How the US Lost Out On iPhone Work 1303
Hugh Pickens writes "Not long ago, Apple boasted that its products were made in America. Today, almost all of the 70 million iPhones, 30 million iPads and 59 million other products Apple sold last year are manufactured overseas. 'It isn't just that workers are cheaper abroad,' write Charles Duhig and Keith Bradsher. 'Rather, Apple's executives believe the vast scale of overseas factories as well as the flexibility, diligence and industrial skills of foreign workers have outpaced their American counterparts so much that "Made in the U.S.A." is no longer a viable option for most Apple products.' Apple executives say that going overseas, at this point, is their only option and recount the time Apple redesigned the iPhone's screen at the last minute, forcing an assembly line overhaul. A foreman immediately roused 8,000 workers inside the company's dormitories, and then each employee was given a biscuit and a cup of tea, guided to a workstation and within half an hour started a 12-hour shift fitting glass screens into beveled frames. Within 96 hours, the plant was producing over 10,000 iPhones a day. 'The speed and flexibility is breathtaking,' says one Apple executive. 'There's no American plant that can match that.' Apple's success has benefited the U.S. economy by empowering entrepreneurs and creating jobs at companies like cellular providers and businesses shipping Apple products. But ultimately, Apple executives say curing unemployment is not Apple's job. 'We don't have an obligation to solve America's problems. Our only obligation is making the best product possible.'"
No, the US has too much freedom for Apple. (Score:1, Insightful)
The only reason they dislike the US so much is that workers have too much freedom versus the slave-labor countries that Apple uses.
If Apple really wanted to invest in the US, and not have contempt for worker freedoms, it would find that there would be no shortage or issue with getting the job done.
WTF... (Score:3, Insightful)
and then each employee was given a biscuit and a cup of tea
So, to translate: (Score:5, Insightful)
"l. A foreman immediately roused 8,000 workers inside the company's dormitories, and then each employee was given a biscuit and a cup of tea, guided to a workstation and within half an hour started a 12-hour shift fitting glass screens into beveled frames"
Of course having next to no labour laws or enforced practices, combined with a workforce housed on site results in amazing results when last minute changes (or ramp ups in production) need to happen.
I'm sure there are many areas of expertise and scale where overseas factories outperform their American counterparts, but is this really the best example to use?
Re:WTF... (Score:1, Insightful)
and then each slave was given a biscuit and a cup of tea
Straight from the horse's mouth (Score:5, Insightful)
Wait, but I thought corporate 'persons' are job creators, whose taxes must be cut for the benefit of jobless Americans! If these "people" aren't willing to lose a little money to create jobs in America, then I may start to consider the possibility the trickle-down conservatives *may* have been wrong, all along!
"Not Our Job" (Score:5, Insightful)
'We don't have an obligation to solve America's problems. Our only obligation is making the best product possible.'"
Correct, you don't have an obligation to solve America's problems, you do however have an obligation to ensure fair working conditions and above-starvation wages for your workers. I wonder whether those 8000 workers who were raised from the company dormitories were paid overtime rates? And how much of their wage is docked for the "privelege" of living in said dormitories. Globalisation of manufacturing is a necessary and logical step forward, but it does need to be accompanied by fair working conditions, a matter on which Apple's manufacturers have a poor record.
With a little less sugar coating (Score:5, Insightful)
Workers in dormitories
24/7 uncompensated on-call
12-hour shifts
Not mentioned:
worker safety
Triangle Shirtwaist Company
Shorter summary:
All the USA needs to be a better place for companies like Apple is to repeal the last 120 years.
Re: (Score:5, Insightful)
The only skill that the US doesn't have that these workers have is being overly pliant [merriam-webster.com]. Businesses hate freedom unless it is solely in the hands of business.
Re:Yeah...but (Score:5, Insightful)
Yeah... because when you are unemployed and have no money (and the housing market sucks) it's so SUPER easy to move to a place with jobs! Gosh, why didn't people think of that. We could have solved this problem years ago and have a 0% unemployment rate!
Re:So, to translate: (Score:5, Insightful)
It's a great example, the majority of a population will always be doing relatively unskilled labour ... so this is what the majority has to compete with in a free trade global marketplace. They have simply stopped caring about the opinion of the 99.9%'s to the point where they don't even bother lying about it any more ... which is kind of scary.
Seriously? (Score:5, Insightful)
the time Apple redesigned the iPhone's screen at the last minute, forcing an assembly line overhaul. A foreman immediately roused 8,000 workers inside the company's dormitories, and then each employee was given a biscuit and a cup of tea, guided to a workstation and within half an hour started a 12-hour shift fitting glass screens into beveled frames. Within 96 hours, the plant was producing over 10,000 iPhones a day.
How is this anecdote NOT just about "workers [being] cheaper abroad"?
Re:Yeah...but (Score:5, Insightful)
Re:Yeah...but (Score:5, Insightful)
Employees at Foxconn who put together iPhones earn 31 cents an hour. Clearly anyone who isn't willing to fly to China to get a 31 cent/hour job is too lazy to be employed.
The arrogance of the executive (Score:5, Insightful)
The executive class of these companies have been farming out more and more work to China. They do so under the arrogant premise that the manufacturing can be done without learning the original design work. Already fair parts of the design work have been taken over by Chinese companies.
The arrogant part is in thinking that we are the only ones that can come up with a good design, that we can create 'intellectual property' and make profits solely off of that. Nature grants no exclusive rights to creativity or intelligence. There is no inherent reason that the creative minds in China can't take over the one piece we think we can exclusively own. This is why American companies are so big on intellectual property. They think they are the only ones that can do high profit design work and that this is the only thing worth doing.
One day these companies will wake up and realize that Apple etc need the ODM's far more than they need the brand names. They will simply refuse more contracts and start manufacturing their own original work. Apple etc will have no place to build or design their hardware and Foxconn etc will become the next Apple.
I give at most five years before we see Chinese brand names taking the place of our familiar brand names on our store shelves. By the time this happens there won't be a damn thing we can do about it in less than two decades.
Re:So, to translate: (Score:5, Insightful)
Re:Yeah...but (Score:5, Insightful)
I did IT work in the Philippines over a decade ago, exported from the UK when you kids needed external talent for almost anything computer-related.
Just because one in a thousand people in that country has the talent and the contacts to be able to move around the world finding jobs, it doesn't mean the lorry-loads of kids coming in from the villages just for the opportunity to work 12-14 hours a day in a nicely ventilated office/factory will be able to do the same. I imagine the same is true in China scaled up by over an order of magnitude.
Apple have just publicly stated, "The problem with the US workforce is that we don't have an underclass of residential workers in a jurisdiction which denies basic human and labour rights who dedicate their whole lives to building toys for an ever-shrinking middle class." Anyone who defends Apple after this is inhuman evil.
Re:Yeah...but (Score:3, Insightful)
FYI - American workers are the most productive workers in the world. You have no argument for laziness.
Wtf? Do you really believe that? Perhaps in a study from 1942.
Re:Yeah...but (Score:5, Insightful)
A foreman immediately roused 8,000 workers inside the company's dormitories, and then each employee was given a biscuit and a cup of tea, guided to a workstation and within half an hour started a 12-hour shift fitting glass screens into beveled frames.
I consider it a perk, not a problem, to reserve the right to work only 8 hours a day not having to answer my phone if work calls after-hours.
As for you, the European companies hire you because you're cheap, not because you're smart.
Re:No, the US has too much freedom for Apple. (Score:5, Insightful)
that 23% is also the difference between a successful product line and one shut down.
When your overall margin is 20-30% 23% is a big deal.
Re:Yeah...but (Score:2, Insightful)
If you buy an iphone, you approve of slavery and the destruction of America.
Which is just about everyone at this point
Re:Perhaps that needs to be forced onto Apple (Score:5, Insightful)
It's really true, actually; free trade has lifted at least a billion people in SW Asia from complete dire poverty to being able to have a safe, clean dormitory and a biscuit, with a little additional money to send home. You view that as shitty abuse of humans, which it is. However, for those people, and they are people, the option without free trade is so incredibly horrible that your western mind won't even watch movies that depict it.
Re:Perhaps that needs to be forced onto Apple (Score:5, Insightful)
Free trade fucked America. The rich found a cheat code and won the game.
Re:Yeah...but (Score:5, Insightful)
Calling the US worker "lazy" because they don't want to live in a dormitory where they are forced to work 12 hour shifts, sleep 8-10 per room, and are literally prevented from suicide by nets surrounding buildings... is like saying that a slave from 1812 was "ungrateful" for the minimal food, clothing and shelter he received.
Those who call the US worker lazy are looking at this problem wrong, mostly because they have never BEEN a worker like that. The fact is, the "problem" is NOT with the US worker, the problem is with the Chinese worker and Chinese civilization. Those poor people are so destitute that they're willing to become virtual slaves for some meager earnings. They give up living an independent life and exist in a factory like some sort of a flesh-robot, and they all want one thing which is to LEAVE that factory.
It's not right. People should not forced to spend years/decades of their short lives toiling in what amounts to a form of constant punishment.
Re:So, to translate: (Score:2, Insightful)
Clearly an American factory worker *is* competing against that, so they'd better ask themselves every morning what they bring to the table that makes them worth 5 times more per hour. Certainly there are differences: education, language, a culture that promotes speaking up when you see a problem. But there's no denying there's a competition going on and there *is* a point in bothering - it's called survival.
Re:So, to translate: (Score:5, Insightful)
Re:Seriously? (Score:5, Insightful)
Just because Apple and other top tier companies (Corning is mentioned in the article) had a good experience with overseas manufacturing doesn't mean everyone will. If you're pretty much any business smaller than Apple, you might not get the results you want since they simply may not care about you as much.
Re:Perhaps that needs to be forced onto Apple (Score:4, Insightful)
Subsistence farming ain't that bad without overpopulation.
With overpopulation everything will end up bad in the end regardless.
Re:No, the US has too much freedom for Apple. (Score:5, Insightful)
I'm sorry-- this is idiotic. Capitalism's only value is profit. But that does NOT imply that workers get the shaft. Quality control is a very important part of manuacturing, and it is a FACT that workers who care about their work do a better job. This is why the Toyota Production System works. It works in America. You can hardly argue that Toyota is not capitalist.
Waking people up in the middle of the night out of company dorms so they can fix your design errors ain't flexibility-- it's slavery. Arguing that it is "just capitalism" is disingenuous, because capitalism is entirely compatible with happy and prosperous workers.
Re:No, the US has too much freedom for Apple. (Score:5, Insightful)
Besides the USA is Capitalism. Capitalism means to exploit the workers for the least amount possible. I don't know why people have such a hard time understanding that Capitalism working means the workers get screwed. it isn't useful to have happy employees.
And thankfully, there are laws which protect workers. Workers are entitled to a minimum wage, limits on working shifts, reasonably safe working conditions and/or appropriate training and equipment when working in unsafe conditions. Workers have the right to form unions.
Sorry if treating people humanely makes your trinkets more expensive. I guess it's easy to distract yourself from how the people who built your iPhone are literally driven to suicide [youtube.com] from their working conditions when you have thousands of 99-cent app downloads and streaming movies anywhere you go. Such great value!
=Smidge=
Re:Prove your absurd prices (Score:5, Insightful)
You realize that you are probably typing this screed on a "slave-built good," right?
Re:So, to translate: (Score:5, Insightful)
Re:Yeah...but (Score:5, Insightful)
Total cost in dollars might be zero, but there you are paying a price. You now separated from your friends and family, presumably you had at least one of those groups before. You now how no possessions, most of have a few things we like and derive please from which we would not want to part with. I would call those things costs. Finally I find it unlikely you can replace the furniture and other items you will eventually need for less than you sold it for, so the dollar cost is actually non zero as well long term.
Don't misunderstand. You did the right thing, you needed a job and you took personal responsibility and did what you had to do to get one. We all play the hand we are dealt. You are a better person and a better citizen than most, who would have sat on their ass and collected unemployment when as you have proven they really could go get a job. Still you should recognize the price was actually high and pat yourself on the back.
Re:No, the US has too much freedom for Apple. (Score:5, Insightful)
Capitalism means to exploit the workers for the least amount possible. I don't know why people have such a hard time understanding that Capitalism working means the workers get screwed. it isn't useful to have happy employees.
You're partially correct. Actually, Capitalism means to get anything for the least amount possible. When you to shopping, and you have two sellers selling the exact same thing (let's say, cheese), with the exact same quality (insert everything you can think in this: brand, weight, environmental conscience, distance from your house, amount of sunlight, nice vista etc.), but priced differently, which one do you chose? The one where it's cheaper, or the one where it's more expensive? In the exact same way you don't usually ask, or care about, the expensive cheese vendor reasons in charging more, someone in need to buy "work" goes, other things being equal, for the cheap offer rather than the expensive one, also usually not asking, or caring about, the expensive "work vendor" reasons in charging more. You, me, and the ultra-capitalist over there aren't all that different when it comes to wanting to spend less: we all want more of our money left in our pockets so that we can purchase more, not less, things. And in both cases the end result -- that the one charging more gets screwed -- is the same.
Re:Prove your absurd prices (Score:2, Insightful)
I havent bought new hardware in 3 years. Suck it.
Re:So, to translate: (Score:0, Insightful)
"A foreman immediately roused 8,000 workers inside the company's dormitories, and then each employee was given a biscuit and a cup of tea, guided to a workstation and within half an hour started a 12-hour shift fitting glass screens into beveled frames"
Now, with a slight change
" An SS prison guard immediately roused 8,000 inmates inside the concentration camp barracks, and then each prisoner was given a biscuit and a cup of tea, guided to a workstation and within half an hour started a 12-hour shift fitting glass screens into beveled frames"
Yep...that would work...
Re:Surprise, surprise... (Score:5, Insightful)
The overseas manufacturing facilities were heavily invested in because that is where the cheap sweat-shop labor was, and still is. Do you know the working conditions at these factories are so bad that the companies install suicide nets [alien-earth.org] around the building to catch the workers trying to commit suicide by jumping off the roof?
The suicide nets were a publicity stunt done to satisfy critics. As for the suicides themselves, China as a country has a suicide rate of 22 per 100,000 persons per year. Foxconn had 17 suicides among its 1 million workers in 2 years. Statistically, publicity seemed to be more of the problem than an actual spike in suicide rates.
The living conditions are bad by Western standards but not so much by Chinese standards. The problem is many here and in print want to apply Western standards to what happens in China without understanding the full scope of the cultural problem. For instance does anyone why Foxconn builds dormitories for their workers? Many of these plants are built in the middle of nowhere where the land and resources were cheap. The towns around these factories do not have enough housing for workers. If the situation was here in America, the company wouldn't care and leave it up to the workers to find their own housing even if it meant that shantytowns were built. In China, a more paternalistic culture, Foxconn built dormitories to attract workers.
No, it's the problem of so-called "free trade" (Score:5, Insightful)
When companies can move production anywhere, they'll always use workers in one location as bargaining chips to get an even better deal for their next plant, so it becomes a race to the bottom for wages.
The old deal was "you want to sell to our people, either open a plant here or be prepared to pay duties."
Real wages haven't risen in 30 years. NAFTA was a mistake, not because the US and Canada and Mexico are "enemies", but because a healthy trade relationship involves give and take between all participants - and companies are no longer required to "give" in order to take.
Look at Caterpillar's latest move - record profits, they buy a locomotive engine manufacturer, get government grants, then tell the employees - take a 50% wage cut and also roll back all those benefits, or we're closing shop - we've got another place that is giving us money right now to train workers to do your jobs for $12 an hour [digitaljournal.com] in Muncie.
The NAFTA legislation only requires a 6-month notice to pull out. If multi-nationals won't play fair under the new rules, let them live with the old rules.
Re:Yeah...but (Score:5, Insightful)
People who have those jobs (and I know because I've been there) have to lump themselves together with relatives or friends and edge a meager existence.
This is one of the big differences between East and West.
We in the West see this a s a negative - can't live on my own.
Those in the East see this as living - part of being a family, helping younger & older generations. With the bonus of a cheaper cost of living per person.
Re:So, to translate: (Score:4, Insightful)
An interesting metric (Score:5, Insightful)
Thirty years ago it was somewhere around 25%, now it's pretty close to twice that. What that means is that for about half of the working population of the United States, it takes about half a month's work to pay the rent. Back when I was starting my career, you could count on having somewhere around three-quarters of your pay left over after paying the rent; now, half or less.
I'm sure that the failure of the median household to save for things like medical emergencies is just due to lack of character and work ethic, though.
Apple fans take note (Score:4, Insightful)
1. Apple doesn't owe you [presuming you are US American] anything and doesn't care to help.
2. Apple believes US American laborers are sub-par and unqualified.
This, from the mouths of Apple people.
Re:Yeah...but (Score:2, Insightful)
GP obviously has no idea how much it takes to pay rent and put food on the table. Not to mention the other expenses of life.
He's likely a college kid still having his meals and boarding paid by mommy and daddy. Either that or he's never had to actually work flipping burgers to pay his own rent.
Re: Yeah...but (Score:5, Insightful)
I've worked 12 hours a day when required, and combined with a good education, and I get paid very well for it.
The fundamental thing that these guys say, is that IT is not a 9 to 5 job. Why? They deal in projects, not operations. Projects need to be agile, and hit the problems hard and fast and get the goods to market.
At the end of the day, you go contract, you hit it hard when you're off, and then you spend some time off between contracts. And before people say "oh, but everyone pays minimum wage, and outsourcing is a race to the bottom," sure, some companies do operate like that. But they can rarely boast a true modicum of success. The smart companies out there pay top dollar for their secret weapons. If they can find one.
The bottom line is that the USA used to do this. Old school Americans who still posess the American spirit do things bigger, better, faster, stronger. There is no room here for "work life balance", there is no room for a giant party at every turn. Do that on your own time, when you're not on contract, and your life is yours.
American's did not land a man on the moon from a group of employees who worked 9AM to 5PM, with a 2 hour lunch break involving beer. They did it through blood, sweat, tears and the efforts of titans.
The times where you can make a million by selling sub prime mortgages to yourself are over. The times where you can believe that you can make a million by being good at poker are over. Bring back the engineers and scientists, bring back a solid work ethic, and the USA can rise again to its former glory.
Funnily enough, modern people don't generally wnat to do that, but it is what is necessary. The world has opened up, and there is no longer a cartel of employees with a long list of stipulations are no longer the only option. We need to pay back the effort that was "borrowed" through quantative easing, establishing a new slave class overseas through outsourcing and a government that has spent $5 for each $3 that was gathered and a president who had started numerous wars for the benefit of his family's empire.
It's a highly unpalletable bitter and jagged pill to swallow, but it's time to pay for the reality check that has bounced. When it's paid back, hopefully we'll have remembered the lessons learned from these trying times, but I doubt we will.
Long live the American spirit of MAKING money, and here's to the death of the culture of theft and deception that has replaced it with insidious graduality over the last 50 years.
Re:First, you must have a boat. (Score:4, Insightful)
Re:No, the US has too much freedom for Apple. (Score:5, Insightful)
You could always refuse to work for a dirty capitalist.
There are a number of options available to you, including the one where you wake up every day, look for your food that day, acquire it, cook it, and sleep in the shelter you built yourself. That way you aren't a "wage slave" or whatever people call it these days.
Of course, you are neglecting the division of labor that has allowed the modern world to be so prosperous if you do that.
One thing "the workers" don't realize is that life as a business owner really, really sucks unless/until you have "made it".
I'm a small fry engineer at a software company. I _never_ worry about if I am going to make sales numbers this quarter. I _never_ worry about cold-calling customers to drum up business. I _never_ worry about all kinds of things that ultimately determine if the company stays afloat or not, can make payroll or not, etc etc.
I show up, I do what I am good at, and the owner(s) of the company are assuming 100% of the risks. Sure, I am subject to the risk of maybe losing my job, but my nest egg isn't on the line. I am not going gray haired from worrying about how to make the entire company's numbers fit.
People who work for capitalists are also participating in the distribution of labor -- they are often putting most or all of the stress and hardship of really having to fend for ones-self on to somebody else.
My father in law has been in the situation of being a business owner. And my wife recalls periods where her parents had to explain to her that they didn't have enough for anything besides box mac-n-cheese, because dad's company wasn't getting paid. (specifically, customers weren't paying for products/services received)
I never worry about whether or not my customers pay my employer. I am sure there is a team somewhere that deals with that so I don't have to.
For most people, having a place where they go every day, show up, and do what they're told, and in exchange they get paid, is a much better deal than what they could otherwise get. They risk losing their job; but fundamentally their employment is not directly tied to the performance of the company. If/when it inevitably tanks, the employee can shift to some other employer. Meanwhile the owner of a failed business has probably lost his health, family, etc.
All that said, it seems that the publicly traded company in the US has allowed the basic capitalist ideal to be grossly perverted. The captains of the company no longer place their personal fortunes on the line; everyone now speculates with others' money. Larger Corporations now have departments that specialize in government influence and rent seeking.
But that aside, your basic problem with capitalism is unsound. There appear to be people with lots of ideas and the acumen for taking risk, and who have bigger goals than what they may personally acomplish. And there are other people who, for whatever reason, don't have the inclination, motivation, or perhaps talent for these things. Yet the two are able to work together for mutual benefit. The capitalist needs talented help. The talented help needs financial/social stability, and tasks suited to their interests and expertise.
Re:Yeah...but (Score:5, Insightful)
The issue is that Western manufacturers need to find a way to be as flexible as the Chinese competition while providing an acceptable lifestyle
for their staff. Automation might be a way. If this change had required just one employee to be roused from sleep (or possibly just phoned in his/her office in New Zealand where it's daytime) to reprogram the machines in the factory start fitting glass screens into beveled frames, that would work. More realistically, it would still work if it needed 10 employees or maybe 50. They can be paid enough to compensate for the out-of-hours callout (or telecommute from somewhere where it's in hours).
Of course there are several challenges in this approach: you need the capital investment to build the automated factory; you need the education levels to train your population for a world where half the jobs are sophisticated technical problem-solving jobs; you need a LOT of factories like this to keep your whole population employed; and, for now, you need to compete with countries still developing who have workers willing to work for a few bowls of rice per hour. This last problem will go away in due course.
Re: Yeah...but (Score:5, Insightful)
You sound like you're endorsing living a life with no roots, no community involvement, and no long-term commitments. Seeing the world and its cities and cultures is a really cool experience, but eventually most people like to settle down and do things like have families, hobbies, and own possessions that don't have to fit in a suitcase.
The career-long road warrior mentality directly contradicts with the need most folks have for being close with extended family, laying down roots in a community, or having long-term friendships with close physical proximity.
Working hard may give you a sense of purpose, but trivializing work-life balance will only isolate you.
Re:No, it's the problem of so-called "free trade" (Score:5, Insightful)
From the New York Times
"Companies once felt an obligation to support American workers, even when it wasn't the best financial choice," said Betsey Stevenson, the chief economist at the Labor Department until last September. "That's disappeared. Profits and efficiency have trumped generosity."
That was never generosity, that was fulfilling a basic social contract.
Last year, [Apple] earned over $400,000 in profit per employee, more than Goldman Sachs, Exxon Mobil or Google.
And there's really no excuse for not fulfilling that social contract,
other than slightly higher stock prices and executive bonuses.
Re:No, the US has too much freedom for Apple. (Score:5, Insightful)
I don't know why people have such a hard time understanding that Capitalism working means the workers get screwed. it isn't useful to have happy employees.
In a truly free market, employers would treat their employees well so that they don't go work for their competitors.
To have a free market, however, you need some level of regulation. Otherwise, companies will just merge or collude until there are no competitors and then they can do whatever they damn well please.
Re: Yeah...but (Score:5, Insightful)
Caterpillar has been doing exactly that for 21 years. Their latest move - buying a locomotive assembly plant and then locking out the workers and telling them to either take a 50% paycut or they'll move to Muncie, where they can pay people $480 a week for the same job.
Want to raise a family on $24,000 a year?
You're a shill or part of the problem. Please DIAF - we need the extra heat to stay warm.
Re:No, it's the problem of so-called "free trade" (Score:5, Insightful)
Don't expect people to buy your products if the 99% are making poverty-level wages - and that's where we're heading.
Problem is, nobody's really at fault (Score:5, Insightful)
Apple makes gobs of money by owning the high-value part of the product - the design, engineering, and final sales. There's virtually no profit in actually manufacturing the product. So as a result, companies have emerged like Foxconn (the biggest) that specialize in the manufacturing process. And they make money by doing a _lot_ of manufacturing, for a lot of different vendors. They set up shop in mainland China for easy access to workers - and for most of those workers the crappy pay they get is better than they could earn elsewhere.
And because of that, a whole supply chain rose around those companies to keep them freshly supplied with components. There's an entire infrastructure in and around China specialized in low-cost electronics manufacturing. That's not the only place Foxconn makes stuff (they have factories in Eastern Europe, Brazil, and India - all places where they can get relatively cheap access to an educated workforce). And also, Foxconn doesn't just make products for Apple - nor are they Apple's only manufacturing vendor.
Also worth noting again is that the manufacturing is a low-margin business. Based on their 2010 numbers, they had about $59 billion in sales. Sounds like a lot, but less than 2/3 of Apple's numbers alone. Again, in profit they did $2.2 billion - but that's a low percentage of sales, and that's after supporting nearly a million employees.
The only other thing I'd mention here is that there are companies manufacturing products in higher-wage places, and there are products better-suited to manufacturing here in the US. Precision electronics, low-volume, high-price items, and goods where the manufacturing cost is lower than the shipping costs from overseas would be - these are all good candidates for onshore manufacturing. iPhones, PCs, gaming consoles - those are gone, and they're not coming back. But the jobs they create are crappy ones anyways. And they'll always be chasing the lowest cost somewhere in the world.
Re:Perhaps that needs to be forced onto Apple (Score:3, Insightful)
The rich don't need a 'cheat code'. They designed the game.
Re:Yeah...but (Score:5, Insightful)
and the average city dweller has basic medical access more readily available and affordable than his/her American counterpart. How can we explain that????
Greed.
Re:So, to translate: (Score:4, Insightful)
That is exactly what the corporatists that run this country want. And if you complain, you're a lazy hippie who needs to get a job.
Re:So, to translate: (Score:5, Insightful)
Listen to the what the Republican voters are cheering. Gingrich wants adults janitors from school greatly reduced and replaced by poor kids (literally poor kids because they need the on-job education more), and made to clean their schools. During the school day. More well off kids will keep their normal schedules.
Romney wants to drop taxes for companies that can afford sending jobs overseas to 0%. Companies that can't send jobs to China will be taxed at 15%.
Republican state governments have been pushing for public job related union killing bills, and declaring emergency take over of poor towns and cities (including Detroit). Emergency take over meaning they give the power of complete rule to an appointed person. Any voted position is now a figurehead position.
NDAA, SOPA? We are slowly going to become China at this rate.
Henry Ford and $5 a day (Score:4, Insightful)
Re:Yeah...but (Score:4, Insightful)
I love how you exaggerate the hell out of the position you don't like until it's so fucking silly it is irrelevant. This is called making up a strawman and then burning him down with a fucking nuclear bomb. But it doesn't convince me that shit-ass McJobs are an acceptable employment solution for Americans, nor that we should be happy with what we have.
I think the most pathetic thing any American can say is "well, just be thankful you have a job." Really, that's not exactly a ringing fucking endorsement of the American way of life.
Re:No, the US has too much freedom for Apple. (Score:5, Insightful)
The problem is that any one company can outsource everything to a cheaper location and instantly gain a huge competative advantage over their competition. Thats the essence of captialism after all.
However, if more and more companies do the same thing, you reach a point where a certain percentage of employees of the orginal country no longer have enough job security to be able to purchase freely and so cuts back, first on luxary items, then increasingly on essentials.
You are right, Apple, as an individual company is there to make profits and that all it's there to do, but it does look like industry (not just consumer goods, but all industries) as a whole are cutting off the supply of money to it's own customers.
This is not a problem business's solve, it requires a government solution.
The long game of course is to bring developed nations down to the level of the developing nations.
Re:Yeah...but (Score:3, Insightful)
I explain it as you lived in a socialist nation. Myself i will give up health care in exchange for freedom.
Also, you are incorrect since anyone can get care in this nation if they need to. Just drive down to the hospital and they WILL treat you, regardless of your ability to pay.
Then I suggest strongly that you give up your medical insurance until you've made 3 trips to said hospital and experienced the lack of health care you get via that route.
You obviously need a major dose of reality, and experiencing it is going to be the only way your eyes will be opened.
Re: Yeah...but (Score:5, Insightful)
I'm afraid that your tale of road warrior machismo has nothing to do with the original story, nor the claim that "you don't need dormitories". To house 8000 manufacturing workers within a half hour commute of the manufacturing facility, if you don't use dormitories, your costs will be ludicrously high in salaries or other support of housing costs. And dormitories effectively divorce the employees from day-to-day family and household maintenance requirements, allowing the 8000 employees to work that shift and still get a meal during and after the shift so they're productive the _next_ day.
Short term contract workers wouldn't normally be capable of this kind of goal. To put in a sudden 12-hour shift on unfamiliar equipment with a changed procedure is to encourage very expensive mistakes, such as injuries and ruining the manufacturing equipment itself. Longer term contract workers or employees can do this and do it well: take a look in any US based auto manufacturing plant for constantly handling last minute revisions as the next model year is built.
The political diatribe is also fascinating. The idea that American spirit is allbout "MAKING money" is lethal to quality engineering and research, because both involve longer term projects that need experienced and educated staff who've really learned their way around a field and can integrate with that knowledge. Factors other than money are vital.
Re:Yeah...but (Score:5, Insightful)
Again with that stupid "We'll never be able to afford it if Americans make it!!!!" argument.
Back when we made shit here, there was actual demand for labor, and people made a decent wage for the time doing even the most menial of jobs because employers actually had to compete for workers. Consequently, the buying power of the dollar was enormous compared to where it is today.
My grandfather came back from Korea and got a job as a truck driver, and that earned him enough money to buy (and pay off) a modest home in Philadelphia; support himself, his wife, and their four children; buy a new car every few years; pile the family in the car and drag them all over the country every summer on vacation; put something away for his children's college educations and his retirement. All on single salary earned with a fucking high school diploma. And to top it off, he was actually treated like a fucking human being by his boss! He regularly had the boss and his family over for dinner, and when there were problems in my grandfather's personal life, like when my grandmother got cancer the first time and had to be hospitalized, not only did his boss give him as much time as he needed to deal with it, no questions asked, he came and visited them in the fucking hospital. The guy ran a trucking company, and my grandfather being gone effected his bottom line, but that wasn't nearly as important to him as the fact that one of his valued employees was in trouble.
Contrast that to the average job a high school graduate can get these days. Hell, contrast that to most any job these days. I've had jobs where you can't even get sick without the threat of losing your job, or at the very least, getting put right to the top of a "layoff" list. Look at all the fucking huge retail chains that deliberately hire two part-time employees instead of one full-time one just to get around having to offer them insurance or any benefits of any kind. There are whole towns in this country now where the only major employer is Walmart, a huge proponent of doing that shit.
People talk about class warfare like it's something new, but the fact is, the war's been raging since fucking 1980, they just called it "trickle-down economics" and "globalization". Now that the other side is finally waking up to that fact and starting to resist in earnest, now come the threats about moving overseas or "competitiveness" or "incentive to hire Americans" and "American labor is too expensive!" and all the other bullshit.
This country was at it's strongest economically when the middle-class was at it's strongest economically. Cutting their tax rate a few percentage points isn't going to turn the U.S.A. into fucking Xanadu. We need to make it financially untenable for a manufacturer to base 95% of production in foreign slave markets and bring the shit here and sell it for premium prices, but those manufacturers spend their hard earned profits making sure that will never, ever happen by lobbying the fuck out of our government.
Re:Prove your absurd prices (Score:2, Insightful)
...just that business has to be given no alternative.
Really? Seriously? That was modded "Insightful"??
If businesses are given no alternative, why shouldn't that apply to consumers? Oh. Consumers should get a choice but not businesses? Aren't businesses just consumers in a different form?
Wow...
Comment removed (Score:5, Insightful)
Re:Prove your absurd prices (Score:3, Insightful)
You hear people bitching and complaining about "entitlements" among the younger generation and how people feel they are "entitled to success", yet all these megacorps and captains of industry that obviously feel they are "entitled" to cut any and all corners in the drive to maximize the profits of a select few "entitled" people at the top to the detriment of everyone at the bottom, you don't ever hear a fucking peep about those "entitled" attitudes.
Apparently it's okay to be "entitled" if you have a lot of zeros in your bank account, but the serfs need to just be happy that they have a job at all. We're coming full circle back to fucking Feudalism; instead of nobility running the show we have a corporatocracy...
Re: Yeah...but (Score:5, Insightful)
Ah, the free market at work. Remember, don't try to stop him, or he'll move the jobs to China. We have to keep our workforce equally defenseless and exploitable.... uh, I mean "attractive", in order to remain the greatest nation on earth!
Re:No, the US has too much freedom for Apple. (Score:5, Insightful)
Or it might mean the difference between astronomical profits and just profits.
"With an estimated bill of materials between $170 to $220, depending on capacity, the manufacturing margins on the iPhone 4S are roughly 71-73%.
That, Whitmore concludes, "should support attractive corporate margins for AAPL for multiple quarters.""
http://bit.ly/AuL0aT [bit.ly]
Re:No, the US has too much freedom for Apple. (Score:5, Insightful)
By that argument, since when does the U.S. have any obligation towards Apple? I'm sure they get hefty tax cuts being here, asking for something in return is just too fucking much?
It's not like Apple went from a garage to the juggernaut it is today overnight. This country facilitated their growth, agreements were made, concessions granted, taxes cut...and now that they've reached the peak of their market share and power, what's the response? "Ha ha, fuck you America, we're building all our shit in China! We have no obligation to you!! But thanks for all the breaks you cut us as we were growing to the point we are today, I guess..."
It was the U.S. that afforded these companies to make their billions, and now that times are tough and we're asking for a little in return, they're all giving us the finger and running like locusts to the next economy to suck off of, and once that economy is all tapped out, they'll just up and move again. If we let them, that is.
A good place to start would be to impose steep tariffs on all imported manufactured goods and use that money to subsidize jobs here in the States. Once they can't bring their crap in from China for nothing, you'll see how fast these factories all start re-opening here, and as far as prices skyrocketing, you know what? It's time to call their bluff because I don't believe for one fucking second that any manufacturer would sabotage their own business by pricing themselves out of the market.
Re:Yeah...but (Score:5, Insightful)
So essentially Apple is saying, "We can't have these jobs in the US because the Standard Of Living in the US is too high, and we want to profit from a lower SOL."
Seriously, the workers are woken up in the middle of the night from their dormitories, given "a biscuit and a cup of tea" (as though this is some magnificent reward), then faced a 12 hour shift, before being overworked for a week straight. All because Apple made a bad design decision, and obviously their product's street date is more important than the health and well-being of 8,000 workers.
This is sweat-shop mentality. Apple shouldn't be boasting about this, they should be apologizing.
Re:What you left out... (Score:4, Insightful)
I could see that. What we take for "modern living" is not always better than the simpler days your grandfather remembers. There's a reason that books/movies like Swiss Family Robinson have a certain appeal for some of us -- living to live, not to race with your neighbor.
I remember a joke/parable/whatever it's called I heard many years ago. I won't write the whole thing, but it basically involved a New York stock broker talking to a local native fishing on the beach in Mexico for food. The broker asked the guy why he had no ambition and why didn't he work harder, get a job, move around, back stab people, and climb the corporate ladder for the next 40 years. When the native asked him "why?", the guy said "so you can get rich, retire to Mexico and spend your days fishing on the beach."
Sometimes, people already have what they need, but just don't see it.
I call bull shit. (Score:5, Insightful)
So what you're saying is, according to his Missisippi study not only is she getting ALL living expenses paid in full (food, shelter, helathcare) but she's getting 21k/year cash on top of that. I call bull shit.
Hell, I call bull shit on the entire "study". Since Clinton you're limited to 4 years max for public cash assistance. Utility assistance is generally 50% max unless you're over 65). Oh, at federal minimum wage you're bumping up against the poverty line ($14k). Once you cross that you'll find lots and lots of those programs cutting you off. In Arizona 130% of poverty level 18/k per year) disqualifies you for food stamps. Cash assistance is even harder to get. And our local free health care gets cut off at $17k/year. I hear Mississippi (and all of the south) is worse. So I say again, I call bullshit.
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Re:No, the US has too much freedom for Apple. (Score:5, Insightful)
The study, Apple’s High Effective Tax Rate Obscures Foreign Tax Benefits, shows how tech giant Apple pays low taxes and keeps this fact from public view. Like Google and General Electric—two companies that have been in the news this year because of their aggressive tax planning—Apple takes advantage of lax U.S. tax rules to shift profits out of the United States and greatly reduce its tax bill. But unlike these companies, Apple also takes advantage of flexible accounting rules that allow it to report large U.S. tax expense to shareholders and the public even though those taxes actually have not (and may never be) paid to the IRS.
Source. [taxanalysts.com]
If I, as a private citizen, were to hide taxable income off-shore in order to avoid paying taxes on it, I would be jailed for Income Tax evasion. I guess multi-billion dollar corporations don't have to abide by the same rules us "little people" do.
Here's another article detailing tax breaks given to Apple to establish a server farm in North Carolina. [macobserver.com] Up to $46 million will be saved in taxes. How many employees do you think they will create with that $46 million dollar break? And if the taxes are paying the employees salaries, why the hell doesn't the state just employ them directly and put them to work doing something that benefits the public directly, and not a billion dollar corporation? You hear "Government doesn't create jobs!" rhetorical bullshit constantly, if the government is subsidizing the fucking jobs, and without said subsidies those jobs wouldn't exist, how does that even make logical sense? It seems to me that the government is the only one creating jobs via tax cuts. Problem is the bulk of private sector isn't holding up their end of the bargain and actually hiring people with those breaks, they're pocketing them and blaming them on unfair regulations and other nonsense...
Re:Will you have the same views on your death bed? (Score:5, Insightful)
Re:Yeah...but (Score:4, Insightful)
once treatment starts the doctors don't have any clue if you can pay or not
Actually, we do. But the fastest way to get a non-paying patient out of the hospital is to treat them, so they get treatment.
Re:Yeah...but (Score:5, Insightful)
'Slavery, it gets shit done'
Next question?
Re: Yeah...but (Score:5, Insightful)
Re:Prove your absurd prices (Score:5, Insightful)
What I find even more disgusting is the following:
We don't have an obligation to solve America's problems. Our only obligation is making the best product possible.
Well apparently corporations are people too. Since when do we, as American people, not have an obligation to solve our problems?
That's the most stupid fucking simplistic sociopathic statement I have ever heard come from a company. It is absolutely obligated to participate with the rest of us in creating a better America and solving our problems.
There you go. The biggest problem with business today. Not just shortsighted and focused on short term profits, but the "Fuck America" attitude as long as it makes them X amount of more profit.
Profit at all costs.
It's possible to run a business where your primary goal is to make a good product, serve the community, and you know, basically not be such sociopathic bastards.
I don't own an iPhone, but.... (Score:5, Insightful)
I do own consumer electronics, and they are virtually all made in Asia under circumstances very similar to those of the iPhone.
It seems that virtually no one posting in the thread has RTFA. The whole point of the article is that the reason all this manufacturing happens in Asia and not in the US has very little to do with wages, and everything to do with supply chain.
If you're going to make any piece of electronics, you're going to need chips. These chips have uses in products in several manufacturers, so you have one manufacturer of Chip A, that companies B, C,D and E need for their products. Where is that manufacturer? In Asia.
So no matter what piece of consumer electronics you want to make, all the parts you need for it are manufactured in Asia. Since all your parts are there, and it takes 35 days to ship them to here, if you want to manufacture an item of consumer electronics, you have three choices:
- Manufacture in Asia and ship finished products here
- Manufacture here, but get your parts from Asia, adding 35 days to your production cycle (making you uncompetitive from a product design and cost standpoint)
- Build manufacturing for all your parts here, which is uncompetitive because you lose all the economy of scale of part manufacturers in asia that make parts for hundreds to thousands of different products for different companies.
Unfortunately, we have allowed the "Critical mass" of electronic manufacturing to develop in Asia, and now that it's there, it's there.
You can actually see something similar in the US - nobody makes cars in, say, Nevada, despite there being an abundant, inexpensive labor force. Why? Because all the companies that make the parts that go into cars are in Michigan, Indiana, Ohio. So you can get away with putting a factory in Tennessee or Alabama and still be close to your source for parts, but not Nevada.
One other point half-mentioned in the article: Labor costs alone would account for only $65 if iPhone production was moved here from Asia. What is not mentioned in the article is probably about half of that $65 is not the amount of money paid to the workers, but is instead the amount of money paid in federal wage taxes - FICA. That's NOT income tax either.
If we want to make production in the US more attractive, we need to fix our tax system so we don't penalize wage income. Stop providing preferential income tax rates for "capital gains" and stop charging penalty tax rates for work. All income should be taxed the same.
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Re:Yeah...but (Score:3, Insightful)
You mean choice to starve?
fuck you, sociopath
Obligations to America (Score:4, Insightful)
'We don't have an obligation to solve America's problems. Our only obligation is making the best product possible.'"
In that case as an American, my obligation is to make sure I avoid buying any Apple products. Thank you for drawing attention to the fact that Apple officially regards itself as unamerican.
Unless, American consumers choose actively to buy and invest in companies that hold America in higher regard than Apple, America will continue to be burdened by corporations like Apple that feel its fine to accept a broad range of tax credits from the American taxpayer, without providing anything in return that they wouldn't also provide to Iran or North Korea. Essentially, Apple's official policy is that it doesn't give a shit about Americans. All that it wants is their money.
Personally, I make it my business to avoid doing business with corporations such as this, lest I suffer even more from their malevolence in the future.