World Reimagined

Immigration Economics: The Power of People with Aarti Shahani

Published
Mar 15, 2021

This week, host Gautam Mukunda sits down with award-winning journalist and best-selling author Aarti Shahani to discuss her work in activism and the state of immigration today. We also hear from Dany Bahar, economist at the Brookings Institute, about his research on how immigration affects economic growth. Listen to this week’s episode anywhere you get your podcasts.

Contrary to conventional wisdom, economic research makes it clear that increased immigration to the U.S. would be a huge boon, spurring innovation, entrepreneurship and long-term economic growth.

Why then are some in politics and the media stoking an anti-immigration sentiment?

Many believe that it is fear of cultural disruption that is standing in the way of boosting the American economy, improving international relations, jump-starting local communities and driving future innovation.

How does this research change the debate around immigration? What leadership role should companies play? What is their moral responsibility?

In this episode, host Gautam Mukunda speaks with award-winning NPR journalist, best-selling author, and activist Aarti Shahani about her tenacious campaign to emancipate her father from the threat of deportation and her ongoing advocacy for migrant identity. And Brookings Institute Economist Dany Bahar shares his research on why immigration may be essential for creating America's next big economic boom.

The thing you have to remember about this country is it is, by design, supposed to be the place where the rest of the world converges. That is the American experiment. It is an experiment in multi-ethnic democracy like the world has never seen before.
Aarti Shahani

Follow @GMukunda on Twitter or email us at WorldReimagined@nasdaq.com

Books Referenced in World Reimagined Episode 10:

Good Economics for Hard Times, by Abhijit Banerjee and Esther Duflo

Here We Are: American Dreams, American Nightmares (A Memoir), by Aarti Shahani

The Shareholder Value Myth: How Putting Shareholders First Harms Investors, Corporations, and the Public, by Lynn A. Stout

Americanah by Chimamanda Ngozi Adichie

A Promised Land, by Barack Obama

Guest Information – Immigration Economics:

Aarti Shahani is an award-winning NPR journalist and best-selling author. Her new show Art of Power (a co-production with WBEZ) is inspiring a generation of listeners to act, skillfully. Aarti spent her 20s organizing prisoners. When she pivoted to business journalism, she enjoyed a meteoric rise at NPR, as Silicon Valley correspondent. She’s guest-hosted NPR’s All Things Considered and KQED’s Forum.

Aarti’s first book, Here We Are (Macmillan), chronicles her unlikely journey from undocumented kid in Queens, New York to national voice on the frontlines of the most powerful industry on earth. An Amazon bestseller, the memoir has garnered critical acclaim.

“Riveting…a bruising critique of colonialism” (NPR); “heartfelt, galvanizing” (San Francisco Chronicle); “timely, bittersweet” (Publishers Weekly); “among the finest memoirs written in recent decades…a vivid, almost cinematic journey that is both beautiful and unforgettable” (Guy Raz, Host, How I Built This and TED Radio Hour).

Aarti’s reporting has received an award from the Society of Professional Journalists, an Edward R. Murrow Award, and an Investigative Reporters & Editors Award. Her very first newsroom was ProPublica.

She received her masters degree from the Harvard Kennedy School of Government, with a full scholarship from the university and additional support from the Paul and Daisy Soros Fellowship for New Americans. She completed her bachelor’s degree in anthropology at the University of Chicago. She was among the youngest recipients of the Charles H. Revson Fellowship at Columbia University and is an alumna of A Better Chance, Inc.

Aarti lives in Oakland, California with her nephew. She loves storytelling and justice.

Dany Bahar is a senior fellow in the Global Economy and Development program at the Brookings Institution. He was previously a David M. Rubenstein Fellow at Brookings. An Israeli and Venezuelan economist, he is also an associate at the Harvard Center for International Development, and a research affiliate both at CESifo Group Munich and IZA Institute of Labor Economics. He also hosts the podcast “Economists on Zoom Getting Coffee.”

His research sits at the intersection of international economics and economic development. In particular, his academic research focuses on the diffusion of technology and knowledge within and across borders, as measured by productivity, structural transformation, exports, entrepreneurship, and innovation, among other factors. Lately, his research has focused on migrants and refugees as drivers of this process, alongside trade and capital flows.

His expertise on policy issues includes international migration, trade, and globalization more generally, as well as the understanding of economic trends in the global economy and in particular regions. His academic work has been published in top economic journals and he often contributes to leading media outlets in the United States and around the globe. He has worked and consulted for multilateral development organizations, such as the World Bank and the Inter-American Development Bank.

Bahar holds a B.A. in systems engineering from Universidad Metropolitana (Caracas, Venezuela), an M.A. in economics from the Hebrew University of Jerusalem, an M.P.A. in international development from Harvard Kennedy School, and a Ph.D. in public policy from Harvard University.

Transcript

Gautam Muknda:

Did you know that there's a magic potion that could save the American economy, power growth and drive innovation if only people weren't scared of it? What is it? Just asking immigrant.

Speaker 2:

10, nine [inaudible 00:00:16]

Speaker 3:

The reality can no longer be ignored.

Speaker 4:

We stand today at the threshold of a great event.

Speaker 3:

But we live in an inter-dependent world.

Speaker 2:

Two, one.

Speaker 5:

World Reimagined with Gautam Mukunda, a leadership podcast for a changing world.

Speaker 6:

I want[inaudible 00:00:43] everywhere.

Speaker 7:

We look for integrity, we look for intelligence and we look for energy.

Speaker 8:

Every country including the United States is going to get impacted.

Speaker 5:

An original podcast from NASDAQ.

Speaker 9:

Are we brave enough and wise enough to grasp this opportunity?

Aarti Shahani:

America is aging. Fertility rates are low. The population is in decline and if we don't fix that, this country is in real danger. Why isn't that a fact that the forefront of the conversation when I see the headlines on immigration?

Gautam Muknda:

You probably recognize that voice, that's Aarti Shahani, NPR correspondent, guest host for Christiane Amanpour on CNN, contributor to the Vox Conversations podcast, memoirist, founder of Families For Freedom, a non-profit that assists families who have members in danger of deportation and host of the soon to launch podcast, the Art of Power from WBEZ Chicago. She pulls no punches and she has trained her laser focus toward a subject that's both personal and important, immigration.

Aarti Shahani:

To keep the US not going in the direction of say Japan, we need far more migration, not less. What I have just said is not a controversial proposition, economists now agree on this. Economists will say, "America needs more migrants not less." You want a book on it? Go read Good Economics For Hard Times by the Nobel laureates from 2019. But our political conversation keeps thinking that we've got to contain the flow. We've got to contain the flow.

Gautam Muknda:

If America needs more immigrants, not fewer, you'd never know it from news coverage, which usually focuses on how immigrants compete with native born Americans for jobs and wages. So what does economic research tell us about the impact of immigration? I asked economist, Dany Bahar, a senior fellow in the global economy and development program at the Brookings Institution.

Dany Bahar:

Today, for instance, [inaudible 00:02:48] about 15% of the population of the country. They represent 25% of all entrepreneurs. I want to say about 30% of the fortune 500 companies were created by immigrants or children of immigrants. About 30% of all the patents that are producing the US are created by immigrants or children of immigrants. That's a number in particular that has grown dramatically in the past 20, 30 years.

Gautam Muknda:

In fact, 40% of America's Nobel prizes have gone to immigrants or children of immigrants.

Dany Bahar:

It's very hard to measure the fact that an immigrant or children from immigrants 30 years from now, is going to create Google or is going to create Amazon. It doesn't have to be the huge mega large firms it can be also small firms that are the ones actually that create most of the job growth in these country.

Gautam Muknda:

First let's rewind. How did Aarti moved from Silicon Valley correspondent to an expert on immigration? The answer has a lot to do with her family's story, which she told in her memoir, Here We Are, American dreams, American nightmares.

Aarti Shahani:

My family came here when I was a baby. We came here on tourist visas, which we overstayed. We were undocumented for a number of years. We finally did get our papers. We got green cards. The card itself says permanent residency, lawful permanent residency. But if you fast forward a few years after getting those green cards, I was a scholarship kid at a fancy private school on the upper East side of Manhattan, The Brearley School for girls. My father, he started his own store, an electronics shop in Manhattan's wholesale district. My father got arrested and this is what I write about in my memoir, Here We Are. He got arrested and according to New York state, my dad and his kid brother, who were running the store with him, were basically a front for a drug cartel. According to New York state, the initial charges, my father was helping the Cali drug cartel of Columbia clean their dirty drug money by selling them watches and calculators to do it.

Aarti Shahani:

I was 16 years old when my father was first arrested, I felt total shame. I felt... Just anything you would imagine a child would feel when they see their father in an orange jumpsuit at Rikers Island prison or going to court in handcuffs. But long story short, the case that made it sound like my dad was some big time cartel warlord guy, prosecutors very quickly came around and offered my dad a plea bargain. And this is like a very interesting thing about how the justice system works. They went back to dad and they were like, "Hey, Mr. Shahani, if you go to trial because you want to fight these charges, if you think that, "Hey, they're not true," if you want to go to trial, we'll listen. If you're convicted, you'll get, say like 14 years in prison. And if you want to take a guilty and don't bother wasting our resources going to trial. Well, you know what? We'll offer you eight months, so you can do eight months inside."

Aarti Shahani:

So my father is given this offer and what does he do? He does what everybody listening to this conversation would do, statistically speaking, he takes the plea. That's what people do. Prosecutors explain they did not intend to destroy our family business, they actually were fine with it running. Turns out we were not a drug grunt and what was supposed to be an eight month sentence rapidly disintegrated into far more because when my father was done serving that time, he was taken in for an additional second surprise punishment, which is deportation from the United States. He does that time and now he's facing life exile for the thing he already served his time for. Life exile for a migrant there's an implication for the entire family, right? So my father gets booted out to India, a country, by the way, he didn't live there particularly long, he was uprooted as a child at the end of British colonialism, but he would get booted out to India and then what would happen to my siblings and my mom, what would happen to us?

Aarti Shahani:

So I actually, at that point, stopped going to school to focus on fighting my father's case. I thought that I would focus on fighting his case to keep him in this country for a year, but that's not what happened. We had the unfortunate timing of the September 11th attacks in that early period of time, which really upended the entire system that we were navigating and the fight to keep my father in this country actually lasted for more than a decade until I was 30 years old. And a lot of what I write about in my journey are the opportunities I was given, full scholarships to the best schools, mentors, teachers, guides, who kept wanting to nurture me and help me leap[inaudible 00:08:07] further and further. And what my father got was endless unrelenting punishments for something that according to prosecutors was not a particularly big deal. I think we lived the different ends of what's possible in America.

Gautam Muknda:

And that contrast is a striking one and you see people go in many different ways. So you've been an activist, you've been a reporter now you're an author. And in each of those, you have been a leader, not necessarily with traditional forms of authority, like a CEO, but someone who is able to lead in a very different way. And I'd love to get your thoughts on that.

Aarti Shahani:

Yeah, absolutely. Yeah. It shaped so much of how I understand power, right? It was getting literally dozens of people I knew in formal positions, whether heads of schools, heads of companies, members of Congress. I actually got a member of Congress to write a letter of support for my father. I remember gathering these letters of support in my late teens and early twenties. And each person working them, working them, pleading, making the case, bugging, guilting, whatever it is, whatever moral authority I had to appeal to this person who I felt could help me keep my father in this country, I would use that moral authority. Writing the letters, doing the followup calls, not taking no for an answer. I managed to get a critical mass of these letters. And that's ultimately how I managed to keep my father in this country. It takes knowing how to communicate your story, knowing how to reach your target and continuing to go with them until they go. One thing I've really learned about leadership in that way... Does that make sense? What I'm describing?

Gautam Muknda:

This is the immigrant hustle of why immigrants make good entrepreneurs in a different context?

Aarti Shahani:

Totally, totally. I mean, to me, the activist campaign to keep my family together, the core skill set is the same skill set you use to build a company. It's the same skill set you do for investigative reporting. It's the ability to find who is relevant and convince them to give you something you need for the outcome you want.

Gautam Muknda:

I'll say from knowing you for so long, I don't think you wrote that story just to tell your story. You wrote that story because you wanted it to influence-

Aarti Shahani:

Oh yeah. Yeah.

Gautam Muknda:

The larger debate. Yeah. And so what is the influence you wanted to have on that larger debate? And then where do you see that debate going in the next year?

Aarti Shahani:

In the most fundamental way, I want my country to stop talking about my identity as though it's subhuman. I am proud of being a migrant. I am incredibly proud of that identity. I am tired of politicians in my industry, the media acting as though it's something we should be apologetic for or ashamed of. I think that the amount of gas lighting that we have gone through, that we have done to ourselves as a country that is built on migrants, and when I say built on migrants, I mean the forced migration of African-Americans, I mean the voluntary migration of other people who came here, I mean the DNA of this country is the newcomer and yet I came of age in an America that dumped on us as though we were pariahs.

Gautam Muknda:

Instead of striking, right? There is no country that welcomes immigrants more than the United States does, I think.

Aarti Shahani:

Let's pretend Canada doesn't exist as we often tend to in the US. So here's the thing that I think people have to keep in mind because when people are like, 'Well, no other country is as open as America," I mean, how open do you want us to be? The thing that you have to remember about this country is it is by design supposed to be the place where the rest of the world converges, that is the American experiment. It is an experiment in multi-ethnic democracy like the world has never seen before. Think about it this way, what is America's competitive advantage compared to other countries? All right, now let's think about this, really think about this. Okay?

Aarti Shahani:

In Silicon Valley, they are the people who come here who decide to stay here, but more than that, let's be real, they are the people who come here for a little bit, and then they decide to go back to their own countries. And you know what? They go back to their own countries with a great feeling of indebtedness, to what they gained from America and with ongoing life relationships to America, huge network effects that happen, right? And then for the ones who stay here, they are basically our global ambassadors because they continue to keep relationships abroad. People in Washington, DC act as though migrants come here and suddenly lose their connections to back home, that's total garbage. We keep our connections to other places and that makes America stronger.

Gautam Muknda:

So you have Hamilton with the line that immigrants, we get the job done, where they literally have to pause the musical for the cheers from the crowd.

Aarti Shahani:

Mm-hmm (affirmative)

Gautam Muknda:

And at the same time in 2016, when I wrote about politics-

Aarti Shahani:

Mm-hmm (affirmative)

Gautam Muknda:

It was pretty routine for me to get death threats on Twitter that were explicitly oriented around, your parents are immigrants, how dare you have an opinion.

Aarti Shahani:

Mm-hmm (affirmative)

Gautam Muknda:

And that duality is striking and powerful in the way we view immigration.

Aarti Shahani:

So why were for so many decades lawmakers, so incredibly concerned about keeping the migrants out? Well, you know what? A lot of it had to do with the change in color that migrant. I mean, and I'm not making that up. I've interviewed people like, for example, a woman named Doris Meissner who headed the immigration agency under both Reagan and Clinton, she talks about the unconscious bias of lawmakers. She served under a Republican and a Democrat, and she talks about the discomfort people would feel about the fact we were talking about brown newcomers. Only they couldn't name it. They couldn't say, "I'm afraid of this country not being white," but they were afraid of the country not being white.

Gautam Muknda:

Right. Aarti so I totally agree that the economics research says overwhelmingly that immigration is really good for the United States, particularly high-skilled immigration, but immigration of all kinds is just a huge economic boost for the country. But I think a lot of the opposition to immigration isn't really about economics. It's about some idea that mass immigration will change the culture of the country. And I think that's harder to answer if you took 300 million people from outside the United States and brought them into the United States, I do think it would change the country in a profound way. And what would you say about that concern?

Aarti Shahani:

Yeah, but who's talking about doing it that way. Get real. I love that you said take 300 million because the fear, right? The fear is like, "Oh, this crazy lady is talking about dumping three countries into the US all at once." And it's like, "No, man, get real." I'm saying create lines. We say, "Hey, why don't they stand on line?" And let's say 10 to 20 million people. And by the way, a lot of those people, they don't want to be on the coast, they want to be in the heartland, they want to be in different parts of the US that are not noisy, expensive, big cities. So you're going to see a lot of cultural, what could feel like disruption. Well, you know how you deal with that? you plan for it. I mean, I have been having these fascinating conversations with people in government and outside of government about literally funding things like welcoming and integration centers.

Aarti Shahani:

The number of people currently who want to learn English, okay? Who are not English speakers, that are signing up on programs so that they can learn English waiting for government funding so that they can actually go ahead and take those classes. There's a disbalance there. I totally agree, it's human to feel the shock of a newcomer or a lot of newcomers. And if it's poorly done, it's just going to feel like crappy and shocking to you. But if your government bothers to think about using some of that tax money you're already paying for, to make the smooth transition so that you're not forced to move out of your small town to a big city, but people from other countries are interested in living in your small town with you, commerce is created jobs are created, opportunity is created, and there are some little program that helps it so that you're not all scared in the process. What we're dancing around is the term anti-racist work. Okay. So how do you make people okay with difference? You don't tweet your indignation at them. What you do is you make it safe. You make it safe to talk about it and then you introduce people to the people that they're afraid of so they can stop being afraid. Migrants are much scarier in the abstract than we are in person. Most people are not afraid of me.

Gautam Muknda:

There is empirics demonstrating that opposition to immigration is highest in areas that do not receive immigrants.

Aarti Shahani:

Oh yeah. It's fascinating. It's fascinating. But to your points, this very wise point, for us to transform America for the next century, right? That's what America is grappling with. I often think of this country as Microsoft before Satya Nadella came on board and figured out how to step into the mobile era. A huge institution that had a glorious heyday but is now trying to figure out its core competency and how to maintain or regain its stature, that is the fact of America right now. It's a great country that's also struggling with feeling less great than it used to be. What I am saying is that part of how we stay great is we get over our unconscious bias, we get over our fears and we let in the energetic human beings from the janitors and the pedicurist and nail salon people up to the AI programmers, we let in the range of people on a line, there are lines, to come and be part of this great project and for people who are afraid of what's going on, create the spaces so that people can interact and know each other. Fund the English language programs so that people who are coming here and want to learn English, which are many, can go ahead and learn English. I mean the stuff can be designed for if you're not busy being scared and or racist.

Gautam Muknda:

What's the leadership story that you tell, whether it's on the political side or in fact on the immigrant community side that could get us into a political dynamic that could get there, right? How do the leaders of the two communities work to get us to that fruitful thing.

Aarti Shahani:

Those Republicans exist. Okay? So will they effectively organize their party? Will they make a compelling case? I have no idea. And then for Democrats, I think that president Biden, he's doing a very interesting dance right now because it's not just that president Biden is repudiating the Trump legacy, Biden is repudiating his own party's legacy, right? What Biden is proposing now would undo much of the Bill Clinton era reforms. It would undo some of the Obama era enforcement. And so it's such an interesting thing to watch because the more progressive wing of the democratic party has called out that party's stance on migration fairly effectively, so much so that you're seeing Biden basically really take a break from what had been the party approach for decades. My theory of change comes down to when the giants fight, the little crumbs that fall from their mouth, those morsels are what the little guys pick up.

Gautam Muknda:

Of course, that makes sense and the giants are certainly fighting now.

Aarti Shahani:

Yeah.

Gautam Muknda:

So Aarti in the time we have, I want to get us out of DC. I want to ask about the Valley because right, what we've seen is I would say in some ways, a political awakening-

Aarti Shahani:

Yeah.

Gautam Muknda:

On the West coast, right? Where companies on which you have a unique vantage point-

Aarti Shahani:

Mm-hmm (affirmative)

Gautam Muknda:

That have extraordinary power in our society and are now thinking about their power in the government. And these are companies that are more closely tied to immigration than any other set of companies in the world.

Aarti Shahani:

Mm-hmm (affirmative)

Gautam Muknda:

Right? And so what is the moral responsibility of the leaders of these companies?

Aarti Shahani:

As somebody who has now reported on Silicon Valley for years, I have limited patience around the exceptionalism and entitlement of the... Hey come on, just let the high skilled workers in, they're high skilled. And let me break down for two reasons why I feel so impatient with that. One is that, literally the only documented, robust documented evidence that immigrants take away American jobs, it's not in the blue collar sectors, sorry, buddy. It's not, it's not happening in blue collar work, it's happening in quote unquote high skilled work.

Gautam Muknda:

This really surprised me. I had always agreed with conventional wisdom on immigration that high skilled immigrants were a huge positive in every way we could measure, but that low skilled ones tended to drive down wages at the bottom of the labor market. I asked Dany to fill me in where the research is today.

Dany Bahar:

For many decades economists, my colleagues economists have really focused on a very particular question when it comes to measuring the effect of immigration on the economy and it's been really, really focused on labor outcomes. Are immigrants causing a decrease in wages or an increase in wages, are they causing unemployment for the locals? And I mean, that's a super important discussion and I think the vast majority of the evidence shows that if there is any negative effect of immigration on the labor outcomes of natives, these effects are very small, very, very small, like make legible. There is great work done by Giovanni Peri of UC Davis in California, who has shown that the inflow of unskilled immigrants to the economy is actually mild, in many cases creates the opportunities for what we call upward occupational mobility for Americans. And example here is that when there are immigrants that are willing to come here and perhaps work in the kitchen of the restaurant, then the American can go using his or her language skills and become the host of the restaurant, which ends up being in many cases, an increase in their salaries.

Gautam Muknda:

So if immigration doesn't create a split in outcomes for the Americans who were already here, if both skilled and unskilled immigrants help people at every layer of the income distribution, how does that change the debate around it? And how does it affect the role that companies will play?

Aarti Shahani:

I'll be curious to see how certain gig companies do or don't speak out for working class migrant constituencies as this debate unfold. So are we going to see in certain gig company CEOs talking about the more humble parts of the labor force that they have not typically celebrated in the past, but given the evolution of technology are becoming very directly part of Silicon Valley. But it's going to happen in a new context, right? 2021 is, it's remarkably different from 2010, from 2017, I named those years as years when Obama and Trump, respectively had different kinds of major developments. 2021 is remarkably different because our understanding... I think in general we believe as a society that corporate CEOs have responsibility as citizens and not just responsibility to their shareholders. I think that is increasingly the sense. I think that the black lives matter movement and how much it pushed corporate America to start making statements and speaking some authentic, some remarkably and authentic, the whole range. I think that the black lives matter movement has shifted our understanding of what is the responsibility of a CEO.

Gautam Muknda:

That question, what is the responsibility of a CEO? What's the responsibility of a leader, is one we've been exploring throughout this show. There's an easy answer that you often hear, maximize shareholder returns. That goes back to a New York times Op-Ed by Milton Friedman, that business's only social responsibility was to make as much money as possible. CEOs supposedly have a fiduciary responsibility to maximize the price of their stock, simple, clean, and easy, right? Wrong. That's not a matter of opinion. It's a matter of law. My friend, the late Lynn stout, a professor at Cornell Law School wrote a brilliant book, The Shareholder Value Myth, which show that under American law, the argument that CEOs have a fiduciary responsibility to maximize shareholder returns is simply a myth. Corporate leaders like leaders of every sort can't take refuge behind such simple answers. They have many responsibilities. Under Delaware Law, for example, directors all care, loyalty and good faith to both shareholders and the corporation. Corporate leaders and their shareholders surely want the value of their companies to increase. Companies exist after all, in order to make money.

Gautam Muknda:

But there's nothing in the law that says it's their only reason for existence or that their leaders are obligated to sacrifice the interests of stakeholders from employees to the community, to the environment, in order to maximize profits. That's a choice. Business leaders can choose differently. They can choose to adopt a stakeholder centered model of capitalism. One in which all the various groups touched by a company benefit together from its activities, instead of being set at odds to benefit one at the expense of all the others. The leaders of the trillion dollar enterprises that dominate today's economy have the power to do that. And that means they have a responsibility to do it too. I asked Aarti whether she saw tech leaders taking important stands on immigration and if not, what she'd like to see them do.

Aarti Shahani:

Here's the thing about people who have power, capital P formal authority. There are so many places where you can weigh in and you've got to choose what's worth weighing in on, right? Where do I want to bother to expend my energy? And I think that what tech chiefs really have is increasingly... These are companies that deal directly with consumers. So they have a relationship with us that the people building semiconductors didn't, we see them, we know them, they're apps on our phone. So they carry with us now a relevance that they didn't previously carry. Okay. So now I'm relevant in ways that 30 years ago, my company would not have been, I'm an app in people's phones. People will identify if not with my own name directly, certainly with my company name. Now would be a really wonderful time for them to spell out their own vision for what America could be.

Aarti Shahani:

Can America be the place that continues to welcome the outsider because they have witnessed firsthand all the magic and productivity that's created by doing that. Can America also be the place where we genuinely invest in people who are raised here so that they have a chance and they're not blocked out by cheap labor? Can they be both of those things? Can the CEOs commit to making it both of those things? I think that if we had CEOs step up and make personal commitments to allay people's fears with real educational investments alongside explaining that no, this country needs foreigners to come here and join. Tech CEOs, maybe more than any other group of leadership understand the power of immigration for this country. Right? So can they hold both of those messages together and convincingly communicate both of those messages together.

Gautam Muknda:

Okay. And how about for media? What do you see as the responsibility there?

Aarti Shahani:

What this heartens me about how my industry, how we have covered migration for so many years, it's been an ongoing act or ongoing process of misinformation and or disinformation. Okay? When you perpetually cite economic studies that have been grossly refuted by the entire discipline, if the desire to be two-sided right? Like the number of news outlets I will see continuing to quote studies about how migrants harm blue collar American workers. And I'm like, "What is this based on?" This is not factually based on anything. This is literally, it's fear. And there might be some two or three decade old study that you're citing that has at this point been thoroughly refuted by everybody else in economics. So I think the media industry needs to understand the facts.

Gautam Muknda:

So what are the facts? I asked Dany Bahar, the economist who summarize the research for us at the beginning of this episode, to tell us the most important things he's learned about immigration.

Dany Bahar:

I'm a Belmont economist and I care about one of the most important questions in economics, which is why there are some countries that are poor and some countries that are rich. Why there are some societies that are poor and some societies that are richer, wiser in equality and so on and so forth. And what I found in my own research is that the own likely key to economic development and to growth is immigration. And that's something that we typically don't think about. Because again, we are thinking always about the very narrow idea of whether immigrants are increasing wages, decreasing wages and employment and so on. But immigrants bring with them a couple of things that are really fundamental for the economic well-being of a country as a whole.

Dany Bahar:

First of all, they bring networks. We know that trade and investment across borders is a very, very important part of globalization and it's a very important part of how America continues to thrive. And it's hard to do business across borders. It's really hard. I mean, you need to create a system of trust and know the right people and so on and so forth. It turns out that and these empirically proven immigrants play a huge role in that, in bridging those gaps and creating more trade and more investment. And example for instance, is the huge Vietnamese diaspora that lives in the US that has created enormous trade links with Vietnam... Trade and investment links with Vietnam. And that's one aspect and the second aspect that is the one I'm particularly working on is the idea that knowledge and know how and technology travels a lot through people. And a lot of what make us better in producing cars, for instance, more productively at lower cost and with better technologies or producing semiconductors or producing any other series that we can think of is what we call a tacit knowledge, is our ability to do more with the same resources and it's how all of us actually become much better at our jobs every day we work, we learn things that are hard to explain are hard to put on paper, but we know how to do them better.

Dany Bahar:

And turns out that immigrants play a huge role in transferring those skills and those knowledge from place to place that otherwise couldn't really be transferred. I think that explains a lot of the growth that America has had. For instance, we see it in Silicon Valley but we also see it in India that the fact that there are so many talented immigrants from India and America is really reshaping the whole economic dynamics in India in ways that it's sending flows of knowledge across countries that really makes the whole world, I think, a better place.

Gautam Muknda:

So here's the thing, intuitively it makes sense that immigrants might compete with people who are already here for jobs. Every job that goes to an immigrant is one that doesn't go to someone native born, right? But that's a mistake, one so common economist, David Schloss gave it a name all the way back in 1891, he called it the lump of labor fallacy. And if you think about it for a moment, you can see why. Let's say one of those immigrant engineers comes to work for Google, she's going to need a house, right? And a car and restaurants and lawyers and accountants and everything else that employs people, lots of people. And eventually she might even leave Google and found, well, the next Google. How many jobs might that create? How many houses will those people need? So if you own a home and want the price to go up, you want more immigration because that will increase the demand for housing. Suppose you live in a town where the economy has been really hard hit and the population is declining, that's a nightmare because that town has to pay to maintain the infrastructure it built for a large population when it only has the tax base of a small one.

Gautam Muknda:

There's only one way to fix that. You need more people to generate demand and pay taxes. And since Americans aren't having as many kids as they used to those people can only come from other countries. So if you live in Buffalo or Detroit, or even in Smallville, Kansas, more immigrants can help you. No wonder Jonathan and Martha Kent were so happy to welcome an illegal immigrant child into their lives because that's what Superman story is really about, after all. And the legal immigrant who decides to stand for truth, justice and the American way. One who saves Smallville and Metropolis. What's more American than that? Immigration is a complex issue and like any complex issue, you can't understand it without doing some really serious reading. So I asked Aarti what book or books she would recommend to our listeners.

Dany Bahar:

One of my favorite books ever, it actually inspired me to write my book is a book named Americana by a novelist, Nigerian author named Chimamanda Ngozi Adichie. She's my favorite author, I think I keep messing up the pronunciation of her name. I just call her Chimamanda in my mind because we're besties, but Americana is... I mean, it's beautiful writing but it's about a young Nigerian woman who comes to America and tries to make it and the ups and downs and what she leaves behind and this [inaudible 00:35:20]reframing of her relationships along the way. I think that's a fantastic read. I already mentioned it, Good Economics for Hard Times by Esther Duflo and Abhijit Banerjee is an excellent take on... I mean, really it's just all the major issues that we think about in economics, whether it's trade, labor various kinds of R & D investments and what they actually do and don't give to us economically. I think that they're a fantastic read. Oh, I mean, obviously Obama's A Promised Land. Did you read it already?

Gautam Muknda:

Not yet, but Tom Friedman also recommended it.

Aarti Shahani:

So let me tell you like A Promised Land. So if Friedman recommended, that's fine. I want to give my version of why I recommend it. So, I mean, if you read A Promised Land, no matter what you think of Obama, whatever the criticism may be of what he did or didn't accomplish like Holy crap, was he juggling a lot? I have never met a human so capable of compartmentalizing as that man. And not that I've met him, I mean, just saying but what he maps out that he was dealing with in terms of various foreign engagements, the economic crisis in the US, having to juggle it all, and then the deep unrest and disenchantment with social causes. He just maps out there. And there are these amazing little details that Obama shares.

Aarti Shahani:

For example, when he ran for Senator, was totally fascinating about his race for Senator in Chicago is he had just lost a statewide election and literally nobody in the state of Illinois was telling him to run for office. It's like, "Hey, I really think you should run." He just really, really wanted to so much so that he basically quietly talked to people to figure out if there was any way in God's [inaudible 00:37:14] leader if he could possibly win. And he did all of this due diligence and all of his homework before ever bringing up to his wife, Michelle Obama, "Hey honey, I think I want to run for office again." Talk about somebody who nobody was really inviting into the party. Nobody was asking him to be there, but he was like, "No, I see it. I see it for myself." I love that book so much. So I'm happy that Tom Friedman and I agree.

Gautam Muknda:

So before we lose you, I want to get our last question, which is of the people you've gotten to know well in your extraordinary career. But beside define as someone you could actually meet for coffee or something like that, COVID permitting not you've shaken their hands once. But of the people you've actually gotten to know, who was the person that you found most impressive and why?

Aarti Shahani:

[inaudible 00:38:02] to me is one of the most impressive people I've met in Silicon Valley-

Gautam Muknda:

Mm-hmm (affirmative)

Aarti Shahani:

Mitch Kapor. Mitch Kapor had outside success as the founder and chief of Lotus back in the 80s, very, very wealthy man and early investor in Uber and meditation practitioner, founder of Electronic Frontier Foundation. He has a lot of different hats he's worn. He now invests in a range of companies through his investment from Kapor Capital, with a specific eye towards underrepresented leaders and diverse investments. And the reason I say Mitch is because I think that Mitch has gone through this fascinating evolution of... He became one of the rich white guys, right? That's who he is. Those are his circles. That's what he managed to accomplish. In tech when you look at who he was working with and who he hang out with, it was a lot of other white guys. And he got to this inflection points in his journey where he started to think a lot about who was and wasn't in the room and how keeping certain people out of the room because of one's own unconscious bias. Gets in the way of progress and growth and then he challenged himself to do something about that. And so I just feel like Mitch's one of these people who... He code switches. He knows how to speak to very different kinds of people and he's, I think one of the few high profile Silicon Valley investors who digs very deep to live his values.

Gautam Muknda:

Immigration and policy is one of the central tragedies of American politics. We all agree that the country has a lot of problems. If we could wave a magic wand, we all love to speed economic growth, to increase innovation and entrepreneurship, to improve our ties with other nations, to jumpstart the economies of the small cities and rural communities that have been struggling for two generations. And we can do all of those things. There's a tool sitting right in our hands that would let us do it, increased immigration. And we now know thanks to the research of Dany and other economists that it would do so without the labor market downsides we once feared. It's not often that the universe hands you a free win and a big one. When it does, is there any folly greater than throwing it away? What would it say about us if we did? How have immigrants and immigration affected your business and your life? Tell me at worldreimagined.nasdaq.com or hit me up at gmukunda on Twitter.

Speaker 5:

World Reimagined with Gautam Mukunda, a leadership podcast for a changing world, an original podcast from NASDAQ. Visit the world re-imagined website at nasdaq.com/worldreimagined podcast.

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