a city is a place where people of all stripes decide they will plant their flag and seek their fortune - not come to spend it after they already earned it someplace else. If your city isn't attractive to hustlers, poor immigrants, ne'er-do-wells of various kinds, entrepreneurs, avant-garde creatives, etc., if people aren't voting with their feet to move there to better their lives, this is telling you something very powerful about the future. In a very real way, the long term future of a city depends as much on attracting the supposedly least talented as it does the most.
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