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Immigrants: Restless Dreamers, Economic Pillars

Marcus Goncalves
Nichols College Professor and International Business Program Chair, international management consultant and le...
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Posted on Thursday, 16 August 2012
in Immigration

The American dream is alive and well, at least to immigrants who are magnetized by it.

It is they who challenge the rest of us to foster a culture of inclusion, access, opportunity, and empowerment. Moreover, they are the ones with the starkest sense of how America differs from every other country in the world. Their very belief in that difference virtually guarantees the American dream come true.

As James Jasper noted in his book Restless Nation, immigrants “picked this country because of its promise. They dreamed the dream.” This has always been one of the underlying premises of this dream, which has simultaneously been a catalyst for renewal and transformation of our society over the centuries.

When it comes to the topic of immigration, however, the public debate seems to undermine the positive contributions of immigration to our economy. True, border control and illegal immigration need to be dealt with, not only to protect the American people, but for the immigrants themselves.

Although it is cliche to note, the United States has always been a nation of immigrants. The fact is, according to Herman and Smith in their acclaimed book Immigrant, Inc., no other country in the history of mankind has accepted over 70 million immigrants. About 50 percent of Americans have close immigrant lineage or share immigrant ancestry.

Whether immigration is a good thing or a scourge, we like to think of our country as an immigrant-friendly place - with borders that are among the most open in the world - which is not the case. But according to the Migration Integration Policy Index (MIPEX), which rates the EU nations, Norway, Switzerland, Canada, and the U.S. efforts to integrate immigrants - the U.S. ranks ninth on the list. Sweden, Portugal, and Canada are the three leading countries respectively. Nonetheless, for John Gartner, a psychologist at Johns Hopkins University, immigrant traits are built into an American's DNA.

As an immigrant, I have the privilege to appreciate the argument from both sides of the spectrum. According to a new Gallup poll, American attitudes toward immigration are hardening. Half of all Americans say immigration should be “decreased” – up 11 points from 39 percent last year.

Although the U.S. is a nation of immigrants, it has rarely understood the vital role immigrants have played in building our country and its economy. The U.S. experienced a great inflow of talented scientists, entrepreneurs, artists, and musicians during the Great Depression which helped bolster its position at the frontiers of science, technology, entrepreneurship, and the arts during the long and prosperous post-war era.

Too often, we tend to view immigration from the alleged costs it bears to society and the American people, especially in times of economic recession, without realizing their significant economic contributions. This is in particular for the entrepreneurs, which tend to be the vast majority. According to a recent report by the International Migration Policy Program at the Carnegie Endowment for International Peace, immigrants are more often than not entrepreneurs and always have been.

Every decennial census, with the exception of the roaring 1990s when everyone in America wanted to own a dotcom, shows that immigrants are significantly more likely to be self-employed than native-born Americans. Who but a restless dreamer and entrepreneur would be willing to leave everything to start a new life in a strange country? Answer: optimistic risk-takers who believe in the American dream.

If we ask what Sun Microsystems, Cirrus Logic (NASDAQ: CRUS), Yahoo (NASDAQ: YHOO), Google (NASDAQ: GOOG), Intel (NASDAQ: INTC), Hotmail (NASDAQ: MSFT), Dow Chemical (NYSE: DOW), DuPont, Pfizer (NYSE: PFE), Procter & Gamble (NYSE: PG), U.S. Steel, and Carnival Cruises (NYSE: CCL) (to name a few) have in common, the answer is that these companies were all founded by immigrants. Not to mention the many Fortune 1000 companies with immigrants at their helm, such as PepsiCo's (NYSE: PEP) Indian CEO, Indra Nooyi, and the Coca-Cola's (NYSE: KO) Irish CEO Neville Isdell, replaced by Turkish Muhtar Kent in 2009.

Other examples include Eli Lilly's (NYSE: LLY) CEO born Spanish citizen in Morocco, Sidney Taurel, and Alcoa's (NYSE: AA) Brazilian CEO Alain Belda, later replaced by German Klaus Kleinfeld. Immigrants created more than half of the companies in California's Silicon Valley, and about one quarter of all new engineering and technology companies created across the U.S. were founded by immigrants.

A college-educated immigrant, according to Herman and Smith, is twice as likely to obtain a U.S. patent as a nonimmigrant. Nearly all of these patents, including my very own (U.S. Patent #2002/0111972) now owned by Symantec (NASDAQ: SYMC), were in science, technology, engineering and math, the so-called STEM fields that are a crucial driver of U.S. job growth. A recent study released last May by the Partnership for a New American Economy, a nonprofit group co-founded by Mayor Michael Bloomberg of New York, argues against immigration policies that are forcing foreign-born innovators to leave the U.S. More than three out of four patents at American's top research universities were filed by immigrants, according to the study.

Notwithstanding, the study shows that while many of these foreign-born innovators are trained at United States universities, after graduation they face “daunting or insurmountable immigration hurdles that force them to leave and bring their talents elsewhere.”

Crises in economics always bring about change seasons where talent flows are often reset - causing nations to rise or decline. If growing anti-immigrant sentiment persists, it can have negative effect for American technology, entrepreneurship, and the economy in general. As argued by Richard Florida, professor and researcher at Rotman School of Management, University of Toronto, “the future belongs to those countries and regions that can attract the best and brightest across the entire world.”The most prosperous states in the U.S. are the ones with large numbers of immigrants.

America is at a dangerous moment, facing global competition as it has never seen before. To maintain its competitive advantage the U.S.must concentrate on its core strengths which include innovation, entrepreneurship, and immigration, which, in my view, are inextricably linked. I'm afraid that, with the economic downturn, xenophobia is rising and political clouds of nativism and protectionism are swirling across the country.

Immigrants play a compelling and powerful role in our economy, reminding us that new people, ideas, and entrepreneurial spirit are at the core of the American dream story. In the words of J.F. Kennedy, “every aspect of the American economy has profited from the contributions of immigrants.”

Dr. Marcus Goncalves: Assistant Professor of Management, Chair of International Business Program, and Director of Academic Programs at Graduate and Professional Studies, Nichols College

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Nichols College Professor and International Business Program Chair, international management consultant and lecturer at Boston University and Brandeis University, more than 40 books published.