President-elect Donald Trump, sometimes called our Twitterer-in-Chief, seems also to be vying for the title of Reshorer-in-Chief.
In what seems to be a pattern for how he'll deal with business executives, Trump yesterday described a phone conversation with Apple CEO Tim Cook. It sounded like not very subtle pressure on Cook to make more Apple products in the United States.
Here's Trump, according to a transcript of a long interview he gave to The New York Times on Nov. 22 — his longest interview with any media since winning the election:
“I got a call from Tim Cook at Apple, and I said, ‘Tim, you know one of the things that will be a real achievement for me is when I get Apple to build a big plant in the United States, or many big plants in the United States, where instead of going to China, and going to Vietnam, and going to the places that you go to, you're making your product right here.'
“He said, ‘I understand that.' I said: ‘I think we'll create the incentives for you, and I think you're going to do it. We're going for a very large tax cut for corporations, which you'll be happy about.' “
That's Mr. Trump's version, of course. I wonder how Mr. Cook would describe it. Still, no matter how it went down, how'd you like to be on Cook's end of that call? That's where he earns his money.
I recently saw this article talking about what Apple does and doesn't make in the United States.
Most of its products are not made in the U.S., of course, but the article looks at jobs created by the company domestically, and claims that making the iPhone in the United States would add $100 to the cost of each phone.
But back to President-elect Trump. I would encourage reading The New York Times transcript. He talks about having other conversations with business executives similar to the one he had with Cook, and he hinted there will be corporate announcements over the next couple of months.
At times, he uses a lot of dark language about how U.S. manufacturing is always getting beat, language I find off-putting and a lot of people who work in the industry might also find off-putting:
“We can't beat anybody, we don't win anymore. At anything. We don't win on the border, we don't win with trade.”
Really? We don't win at anything?
At another point he says: “We don't make anything. But we're going to. … We're going to have more factories. We can't lose 70,000 factories. Just can't do it. We're going to start making things.”
And, he said this on Monday that his “simple core principle” would be “putting America first” so that the “next generation of products and innovation” happen in the United States.
That's a worthwhile goal, of course, but it's also not a simple problem, where you can make a statement, wave a wand and boom, solve it.
Business groups like the American Chemistry Council say that the trade deals that Trump vilifies are actually very important to getting the maximum benefit from the $175 billion that the industry is investing in new production related to shale gas.
If the U.S. starts to carelessly tear up trade deals and say, substantially increase tariffs on manufactured goods from China, what happens if China decides to buy Airbus planes instead of Boeing, or if they cut back on purchases of U.S. soybeans, which would hurt some of the rural voters who supported Trump.
In the interview, Trump is asked about robots, and he seems to acknowledge that the increasing use of robots also holds down the number of jobs that could be created.
I would love to have a crystal ball looking ahead four years.
It seems like it's possible that we could look back on a Trump administration that helped give a shot in the arm to U.S. manufacturers, and pursue more forceful policy options than the government has done. Or we could see that they'll discover it's not so simple.