Apple and the American Economy

In Apple, “we have a company that’s been phenomenally successful, making products people love and directly creating nearly 50,000 American jobs in doing so, criticised for not locating its manufacturing operations in America,” The Economist writes. “It isn’t enough for Apple to have changed the world with its innovative consumer electronics. It must also rebuild American manufacturing, and not just any manufacturing: the manufacturing of decades ago when reasonable hours and high wages were the norm.”
All told, the physical production of Apple’s products accounts for hundreds of thousands of manufacturing jobs. America, which finds itself several million jobs short of where it would like to be, and particularly short of the middle-skill manufacturing positions that once powered growth in the middle class, seems to want some of those back,” The Economist writes. “Is that a reasonable desire?”

“The [New York] Times piece quotes Steve Jobs as telling President Obama that those jobs aren’t coming back, and they probably aren’t. Attracting firms back to America wouldn’t simply be a matter of helping reduce production costs in America. You’d have to replicate the convenience of the entire supply chain, which would likely be an enormously costly enterprise,” The Economist writes. “Given the quality of the jobs characteristic of these production chains, one should ask whether it might not be a better idea to invest that money elsewhere.”

“It’s worth asking how the American government might alter its policies so as to make life better for middle- and low-skill workers in America at reasonable cost. Offering heavy subsidies to Apple to get it to relocate production would reduce inequality in America; you’d increase the tax burden which would mostly affect richer households and you’d create low-wage jobs, which would mostly benefit underemployed, low-skill workers,” The Economist writes. “Now, perhaps after we add up everything Americans will decide that this kind of massive intervention in the economy and associated efficiency cost is worth it, in order to provide the dignity of employment, such as it is, to millions of workers. It’s worth asking, however, whether there might not be a different and better way forward.”

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