America needs its foreign students

We're messing with the engine that makes our country run.

Photo by Joshua Hoehne on Unsplash

The Trump administration has just paused all visa interviews for all foreign students seeking to study in the United States. This means that until and unless that pause is lifted, the number of new students who can apply to come study in the U.S. is zero. Ostensibly, the pause is a short-term measure that will give the Trump administration time to set up a procedure to vet prospective students’ social media accounts for ideas it doesn’t like; interview scheduling could resume within days, or it could take longer.

This is important because it’s part of a more general attack on foreign students. Trump already forbade Harvard University from enrolling students from overseas, although the action was blocked by a court. This was part of a high-profile confrontation with Harvard over anti-white racial discrimination, but it also reflected Trump’s belief that international students are taking spots that ought to go to Americans. Bloomberg reports:

President Donald Trump said Harvard University should cap foreign student enrollment at 15%, ratcheting up his effort to force policy changes at the elite institution.

“I think they should have a cap of maybe around 15%, not 31%,” Trump said Wednesday at the White House. “We have people who want to go to Harvard and other schools, they can’t get in because we have foreign students there.”

Trump has the same attitude toward college spots that he has toward immigration and imports. To him, everything is just a lump of fixed size — a pie to be divided. In his mind, if you kick out immigrants, the number of jobs doesn’t go down — the jobs just get parceled out to native-born Americans instead. If you ban imports, Americans don’t consume less — they just buy American-made products instead. And if you kick out foreign students, the number of college spots doesn’t go down; American kids just get more.

Of course, Trump is wrong about that, as I’ll explain. But kicking out international students dovetails with a number of other Trump administration priorities. It allows them to strike out at left-leaning universities. It allows them to implement ideological tests for immigrants — something they want to do in general.¹ It allows them to reduce the number of foreigners in the country, which they feel strengthens Western civilization.

And for the China hawks in the administration, it allows them to kick out the Chinese, whom they suspect of being spies:

The U.S. will “aggressively revoke” visas for Chinese students, Secretary of State Marco Rubio said Wednesday…“Under President Trump’s leadership, the U.S. State Department will work with the Department of Homeland Security to aggressively revoke visas for Chinese students, including those with connections to the Chinese Communist Party or studying in critical fields,” he said in a statement. “We will also revise visa criteria to enhance scrutiny of all future visa applications from the People’s Republic of China and Hong Kong.”

So kicking out foreign students is, in many ways, the perfect policy from the Trump administration’s point of view. The problem is, it’s a terrible policy. But like tariffs, this policy will immediately and needlessly hurt some parts of America, while also leading to a long-term erosion of American competitiveness, innovation, and general economic strength.

There are three basic ways that international students are important for the U.S. economy:

1. Their high tuition payments subsidize the education of native-born American students.

2. The money they spend in America helps keep the economies of small towns and cities going.

3. They are crucial for American innovation and technological strength.

International students subsidize American students, especially at state schools

American universities fund themselves five main ways: 1) government money, 2) alumni contributions, 3) investment income from endowments, 4) revenue from hospitals and other businesses, and 5) tuition. Tuition currently provides about 17.5% of the total overall, and almost a third for private nonprofit universities. Here’s data from 2020: