Massive Internal Brain Drain: a Potential Cause of the Great Stagnation
The increased demand for tech workers in modern America could be a possible cause for not only America's current plateau, but the ongoing degradation of its cherished institutions.
Arguably, capturing most of your country's top talent with absurd salaries and putting them to work on world-critical challenges like... how to generate more revenue from advertisement or... how to create as many "phone-addicts" as possible... could be quantified as producing tons and tons of negative value.
If China's crackdown on "consumer-facing tech" is about this, that could be a very good thing for China long term.
I grew up wanting to work on NASA and putting stuff on space, and during university got offered 10x the NASA salaries at FAANG companies, and was to week [sic] to just say "no thanks".
10 years later I am starting to wonder what my legacy is going to be.
— volta83, on HN1
I. Intro
This essay builds on ideas found in Tyler Cowen’s The Great Stagnation, particularly in regards to the zero-sum focus on science vs. money.
What is the Great Stagnation?
"…our economy has enjoyed low-hanging fruit since the seventeenth century: free land, immigrant labor, and powerful new technologies. But during the last forty years, the low-hanging fruit started disappearing, and we started pretending it was still there. We have failed to recognize that we are at a technological plateau."
— Tyler Cowen: The Great Stagnation.
Here’s another quote, which sort of ties into the theme of this essay:
Of course, the personal computer and its cousin, the smartphone, have brought about some big changes. And many goods and services are now more plentiful and of better quality. But compared with what my grandmother witnessed, the basic accoutrements of life have remained broadly the same.
— Tyler Cowen
The gist: information technology has boomed in the last 50 years. Other fields, such as education and healthcare, not so much. What gives?
II. What is Brain Drain?
In theory, a society where work ethic and intelligence (the basic building blocks of human capital) are highly rewarded should be one which is prospering.
However, is this necessarily the case? The technology sector is known for being a hub for brainy talent, and up until now this has been viewed as a positive. It’s undeniable that the value generated by Silicon Valley in the past 50 years is absolutely mind-boggling, and much of that can be attributed to its monopoly on human capital. Recently, however, my view on the relationship between the tech sector and talent has shifted. Although Silicon Valley is probably one of the more meritocratic institutions in America, and doubtlessly rewards merit approriately, it’s become a sort of sinkhole for talented people. Let me explain.
First, we have to understand what a brain drain is, and take a look at how negative externalities could arise from seemingly benevolent behavior. What is external brain drain? Consider a country such as Iran. The government is authoritarian and repressive, yet, considering its status as a dictatorship, its people are, on average and in comparison to other autocracies, well educated. For the intelligentsia of Iran, the pull to come to America is tremendous.
Not only is America vastly wealthier, but there are many additional freedoms to be enjoyed here. In addition, the “bonus” for being bright in America is much larger than it is in Iran. That is to say, being an incredibly talented programmer, for instance, is far more rewarding in America than in Iran. As a result, we have many talented Iranians moving to America, and for the émigrés themselves (and for America) this is both a economic and an ethical victory. What happens to Iran as a result? It is less well equipped to develop and less likely to build its standing in scientific fields in coming decades.
Perhaps this is a bad example, though, because not many people are shedding tears over the fact that the Ayatollah will not be able to launch cyber-attacks as effectively as he would have liked to 50 years from now. For a look at a brain drain that is a net negative with regards to a democratic society (and therefore is more understandable as a Bad Thing), we must shift our attention to internal goings-on.
III. Human Capital in 1900
Before assessing the effects of internal brain drain in America, let’s take a look at what the career path of a talented person in America in 1900 might have looked like, so we can compare and contrast with modern day America. Sewall Wright, an integral figure in genetics, was born in 1889 to a academically prominent family. He excelled in school, and at the University of Illinois was “discovered” by William Castle, a Harvard geneticist. Sewall took him up on an offer to move to Cambridge and spent his time there working on guinea pig genetics.2
Maybe to our modern eyes, the beginnings of this career path ostensibly sound like a waste of talent. Weren’t there far more interesting things to be doing at the start of the 20th century? Toiling over your predictions of the fur colors of admittedly adorable creatures couldn’t possibly be as fun as aviation, right? Obviously genetics was a cutting edge field back then (as it still is), so it’s not like what Wright was studying was some academic backwater, but it stands to reason that a field undergoing a more thorough revolution at the time, such as physics, would have been more remunerative and perhaps more stimulating.3
However, perhaps because other fields, such as the aforementioned ones, were not that much more enticing4 at the time, Sewall instead studied guinea pigs, and the world of genetics was forever changed because of this.
IV. America’s Obsession with Code
In America today, there is an obsessive focus on getting kids to be more smarterer. Perhaps this is driven by subliminal fears about America losing its competitve edge 50 years from now; a more parsimonious explantion would be that parents, regardless of the country, have always wanted their kids to gain in distinction and stature, and education is simply the best conduit for that in the 2000s.
Within the American obession with education, there is an increasing push to get kids to learn how to code. There is the yearly day of code, there the movement to have secondary and primary school classes in programming, there is a large market for little programming toys to gift your precocious daughter or son.
I would like to think this is because of America’s great desire to improve the intellectual lives of the next generation, but the cynical side of me says that this is simply being done to increase the number of software developers 20 years from now, in order to further feed the engines of octopine Bay Area companies.
There is a potential problem which is rarely addressed. What if our society is too efficient at sorting people? Is it possible that being too much of a meritocracy (in this and only this regard) has profound negative effects on scientific fields? 100 years ago, if a kid was “gifted,” he would be free to pursue any science field or liberal art he so chose, even ones that were not considered particularly financially rewarding, such as guinea pig genetics. Now, though, there is tremendous pressure for talented members of Gen Z to go into tech. The Pied Piper in this instance is not just the classes, toys, and cultural movements that have become so engrained, but also the booming salaries at tech companies.
Why would a CS major graduating at the top of his class want to live the Tremainian life of a graduate student, when she could become a proprietary trader and make hundred of thousands of dollars in her early twenties?5 There is this disingenuous thread weaved throughout America that talented people “can’t be bought,” but this is simply not true and does not hold up in practice.6 Very creative, very driven people have a price, even in the case of a potential job which is altogether neither rewarding nor enjoyable.
The fact that Apple, a company which creates small variations of the same product every year, not only has the largest market cap of any company in history, but also makes 3 million dollars per software developer, is not promising for the end of the Great Stagnation.
That isn’t to say that what Apple is doing ethically wrong, or that it was never innovative in the past, but I think there’s a good chance that our great-grandchildren (post-Great Stagnation) will look back at this specific decade in history and chuckle at the fact that Apple built a 2 trillion dollar brand on minor changes, such as One More Camera, or Slightly Larger Phone. Consider also this “portal” device that Facebook recently came out with.7 It’s a large screen with a camera, to be used for video calls. Why buy this? Why spend hundreds of dollars on something with only marginal advantages over video calling via laptop or smartphone? More importantly, why is Facebook’s foray into hardware so thoroughly unoriginal and unimpressive? With a market cap of 1.02 trillion dollars, I think they could have come up with something more inspiring.
In the future, maybe the rate of innovation will be so high that products will look completely different from year to year. However, at least for now, companies have a narrow focus because that is what is being rewarded by markets. Generalists will exist only if there are not strong incentives for them to intensely specialize.
Also…
Have there been brain-draining movements in the past? Logical positivism seems to be one of them. The number of people in academia in the previous century who expressed an interest in centrally planned economies were perhaps being brain-drained into wasting their time reading critical theory. However, in both these cases it was more a instance of nerd-sniping8 than of competing financial incentives.
Perhaps internal brain drain, among many other reasons, is behind why people today complain about a lack of talent in areas such as psychology and journalism. It could be that in earlier times, someone who showed promise in English IV would therefore grow up to be a talented journalist working for the Times or The New Yorker. However, nowadays, with our overly-efficient system for filtering and funneling talent, such a person might be pressured into going into technology for entirely sterile reasons, such as a high SAT score. Every institution is only a product of the people who make it up, and therefore journalism at present suffers. Internal brain drain could be the root cause of what some people see as increasingly amateurish and unrefined work in the field of journalism.9
TL;DR
A culture of lower-case growth might be partially or completely perpendicular to a culture of upper-case Growth.
If you found this article interesting, or found serious flaws with my reasoning, please leave a comment or reach out to me on twitter, at @WhitePill10. Oh, and make sure to subscribe I guess.
I understand that much of this is subjective, and perhaps a revisionist take on how science was perceived at the time. My point is not to make conclusive statements about the biography of Sewall Wright, but instead to find some ground to contrast our present day approach to vocations to.
Financially or otherwise
[Of course, this is sort of dipping the proverbial chip into whether or not academia itself should be reformed, but that’s a different topic entirely.]
Considering the fact that the concept of “selling out” has all but died out in creative fields, maybe I am not on the cultural ball on this
Although there are many other factors at play, and I am far from confident enough to suggest that the arrow I’m claiming exists plays a major role. In my personal 5-second opinion, the perceived downgrade in journalism is moreso a result of people gravitating to journalism which is of poor quality but which is very stimulating. In other words, as a result of markets we see a sort of journalism desert, similar in form and origin to a food desert.