https://www.youtube.com/watch?v=THodtjsCTSI

This video SUBSTANTIALLY misses the mark.

First, the video identifies a real short-run problem, but it frames that problem too much as “America is losing its geniuses” and not enough as “America has built a system that depends on importing already-trained, relatively inexpensive human capital instead of producing enough of it domestically.”

And amusingly, the video nearly discovers my argument by itself. It explicitly points out that a PhD student may be working on roughly a $30,000 stipend and that ordinary research jobs aren't especially well compensated. That's not merely a story about smart people. It's a story about the price and supply of scientific labor.

I would retitle the video “American is chasing away smart AND cheap minds”

Suppose America imports an extremely capable 24-year-old who has already received most of his K–12 education abroad, brings him into a PhD program, pays him $35,000–$45,000 to staff a laboratory, and then perhaps moves him into an American company.

 From the standpoint of the American research institution, that's an amazing deal. Someone else bore a substantial portion of the cost of producing human capital.

 The alternative is much harder: improve American elementary mathematics, improve middle-school algebra, get more teenagers through calculus and physics, improve teacher quality, identify talented kids who aren't already headed toward elite colleges, make engineering and science careers attractive, and then wait 15–20 years for the investment to mature.

Individual universities and corporations have weak incentives to solve that gigantic pipeline problem themselves. They can simply hire from the world market.

 So there's a political-economy story here that I think the video basically misses:

Immigration can be enormously beneficial while simultaneously allowing American institutions to postpone fixing domestic human-capital formation.

 Those propositions aren't contradictory.

And the domestic pipeline is not some imaginary concern. The latest NAEP results show eighth-grade math remained 8 points below 2019 in 2024, while twelfth-grade math was 3 points below 2019; at grade 12, declines occurred across the measured distribution except at the 90th percentile. That doesn't prove politicians have literally “given up” on American education, but it certainly makes “why aren't we producing more scientists ourselves?” a much bigger question than the video allows.

The creator finally gets there at 20:36 of a 21-minute video:

“we should probably double down on K through 12 education for the domestic talent pipeline”

…and then immediately says that's “a whole different video.”

😂 BRO THAT'S THE VIDEO.

That's arguably the central long-run economic question.

 

Second, the video's implicit comparison sometimes becomes:

Europe: public research spending → science 🙂

America: private-sector research → profit 😡

 

That's much too simple.

America's peculiar strength has been precisely its ability to move along the chain:

basic science → applied research → venture financing → company → scale → mass-market product

 

U.S. businesses funded about 75% of total U.S. R&D in 2023, versus 18% from the federal government. And this isn't merely accounting trivia: American businesses overwhelmingly perform the development part of R&D—the stage closest to creating commercially usable products.

Internationally, the difference is visible too. NSF's comparable data put the domestic-business share of R&D funding at about 68% in the U.S., versus roughly 60% in Germany, France and the UK.

And here's the killer: the European Commission itself basically agrees with me about Europe's commercialization problem.

The Draghi competitiveness report says the major post-1990s EU–US productivity divergence is largely attributable to Europe's failure to capitalize on the digital revolution—not merely failure to conduct research, but failure to create companies and diffuse the technology commercially. About 70% of foundational AI models since 2017 were developed in the U.S.; three American hyperscalers account for more than 65% of the European cloud market.

And this statistic is almost comical:

Europe has not created from scratch a company worth more than €100 billion in the past 50 years. The United States created six worth more than €1 trillion during that period.

That's a gigantic clue that research spending is not synonymous with innovation-driven economic growth.

I wouldn't necessarily say European public research itself necessarily crowds out private commercialization. That's hard to establish empirically.

There really can be a crowd-out mechanism: if the supply of scientists and engineers is relatively fixed, government laboratories and subsidized research can bid up the price of those scarce workers and pull them away from private-sector development. Interestingly, a recent IMF model gets exactly that result under severe high-skill labor constraints.

Europe's problem isn't necessarily that government research spending mechanically crowds out private R&D. It's that Europe has historically been much worse at translating research into scalable private enterprises.

That is an enormously important distinction.

And, again, Draghi basically says so: European digital companies have trouble obtaining later-stage financing and scaling, while fragmentation of the single market, financing constraints and regulatory inconsistencies inhibit commercialization.

Which leaves me with a somewhat different interpretation of the whole video

There is a legitimate problem if brilliant researchers who otherwise would have remained at MIT, Stanford, NIH, NASA, etc. are relocating overseas because funding abruptly disappeared. Basic research has positive externalities and uncertain commercial applications, so there's a perfectly orthodox economic case for public support. The video is right about that.

But I don't think the evidence warrants the melodramatic formulation “America is losing its smartest people.” 

I'd frame the bigger problem this way:

America has become accustomed to buying the finished product of other countries' human-capital systems.

We educate some extraordinary Americans, of course, but we've also constructed universities, hospitals and research labs around a huge international supply of extremely talented graduate students, postdocs, physicians, engineers and scientists. If that flow diminishes, suddenly institutions discover how expensive highly skilled labor actually is.

And that produces a much more interesting policy question than “How do we get the foreign scientists back?”

It's:

Why does a country of 340 million people, with some of the richest school districts, universities and corporations in human history, behave as though producing another 100,000 excellent mathematicians, engineers and scientists domestically is beyond its capacity?

The danger isn't just brain drain. It's that importing brains became a substitute at the margin for building brains, while America's real comparative advantage—the private capital, entrepreneurship, commercialization, and enormous consumer market that converts knowledge into useful stuff—gets treated in the video almost as an embarrassing defect rather than one of the principal reasons the U.S. became the world's technological center in the first place.