Tax cuts? Don't multinational corporations pay a tax rate effectively lower than an average single American? Am I missing something here? How about we stop with the tax cuts and instead create new tax laws that do not allow the hoarding of cash in other countries. Then bring all of the hoarded cash from overseas back to America, invest that money into education and infrastructure... if they do not comply then they will be breaking the law.
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Donald Trump Tells Tim Cook He'll Offer Apple 'Very Large Tax Cut' to Make Products in America
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The President-elect and the Vice President-elect have finished campaigning, and it is natural that they shift their focus to governing. The immediate task of governing is the transition where the new incoming president assembles his team and outlines his agenda. In many cases, that involves making decisions on the many jobs, large and small, in the new administration, including Cabinet picks and related jobs. The goal is to hit the ground running right after the Inauguration on Jan. 20.
I'm certain that President-elect Trump is deeply engaged in the process—just as Americans would expect from a CEO who has taken a hands-on approach to running his international business empire.
It's a mistake to simply compare labor costs in China and elsewhere to the US. Some estimates are that it would only add $30.00 to the cost of the phone. No one knows because there are huge unknowns. For example, how much would Apple outsource and how much would they automate. Foxconn is already deploying massive numbers of robots as labor costs in China rise. Steve Jobs made it clear that the biggest challenge is actually having enough engineers to run the factories as China has spent considerable time and effort developing the number of engineers such that they can rapidly change production lines, increase production, etc. Since America has outsourced so much production we have a paucity of these skilled workers. That all could change though, and it doesn't have to be overnight. Some production could begin to be shifted to US.
Indeed, Foxconn has already been looking at shifting from China due to rising costs. This could be opportunity to test production in US. The automation is going to come regardless, but engineering and related jobs would be positive result in US production.
Finally, all this focus on increasing manufacturing jobs for Americans bodes well for those who feel Apple is abandoning MacPro as that is currently only computer that they are producing in US. People forget about that, and in this environment, Apple would likely be loathe to shut down that production.
Our unemployment rate is pretty low, unless we want to start accepting wages like those in Asian this isn't going to help.
Apple is NOT a US company, it is a multinational company operating in many countries and has thousands of employees abroad. Apple headquarters are located in the US and a major part of its R&D and design work is undertaken in the US, a part from obtaining a big part of its revenue from the US market. However, the US market is not the biggest one it terms of revenue anymore. Additionally, Apple has recently opened big R&D facilities in India, China, Israel and some huge data centers in Europe...because many of its customers live there and not because it is cheaper. Apple has local headquarters, subsidiaries and facilities across the globe not because it is cheaper, but because it make sense from operational and logistical perspective and ultimately, because they are necessary to support the local business of Apple. The idea that Apple should manufacture all its products in the US because it was originally established in a Californian garage is something that is beyond my understanding.
Don't worry - with the way things are headed under the hothead in chief, we'll get to fight WWIII in no time.
And don't even THINK of bringing up the WWII generation. My grandfather served in the Navy and fought against the Axis powers. And now we have a guy whose big supporters include white supremacists saying things like "Hail Trump!".
I wish my grandfather were here today to give every one of those alt right idiots who think channeling Nazi imagery is "clever" a swift punch in the jaw.
I don't disagree. I was just commenting on Apple, but I believe the incentive should be extended to all businesses.
Instead of seeing "Designed in California" at the back of an iPhone, I'd prefer see "Designed and Proudly Made in USA".
Trump's tax incentives can help to finance the robotic manufacturing factory Steve had envisioned.
Trump's tax incentives can help to finance the robotic manufacturing factory Steve had envisioned.
Considering the amount of manufacturing happening in the US, it isn't impossible. It is just infeasible to assume those jobs are going to be like the assembly lines we see in China stocked with laborers. The manufacturing happening in the US is robotic. The manufacturing jobs are ones where people manage and operate the machines. So the labor cost of the individual is less important on a per unit cost, since you need fewer of them to manage a high volume of output. That or you are dealing with skilled workers that are working a craft rather than an instruction list, which is harder to value and outsource. Furniture made here for example.
iPhone manufacturing can come to the US, but assembly of electronics like this is notoriously difficult to automate (the circuit boards are already automated I believe). Which is why it stopped happening here. The main cost was labor at the assembly stage. If it did return, it's because the assembly part was automatable. Much like how the Mac Pro is done in the US mostly because assembly is far simpler, and probably automated.
But now that we do have this entire manufacturing pipeline in Asia, there are now even more costs of moving manufacturing out of the region. Since you no longer just have to worry about the cost of labor and the assembly stages, but the logistics side of things where you can no longer just ship cheaply from other parts of the region to get your supplies for assembly.
One of the biggest issues I see with manufacturing as an industry is that going forward, the biggest gains you will get in productivity isn't going to be by hiring more people. It is either more automation overseen by humans, or new technologies in automation like 3D printing enabling new forms of automation, in possibly smaller footprints. US manufacturing productivity is up, but jobs are down from the peak of around 20 million in the late 70s.
I personally wonder if we would be better off actually investing in these automation technologies to create local manufacturing jobs that way. It won't create as many jobs as moving existing manufacturing lines, but those are doomed IMO. Instead, it will be building towards a world leading manufacturing center. One that can compete in the coming decades.
I want to know more about two things before I make up my mind.
1. Will the tax cuts just be a blanket tax cuts or will there be actual JOBs associated with it? My guess is that any manufacturing will be automated to the Nth degree.
2. What regulations was Trump talking about eliminating? EPA? OSHA?
You do realize that only people who do not understand economics and tax policy say that, right?
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News Flash Donald: Most of the individual components are still made overseas. This would be great but not the end all be all.
apparently we will get so tired of winning......
i hope he's right! would be nice.
i hope he's right! would be nice.
He's way ahead of schedule. It's because he actually cares. It has been decades since the US had a president that cared about the people.
Nobody ever talks about the fact that Chinese workers are underpaid, because their country undervalues their currency. It’s wholesale theft, but then again, China is not really a free country. This should have the social justice crowd up in arms!
The best solution would be to just lower the nominal corporate income tax rate, which would slow the exportation of labor and earnings overseas (by large corporations such as Apple) while lowering the existing tax advantage that large corporations enjoy over small businesses who don't have acesss to the million-dollar tax attorneys that allow them to avoid paying the nominal corporate income tax rate.
The reason to stay in China is that it is super efficient and highly organized manufacturing center. If you are suddenly short of specific chip, the factory next door can produce it and deliver it within hours. Also, Apple has more customers in Asian region than in the US.
I think he meant legal, as in when the United States locked up all legal Japanese immigrants in concentration camps and took away all there belongings for no other reason then their race.
That maybe true, but the main thing Trump is trumpeting is the return of higher paying manufacturing jobs. That is a pipe dream as those jobs are gone for good. Paying someone to wipe down the windows and floors was not exactly what American's had in mind for a "return of jobs". Those jobs are still here
Make Tap Water Great Again... I believe this is the new Flint, Michigan slogan
"A distinction without a difference"?
I'd swear I've heard that phrase used many times ... by many different people.
The best solution would be to stop taxing overseas profit where such profit was already subject to tax in the country it was generated.
To put it simple, you buy an iPhone in France and pay the full price to the French subsidiary of Apple. The French subsidiary of Apple pays its corporate income tax over the profit it generated from the sale. At the end of the year, the French subsidiary of Apple decides to distribute a dividend to Apple US out of its net profit after taxes. Once Apple US receives this dividend it is again subject to corporate income tax over the same profit, resulting in double taxation. That seems fair right?
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Underpaid? Compared to who? Apple workers in China receive adequate salary to the standards in China. From a Swiss citizen perspective, and according to your logic, you are the one who is underpaid and poor.
This. I've been hearing this for 15 years. Sure its going to happen, but who knows when. Just like the electric car. Sure one day they will be popular and it will be the majority of new car sales, but until then, we don't need to walk away from gas vehicles.
I've said this before and I'll say it again: It's going to be hilarious when Apple eventually does move manufacturing back home and hires hardly any people to work in the factory. Why? Because they have a new version of Liam—their loveable recycling disassembly robot—which can completely assemble an iPhone from scratch. It's incredibly short sighted to see something like Liam and not believe that the next logical step is to make a version that can construct any Apple device. But then again this is Donald Trump we're talking about.
To get the iPhone to be made in America without becoming astronomically expensive means robots and not thousands of jobs. If anything the government should be providing incentives to these companies to grow their development efforts. Apple has created tons of jobs through the creation of the App Store. However instead they want to increase surveillance and put back doors into our software, making American operating systems and therefore hardware extremely unappealing to the rest of the world.
Through recent work with robots, AI neural networks and automation such as self-driving cars, I fully expect more and more jobs to be replaced and not created during the Trump administration. Are they going to pass laws stifling this innovation? Trump has already talked about cutting funding for renewable energy initiatives, which makes no sense as cheaper renewable energy will benefit our economy most and actually make America great again. Many third world countries recently signed an accord pledging to become 100% energy efficient. We run the risk of falling behind the worlds poorest countries in the long run with these type of policies.
I wish we could get some moderate libertarians to run the country.
To get the iPhone to be made in America without becoming astronomically expensive means robots and not thousands of jobs. If anything the government should be providing incentives to these companies to grow their development efforts. Apple has created tons of jobs through the creation of the App Store. However instead they want to increase surveillance and put back doors into our software, making American operating systems and therefore hardware extremely unappealing to the rest of the world.
Through recent work with robots, AI neural networks and automation such as self-driving cars, I fully expect more and more jobs to be replaced and not created during the Trump administration. Are they going to pass laws stifling this innovation? Trump has already talked about cutting funding for renewable energy initiatives, which makes no sense as cheaper renewable energy will benefit our economy most and actually make America great again. Many third world countries recently signed an accord pledging to become 100% energy efficient. We run the risk of falling behind the worlds poorest countries in the long run with these type of policies.
I wish we could get some moderate libertarians to run the country.