This Article Explains Why Apple Makes iPhones In China And Why The U.S. Is Screwed

Business Insider ^ | 01/22/12 | Henry Blodget

[TigerLikesRooster]

This Article Explains Why Apple Makes iPhones In China And Why The U.S. Is Screwed

Henry Blodget | Jan. 22, 2012, 5:30 AM | 3,191 |

The manufacturing processes of Apple and other electronics companies have come into sharp focus of late, with the revelation of more details about what life is like for the Chinese workers who make the world's gadgets.

When one reads about these working conditions--12-16 hour shifts, pay of ~$1 per hour or less, dormitories with 15 beds in 12x12 rooms--the obvious assumption is that it's all about money:

Greedy manufacturers want to make bigger profits, so they make their products in places with labor practices that would be illegal in America.

And money is certainly part of it.

But an amazing new article by Charles Duhigg and Keith Bradsher of the New York Times reveals that there's a lot more to it than that.

The article illustrates just how big a challenge the U.S. faces in trying stop the "hollowing out" process that has sent middle-class jobs overseas--and, with it, the extreme inequality that has developed in recent years.

The reason Apple makes iPhones and iPads in China, the article shows, is not just about money.

[bert]

And in Seattle Gazelle Jones doesn’t come to work at all because he couldn’t manage to get up and drag himself in on Mondays till 9:30. He just couldn’t manage a schedule set by his job.

His half sister tamikila also no longer has a job because she couldn’t pass the drug test they gave every week

[TigerLikesRooster]

P!

[HangThemHigh]

I didn’t read the article, but I’m guessing they make iPhones in China because it’s cheaper.

On the other hand, the real reason that America is screwed is because of the terror cell occupying the White House.

[ingeborg]

Americans make poor biobots (vide http://en.wikipedia.org/wiki/Nikolai_Eberhardt).

[Texas Eagle]

This explains why China spends so much money on DemocRAT politicians.

And probably a few Republican, too, no doubt.

[knarf]

I heard a sound bite on an NPR station as I flipped through looking for something to listen to while driving in an unknown geography;

It was asked, "How much in America is hand made?"

and the answer surprizingly is,

Almost everything ... and this article explains why that is a true statement.

[central_va]

The national security implications of the off shoring of American manufacturing base are huge. No real conservative, regardless of being anti union or anti regulation, can see moving factories to China as good and healthy thing. Yes regulations, taxes and unions are bad things. But change those things here, or work for them. Don't sell out to China for Gods sake.

Economic Libertarians are a wacky as PaulBots.....

[denydenydeny]

Apple doesn't build iPhones in the United States, in other words, because there is no longer an ecosystem here to support that manufacturing. There's no supply chain, there aren't enough super-low-cost workers, and there are not enough mid-level engineers. And many Americans looking for work are still hoping for a return to jobs, salaries, and lifestyles that have simply disappeared. This is a complex problem, and there's no easy solution.

Only because there is a Democrat Party. The party of continued privation.

[Leroy S. Mort]

The article in a nutshell: The Chinese..doing the jobs Americans don't want to do...on the cheap

Duhigg and Bradsher tell the story of Eric Saragoza, an engineer who began working in an Apple factory near Sacramento in 1995. The plant made Macs, and for a few years, Saragoza did well, earning $50,000 a year, getting married and having kids, and buying a house with a pool.

(snip)

Soon, however, Apple started shipping jobs overseas, because the costs of manufacturing in Asia were so much lower.

(snip)

Saragoza was soon asked to work 12-hour days and come in on Saturdays. But, understandably, he wanted to watch his kids play soccer on the weekends.

They go on to say Saragoza quit a job testing iPads which paid $10 an hour and is now looking for work. Meanwhile, Chinese workers work 12-16 hour shifts for a dollar an hour and Apple makes a 40% profit on each iPad.

[Jonty30]

Sure, Apple will likely not bring their manufacturing firms back to America, as things stand. At least, not until China decides it doesn’t need Apple anymore and rips off its designs wholesale, like everybody else that has dealt with China.

What the author is not saying is also important. It’s not necessary for companies, like Apple, to come back to the shores of America. It’s only necessary that America creates the environment that new companies can grow and develop their products and sell them.

Who cares about one company, like Apple, if conditions made it favourable for 5,000 other companies to form and train workers in America?

[Eureka_Lead]

They went to China for (insert excuse here) = profits....

The start of it all was the excuse, logistics

then, skilled labor workforce

now, “hey, it is all about giving our shareholders a huge return”.

Slave labor is slave labor.... there used to be factories in the USA that produced everything you buy that now says CHINA on the back of it.

Shareholder profit by the use of slave labor, nothing more, nothing less.

See how long CHINA lasts when a tariff is placed on their goods so they equal the cost of production in the USA... yes, kill off the “free trade” rubbish..... as all it has done is totally crush this once proud nation to the point we have to wait for the boats to dock so we can eat, see, clothe ourselves.

Yes this is a rant.... but, go look at the things in your home, and the store, that you buy from, how many are MADE, GROWN, PRODUCED in the USA.

EL

[impimp]

Eliminate free trade and we turn into North Korea. Some people want to take their ball and go home when they are losing. I think Americans are better than that. I say COMPETE. In some areas we will lose and in some we will win. Overall, we will win. How can America be called a nation of liberty if it would prevent free men from selling to other nations and vice versa.

[spokeshave]

......Work Makes You Free........

[theBuckwheat]

China has hundreds of millions of people living the bucolic life of the peasant, in amongst the ducks and pigs. Some of these people think that living and working in the conditions described as horrible and making US170/month is better than life in the organic and natural countryside.

As much as I wish life could be cushy for everyone on earth, the hard truth is that if wages where high enough to meet the author’s approval, say US 2,000/month, that there would be no jobs and these people would get to stay back on the farm. And what if some peasant in Vietnam was willing to work for only $1,700/month would the author lament the loss of jobs in China?

But then again, the author never seemed to care for what conditions are like for those peasants before now. You would think if he really cared for these people, he would care for them no matter where they lived.

Maybe he is just projecting his revulsion at how prosperous the US has become, like so many media professionals like to do in recent times.

[Le Chien Rouge]

The left scream about oil companies making 7 cents on the dollar from a gallon of gas and moan about Wall-mart workers not making a livable wage despite Walt-marts employee low turn over rate(must not be that bad) yet are curiously quiet about Apple or Microsoft very high profits, their favorite high end restaurants commonly using illegals in the kitchen or the the non-union people working at their favorite wine bottling plants.

Hypocrites, but we all knew that anyway.

[traditional1]

"when a tariff is placed on their goods so they equal the cost of production in the USA"

You COULD install reasonable tariffs, and have manufacturing back in the USA; IF it's done in Right-to-Work states, where you don't have $30+/hr. Union Rates + benefits extorted.

The cost of shipping and labor would STILL result in profits, IF it wasn't for Union Labor rules (same with auto-making).

[Cringing Negativism Network]

There are two types of “free trade” supporters:

The first type, is like Mitt Romney: amoral (I did not say immoral) about trade and business - Gordon Gecko-ish about jobs. It’s just business, and those who lose their jobs don’t matter. If employees or America suffer, that’s just the way it is.

To those, I can only express my respectful disagreement, and say that amorality about the effects of “free trade” is the reason I support import tariffs - because import tariffs are also amoral. They benefit America without making any decisions about business.

There’s a second type of “free trade” supporter though, and I think it’s time to explain something to the second type.

The second type of “free trade” supporter believes that “free trade” will create freedom and democracy in places like China.

There seems to be a lot of this belief, right here on this board.

Let me attempt to disavow FReepers of that naive belief. China in it’s 5000 years of history, has been consistently ruled (not governed) by a central, omnipotent government of one type or another.

Chinese do not yearn for democracy. Chinese believe in clarity, of control relationships. The boss is clearly defined, and the boss is powerful.

The government is the same way. Before there was the CCP, there was the Emperor. Always there has been the central authority, more powerful than Americans can imagine.

If Chinese were yearning for Democracy and freedom, somewhere in those 5000 years, they would have happened upon democracy themselves. It has not happened, because that’s not what Chinese seek.

For Americans to believe that sending our jobs, money, technology and factories to China will somehow create a democratic, free society in China is WRONG.

Once one realizes that basic assumption of “free trade”, as a policy of engaging China is flawed, and incorrect - one inescapable conclusion only, becomes inevitable:

“Free trade” will not benefit America.

“Free trade” will not create freedom around the world.

“Free trade” will only make China, controlled from the central government, with no desire or possibility of becoming a democracy - a global superpower which will inevitably challenge America.

“Free trade” is not a good thing. It is national suicide.

[driftdiver]

“Eliminate free trade and we turn into North Korea”

BWHAHAAHAHAAA

Direct labor costs are only part of the reason China is so much cheaper. The bigger reason is regulation. China doesn’t have to worry about the EPA, OSHA, EOC or a host of other agencies.

Free trade has nothing to do with it except make it easier for companies to ship American jobs to those regulation free zones.

[driftdiver]

Its also important to note that these countries spend major $$ lobbying Congress for laws friendly to off shoring those jobs.