Obama’s Praise and Hopes for Apple
In his state of the union, President Obama praised Apple for all it has done for the US economy. However, in the past President Obama asked Steve Jobs if there was any way to manufacture iPhones in the US, creating more jobs and further boosting the economy. This article explains why keeping the software jobs in the US are equally crucial, and why we can still be optimistic.
Spotted by Daniel Lubetzky, by Adeena Schlussel
Apple and Obama
Posted by Nicholas Thompson
Yesterday afternoon, Apple released its quarterly earnings. They were good! The company’s quarterly profit of thirteen billion dollars exceeded the annual G.D.P. of Iceland. To put it another way: the market cap of one company based in Cupertino, California, is now equal to the G.D.P. of Iran. If, as Rick Santorum says, jihadists in alliance with Tehran are really massing in Nicaragua, Cuba, and Venezuela, maybe we could just buy them off with iPads instead of blowing them up?
A few hours later, Barack Obama gave his State of the Union address. Steve Jobs’s widow, Laurene Powell Jobs, a philanthropist, was there as a guest of the First Lady, and the speech centered on the rebirth of American manufacturing. Her cameo seemed appropriate. The two companies that Apple’s surge has hurt the most are foreign: Research in Motion, in Canada, and Nokia, in Finland. The company Apple sues the most aggressively—Samsung—is South Korean. People are rioting in China over iPhones; when they buy them, it helps our trade deficit. Vladimir Putin gave free iPads to stripping female supporters this summer. What company could be a better example of Obama’s vision: “An economy that’s built to last—an economy built on American manufacturing, American energy, skills for American workers, and a renewal of American values”?
However, as Charles Duhigg and Keith Bradsher reported Saturday, in my favorite New York Times story of the year so far, Apple doesn’t manufacture here and it doesn’t expect ever to do so. “Those jobs aren’t coming back,” Jobs reportedly told Obama at a dinner when the President asked whether it would be possible to make iPhones in America. The wages in Shenzhen are lower, yes, and the factories are brutally efficient. There is also deep intelligence built into Chinese sweatshops. The iPhone manufacturer Foxconn, Duhigg and Bradsher report, “employs nearly 300 guards to direct foot traffic so workers are not crushed in doorway bottlenecks.” Everyone knows that Asia pumps out our gadgets; the story makes plain why it will do so for a long, long time.
Still, there’s a reason for optimism about America’s workforce, and a good lesson to be learned from Apple’s surge. What really makes the iPhone work isn’t the hardware. Sure, the glass—designed by Corning in upstate New York and manufactured in China—is beautiful. But the transformative part of the phone is the software. The code behind the touch-screen was written here; the iOS operating system was written here; most of the apps that we use are written here. Thousands of companies, in fact, have been started here to write apps for Apple’s iOS and Google’s Android. Software remains a great American expertise, and it’s only becoming more important as processors shrink into ever more powerful forms. As Marc Andreessen argued in the Wall Street Journal this summer, “software is eating the world.” Computer code is transforming industry after industry, and writing code is something that Americans are very good at. It’s also something that requires creativity, which isn’t fostered in giant factories with guards guiding people through crowded doorways and a central kitchen that roasts three tons of pork and thirteen tons of rice a day.
So perhaps there’s a different insight from Apple for Obama. Yes, there are industries where manufacturing jobs can be brought back to America through proper tax incentives and training programs. But maybe he should have talked more about the things that he could do to keep software jobs here. He spoke of federal funding for university and scientific research. But a real pro-software agenda would also include reforming patent law to stop trolling (and perhaps eliminating software patents altogether); increasing H-1B visas for highly skilled coders; stopping Congress from defunding DARPA, whose research helped create Siri, the iPhone’s talking assistant; and opening up the unused, federally owned wireless spectrum.
That agenda wouldn’t bring Apple’s manufacturing jobs back, but it would help to keep the company’s coding jobs here. And it would certainly help develop “an economy that’s built to last.”
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