America is losing its smartest people. By the  numbers alone, 80% of postoc researchers now  

report they are looking for positions outside of  the US. The number of US researchers applying for  

positions in Europe has tripled. And just across  the border, applications from American scientists  

looking for jobs in Canada rose 41% while Canadian  scientists looking for jobs in the US fell by 13%.  

Federal agencies lost over 10,000 doctor level  STEM and health experts over the past year.  

Hospitals are now running low on skilled  practitioners entering the field and even  

in purely profit-driven enterprises. People  like AI researchers are rather loudly finding  

opportunities abroad. These are also only  the positions that we know about. And well,  

this shouldn't really be happening, right? The  United States has always attracted the very best  

and brightest people to live and work here. And  it's done that for a number of logical reasons.  

We have some of the best research institutions  and schools in the world. We have a robust funding  

system to finance cutting edge development. And  honestly, the not so secret reality is that very  

smart people can normally make a lot more money  here than they can anywhere else in the world.  

Even amongst other high-income economies, startup  founders, scientific researchers, academics, and  

medical practitioners have typically been drawn  to America because there are more opportunities  

to get their work funded and also to be funded for  their work. Now, I know what you were thinking,  

and yes, obviously, a lot of this has to  do with things like lacks or regulations,  

over financialization, and a health care system  that prioritizes profits over outcomes. And well,  

yeah, you would have a point. But putting aside  the social problems these may cause for a second,  

American pharmaceutical labs, financial firms,  hospitals, startups, big tech, and the venture  

capital ecosystem all genuinely present amazing  financial opportunities to highly skilled people.  

But the thing is, none of this has really  changed. We still have all of the systems  

alongside the good and bad that comes with them.  What has changed, though, is that despite the  

chance to make a lot more money, smart people  from across the world aren't coming in nearly  

as fast as they once did. And perhaps even  more worryingly, the smart people that we do  

have are moving out. It doesn't sound great, but  perhaps this could all mean more opportunities and  

training for the people who are already here,  right? Well, we will get to that. But also,  

this raises the question of where are these people  going and what are they actually taking with them?  

Americans are leaving the United States at record  levels in large part because of divisive politics  

and an affordability crisis. A poll from the  journal Nature earlier this year found that 75% of  

researchers in the US are considering leaving the  country. We've lost more than 15,000 scientists  

from the ranks of the federal government. We're  losing our scientific base. New breakthroughs  

in powerful lowcost Chinese AI models are sending  shock waves through Washington and Silicon Valley  

as Chinese companies continue to narrow the  AI gap despite vast differences in computing  

power and financial resources. Okay, so obviously  the most pressing question would be to ask why is  

this happening? Or rather, why is it happening  now? And well, yeah, while it would be easy to  

blame everything on the current state of America,  it's worth at least acknowledging that most other  

countries are dealing with their own problems as  well. And in the grand scheme of things, we still  

have it pretty good. Especially for people at the  top of their respective field. And yet, people who  

theoretically have the qualifications to live and  work almost anywhere they want are still reversing  

a very long-standing trend of gravitating to  the USA. And they are doing it for two reasons.  

The first is that despite spending hundreds of  billions of dollars on R&D every year, we are very  

selective with where we actually spend it. And  overwhelmingly, it goes to projects with a clear  

path to return on investment. The private sector  now funds about 3/4 of all American research and  

development. And even amongst what's left, federal  agencies only fund around 40% of the country's  

basic research. The problem this creates is that  private for-profit companies have no incentive  

to fund the risky foundational work that doesn't  have a clear path to making well a profit. This  

means something like climate science, which might  actually stand in the way of corporate profits,  

hasn't been well funded compared to opportunities  in places like Europe. Last year's White House  

budget request for the National Ocean and  Atmospheric Administration proposed exactly 0 for  

climate research, which would theoretically impact  the ocean and the atmosphere. At the same time,  

for comparison, the EU set aside almost 5 billion  of its current 2-year research budget just for  

climate work. For the most part, this just simply  means that at least for the next few years, if a  

climate scientist wants to continue their studies,  they are effectively being forced to move.  

The other thing is that people in these fields are  a lot more open to moving because for better or  

worse, it's kind of a part of the job. Someone  who just finished a PhD in one of these fields  

is effectively eternally at the whims of research  funding. They kind of go where the grants go. And  

especially in less profitable fields of science,  less and less of that money is in the USA. Now,  

to play devil's advocate, maybe pursuing science  only when it is profitable still means we keep  

all of the research that will actually  contribute to economic development, right?  

Well, we will get to that assumption, but even  if it was completely true, it would still be  

very shortsighted. A lot of research doesn't  seem profitable at first before it turns out  

that it really is. Radio astronomy was developed  to get more accurate images of the cosmos before  

the same tech ended up giving us Wi-Fi. Number  theory experiments from the 1970s gave us modern  

cryptography, which enables end to-end encryption,  secure online payments, and login. There are also  

infamous things like GLP-1 drugs which trace  directly back to government-f funded researchers  

studying Gila monster venom. There are literally  hundreds of these examples because we don't really  

fully know the applications of frontier research  until we have done it. Nobody ever budgets for  

the lizard spit economy. Neil deGrasse Tyson  may be best known as that famous science guy,  

but he is also a legitimate physicist who has  recently spoken about this trend in his field  

here on YouTube. His video actually came out as  we were writing this one and he has basically  

said the same thing which is probably worth more  from someone with one foot still in the door of  

academia. So I will leave a link to that below.  More broadly though, other countries have seen all  

of this happening and they are capitalizing on our  complacency by setting up grants and systems to  

make it easier for these smart people to just make  the jump in the other direction. Some are even  

specifically head-h hunting researchers, offering  them comparable salaries, fully funded labs,  

and stable positions overseas. Canada launched a  $ 1.7 billion Canadian program at the end of last  

year built to recruit more than a,000 worldleading  researchers, complete with money for their labs,  

their equipment, and their grad students. The EU  announced a€ 500 million euro choose Europe for  

science package aimed at researchers looking  for the exit. And applications from US-based  

researchers from the European Research Council's  most prestigious grants went from 23 to 114 in  

a single cycle. One university in the south of  France even set up a program actually called Safe  

Place for Science. Subtle and got 298 applications  from researchers in America, including people at  

Stanford, Berkeley, and NASA. And of course, above  all, China has been aggressively pursuing talent,  

especially amongst its own nationals who often  study in the West and then stay in the West. For  

at least the last century, the USA has been by  far the largest hub of research and development  

funding anywhere in the world by some margin. But  as of 2 years ago, adjusted for purchasing power  

parody, China has now overtaken us, and they are  now channeling more resources into R&D every year  

than we ever have. Uh, now a quick interlude here  is that purchasing power parody accounts for the  

lower cost of most things in China. A million  dollars in China just buys more equipment,  

man-hour, and other resources than it does  here in America. Without that adjustment,  

we are still technically throwing more money  at R&D. But in plain English, China is throwing  

more actual resources at upgrading their tech  tree. Anyway, back to it. Today, there's a big  

push to get a lot of the students that left  China to study in places like America to come  

back to China along with all of the skills and  expertise they have gained from research and work  

at Western institutions. Often, this incentive is  as simple as just a big pile of money. But again,  

more on those in a minute. The point is that  if the brain drain trend that has served us  

for the better part of a century actually  reverses, that would be catastrophically bad.  

Being at the cutting edge of a broad selection  of sciences has been instrumental in America's  

outperforming economic growth and well our  military dominance over the same time period  

too. Competing in either metric without the  foundation of worldleading science is kind  

of like trying to compete in AoE2 when your  opponent is two ages ahead. It's going to go  

badly. When scientists fled Germany in the 1930s  and landed here, American patenting in the fields  

they joined jumped around a third. And the effect  lasted well into the 1950s and arguably set us up  

for our dominance over the next 50 years. But  well, the thing is, to be fair, none of this  

is new. Countries from across the world have  been well aware of brain train to America for a  

long time. And they know how much it has helped  keep us at the forefront of most fields and how  

much it has hurt their own development. They have  also always done what they can to get their smart  

people back. But it's time to learn how many works  to find out why they might finally be succeeding.  

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the description to get started. Okay, so America  has stopped paying for a lot of the science that  

doesn't pay for itself. But the second reason  smart people are leaving is a little bit more  

personal. It's absolutely true that highly skilled  professionals can earn more in the USA than they  

would typically be able to almost anywhere else  in the world. But just because they can doesn't  

mean that there is a guarantee that they will. And  look, the frustrating part about this whole topic  

is that it is incredibly complicated. Even if we  are just looking at their overall net economic  

impact, a PhD student on a roughly $30,000 stipend  might end up contributing more to a country than  

a head-hunted AI researcher being offered a  9-figure signing bonus. In typical research  

roles, the compensation is not that great. The  averages just get pulled up by the outliers that  

get poached away into private industry, often in  narrow verticals that just happen to be jazzing  

investors at that point in time. Even a couple  rungs up the ladder. The official NIH pay floor  

for a posttock is about $635,000 a year. Usually  located in a city where that doesn't go very far.  

The joke of a physicist going to work for Loheed  Martin to pay off their student debt exists for a  

reason. Physicists in the private sector earn  roughly 30% more than the ones who stay in  

education. The defense and aerospace jobs pay even  better still. And that's ignoring the people who  

just go and take a job as a quant on Wall Street.  So, you're a rocket scientist. How did you end up  

here? It's all just numbers. Really, just changing  what you're adding up. And to speak freely, the  

money here is considerably more attractive. The  problem is that at these more basic income levels,  

quality of life in America is statistically  worse than in a lot of other countries around  

the world. especially when the research mandates  living in high cost of living cities like Seattle,  

Boston, San Francisco, or DC. There is the  classic argument that even Mississippi or  

state with the lowest GDP per capita mogs most  major European economies on paper. But you  

can't eat productivity. And for people on average  incomes, public transport, walkable cities, public  

healthare, and just generally lower living costs  mean they can normally afford a more comfortable  

life while pursuing their academic careers. And  since a lot of American academic talent moved  

to the US in the first place to further their  studies and achieve a better quality of life,  

they are naturally more okay with moving abroad  again to continue the work and achieve a better  

quality of life. This used to literally be our  selling point to the best and brightest people  

around the world. But other countries are just  becoming more competitive, especially in the  

fields we aren't really valuing. So yeah, it's  not great, but why is it happening now? Chasing  

profit and unaffordable cities are not exactly  new American phenomena, but they have recently  

been compounded by a gutting of scientific funding  and a general push of anti-intellectualism. Last  

year's White House budget proposal called for  cutting the National Institute of Health by  

around 40% and the National Science Foundation by  more than half. Congress ultimately rejected most  

of those cuts at the start of this year, but by  then a lot of the damage was already done. Between  

the hiring freezes, buyout offers, and great  terminations, more than 15,000 people left federal  

science agencies in 2025 alone. According to the  American Institute of Physics, the government's  

physical sciences workforce shrank by 12% in a  single year, compared to 8% over the previous 26  

years combined. And that's before we even got to  the people entering the top of the talent pool.  

Tightened entry for high-end researchers  and students coming from abroad has meant  

smaller classes and less funding and ultimately  less manpower actually doing research. Now,  

international student enrollment fell 17% last  fall with graduate enrollment which is generally  

the people that actually staff research labs  falling by 12%. There is also something of a  

soft power element in all of this as well.  Doing research in America, getting an Ivy  

League education, or building a startup in Silicon  Valley was for a long time seen as the goal by  

ambitious people from across the globe. Immigrant  researchers have won about 40% of America's  

science Nobel prizes since the year 2000. Today,  that image still certainly exists, but it has been  

uh tainted. And at the very least, a lot of people  are now shopping around for alternatives. But all  

right, I know what you were saying. So what? A  few people are going to do non-economically viable  

research somewhere else on someone else's dime.  Who cares? At least we still have the profitable  

research, right? Well, in a roundabout way, that  profit motive has actually started working against  

us. Researchers developing technology for dumb  reasons like the good of humanity have long been  

drawn to private institutions where they can make  much more money. But their work is naturally more  

closed off and focus more on developing products  rather than building a foundation of scientific  

understanding. This has been a trade-off forever  with graduate students picking between working  

in industry and working in academia. Someone  with their PhD is every bit as susceptible to  

the cost of living pressures as anybody else and  arguably more so exposed to their student debt.  

In many instances, it's to the point where the  only people that can afford to remain as career  

academics are people who have rich parents to fund  their life. It's not great, but it gets worse. The  

market opportunities have become so great that  even tenured professors at high-end schools are  

making the jump. The Atlantic reported more than  80 current and former professors at schools like  

Stanford, Maryland, and UT Austin have left or  taken leave to join OpenAI, Anthropic, Meta, and  

Google DeepMind, including the chair of Berkeley's  electrical engineering and computer science  

department. As one Arizona State professor put it,  I'm joining anthropic is the new meme right now,  

which um isn't great, but it gets worse. This  is ultimately even more resources going to push  

this particular new technology forward within  these companies. But it also means that their  

teaching isn't going to become accessible to  new students coming through these institutions.  

Students that may in turn have developed something  different and potentially even more revolutionary.  

So even though this particular group hasn't  actually left America, they have still kind  

of taken their brain power out of the American  ecosystem, which means that they won't be around  

to teach new students who could in turn build  up a wider foundation of research. That might  

be a great short-term deal for these companies,  but it's likely coming at the long-term cost of  

wider progress in their respective fields. Now, I  know this all might sound a bit wishy-washy, but  

developing scientific knowledge kind of depends  on a hierarchy of personnel. At the bottom are  

students learning how a field works, and in the  middle is a group that may keep researching or may  

apply their learnings in industry. And at the very  top are the thought leaders at the cutting edge of  

their particular branch of a discipline. They know  their stuff usually after decades of research,  

consulting, and advising other people up and  down this hierarchy. Today, we are losing a  

lot of the people entering at the bottom and  pitting away the people at the top into siloed  

institutions all while pricing out the people in  the middle. If we don't maintain it, this can also  

very easily create a bad feedback loop. Colleges  can't offer courses, so top students look abroad,  

so there is less research getting done, so there  is less funding coming in. So, more professors  

start looking for work abroad, too. add less  money for entire fields on top of this and  

it really could get pretty bad. The good news is  that so far we are still pretty early on in this  

process. Most people anywhere on Earth would still  happily take a place at a university like MIT.  

But the trend is not our friend and these fields  naturally compound on themselves. But this also  

raises a pretty fair question. Is this actually a  problem? Sure, we have attracted a lot of talent  

at every level of this pyramid from overseas for  a long time. But we also have a lot of very smart  

people right here at home. The acceptance rates at  top colleges, research firms, grants, and jobs in  

these fields are legendarily slim. And sometimes  the difference between the average smart person  

and a worldleading researcher is just getting the  opportunity to do the research in the first place.  

If countries like China really are investing  serious money into taking back top talent,  

there is a reasonable argument that giving these  slots to international students has effectively  

disenfranchised an almost as good American  hopeful. all to train people who may end up  

furthering the scientific ambitions of an economic  and potentially militaristic rival. It's a not  

unreasonable concern that is made worse by the  already existing trend of reversing brain drain.  

Now, it's easy to get a little bit conspiratorial  here and assume that they are sending over spies  

to steal our intellectual property. And well,  in certain cases, that does happen. But the much  

larger problem is also much more simple. In the  past, the vast majority of purely self-interested  

STEM graduates from almost all countries in the  world would choose to stay and work in America  

because of, well, the opportunities, the quality  of life, and the extra money that I've spent half  

this video yapping about. This was especially true  for students coming from developing countries. But  

now, fewer are staying. From China, in particular,  around 90% of their STEM PhD graduates used to  

still be living and working in America years  after finishing their degrees. But today,  

according to the National Science Foundation's  most recent tracking, that is down to just 76%.  

Now, obviously, that is still a majority. But it  also means that the share leaving has jumped by  

about 140%. On top of all of the self-inflicted  headwinds we have put on this trend, China is  

pouring money into facilitating the reversal.  Its flagship recruitment effort, a program it  

has never officially announced, reportedly offers  returning researchers signing bonuses that can  

reach $700,000 plus help buying a home. So even in  the complete absence of any sinister intentions,  

normal students just following the best available  opportunities for themselves could easily end up  

on this path. And this is genuinely causing some  big hits. The founder of Moonshot AI, Yong Jerene,  

got his PhD at Carnegie Melon. And well, his Kimmy  models are kind of moonshotting our domestic AIs  

at the moment, which even though we may not like  it, is a major component of our economy. Now, it's  

happening outside of AI, too. The mathematician  Jangi Tong, famous for a landmark proof about the  

gaps between prime numbers, left UC Santa Barbara  last year for a university in Guanghou. Now,  

I really can't tell you what the right answer is  here. And for every argument about furthering a  

rival science, there is a counter-argument about  international students overcontributing to the  

funding of these educational institutions in the  first place. They poured about $43 billion into  

the US economy last year alone. But genuinely, I'd  be interested to see your guys' thoughts in the  

comments. I can't see that going badly. For what  it's worth, if this really is an adversarial zero  

sum game, then well, we are still taking more  smart people from them than they are from us.  

What's more is that if we really wanted  to avoid this dilemma in the first place,  

we should probably double down on K through2  education for the domestic talent pipeline,  

but that's a whole different video. The point is  on either side of this debate, we should probably  

be trying really hard to reduce the exodus of  the talent that is already here. This is also,  

let's be honest, a very emotional argument where  it's all too easy to dismiss one side as racist  

for raising legitimate concerns, and it's also  very easy for actual racist ideas to piggyback  

on some valid criticism. The unfortunate reality  is that companies know this and they know the  

emotions of this debate will make for a great  get out of jail free card. So go watch this  

video next to find out why the fear of China  has become such an effective tool for the AI  

industry specifically. And don't forget to like  and subscribe to keep on learning how money works.