The U.S. runs big trade surplus in higher education. About one-third of the foreign students generating that surplus come from China.
Nonetheless, Trump Threatens Student Visas.
The White House is considering limiting visas to Chinese students as part of a broad package of measures targeting Beijing, which the U.S. accuses of violating intellectual-property laws and other misdeeds. A White House official said the package, including tariffs, could be unveiled later this month.
China sends more students to the U.S. than any other nation, accounting for roughly one-third of the 1.1 million international students enrolled at American universities in the 2016-2017 academic year. China has long valued access to U.S. colleges and universities, which consistently rank among the best in the world.
When international students and their families spend money at American colleges, it is considered an export for the U.S. because money flows from a foreign country to the U.S.
Foreign students attending American educational institutions accounted for $39.4 billion in U.S. exports in 2016, Commerce Department data show.
Data Way Understated
The data are way understated because the numbers include tuition and perhaps some room and board.
Meals, books, nightlife, entertainment, travel, etc. are not included in the trade surplus numbers. Nor is rent, unless it was paid directly to the university.
Services – Net Trade Surplus
The US consistently runs a positive balance of trade in services. More than 100% of that is education.
Why? The total services surplus is $22 billion, whereas education alone provides about $30 billion net, not counting meals, books, rent, etc.
If Trump kills student visas, that surplus could easily turn into a deficit. Trump threatens to do just that.
Hidden Value
The setup is even worse as reader “Sechel” explains:
It’s not just balance of trade, but we’re giving up the hidden value of goodwill and the promotion of US values both at home and abroad. This is just a another version of the Voice of America. When these students go home, they’re able to counter any incorrect narrative of the US that their government and media put out. Foreign students that come here see first hand our values and our culture.
Mike “Mish” Shedlock
Good, then these colleges will have to have seats for American students.These colleges only care about the sweet dollars they get from these students who go back to their countries and bash us.We’re at more than just a trade war. Wake up!
Thanks Escierto. I am equal party basher. Bush, Obama, Trump. There was one major thing Obama did right – Talk with Iran. Note how the Trump fans changed on North Korea. They wanted him to bomb North Korea, now they are praising the talks. The same group bashed Obama for wanting talks with North Korea.
What is fascinating to me is no matter how much common sense logic Mish serves up to his readers, the vast majority of them are Trumptards who defy any attempts at reason. Like their leader, you must not bother them with the facts, their minds are made up! Lemmings, full speed ahead! Over the cliff!
This “Russian spy” nonsense has no meaning now. If you are against unfair trade deals, the neoliberals will call you a “Russian spy”. If you are against endless foreign wars, the neocons will call you a “Russian spy”. Anyone who doesn’t toe the establishment line on any issue, is now a “Russian spy” – environmentalists, Medicare-For-All activists, Black Lives Matter volunteers… you name it.
I think this is a negotiating position that Trump is taking. Foreign students who come to the US to study end up getting jobs on H1 visas that then keep getting renewed forever and ever. If the compromise is that they can come here to study and leave after the studies are completed (and take back the values and culture that they are supposedly imbibing here) would it be acceptable to the Mish types?? Of course not. Because what they want to do is to screw legal US citizens every way they want (job-killing trade deals, so-called right-to-work laws that impoverish them further, unchecked illegal immigration, red-carpet style legal immigration and on and on and on).
Oh, that is too much cotton candy for one post! And you are talking about values, schmalues, culture and schmulture….
Those students are intent on making money for themselves and not concerned with anything else. If they go home (or even if they are here) the only thing they would be doing is to get more jobs shipped from the US to their country. Period.
Savage.
@Shimshon @wootendw @Mish It’s Shift-Enter
If Trump does away with Student Visas that is the end of Silicon Valley, MIT depends on foreign students because God knows the home-grown ones have neither the discipline nor the IQ nor the prerequisite knowledge in Math & Chemistry. I am starting to think he really is a Russian spy sent to destroy America.
This is my first time commenting here too. So, from my first impression it’s a botched implementation (yes, if they were exactly like Facebook, I would be okay with the behavior, but they’re not).
Yes, I know about Ctrl-Enter and I did this too. I assumed that it behaved like Facebook, yet it doesn’t. So they’re “like Facebook,” but not really.
Mish, that is how Facebook works. I hate it. And I use a nice Chromium add on that fixes that flaw.
Thanks. I quit Facebook but, to enter a new paragraph in FB, you hold down the ctrl key while pressing ‘enter’. I tried it here but it didn’t work.
I have bitched about this absurdity on numerous occasions. I am told this is how Facebook works. (I think it was Facebook, it may have been another social media program). My reply was “why should the Maven copy obvious flaws in the design of others”. So please bitch away, All you want. The more bitching, the more I will be able to get an obviously needed design change. Meanwhile, this is the way around the problem. Press enter. then click on the three dots (assuming you can find them), then press edit. Then insert a blank line. Notice you now have a “publish” button. Yes, this is absurd. I still stick with them because in general, I am sure they know what they are doing. But routinely following Facebook “just because”, is a problem for me too.
Good night everyone. This is supposed to be a standalone comment.
But at least you get another paragraph.
If you add a comment immediately after posting one, they appear as part of the same comment.
If a foreign investor buys a US skyscraper, why isn’t that considered an export? It brings money back the US in the same way an export does, even thought the building stays here.
Comment issues. If you hit the Enter (‘return’) key to go to the next paragraph, the comment gets published. How do you enter an ‘enter’ to start another paragraph?
“It’s not just balance of trade, but we’re giving up the hidden value of goodwill and the promotion of US values both at home and abroad.” I am not sure that colleges promote ‘US values’. If students are taking STEM courses, they’re not getting indoctrinated – which is probably a good thing as most academics are economic leftists. Foreign students will most likely get a globalist viewpoint. And if foreign students watch millenials walking around playing games on their smartphones, they might well conclude that we’re idiots. And if a foreign government – eg China – is paying for the books and tuition, are they not going to screen their applicants before handing out the money? University education in the US (and elsewhere) isn’t an example of free market economics. I don’t know why this should be considered an export.
Please explain what you do not like about the comment system. BTW – I have issues as well, but I want to know what yours are. By Yours, I mean “anyone”.
(Not happy with this comment system.) Admitting non-residents and foreigners at “full fare” without restriction, can have only one effect on residents: similarly (and unfairly) jack up their prices, to the point that even the discounted state tuition is still very high. If Harvard (still massively state supported, but ostensibly “private”) wants to open the floodgates, they are welcome to, personally, but if they get caught up in restricting foreign access to American schools, oh well. Perhaps the funding shrinkage will help them reassess their SJW-infused decision making. A freebie, as far as I am concerned.
I used to think the same way. However, I would say there’s a reasonable argument that for state universities (at all levels) should be restricted to state residents (and perhaps a small number of slots allotted to other Americans and foreigners.
Well if its Chinese then we’re talking University of California. UC academic affairs recently posted, “I believe the most qualified person should get the job”, is an example of a racist micro-aggression. UC Irvine no longer accepts VA benefits, probably because it’s flooded with so many Chinese exchange students who might be offended by ex-military in their classroom.
Also, tuition increases have very little to do with foreign students. How about imposing stricter requirements and limits on student loans to rein in the tuition increases?
I am not sure how you can ‘weaken’ the entrance requirements when there are more qualified applicants than Harvard (or Stanford etc) can accommodate today. I would rather see Harvard limit its intake of foreign students to a small number (e.g. 5 percent or less). We need more Harvard students who will remain here upon graduation than returning to their home countries.
” promotion of US values both at home and abroad.” Yes we need more fat warmongers, debt slaves
May be you should think twice before making a joke since only you understand it.
I was joking, but no tuition increase would be necessary at the top 40 or 50 schools because they have the endowment to cover it. For example Harvard has an endowment of nearly $40B and the total cost of tuition for the entire undergrad population is around $300M, or 3/4 of 1% of the endowment. They don’t have to charge anyone a dime if they don’t want to.
How about zero? But assume something else. Assume whatever you want but then explain how much do you want to weaken entrance requirements. Also, explain how much of an increase in tuition do you are willing to have.
How many more Americans could enter MIT, Stanford, and Harvard if it weren’t for those damn Chinese and Indian students?
I agree with Mish
I modified your comment slightly changing “America” to the more accurate “US”
Love the comment. Will add it to the article. Thanks