Why These Business School Professors Oppose Trump's Executive Order on Immigration

 
 
More than 14,800 professors at United States colleges and universities —including some 50 Nobel laureates— signed a petition opposing President Donald Trump’s Executive Order on immigration. Signatories from Harvard Business School explain their opposition.
 
 
by Staff

Editor’s note: Last Friday, President Donald Trump signed an Executive Order indefinitely preventing Syrian refugees from entering the United States, suspending all refugee admission for 120 days, and blocking all citizens of seven predominantly Muslim countries from entering the United States for 90 days. (These countries include Iran, Iraq, Libya, Somalia, Sudan, Syria, and Yemen.)

The order provoked a great deal of opposition, including an online petition entitled “Academics Against Immigration Executive Order,” which argues that the order is “discriminatory,” “detrimental to the national interests of the United States,” and “opposes undue burden on members of our community.”

As of this writing, the signatories include some 50 Nobel Laureates and more than 14,800 faculty members at US colleges and universities. Harvard Business School Working Knowledge reached out to several Harvard Business School professors who have signed the petition, and asked them to share why they openly oppose the Executive Order. Here are their initial responses. 

David B. Yoffie, Max & Doris Starr Professor of International Business Administration:

Early last Saturday morning, I received an email from a distraught student. She was born and raised in one of the banned countries, and held a Canadian passport as well as a passport from that banned country. Her family was located in Canada and the United Kingdom. Suddenly she was faced with an impossible choice: stay in the United States to pursue her passion in technology and risk not seeing her family for a long time; or visit her family in Canada or the U.K., and risk losing her livelihood.

The question she posed: Would I be willing to sign the ‘no-to-immigration-ban’ petition?

“It is a lazy person’s policy answer to a complex problem that was poorly conceived, inadequately reviewed, discriminatory, counterproductive, and fundamentally anti-American”

After reading the petition and the news reports on the executive order, the decision was fast and easy. President Trump’s policy is a disgrace. It is a lazy person’s policy answer to a complex problem that was poorly conceived, inadequately reviewed, discriminatory, counterproductive, and fundamentally anti-American.

Why do I say lazy? The ostensible purpose of the executive order is to provide “extreme vetting” for possible terrorists. Vetting for possible terrorists is good; extreme vetting may be even better. But banning everyone from a few poor Muslim countries is not vetting at all. Since the 9/11 terrorists came mostly from Egypt and Saudi Arabia, this executive order would have missed the biggest terrorist attack of all time. Vetting means investigating and scrutinizing anyone suspicious for possible terrorist connections. Yet this executive order had nothing to do with vetting: it banned green card holders, eminent scientists, poor refugees, and even collaborators who played important roles in helping our country.

Ironically, the executive order itself was also not “vetted.” Thoughtful policies get reviewed, debated, discussed and revised. Instead, the President hurriedly picked a bunch of countries and tried to make a political statement without considering all of the ramifications. This ready, shoot, and then aim strategy may be OK for an entrepreneur trying rush to market, but it is not how great policies get formulated.

Like many, many Americans, I am the grandchild of immigrants. Our country’s growth and prosperity have depended on immigrants. I recently published a book (Strategy Rules: Five Timeless Lessons from Bill Gates, Steve Jobs, and Andy Grove) in which two of the protagonists—two of the greatest business executives in modern times—would be rolling over in their graves over this policy. Since Steve Jobs’ father was a Syrian immigrant, President Trump’s executive order might have led the world’s most valuable company (Apple) to be non-American. Andy Grove, a survivor of the Holocaust, would not have wanted to come to a country that didn’t welcome immigrants.

Moreover, it is no wonder that Silicon Valley is up in arms over this policy. Our most dynamic industry depends on tapping into the best labor pools all over the world. The tech industry has thrived by capturing our best students—regardless of origin—and giving them exciting jobs, which helps make America one of the most innovative countries in the world. Restricting the free movement of talent does not make America safer or produce more jobs. In fact, it does the opposite: in today’s world, capital is mobile.

If American companies cannot employ the best talent in the United States, they have two choices: risk becoming less competitive in an intensively competitive world; or locate your capital investments and your research labs in locations where you can tap into those talent pools. If American companies want to keep their lead in their industries, and President Trump wants to make it harder and harder to employ the best talent within our borders, then American companies will have no choice but to become less and less American.

No President in the history of the republic is off to a rockier start. What I teach my students is that great leaders—like Bill Gates, Andy Grove, and Steve Jobs—are fast learners, and they continue to invest in learning throughout their careers. Moreover, when they make mistakes, they own up to them and pivot. I can only hope that this President will do the same.

Christine Exley, an assistant professor in the Negotiation, Organization, & Marketing Unit:

Donald Trump's recent executive order is indefensible. We must welcome the brightest students, researchers, and innovators, without regard to national origin or religion, to continue to prosper economically. We must welcome refugees from exactly the regions banned by the executive order to uphold our society's core values. The exclusionary nature of Donald Trump's order echoes some of our country's worst historical mistakes.

Boris Vallée, an assistant professor in the Finance Unit:

As an academic, my main reaction to the executive order is that this decision is absolutely not grounded in the facts. I spend a lot of energy teaching my students to look at the facts to educate their decision. The government is doing the exact opposite, and setting a terrible example for everyone to follow. The argument of domestic security simply does not hold in the data. No terrorists on US soil came from the country on the ban list. And there are so many measures that are proven to significantly reduce violent deaths that are not implemented in the US.

Arguably, the threat of ISIS is used as a red herring, to divert attention from other more fundamental issues within US society. This is a powerful strategy in the sense that it builds on people lack of knowledge and emotions. There is abundant research on the fact that people are prone to prejudices, especially when they don’t have any knowledge of a subject. Designating a common enemy has always been an efficient way at uniting people. It also typically leads to scapegoating.

Politicians’ role should be to educate the people and fight prejudices, not exploit and amplify them. This is where empirical considerations clearly meet ethical ones. The executive order is not only unrelated to reality, but it also presents us with a toxic society project, one that opposes communities to each other instead of bringing them closer.

From a business perspective, I think shutting down the country to immigration from certain countries has the potential to reduce the competitiveness of the US in the long run, as it mechanically restricts the pool of applicants (not only applicants from these countries, but also any applicants who disagree with the society project the US is presenting).

It is interesting to note, though, that this situation might benefit other countries that will welcome these workers, as for instance Canada has been saying. The US will get a smaller slice of the world economy pie if it turns it back to the world. But if we take a step back, putting barriers between countries might shrink the pie we all share, and at the end we all lose. This is even truer if other countries follow in the path of the US.

I also want to stress that we should not be surprised by the executive order. The current president campaigned specifically on this type of measures, and there is also evidence that a large share of the US population is sympathetic to such measures. This is an uncomfortable truth, but this is the true question to me, and likely the answer to why the president is implementing it: because many American people agree with it.

Why is it the case? Where did we fail as a society in developing altruism? What is it about our current society that drives a large share of the population to be scared of other countries, and to be willing to shut down to the world and not open itself to it? Why is it that people frequently discard facts and make their opinions based on emotions or prejudice? These are collective failures where we all bear a responsibility. Fixing them is going to take a long time, but we should have the objective clear in mind.

Katy DeCelles, James M. Collins Visiting Associate Professor of Business Administration:

A friend of mine who is a Muslim academic sent me the link [to the petition] after I expressed sympathy for her situation … I opened my class today echoing the Harvard president and HBS dean that all voices, religions, nationalities and values belong at Harvard and are valued in my classroom.

William Kerr, Dimitri V. D'Arbeloff - MBA Class of 1955 Professor of Business Administration:

The immigration bans of the past week are potentially catastrophic for the United States’ leadership in innovation and entrepreneurship. Many have lamented the potential loss of specific talent from the bans, even colorfully noting that Steve Jobs' father was a Syrian immigrant who would have been precluded. These are legitimate concerns, as casting a narrower net means fewer chances of finding the one-in-a-million genius. One example: Born in Iran, Maryam Mirzakhani came to the United States to study at Harvard, became a Stanford professor, and in 2014 became the first woman to win the Fields Medal, which is equivalent to the Nobel Prize in mathematics. These superstar worries are real, and there are many more one-in-a-thousand talents that could be missed too.

But the real catastrophe for US innovation leadership is the loss of stability and the uncertainty it generates for investments. All aspects of the migration-innovation-entrepreneurship nexus involve deep investments. To move to another country for education or work is a life-changing investment, and individuals must master difficult subjects over an extended period. Same goes for investing heavily in R&D and innovation by large companies or in the decision to open a new start-up by a graduating Harvard Business School MBA. Uncertainty kills investment, however, and we are seeing uncertainty on an unprecedented scale.

To illustrate, one clever study by Takao Kato and Chad Sparber looked at changes in applications to U.S. colleges before and after the reduction in the annual quota of H-1B visas that took effect in 2003. (The H-1B visa is the United States’ largest visa for skilled temporary work.) Even though these applications were being made for admission to college, this lower potential to later enter the US workforce weighed heavily on the minds of potential student migrants. Due to some policy quirks, some nationalities were de facto exempt from H-1B visa restrictions and thus could form a control group to compare against other countries whose prospects were shrouded with more uncertainty. The authors found that the lower prospects of future US employment reduced the average SAT score of affected international applicants by about 1.5%, with effects being especially sharp among the very best international students. Fewer of the very top students applied for admission.

Not to put too fine of a point on it, the annual change in H-1B visas studied in the Kato-Sparber study is child’s play compared to the current immigration ban—a four-year-old smashing Hot Wheels together compared to Monster Jam. First, with the H-1B visa change, the potential lack of opportunity was many years ahead, and it was widely expected that the policy would be readjusted if the labor market tightened back up. Second, there was not even a ban, just fewer visas! The threat that a U.S. green card holder might not be let back into the United States is simply on a different planet, and the negative consequences to many forms of innovation and entrepreneurial investment may be shattering. Without trust in the future, many talented workers may look elsewhere.

But isn’t Silicon Valley impossible to match in terms of resources? Yes, except that these clusters can be surprisingly agile with a modest amount of time. The epicenter of inventive and entrepreneurial activity is quite mobile as it is built around people and their interactions, rather than a fixed natural resource like a coal mine or great seaport. Boston famously gave ground to Silicon Valley, and Detroit was the Silicon Valley of its day at the turn of the 20th century. Kendall Square is the pride of Boston activity these days, but was rather quiet and sleepy even ten years ago.

Special innovative and entrepreneurial clusters, which are the envy of the world, are very hard to create, but destruction of trust and stability by one administration jeopardizes decades of step-by-step development. Other countries may seize at the current opportunity, but they can only gain in a comparative sense. We can destroy special ecosystems with Monster Trucks, but no one can immediately build them, and globally we will lose deeply. The fact that our innovative workforce depends so heavily on being the best place in the world for global talent to work only exacerbates this sensitivity.

The United States could use a big dose of immigration reform. Our system is outdated and leaves value on the table. But we must all press and pray for a return to intelligent and careful deliberations, as this is a setting where shock treatments can do permanent harm. Regardless of political leaning, we must all hope and persevere that President Trump’s most noticeable accomplishment from the first week in office is not to have destroyed the innovative and entrepreneurial leadership of the United States.

Our nation has long enjoyed an amazing gift from the world in the form of talented people. At times, individuals have come fully equipped to the United States with education and work experience in place; many other times, the United States received someone with raw talent and determination who sought opportunities not available elsewhere. Some stayed a short period, but many stayed forever.

The quantities are large. Immigrants account for about 25% of our college-educated workers in science, engineering, technology and mathematics (STEM), and they have equivalent contributions in outcomes like granted patents and entrepreneurial firm starts. These contributions are increasing, up from 10%-15% just a couple of decades ago. And yes, over half of Silicon Valley founders are immigrants. More generally, America has typically received about half of all skilled immigrants to OECD countries, much to the envy of other countries.

At the highest level of talent, America’s special position has been even more rarified. Over the last century, immigrants have accounted for 107 of the 230 Nobel prizes for Chemistry, Medicine, Economics, and Physics awarded to faculty at American institutions. Some of these were refugees, like Albert Einstein. To understand our “trade balance” in this area, note that only 4 Americans have been affiliated with a foreign institution when they received the Nobel Prize during the same time period, compared to the 107 gained. (For more on the above calculations, please see Global Talent Flows.)

The United States’ special position, however, has been in jeopardy for some time. This was in part due to a poorly functioning immigration system, which immigration-reform advocates labeled our “national suicide” well before Donald Trump began his Presidential campaign. The latent demand was so great that there were serious proposals like Blueseeds to build large ships parked off of the California coast to provide needed access to Silicon Valley to those who could not obtain permanent entry for their work. Countries such as Canada and Chile actively courted those with U.S. visa troubles, including taking out billboard advertisements along highways in the Bay Area.

But the troubles with the US immigration system were not the most important factor behind the fading luster. Much more important was the changing world around the United States. Many countries like China and India, and especially some of their leading cities, made substantial economic gains over the last few decades. This rising prosperity made returning home less of a trade-off for talented workers. Moreover, multinational companies pursued faster market growth abroad, often staffing these growth markets with their best and brightest.

These trends were the real dark clouds on the horizon, with the immigration system being a rather questionable “own goal” along the way. This is not to say that mercantilism of invention should be the goal of the United States, as great good can come from ideas and innovation elsewhere that diffuse and spread. But the gains from innovation leadership are huge, ranging from the tech giants that dominate our stock market to the beneficial contributions that skilled individuals make to our public finances. This is a franchise quarterback we want to protect.

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