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When it comes to America’s race to the bottom, Apple is right there at the finish line waving the checkered flag. At least that’s the impression one gets from reading “How U.S. Lost Out on iPhone Work,” in Sunday’s New York Times. Reporters Charles Duhigg and Keith Bradsher begin their lengthy piece with an unsettling anecdote set at a 2011 dinner for Silicon Valley big wigs that was attended by President Obama. At one point the president asked the late Steve Jobs why Apple couldn’t bring back to America the tens of thousands of jobs it had outsourced, mostly to Asia, where its iPads, iPhones and other products are engineered and assembled.

apple assembly plant

“Those jobs aren’t coming back,” Apple’s CEO reportedly replied. End of discussion.

According to Duhigg and Bradsher, Apple’s brass believes the American worker, besides earning too much money for his or her labor, just doesn’t possess “the flexibility, diligence and industrial skills of foreign workers.” Last week Frying Pan News writer Jon Zerolnick described the “flexibility” of Apple’s subcontracted Chinese workers, with their 34-hour shifts and 12-foot by 12-foot dormitories, and their skill at sliding into coffin-sized beds at night. Victorian Manchester was a worker’s paradise by comparison.

Everything about Apple (from the mocking irony of Jobs’ name to the outsourcing of its employees’ livelihoods to factories in a totalitarian police state) epitomizes big business’s attitude of contempt – not only for American workers but for America itself.

“We sell iPhones in over a hundred countries,” answered one Apple executive, when asked by the Times about the unemployment crisis. “We don’t have an obligation to solve America’s problems.” Except that by shipping America’s jobs overseas they are creating those problems. Apple executives presumably have their black turtlenecks and toothbrushes packed and ready to go, if the day comes when the country they are fast helping to make an economic wasteland becomes uninhabitable for them. (See Harold Meyerson’s sardonic contrast of Jobs and his colleagues with Henry Ford and his contemporaries: “Ford didn’t just build the first car the middle class could afford; he built the middle class itself.”)

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The Times piece ran a devastating graphic of the top labor-intensive companies, comparing the vast numbers of Americans employed by 20th Century industrial giants such as GM and U.S. Steel with contemporary companies that are, for the most part, low-wage service-sector employers. Apple, with its 63,000 worldwide employees, came nowhere close to appearing on that graphic. How could it, when most of its production is contracted out to Taiwan’s Foxconn, whose Foxconn City in mainland China employs 230,000?

the frying pan

One bitter irony to emerge from Duhigg and Bradsher’s article is the acknowledgment that wages – the original motive for American companies relocating overseas – are no longer the main reason Apple’s jobs are not coming back. (Making an iPhone in America would only add an estimated $65 to its production cost.) It’s mostly because of the mega-plants and vast distribution systems that have been created in China, South Korea and elsewhere. These have become the production arteries of America’s tech firms – arteries this country lacks, along with the necessary number of skilled engineers.

Those distribution matrixes could be built here, just as armies of engineers and other skilled professionals could be taught in American schools. (Or, for that matter, in company-run classrooms.) But that would involve investment – a business concept completely alien to many congressional and business leaders today. Why investall the time, effort and money when the helpful Chinese government will make sure everything’s taken care of for us? This is called free enterprise, but of course Apple and other tech companies couldn’t succeed without their Faustian partnerships with the regimented command economy of China.

While it’s true that the successes of Apple and other hi-tech corporations have resulted in a few thousand extra American jobs being created (mostly in shipping and marketing businesses), a grim reality raised by the Times article far overshadows those gains. The bad news is that Apple’s production model is being adapted by other American industries – even the clean-energy sectors on which so many have placed hopes for future domestic job creation.

steve mikulan

The race to the bottom, in which we lower the value of our citizens’ labor in exchange for new industry, continues at breakneck pace because we let it. Our society is impoverished a little bit more every time an entrepreneur awards a contract to an “irresistible” foreign bid that is underwritten by slave labor. It’s a slippery road to go down — and one that is not even paved with good intentions.

Steve Mikulan
Editor, The Frying Pan