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Trump Tells Apple To Make Products In the US To Avoid China Tariffs (thehill.com)
hackingbear writes: President Trump acknowledged in a tweet that "Apple prices may increase because of the massive Tariffs we may be imposing on China," but suggested the issue was not with the tariffs themselves. "There is an easy solution where there would be ZERO tax, and indeed a tax incentive. Make your products in the United States instead of China. Start building new plants now," Trump wrote. The U.S. is threatening to impose 25% tariffs on all $500 billion worth of Chinese imports over issues such as intellectual property theft.
While Apple et al are still making their products in China, Trump didn't offer Apple a place to find the millions of laborers needed to make their products, given that the official unemployment rate is at a historic low of 3.9%. Manufacturers also need to compete in the labor market with garbage companies who need to find American laborers willing to recycle their own trash -- a job once imposed upon China as a condition to enter the World Trade Organization and enjoy advantageous tariff rates. China is gracefully giving back those jobs as the U.S. is complaining of unfair trades.
While Apple et al are still making their products in China, Trump didn't offer Apple a place to find the millions of laborers needed to make their products, given that the official unemployment rate is at a historic low of 3.9%. Manufacturers also need to compete in the labor market with garbage companies who need to find American laborers willing to recycle their own trash -- a job once imposed upon China as a condition to enter the World Trade Organization and enjoy advantageous tariff rates. China is gracefully giving back those jobs as the U.S. is complaining of unfair trades.
On paper we're at full unemployment. But funny enough there's a ton of resentment around not having jobs in America. Of course, everyone knows the unemployment stats are nonsense. But we act like they're not.
This leads to some crazy political theater. For one thing we've got economists trying to come up with excuses about why wages aren't climbing despite "full" employment. And now we've got Trump needing to explain to businesses where they'll get workers needed to run factories when on paper those workers already have jobs. I mean, I suppose Trump could argue that he'll do mass immigration. I'm sure that'll go over swell at his monthly rallies.
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Why United States?
I doubt that they need that many. In the U.S., a million Chinese laborers become 999,000 robots and 1,000 robot technicians.
You have a point, but we could partly solve this by dropping the patent system (the average smartphone has over 250,000 patents covering it), then instead of obscene profits all going to a tiny handful of mega-wealthy shareholders, we could have products made in America that are also still affordable, as getting rid of the patents would cause a huge drop in the price of the products, which would (A) offset the increase that goes to paying a living wage to American workers and (B) help keep the products comparably affordable to said middle-class workers.
Apple just got a ton of money from that giant tax cut. We're going to be paying for Apple's tax cut for decades, they can afford to lose out a little on their already very comfortable profit margins.
I'd really stick it to the US. Just shut down all exports to the US, pending trade talks. We would really feel that.
Trump is playing a very dangerous game with the dragon.
One relevant criticism of the tariffs is the actual cost of work done of assembling the Apple product is a tiny faction of it's value. For a $2000 computer it might be less than $100.So taxing the full value can be considered unfair, as the conservatives always like to say.
What I find interesting is that lots of industries do not face such complications. For instance apparel can be sourced more easily that cars or electronics, and assembled in the USA. However, as simple as it is to make clothes in the USA, Trump and his family still chooses to make the clothes in Mexico and China.
So, as Trump chooses not manufacture in the US, and in fact regularly imports workers from other countries instead of hiring local workers, we can only assume that he knows, as president, something we do not. Like maybe US workers are inferior.
"She's a scientist and a lesbian. She's not going to let it slide." Orphan Black
Unfortunately, yes, because those long term unemployed adults are called retirees, who dropped out of the workforce, either voluntarily or forcibly during the recession. They do depend on Social Security and Medicare, mainly the latter, because many do have either pensions, or good retirement funds, but drug costs and medical costs will obliterate anyone's retirement fund in a heartbeat. And yes, they are cheering him on to destroy those 2 programs. Hence the unironic quote "Keep the government out of my Medicare". And yes many many boomers who are retired are hard core Trump supporters.
There's another problem with moving manufacturing to the US.
There's also the reality that other countries impose their own excessive, punitive tariffs on manufactured goods from the US.
Tariffs aren't uniquely American.
Ken
Now the actual chip & electronics manufacturing capabilities of China, combined with reasonable quality affordable staff, that's a lot harder to replace.
Any manufacturing capability China has can be easily replicated in America, esp. by a company like Apple with their seemingly infinite financial resources, what can't be replicated here are low wages, lax environmental and worker protections.
Ken
I'm skeptical that there is a labor shortage. Simple supply and demand rules of economics tells us that if there is a labor shortage, then the price of labor should increase. Small increases are normal due to inflation, and I'm glad if there are a few companies forced to shell out a few more bucks to its workers, but so far I haven't seen any huge amounts that would indicate a "labor shortage".
I used to do Perl programming, I had to move from Pittsburgh to Tucson, AZ because there were no Perl positions in Pittsburgh and had to move half-way across the country because they could find no one locally for the position. If you are Shenzhen, there are thousand chip programmers because there are literally a thousand companies with those sorts of jobs, of course there is no problem with finding someone there!
I can imagine most people would not know what a "pick and place machine" is. Why would people apply for a job just because a company is offering a salary? Most companies don't respond to most job applications and why waste time for applying for positions they barely know anything about? Where is the responsibility of the company to train and educate people they wish to employ?
Meanwhile, economy is going great, Americans have jobs and a reason to feel good about their economic prospects for the first time in 10 years.
That is true in most places. The long recovery from 2008 is not a Trump exclusive
They'll never choose what's good for the US over what's good for their own people
Those are not necessarily mutually exclusive things. Or didn't use to be anyway.
Unfortunately, yes, because those long term unemployed adults are called retirees
Hold on a minute. So Trump is lying about unemployment because he quoted a rate that doesn't include RETIREES?
Your comments about drug and medical costs are irrelevant. I'd love to see major changes in the US Healthcare system, but anyone who calls a number "unemployment" when it includes retirees is full of shit. If somebody retired and then ran out of money and started looking for work then they're unemployed, but you can't just say that everyone who is not working is unemployed. At least not if you want to keep the word "unemployed" as a bad thing.
Unemployment means #1 you want to work and #2 you're able to work. If you don't meet both those criteria then you're not unemployed regardless of whether you don't have a job.
And if the only "work" you're willing to do is work that no one is willing to pay you for then you don't qualify as wanting to work. I do things that require skill and effort but that no one would be willing to pay me to do but I also do things a company IS willing to pay me for. If I CHOOSE to only do the former and not the later then I should NOT BE counted as unemployed.
I always love these "Most people don't understand that Trump just sounds like a moron who went bankrupt several times and couldn't even make money with a casino, but really he is a negotiation wizard and very stable genius who went bankrupt several times and couldn't even make money with a casino" comments. Pure gold.
Guns don't kill people; Physics kills people! - John Lithgow as Dick Solomon on Third Rock From The Sun
So it is OK for the Chinese to strip mine for rare earth metals, and then build the Iphones with slave labor and then ship those Iphones overseas on Nigerian flagged vessels staffed with cheap labor from the Philippines to be consumed by snooty white liberals who hate racism, but If Americans mine for rare earth metals on American soil, and then build those Iphones in America using American labor, and then ship those phones on trucks driven by Americans to be sold to Americans who can afford to buy them because they make stuff, then that is racist and damaging the environment.
Got it.