Expelling mistake: the costs of hardline immigration policy

The Economist. Hello and welcome to The Intelligence from The Economist. I'm your host, Jason Palmer. Every weekday, we provide a fresh perspective on the events shaping your world. If you've heard anything about the online dating world lately, you've probably heard people saying that it sucks. In the first of our 3-part series, we look at how and why the big established dating firms are falling behind. And today is a landmark day in the history of breakdancing, or breaking as its actual practitioners call it. The sport makes its Olympic debut, the only new event at this year's games. We take a little spin through history to see how it got here. First up, though. The riots in Britain that we started off the week with have now mercifully died down. The reasons behind them are varied. Bluntly, some of it was unabashed racism, but plenty of it was frustration about what has become the running sore of British politics. Politics: immigration.

"I can tell people what I will do with them. I will put them on planes to Rwanda because they shouldn't be able to stay." And of course, it's not just Britain.

"Stopping Muslim migration into Denmark.

Stopping Islamization of the Danish society." "Close our borders right away to asylum seekers and immigrants originating from Islamic countries." Over in America, immigration might be the single biggest campaign issue and line of attack. Now, to be clear here, in all of these rich countries, there are two questions: getting control over illegal immigration and setting policy for the legal kind. Sometimes the policy prescriptions lie somewhere between the impractical and the illegal.

The first and most urgent action when we win will be the sealing of the border Stopping the invasion. Drill, baby, drill. Send Joe Biden.

Dramatic stuff. Closing borders, visa refusals, mass deportations. It makes for rousing rhetoric on the campaign trail, but much of it makes for terrible economics.

So in the past couple of years, the rich world has seen a period of sky-high immigration. We estimate that in the past 3 years, 15 million people have moved to rich countries. And that's actually the biggest surge in history.

Callum Williams is a senior economics writer at The Economist.

So, for instance, last year there was net migration of more than 3 million people to the US. Well over a million people went to Canada with a much smaller population, and about 700,000 people turned up in Britain. The arrivals are from all over the world. Of course, there are hundreds of thousands of Ukrainians fleeing war, but there are also millions of people moving from India and sub-Saharan Africa. The rich world is turning against migration in a big way. There's lots of examples. One of the starkest is a survey which shows that more than half of Americans now favor deporting all immigrants living in the US illegally back to their home country. And that's a rise from only about a third of people as recently as 2016.

So let's be clear here. That statistic from America was about specifically illegal immigration, but you kind of imply that the tide is turning against immigration in a more general sense.

Yes, absolutely. So other surveys, including from America, show that people have turned against migration in general. This is also true in other countries. So for instance, there's a good survey in Australia which shows that the share of people who think that migration to Australia is too low has come down quite a long way. So yes, this is a generalized shift in attitudes against migrants of all sorts.

Now I want to make a distinction here between what we talked about on Monday, the, the riots in the UK, which largely had an anti-immigration bias to them, and, and move on to the actual sense possible policymaking end of this for countries that have levels of migration that, that don't fit in one way or another. What can countries trying to tackle that from a policy perspective, not a knee-jerk one, actually do?

Yes, and here there has been a very clear shift in policy over the past year. So one popular thing that countries are doing— this is happening in Australia, the UK, and Canada— is to crack down on these so-called degree mill universities. And these are universities which offer courses that allow in people whose true intention really is to work rather than study. So Canada is cutting the number of study permits by a third this year. Elsewhere, we're seeing that other countries are making it more difficult for migrants to bring their family with them. Of course, recently in the US, the president announced measures to bar those who had crossed America's southern border illegally from receiving asylum. And then also you have measures, particularly in France and Germany, to speed up deportations. Of course, with an election coming in the US, there's a possibility that the policy machine will become even more drastic, particularly if the Republicans get back into the White House. So Donald Trump has a plan to deport a large number of people living in the US illegally, and we would estimate that his plans involve kicking out roughly 7.5 to 8 million people, which is a tremendous number of people that in a lot of cases actually deliver something for their adopted home country's economies, right?

There is a certain amount of self-defeating when it comes to just getting rid of people.

Yeah, so I mean, in particular, if you look at the measures that involve actually kicking people out, the history here is pretty clear. They do cause a lot of economic damage. So, you know, there's lots of examples you can pick from, but one is during the Depression, Canada ramped up deportations, and that came at a very large fiscal cost and created chaos at the ports as they were trying to get people out. Another famous example is what the Ugandan government did in the early 1970s where they expelled thousands of people of Asian descent. It accused them of being kind of hyper-capitalists, basically caused a huge shortage of entrepreneurs and really damaged the Ugandan economy. Some economists argue, particularly on the right in the US, that the US in fact does show that it's possible to kick out large numbers of people without economic ill effects. Eisenhower did this in the 1950s with people who'd come in from Mexico. But this comparison is pretty misleading, actually. Deportations of Mexican people did rise in the 1950s, but also legal migration from Mexico to the US actually increased very substantially during that period. So there wasn't really the large level of deportations that people close to Trump believe that there were.

So it's sort of not clear to me then the kind of approach that Donald Trump advocates here would have what kind of effect under today's conditions?

So we're talking about the removal of 7.5 to 8 million people. It's quite hard to see how this wouldn't cause economic chaos of one sort or another. Entire industries would be forced to find new staff practically overnight. That would be enormously damaging. That said, I think there is greater uncertainty about the effects of more moderate anti-immigration policies, particularly those that involve trying to slow the number of new people arriving at the country. There could even be some benefits, of course, but they're pretty marginal, and our judgment is that they're likely to cause some economic damage.

Well, for the sake of argument though, what are the potential benefits?

So a lot of the benefits arise in the short term. One is that it would probably reduce inflation in the housing market. In recent years, you've seen very rapid increases in rents and in some cases house prices. Largely as a result of the large number of new arrivals. And so if you were to slow the inflow, you would probably see the reverse effect. So there is research by Goldman Sachs which suggests, in the case of Australia, that a decline of about 100,000 people in net migration would reduce rents by about 1%. And of course, as migration to Britain has slowed in recent months, so has the pace of rent rises in the housing market. I think though it's worth remembering that Over a slightly longer period, falling migration could push up other sorts of inflation. So as labour supply declined, wages might grow more quickly than they were before. And so what that would do would be to raise the price of particularly labour-intensive services, thinking in particular of things like hospitality and healthcare.

So there's a lot of competing effects there in the short term. Let's zoom out a little bit. What's the long-term picture here policy-wise, where this is headed likely?

Yeah, exactly. So the short-term effects are pretty unclear, pretty indeterminate. I think the long-term effects of cracking down on immigration are much clearer. There's a lot of evidence which shows that allowing more people into your country makes you much more likely to become a more innovative country. It allows, quote unquote, native-born workers to move into more productive jobs, which tends to be good for productivity. Of course, the biggest challenge at the moment facing a lot of rich countries across the world is changing demographics. We're not seeing any serious moves by politicians to do things like drastically raise the retirement age, implement serious reforms to healthcare services. And so what that means is that rich countries are getting older and they're getting sicker. And that means you do need to have people coming in, in particular to work in healthcare. So the risk is that a crackdown on migration in this way will create potentially some short-term benefits, but at a very serious long-term cost.

But there is the middle ground to consider to get away from the sort of academic economics of this, there are the social effects of those changes of allowing the immigration. The long-run effects may be this or that, maybe greater innovation, maybe better care in care homes, but it could also be violence on the streets, as we keep seeing.

So I think there's a legitimate argument that what happened after the pandemic was not sustainable, rightly or wrongly. Even before the pandemic, migration was high, but after the pandemic, it really did go off the charts. And I think there's a legitimate argument to say that the pace of migration particularly to places like Canada, was unsustainable. I think there's not much appetite for the sorts of fiscal reforms that would be necessary to allow the public finances of the rich world to be sustainable without migration. And so that means that the rich world does need migration. The question is whether it was too high in recent years, and that it probably has created some social unrest and problems, particularly in the housing market. And so for politicians across the world, this is going to be a very difficult balance to strike.

Thanks very much for your time, Callum.

Thanks, Jason. I mean, I've tried them all. I tried Tinder, Bumble, Hinge. There's a new one called Breeze.

It seems that my single colleagues at The Economist aren't finding much success on the dating apps.

If I have to see one more person on Hinge talking about how much they love travel or their controversial opinion is pineapple on pizza, I will do bad things.

Everyone's kind of tired of being online all the time.

Everyone kind of wants a meet cute. My last long-term boyfriend I met on an app, and it turned out that for the duration of the year, He was dating 6 other women at other points. So yeah, just not like, not a generally great experience, I would say.

All these folks aren't alone. Lately, online dating seems to have lost its spark. Fewer people are downloading the apps, and those that do don't seem to want to pay for the services. Last week, Match Group, which owns Tinder and Hinge and others, reported quarterly growth of 4% year on year. Back in 2021, that number was 24%. And this week, Bumble said its quarterly growth was 3%. Again, back in 2021, that was 25%. What's going on here? Over the next few weeks, we aim to find out what's changed in online dating in that short time. In our 3-part series, we'll ask why people are falling out of love with the apps, how cultural forces are driving innovation and what it means for single people across the world. You already know our guide here, my former co-host Ore Ogunbiyi, now our Africa correspondent and part-time dating correspondent.

When Tinder launched on American campuses in 2012, it was a huge hit. And online dating wasn't actually new at the time, but it would go on to become the most common way for American couples to meet. Match.com had been offering online dating since 1995, but their owners went and bought Tinder, which was booming because in an app form where you can swipe right if you like someone, swipe left if you don't, and then chat with mutuals, that kind of convenience really changed the game. And then in time, dating apps have become so popular that they've shed that reputation of being a bit cringe and looking desperate and have become the new norm. But they've hit a bit of a turning point.

In the sense that the big dating apps aren't getting bigger faster as they once were?

Well, exactly. And people's attitudes towards them are kind of changing. So some of the problem comes from within the business model themselves. By design, if a dating app works, you should have less need for one. As more people get on the apps, you have more choice, you're more likely to find the love of your life and get straight off it. There are also external factors that are also affecting how well these apps are doing. They thrived at a time when there was a lot of cheap venture capital money, when it was okay if you could prove that you were big. But now they need to prove that they're profitable, which is kind of hard if you're mostly free. And so they've run into a bit of trouble. But I'm not saying that people aren't on the apps. Lots of people still use them, even if reluctantly. Tinder, for example, is still the world's most popular app with about 50 million singles globally. And some estimates suggest that over 381 million people across the world have used some kind of online dating service in the last year. And that's double what it was in 2017. In the pandemic as well, people who were lonely really turned to these apps as a bit of a lifeline. But the problem is that now that tricky business model, the venture capital funding drought, and a real lack of innovation means that these apps just aren't growing as fast as they used to. They're not as cool as they once were. And so now they're scrambling to try and find ways to stay afloat.

You said that people are kind of changing their attitudes to the app, though. You described the business model factors, but what about the users?

Well, so there are a few reasons. Firstly, people don't want to pay for this stuff. The apps used to be free, and you can't really prove that if you pay, you're giving people better odds of finding what they're looking for. Straight women are complaining all the time that the quality of men on these apps have decreased. Also, there's a cost of living crisis, and people just have different priorities. I think it's one thing to not be seen as desperate to be on the app, but paying to have access to people is still slightly cringe. Secondly, I think people are just tired. There's a general fatigue around apps more broadly, but in particular with dating apps, there's nothing novel or impressive about the swipe anymore. And that cheap thrill, that cheap entertainment, is beginning to lose its meaning. For a lot of women, it's actually becoming overwhelming to have to constantly entertain these conversations that don't necessarily lead to anything. And recently there was also a proposed class action suit against Match Group, so the owners of Tinder, Hinge, and a bunch of other apps, that accuses the firm of specifically designing the apps to keep users addicted. Now Match Group has responded and said that the lawsuit is ridiculous and has zero merit, but it's interesting that people are that annoyed. There's also a third reason: people are just looking for new ways to find love offline, something a little nostalgic, something that feels real. And especially post-pandemic, when people have had to move so many of their relationships online, People just want to do more things in person. But, but, but, but, but, big caveat, not all the apps are in trouble.

So tell me about the apps that aren't doing so bad.

Well, apps that are focused on specific identity groups are still quite popular and rather resilient. Grindr, for example, whose users are mostly gay and bisexual men, has the highest engagement rate of any dating app.

It's 50 chats per user per day, right? And that's about the number that WhatsApp has.

And that's something that their boss George Arison told me a bit about.

And we don't limit how many messages you can send, who you can speak to, any of that. Like, that's available to everybody.

Match Group also has expanded their offerings for gay men and also for single parents, Black people, Latin and Christian singles. And that combined portfolio is growing at 70%, which is much higher than the group of all their other catch-all brands. You've also got niche companies outside of the West that are popping up as well. So there's Maz for Muslims, which is growing pretty well in the Middle East. But the mainstream apps are still struggling.

And so for the ones that are struggling, what's to be done?

I don't think this has to be the end of dating apps. In fact, I don't think it is at all. But there are many ways that they can innovate to stay cool, to stay relevant with young people. They're trying with TikTok ads, for example, to rebrand and refresh.

What?

He just messaged me.

The one you matched with?

The one off Tinder.

Oh, what's wrong? I do. What'd he message you He said hey.

But I think a big challenge that they have is that people spend too long on them having mindless conversations and less time off them actually dating people. So maybe there are ways in which they can limit how long people chat for. For example, how do you keep up with people's evolving preferences, which seem to tend away from casual sex and more towards love? Tinder, for example, said they are reprioritizing that in their branding, but it's unclear if it's resonating at the moment. A lot of the challengers are focusing on planning those dates for you so that it's one less thing that you have to think about. And these small companies could of course be absorbed by the larger ones, but it also just forces the big apps to think differently about how they think about dating. And next week we're going to take a closer look at what a bunch of singles who are sick of these apps are trying instead.

Well, I look forward to hearing more next week then. Thanks as ever, Oyin.

Thanks for having me, Jason.

In 1984, the New York City Breakers, a dance group, made the rather presumptuous proclamation that breaking would one day be an Olympic sport and that they themselves would be the pioneers.

Max Norman is a culture correspondent at The Economist.

Today, 32 breakers will grace the outdoor stage in Paris' Place de la Concorde at the Olympic Games.

For 30 years and more, it's something that's been done on street corners, at skate parks, and on dance floors. But now it's official. Breaking is an Olympic sport.

Breaking will be the only new event at this year's games. By the way, practitioners shun the term breakdancing, which is associated with the frenzy of media attention that the dance got in the 1980s. 1980s. Despite the spectacular physicality and emphasis on competitive battles, breaking has always been more of a culture than a sport. You might say breakers were more interested in gold chains than gold medals.

Yes indeed, y'all, this is DJ Kool Herc once again coming at you.

Breaking emerged in New York in the 1970s alongside breakbeat music, early hip-hop, and even disco.

[Speaker:DJ HERC] What we gotta do out there is big up ourself, live up ourself.

[Speaker:GHION.AI] Right now you're listening to "A Message from DJ Herc," a track featured on an album by DJ Terminator X. DJ Herc is credited as one of the founders of hip-hop in New York and a pioneer in using two turntables at once to create breakbeats. He also first called breakers B-Boys and B-Girls. And now to hit. After what might be seen as a publicity stunt from the New York City Breakers in the '80s, breakers never seriously sought a place at the Olympic Games. They're there thanks to the World DanceSport Federation, which is the international body recognized by the Olympic Committee to oversee dance. Historically, the World DanceSport Federation was focused on ballroom dancing, and they tried for years to get dancing in some form or another into the Olympics, to no avail. Breaking was suggested as a potential path into the Olympics because it would give the Olympic Committee what they were looking for, specifically renewed popularity among younger viewers. Olympic viewership has been in decline for years, at least since the 2012 Games in London. Breaking has no language barrier. It travels really well on social media, it's visually impressive, and you don't need to know that much about it to find it interesting. A key point on the path to Paris was the 2018 Youth Olympic Games in Buenos Aires. In advance of those games, the World DanceSport Federation had to put together objective judging criteria and figure out how qualification would work. These are necessary for an organized sport, but were new and not uncontroversial for breaking, which is all about self-expression, independence. There was even some concern that the whole Olympic process would neglect the rich culture from which breaking emerged and perhaps even replay some of the commercialization of the 1980s. Unlike many sports, breaking has a very specific point of origin. It emerged among Black and Latino communities in the Bronx in the '70s. At the same time, though, it was actually the first element of hip-hop culture to spread internationally, thanks to a few really popular films like Breaking and Break Street. Those films raised its profile, but at the same time are sometimes even referred to as "breaksploitation" films by critics for the way in which they commercialized the dance. The song you're listening to now Now is by the hip-hop duo Eric B. Rakim, and it comes from the 1992 film Juice. It's a classic track for breakers today. After the explosion of attention in the 1980s, the boom fizzled out, and for various reasons, dancers felt that they were left by the wayside. As a result, they've been wary of too much mainstream attention and appropriation from those who perhaps do not have their best interest in mind. In advance of the Olympics, there was even a petition in 2017 which accused the World DanceSport Federation of exploiting breaking as a, quote, Trojan horse to get dance into the Olympics. Since then, after lots of difficult conversations, negotiations, many breakers have warmed to the Olympics. The potential upside is really too big to ignore. In Europe and Asia, breakers have often benefited from state support. Breaking is seen as a kind of art form. It's part of culture. Governments see it as a good thing for kids to be doing. The Olympics will undoubtedly expose a whole new generation to breaking and will boost the public profile of the dance. But it will probably be a one-off. The event won't return for the 2028 Games in Los Angeles. For now, though, the focus is on really leveraging the publicity in Paris and trying to turn it into more corporate sponsorship and a greater public profile for breaking. Lots of breakers are optimistic. They see this as a path towards building careers that resemble those of other athletes with corporate sponsorships that let them spend more of their time on breaking and less of their time figuring out how to pay the rent.

That's all for this episode of The Intelligence. The show's editors are Chris Impey and Jad Gill. Our deputy editor is John-Joe Devlin, and our sound designer is Will Roe. Our senior producers are Rory Galloway and Sarah Larniuk, and our senior creative producer is William Warren. Our producers are Maggie Khadifa and Benji Guy, and our assistant producer is Henrietta McFarlane, with extra production help this week from Kunal Patel and Elna Schutz. We'll all see you back here tomorrow for the Weekend Intelligence.