America is better than that

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Apr 1, 2012

Why can’t iPads and similar gadgets be made here, not in China?

For a moment last month, many momentous troubles and triumphs seemed to recede and our focus shifted to Apple CEO Tim Cook as he took to a San Francisco stage to introduce the newest iPad tablet computer. These periodic unveilings are highly choreographed performances, perfected by Cook’s predecessor, the late Steve Jobs.

This time, however, the spectacle was haunted by a brooding specter. Not the ghost of Mr. Jobs, nor the memory of his bravura performance at past product introductions. The spirits in the auditorium were Chinese workers, indeed some dead, widely reported to have been underpaid and working in dangerous and inhumane conditions in immense campus-like factories, such as Foxconn Technology’s 120,000-worker plant in the city of Chengdu.

The low pay, long hours and crippling work involving toxic and highly combustible chemicals had been reported for months in the American press. Apparently with great accuracy by New York Times reporters, but also with vivid imagination and some downright lying by performer/journalist Mike Daisey, in a stage piece and in the most popular and now retracted episode of the National Public Radio Show “This American Life.”

The truthful media reports pointed out that abused and sometimes underage workers made electronic gadgets for our consumption bearing the Dell, Amazon, Hewlett-Packard, Nintendo, Nokia and Samsung brands. However, the vast majority of the spotlight was aimed at Apple. Apple has responded by enlisting the Fair Labor Association to audit the labor practices of its suppliers in China.

Apple’s status as the world’s wealthiest corporation, resurrection from near bankruptcy in 1996 by the return of co-founder Jobs, and his recent death and beatification guarantee that the China revelations and ensuing debate would focus on Apple and on the question, “How much more would (or should) American consumers be willing to pay for an i-thing, if that would improve pay and conditions for Chinese workers?”

That’s a good question, but not the first one that should be considered and answered. A better and more important initial inquiry is how much more Americans should be willing to pay for high-tech devices to be manufactured here, where they are invented.

The new iPad comes in a box bearing the prominent inscription “Designed by Apple in California.”

We, as a nation, shouldn’t skip that first order inquiry, and move directly to pondering the plight of foreign workers. The assumption that Apple products and most other physical items we use can no longer be made here is one of the saddest stories ever told.

Typical of the mind-set that warps our collective rationality was a recent Boston Globe column by Joshua Green, a writer for Bloomberg Businessweek. The article titled “The Manufacturing Myth” sneers at those who seek repatriation of lost American manufacturing jobs, arguing that we should get over it and that politicians who propose doing that are just pandering to labor and America’s archaic sense of who we are or what we were.

The overarching claim that manufacturing is America’s past and that our future resides in providing services, ideas, inventions, and intellectual property, that workers in other countries will turn into physical objects, is not only dangerous, but false.

Without launching into the larger debate over the efficacy of the recent bailout of General Motors and Chrysler and their return to profitability, several things must be noted. These auto companies, hundreds of thousands of jobs and the industrial core of the Midwest have survived, at least for the reasonably foreseeable future. GM cars are being built in the United States. GM workers have accepted large reductions in pay and benefits in order to preserve and increase the number of U.S. auto manufacturing jobs. These jobs are still relatively high-paying, especially compared with the typical service-sector jobs that most laid-off factory workers get — if they find work at all.

Beyond the auto industry there are scores of examples of high-tech and high-quality items being made here. The inexorable trend toward increased wages, as well as higher energy and transportation costs abroad, will continue to reduce the economic incentive to make the things we consume abroad.

That is one reason why so many “foreign” cars are now partially or completely manufactured here. However, if we lose our manufacturing base, we will have little ability to ramp up production when the foreign cost advantage all but disappears, as it has with Japan. That nation, like America, now buys much of what its people consume from lower cost producers such as those in Korea and Vietnam.

Americans have demonstrated a willingness to pay significantly more for things produced in a desired way, such as organically, or in “free-range” environments. The popular Chrysler ad that proclaims “Imported from Detroit” speaks to Americans’ desire to buy American. And that desire is not merely patriotic and altruistic, it’s also just plain smart.

When we pay more to buy American made goods, we put money in the pockets of our sisters and brothers who will buy the goods, services and intellectual property we make.

When all the costs and benefits are tallied and fully comprehended, Americans would be willing to pay a good deal more for an iPad or other high-tech product not only designed but made by American workers.

I would. Wouldn’t you?

Lloyd Constantine is a Manhattan lawyer. He was a senior adviser to Gov. Eliot Spitzer and is author of several books, including “Journal of The Plague Year” about the Spitzer administration.



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