"We don't have an obligation to solve America's problems," an Apple executive told the New York Times in connection with Apple's decision to make the iPhone in China. "Our only obligation is making the best product possible."
To be sure, Apple is a business and, as such, it seeks to maximize profits for its shareholders -- not improve the living standards of average Americans. Unfortunately, policymakers tend to forget that basic reality when they are debating policy, especially tax policy.
Take the major effort by a number of corporations to convince Congress to adopt a "territorial" tax system, which would set U.S. taxes on corporate foreign profits at zero. Proponents claim it would make the United States more "competitive" with other countries, implying that we're all in this together. But although a territorial tax system might be good for corporate shareholders, it might not be good for America's workers. The Congressional Research Service's Jane Gravelle told Congress last year that it:
would make foreign investment more attractive. That would cause investment to flow abroad, and that would reduce the capital which workers in the United States have, so it should reduce wages. A capital flow reduces wages in the United States [and] increases the wages abroad.
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This blog post originally appeared on the Center on Budget and Policy Priorities' blog, Off the Charts (www.offthechartsblog.org).
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The author then moves on to this next statement:
"To be sure, Apple is a business and, as such, it seeks to maximize profits for its shareholders -- not improve the living standards of average Americans."
Let's first dispense with -- banish forever -- the implicit capitulation packed inside that statement... the notion that just because "Apple is a business" that it therefore and thereby is the only entity in the conversation with interests -- and investment -- at stake, and that only its interests count.
As policymakers, we should not be capitulating -- up front -- to any such notion at all.
Sure, we ought to expect that Apple will gladly take whatever it can get for free -- what recent post-adolescent, no matter how successful, doesn't? -- but that doesn't mean that we're obligated to just stand aside while they continue to empty the fridge while never putting anything back in it.
Instead, policymakers need to put the Public Interest on the table -- the "living standards of average Americans" interest -- as being a positive claim on the debit side of Apple's ledger... a debt which Apple is quite a long way from satisfying, and must continue to service, if it expects to continue doing business in the United States at all.
It's the basic "MY HOUSE, MY RULES" speech: You want to operate here? Then follow our rules... or get out.
Apple only exists because the United States provided the conditions allowing it to exist, and this statement of defensive indifference to the United States seems little different from that of many ungrateful post-adolescents who've recently achieved a modicum of independence from his or her parents: "I'm on my own now... I don't have to listen to you anymore!"
Really.
Well... policymakers should head-slap Apple -- hard and quick -- for there ought be no "moving out to your own apartment" for corporations who've happened to achieve enormous wealth.
Policymakers ought get it clear in their heads that the very purpose that we, as a nation -- a nation aggregated together out of local communities -- that provides all of the support infrastructure for businesses to start and to grow in the first place ONLY DOES SO for the purpose of reaping the return on that massive upfront investment. A many more fail than succeed... and that is a "sunk cost" that we incur, counting on the success of the successful to balance out the books over the long term.
Apple has a very, very long way to go before it could even come close to evening the scales... and for it to act today as if its historical debt-slate is clean is preposterous, and outrageously offensive.