During last Wednesday’s Republican presidential candidate debate Rep. Ron Paul made a point that was greeted with near-universal derision. In the midst of a discussion about the advisability of building a fence along our Southern border, Paul opined that fences could also be used to keep people from getting out.
Everyone was horrified, but strictly speaking, Paul was right; fences can also serve to prevent people from leaving.
I don’t recall if he mentioned it, but different kinds of fences can be used to impose capital controls, the better to prevent you from sending money out of the country.
For now, let’s examine our human capital. Today, I read a report suggesting that America’s future human capital, its young people, is starting to migrate to Canada in search of jobs and opportunities.
And more and more students are choosing to study in Canada. The universities are first rate; they cost much less; and they provide an entry into Canadian society.
We are all aware of the fact that more than a hand full of recent college graduates have chosen to move to East Asia, especially to China, to teach English, but, more importantly, to try to build a better future for themselves. In the past they used to call it a brain drain.
The Economist reports that youth unemployment is becoming a very serious problem: “But youth unemployment is rising perniciously across much of the developed world. It can seem like something of a side show; the young often have parents to fall back on; they can stay in education longer; they are not on the scrapheap for life. They have no families to support nor dire need of the medical insurance older workers may lose when they lose their jobs. But there is a wealth of evidence to suggest that youth unemployment does lasting damage.”
In Europe this problem has been producing a migration of human capital throughout the European Union. If America cannot provide opportunities for its young people, they will leave.
Studies have shown that young people who remain unemployed for too long develop a form of psychic scarring. The more they are unemployed the more they are likely to continue to be unemployed.
The Economist explains: “Unemployment of all sorts is linked with a level of unhappiness that cannot simply be explained by low income. It is also linked to lower life expectancy, higher chances of a heart attack in later life, and suicide. A study of Pennsylvania workers who lost jobs in the 1970s and 1980s found that the effect of unemployment on life expectancy is greater for young workers than for old. Workers who joined the American labour force during the Great Depression suffered from a persistent lack of confidence and ambition for decades.”
In a famous editorial in the New York Tribune, Horace Greeley offered this famous advice to those who were planning their futures: “Washington is not a place to live in. The rents are high, the food is bad, the dust is disgusting and the morals are deplorable. Go West, young man, go West and grow up with the country.”
The year was 1865. A lot has changed since then. Many young people no longer feel that they can grow up with the country. They are afraid that they will be growing down with the country. The exodus of American youth is not yet a tidal wave. It’s just beginning. Perhaps it will become a larger trend; perhaps not. In any event, it's not a good omen.