What Makes America Strong?
In 2025, US net migration was likely negative, as the number of legal immigrants has been reduced in various ways. The overall effect will be to slow economic growth – perhaps by a lot – relative to what it otherwise could be.
Simon Johnson
WASHINGTON, DC – President Donald Trump says that he wants to launch a new “Golden Age” for America (or perhaps that it is already here).
A defining feature of Trump’s vision, it is now clear, is the generous use of military force within or against various countries – Nigeria, Venezuela, Iran, and presumably others to come – for various reasons.
Another will be an America that admits and integrates far fewer immigrants.
But while military might, as the US should know by now, does not necessarily make a country stronger, a closed-door immigration policy is a surefire way to make it weaker.
Restricting legal immigration lowers economic growth, constrains innovation, and impedes productivity gains.
Trampling on the rights of citizens and legal residents while pursuing people whose only crime is being undocumented undermines civil order and reduces investment (and likely consumption).
The numbers don’t lie: the United States is obviously a country built by – and made strong by – immigration.
At independence in 1776, the 13 former colonies had 2.5 million people, compared to at least 7.5 million in Great Britain. By 1860, just before the Civil War, the US population (33 states and ten territories) had risen to just over 31 million (based on the eighth census), including nearly four million enslaved people.
Over 25 million immigrants arrived during the 19th century, including nine million between 1880 and 1900.
By the start of the 20th century, the population exceeded 76 million, powering what had become – and what has remained ever since – the world’s largest economy.
There are major advantages to having a large home market.
Being able to reach scale before attempting to export is helpful when building a business, and this is one reason the US has long been ideal for entrepreneurship and breakthrough innovation.
This has been true for most of the industrial age, as well as the internet age so far.
Railways thrive on scale, as do steel plants, car makers, airplane builders, semiconductor designers, social media companies, AI developers – and of course defense contractors of all kinds.
The size of the US has enabled it to set global trends, from Hollywood to social media.
And economic scale, the size of your GDP, reflects two things: population size and average productivity.
It was also population size that made the US a military power.
The US played a decisive role in both World War I and World War II because all those newcomers (as well as millions of African Americans who moved from the South to northern cities during the Great Migration) had powered massive growth in industrial production.
Eventually, during both world wars, the US was able to mobilize and equip a military that could project power globally.
A previous generation of policymakers understood and appreciated the importance of population size for national security.
In 1948, the year the Berlin Airlift began at the start of the Cold War, the population of the Soviet Union (estimates run as high as 195 million) exceeded that of the United States (148 million).
During the 1950s, the US authorities were concerned that America’s education system would not produce enough scientists and engineers to keep pace with Soviet technology.
By 1989, the US had reached 250 million people while the Soviet population was around 290 million.
Today, the US has a population of around 349 million, compared to less than half that in post-Soviet Russia, and an economy that is roughly ten times larger than Russia’s. Victory in the Cold War was, at least in part, demographic.
But today, of course, the US is competing head-to-head in economic terms with China (currently around 1.4 billion people, a number that is falling) in a world with a total population of over eight billion, likely on its way to ten billion later this century.
Once again, immigration policy will be an important component of America’s success.
To see why, consider that over the past two decades, annual legal immigration to the US (the number of people receiving green cards) has averaged more than one million people.
These newcomers have made an enormous contribution to innovation and new company formation, in addition to paying taxes and strengthening Social Security.
The broader economic effects of immigration are also significantly positive.
Since 2000, immigrants have won 40% of the Nobel Prizes awarded to Americans in chemistry, physics, and medicine.
In 2024, Daron Acemoglu, James Robinson, and I won the Nobel Prize in Economics.
We are all immigrants to the US.
Now the Trump administration is slamming the door.
In 2025, net migration was likely negative (according to careful analysis), as the number of legal immigrants has been reduced in various ways.
The overall effect will be to slow economic growth – perhaps by a lot – relative to what it otherwise could be.
There are, of course, many dimensions to the immigration discussion, and without question, the US must secure the border.
But the legislation needed to manage immigration properly must also address pathways to citizenship for law-abiding people already in the US, as well as the rules for asylum seekers.
But the bottom line is clear: dramatically reducing legal immigration will slow economic growth and undermine national security.
If the goal is a Golden Age, or at least a more prosperous and secure US, the Trump administration’s policies will fall far short.
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