Apple keeping cash, jobs overseas
Time to change U.S. laws?
- Duration 8:44
- Date Mar 24, 2012
Time to change U.S. laws?
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Forget the buzz over Apple's hot new -- or its new stock dividends or it's monster's stock moves.
Here's a thing about apple but should get the most -- The lion's share of Apple's jobs and cash are outside the US because of the cost of doing business.
Inside the US so -- Apple's signaling that it's time to change US laws to bring the jobs and cash back home.
Hi everybody I'm David has been welcome to Forbes on FOX let's go in focus width is rich -- guard Victoria Barrett.
Bill ball and Dennis -- Rick -- and Mike all zany it.
Rich what -- event.
What you know if you project forward in the future just a few years you're gonna find out the Chinese advantage and labor costs don't matter anymore because everything will be done.
By robotics and 3-D manufacturing so at that point does America have a chance for a manufacturing Renaissance to create apples and automobiles and health care and that should be the key policy question.
And right now with tax and regulatory policies I don't think so and even the liberal Steve Jobs told President Obama -- during jobs is dying days.
The things had to be fixed if we're gonna reinvigorate America's economy.
Beyond that according to the Walter Isaacson book and and Victoria let's let's quote from that book.
Steve Jobs apparently said and comparing the US the ease of doing business in China with.
-- what it takes in the US he said companies can build factories in China compared to the United States where regulations and unnecessary costs make it difficult for them.
So even Steve Jobs is so I -- right here to President Obama you gotta make it -- I -- business in the US.
I know -- it's an amazing thing coming from a guy who lived on -- -- walked around Silicon Valley.
And I an awesome time to -- stocks I mean.
But he -- pragmatist when it came to business that supply yeah exactly exactly and I think his message -- mom and one that we need to listen to.
Granted there are issues with those factories in China that were all well aware of it is not yet but somebody away some of the issues turned out to be bogus as we found out you have to go but it doesn't -- all the issues are -- which is a tragedy of that story being fabricated but anyway.
That that's my point is I actually think it's a beautiful thing.
That we could get devices like the iphones -- the iPad because apple could go to the most efficient.
-- of hard labor they could create these devices in the in the cheapest way.
Possible that's why we have these devices.
I actually think it is a testament to our system that we allow companies to pull labor from all over the globe we let you continue fighting might.
They don't just -- Howard with a -- but let's be specific about what apple has.
Apple has this huge cash war that's one reason why they're giving out dividends now about a hundred billion dollars -- huge amount of money.
Billion of that are outside the United States.
When to be much better -- that money was back here and all the jobs that they're creating overseas would have been better if they were creating them here from David I agree that apple is a perfect example that the cost of doing good -- -- the cost of doing business in the United States is way too hot.
Before any but any business leader decides to invest in hiring people or invest in factories are real estate.
They've got to say this is what it's going to cost me and this is what -- after tax return could be.
Increasingly businesses in this country are saying you know what the after tax return is going to be too high in the United States too -- in the United States excuse me.
I'm better off going overseas this is one of the reasons why many companies in the United States have actually moved to the south in recent years why Boeing wanted to move because certain states in America.
Have too much onerous tax code so -- the cost of taxes is very important.
And Rick we desperately want to create jobs and businesses here in the United States -- -- be better all that money and all those jobs overseas from apple came back.
There are certain realities about the cost of of workers in China that aren't gonna change it has a lot to do with things that we can't always impact but I'll tell you what troubles me.
I lived outside of the United States where -- rather lengthy period of time and you know what.
I had to file my tax returns in the United States I had to pay my taxes in the United States.
Even though I was based somewhere else my question is why do corporations like apple.
Get to keep all that money outside the country and not pay their activities better I say it perhaps because of the fact that tax rates are too high end.
It if we lower them a little maybe they could bring them back into the good you know what we all think our tax rates are too high I didn't like paying my taxes even though I was living and -- -- -- President Obama -- -- irate and find lower them a little bit you know what you know what even lower than lowering them a little -- you and I both know.
These corporations are still gonna try and avoid paying US taxes.
Because when they -- -- pay US taxes yeah don't you think we should make them do well then -- still practice is that millions of Americans are part owners of apple I don't make as much profit as possible don't.
Your company and every American has that god given legal right to pay as -- taxes legally as they possibly can't we look inflating two different issues here now one.
Is that there's one point four trillion dollars in US profits cash after tax sitting overseas -- they bring it home.
Because we -- the only major.
Nation in the world that taxes -- a second time when you finally bring home double echinacea and we would bring home 800 billion cash easily John chambers of Cisco told me.
If we're just -- it 35% tax rate to 5% the second issue is sending jobs overseas.
Apple has the right.
To make the goods at the highest quality at the cheapest price anywhere in the world -- wants that we make our economy stronger.
The problem is that when it earns money overseas in those markets it doesn't bring it home because it will they get taxed again at rates that effectively -- up to score here 70% below -- when he.
-- -- a question do we do what -- -- says which is clamp down on on the folks who weren't paying as much as he thinks they should be thankful.
Or do we do we lessen the tax burden on companies so they can.
Bring word that cash back home to that that the tax situation is extremely complicated -- -- about the jobs are having to think that apple shows what's good about American jobs markets.
What's happening is that we get the manufacturing it did we get the marketing and the design jobs.
And the assembly goes to -- wage countries I think this is good I think portrayed as good I think it's fine that America lost all of its banana growing jobs -- -- -- -- -- -- that order does not export filmed entertainment this is called the law comparative advantage it weren't sure except that I'll ask.
Want to know what I say you're at it -- let me go to Victoria -- -- written Victoria it's true what bill saying that some jobs should be outsource some of the cheaper jobs it.
That Americans don't want to do that we can get folks in Mexico do a lot cheaper in China where it is however.
They have hundreds of thousands of jobs Apple's overseas and a lot of those jobs are jobs that would be good for Americans it's just.
Clinton when you can't have one without the other the iPad.
Wouldn't exist if we didn't didn't have this free market of labor it -- -- think the product would never have come to being.
And out of it we have all these other jobs you have entire.
He -- has come out of me develop.
I heard all over the country governor David I don't know that the better a little factories -- thing going to -- I was saying you know I think Victoria is mixing two things -- is actually right no one is saying that apple should have the right to create jobs overseas or put factories overseas.
-- -- -- Taxation that Dennis is pointing out is keeping cash you're coming back to this country.
And -- yes bill we don't want banana growers necessarily but like the multiplier effect of that cat hey how -- -- I don't really know how -- And -- hit -- say Dennis go ahead.
-- like five years ago I interviewed a guy at the Shanghai Stock Exchange who said.
Within five years will be selling more cars and making more cars and try and in the US and said what -- -- didn't do in the US he said.
You have to move up the manufacturing chain will make the patient mattress you make to MR MRI scanner we don't know how to make that we will make far more sophisticated things Obama's not a lot of make simple things here.
And and just artist they're gonna tell our prices which Rick I got -- Anderson about rich what about that day there are some jobs that are better off overseas know.
Yes but if you projected that's true right now but if you project in the not too distance future.
Technologies like robotics in 3-D manufacturing are -- -- completely take that equation away at that point.
America should ask itself do we want it to be the apple bottom mobile manufacturing.
Of health care devices we have that opportunity.
But not you know these are capital intensive industries should we have basically almost as favorable tax climate to bring that money back you know then why -- word.
Sir rich we got to leave it -- that the future is here we got to start building jobs right here.