Increasing Returns

Recently a number of articles in the press (many undoubtedly “planted”) have been warning that more foreign students earning degrees at U.S. universities are returning home (CNBC) after their studies, or “worse” (in the view of the press), not coming here to study in the first place (New York Times).

A few weeks ago, I mentioned to an old friend and fellow educator another article reporting a decrease in foreign applications to U.S. schools. His answer stunned me: “GOOD!”

Now before you leap to the conclusion that this friend is a redneck racist/xenophobe, let me assure you that he is none of those things. Instead, he is well aware of the pain that the foreign student program, as an H-1B/green card enabler, has brought on many Americans. He also understands that many of the foreign students are weak academically, and are not always models of good behavior, points I will return to later in this post.

As usual, these claims, e.g. of increasing return rates, are based on misleading statistics, and more importantly, on hidden assumptions. One big hidden assumption, of course, is that the populace wants, and benefits by, the large population of foreign students now in U.S. schools. Again, I’ll return to this point below, but first let’s look at a couple of concrete examples from the above CNBC article. It says,

A report released by the Chinese Academy of Social Sciences showed that only 30 percent of Chinese students studying abroad between 1978 and 2006 chose to return to China after graduation. That figure has jumped nearly a decade later: According to data provided by China’s Ministry of Education, more than 500,000 Chinese students went overseas for education in 2015, and another 400,000 returned home.

Well, not so fast. Until recently, most students from China would come to the U.S. for a Master’s degree, typically in STEM, and then “transition” to a STEM job and a U.S. green card. We still have that, but in recent years, the number of undergraduate students from China has skyrocketed. They are less likely to be studying STEM, less likely to be employable in the U.S., and less likely to have immigration to the U.S. as their goal. So the quoted statistics do not necessarily imply that the return rate for the grad students, i.e. the old figure, has increased.

The CNBC article also says,

Columbia University alumnus Hongli Lan will have no choice but to leave the United States if he loses the H-1B visa lottery again this year.

The young Chinese quantitative analyst, who says he graduated in 2014 with a master’s degree in Mathematics of Finance and GPA of 3.9, was just ready to get his feet wet on Wall Street before a letter from U.S. Citizenship and Immigration Services (USCIS) notified him of the H-1B lottery rejection.

“Certainly it’s not fair,” Lan told CNBC. “Chances of winning the lottery are too low for Chinese students and I don’t see how the current system benefits high-skilled workers.”

 

To non-cognescenti, this looks quite convincing. The U.S. is about to lose a highly talented potential American because of our “unfair” visa system, right? Actually, not really. That entire passage is misleading.

To begin with, the H-1B lottery does not discriminate against Chinese students. Every applicant has an equal chance of “winning.” (Mr. Lan is confusing H-1B with green cards, which have country caps, causing a problem for the Chinese students due to their huge numbers.)

But much more importantly, let’s look at this student’s credentials. Lan’s 3.9 GPA is a red flag for us academics, as grad school grades tend to be quite liberal and not useful as a measure of the strength of a student. But even more of a red flag, for those in the know, is Columbia. That university seems to have jumped in with both feet into the “Master’s degree for sale” waters, especially marketing the program to foreign students. I reported on this earlier. pulling comments from student discussion boards. Here are some (again, these are comments by Chinese and other students, not my remarks):

…most Chinese believe this program has quite low threshhold [for admission]…I heard that the program is not on par with the reputation of the school and that over half the students are Chinese international students…I believe that many of the courses offered are taught be adjunct faculty and that the purpose of the program is to make money for the department.

 

In short, Mr. Lan, whom CNBC paints as an exceptional talent that the U.S. is on the verge of losing due to — in the standard words of immigration advocates — “our broken immigration system,” the truth is that he is likely — in my own standard words — one of the “ordinary people doing ordinary work.”

It is fair to say, I believe, that over the years, the American public has been quite welcoming of foreign students. To this day, one of the most well known writers who advocate reducing yearly immigration levels — I won’t “out” him but many readers here would recognize the name — volunteers his time to help local foreign students with their income taxes.

The prevailing wisdom originally was that the foreigners would mix with the Americans, to the cultural enrichment of both sides, and that we were educating the Third World, with the foreign graduates returning home and improving conditions for their impoverished countrymen. We’ve lost a lot of that. Once a foreign student nationality reaches critical mass, notably the Chinese, the incentives and opportunities to mix with the Americans diminish rapidly. And over the years, instead of returning home, most Chinese and Indian grad students came to view U.S. schools as steppingstones to a U.S. job and a green card.

The statistics on foreign student university applications and return rates must be viewed in that latter context. Though the narrative is that international students come here because of the world-class nature of our educational institutions, that has never been the real draw. Instead, a U.S. education is viewed as a conduit to a U.S. green card, which in turn means being able to afford a car or two, a large single-family home and so on, i.e. a materially richer life than the students would have back home. Without that draw, most of them simply would not be in U.S. schools. (Though the official line from the ethnic activist groups has been that elderly people immigrate here “to join their families,” Chinese-American political activist Yvonne Lee once told Asianweek “Without access to welfare, the seniors would not come.”)

Given the “shortage” (from the viewpoint of the foreign students and U.S. employers) of H-1B work visas and employer-sponsored green cards, there is indeed reason for the prospective foreign students to think twice about coming here, and about staying here if they do come. The CNBC and New York Times articles above are right in that sense. Their statistics may be exaggerated and misleading, though.

 

But if that trend were to occur, what about the question I raised earlier, concerning whether Americans welcome and value the large influx of international students in recent years? These points have been of increasing concern in U.S. academia. The Chinese students in particular are viewed on the whole as weaker academically and more prone to cheating, according to Wall Street Journal reports, compared to their American peers. Though no data was offered in those articles, my own research has found that the foreign grad students in general, and the Chinese ones in particular, are somewhat weaker than their American peers.

In addition, the California Legislative Analyst’s Office found that the admissions bar in UC had been lowered for undergraduate foreign students (who pay higher tuition without much if any financial aid), displacing domestic students, and other sources indicate that this is happening at the Master’s level as well. I wrote at the time,

This was recently illustrated in information sent to me concerning the Master’s degree in Statistics (leading into jobs in Data Science, a hot field these days) at UC Berkeley. Like the programs described above, the UCB program seems aimed at foreign students, and no wonder! Each international student in the program brings in a total of $28,000 above and beyond what a domestic student in a nonprofessional program pays…

Curiously, the department itself raises the question of the concentration of foreign students in the program, but then refuses to answer. But one can get a good idea from the department’s Web page listing its graduate students, where clearly the proportion of Chinese students (most or all of whom are likely foreign) is much higher at the MA level than the PhD level.

It should be clear that departments have incentive to lower admissions standards, especially for foreign students. Recently the California State Legislative Analyst’s Office issued a scathing report, accusing the UC system of lowering standards for nonresident students, most of whom are foreign students. The report’s subtitle, “[UC]s Admissions and Financial Decisions Have Disadvantaged California Resident Students,” caused quite a stir, but that is only half the story. The untold part is that graduates of the UCB Master’s program in Statistics, and a similar one at UC Davis, are getting jobs while equally qualified (and typically older) Americans are rejected by the same employers.

It used to be the case that there would be at least two students from China among the top students in any undergraduate class that I would teach. That does not seem to be occurring as much these days.

I would miss the foreign students if they were to leave en masse. I have often helped highly talented international students and other foreign nationals get jobs in Silicon Valley. But certainly the bar for university admission should be raised somewhat, and in terms of work visas and green cards the bar should be raised quite substantially.