Apple is headed for a clash with President Trump on some crucial issues

“If President-elect Donald Trump stays true to his word, Apple should hope that a big wad of extra cash can help compensate for what are likely to become big fights with the new administration over trade, encryption and immigration,” Anita Balakrishnan reports for CNBC.

“Even though Apple would benefit immensely from Trump’s proposed tax reform, the president-elect’s stance on trade with China, his immigration-hawk attorney general, and his cybersecurity appointees could pose threats to America’s wealthiest company, industry watchers said,” Balakrishnan reports. “Trump’s victory comes at a time when Apple and the government are more intertwined than ever. Under CEO Tim Cook, Apple has spent about 3½ times more on lobbying than when co-founder Steve Jobs led the company, according to data collected by the Center for Responsive Politics.”

“With a 26 percent tax rate and $216 billion stored offshore, Apple would benefit from Trump’s proposals to lower the business tax rate to 15 percent and allow the one-time repatriation of corporate profits held offshore at a tax rate of 10 percent, Bernstein analyst Toni Sacconaghi wrote in a research note,” Balakrishnan reports. “‘Trump’s stance towards tightening H1-B visas could negatively impact the company in the near term, given Apple and other companies in the Valley is a hotbed for technology developers,’ [said Daniel Ives, senior vice president of finance and corporate development at mobile cloud maker Synchronoss Technologies, who covered the company on Wall Street for years]… While Cook hasn’t made direct comments about the issue, Alphabet’s Eric Schmidt has defended the use of foreign labor and called for reform of the program, arguing that if the U.S. kicks out out American-educated engineers, ‘they go and build competitors to our companies.'”

Balakrishnan reports, “‘That said, Apple is in a position of strength around R&D and developer talent worldwide, so while they would have to slightly pivot on their hiring around H1-B visas if Trump went down the path, it would not have a long-lasting impact to their model.'”

Read more in the full article here.

MacDailyNews Take: Some say that the crux of the H-1B visa system is about securing cheap, immobile labor. With his quote above, Schmidt basically confirms the immobility bit.

If an engineer leaves an employer in the midst of an urgent project, this can be a major problem for the employer. The H-1B and green card programs give the employer heavy leverage to force workers to stay.Norman Matloff, Professor of Computer Science, University of California, Davis

Vivek Wadhwa confirmed the cheaper aspect over nine years ago in November 2007:

I was one of the first [CEOs] to use H-1B visas to bring workers to the U.S.A. Why did I do that? Because it was cheaper. — Vivek Wadhwa

U.S. President-elect Trump’s position paper is still online and states the following regarding H-1B visas:

· Increase prevailing wage for H-1Bs. We graduate two times more Americans with STEM degrees each year than find STEM jobs, yet as much as two-thirds of entry-level hiring for IT jobs is accomplished through the H-1B program. More than half of H-1B visas are issued for the program’s lowest allowable wage level, and more than eighty percent for its bottom two. Raising the prevailing wage paid to H-1Bs will force companies to give these coveted entry-level jobs to the existing domestic pool of unemployed native and immigrant workers in the U.S., instead of flying in cheaper workers from overseas. This will improve the number of black, Hispanic and female workers in Silicon Valley who have been passed over in favor of the H-1B program.

· Requirement to hire American workers first. Too many visas, like the H- 1B, have no such requirement. In the year 2015, with 92 million Americans outside the workforce and incomes collapsing, we need companies to hire from the domestic pool of unemployed. Petitions for workers should be mailed to the unemployment office, not USCIS.

· End welfare abuse. Applicants for entry to the United States should be required to certify that they can pay for their own housing, healthcare and other needs before coming to the U.S.

· Immigration moderation. Before any new green cards are issued to foreign workers abroad, there will be a pause where employers will have to hire from the domestic pool of unemployed immigrant and native workers. This will help reverse women’s plummeting workplace participation rate, grow wages, and allow record immigration levels to subside to more moderate historical averages.

SEE ALSO:
Scholars debunk claims of high-tech workers shortage, question tech industry’s ‘free pass’ – May 19, 2014

18 Comments

  1. The chump is the one that’s going to be headed for a clash with everyone. As a result of that election, there has been a lot of migration inquiries from that country. With this in mind here are some useful tips and hints for anyone considering (re)joining the free and civilized world.

    – Immigration may look and sound a bit like invasion but there is a big difference between the two. Both involve traveling and you are more than likely familiar with the invasion process, going to an exotic location, meeting interesting and stimulating people of an ancient culture and killing them. It’s pretty well a national pastime. With immigration you respect the sovereignty and laws of a foreign country, you allow innocent civilians to live, and you certainly refrain from committing atrocities and crimes against humanity. It sounds like a more daunting task than invasion and it probably is considering where you are coming from.

    ************************* ARMS *************************

    Be aware that when people from the free and civilized world are talking about bare arms, they are usually talking about short sleeve shirts. Unless they are talking about bear arms. They’ll show you when you get there.

    Leave your weapons behind. There is no need for superior weaponry to defend a lack of ethics and morality. Bring your ammo though, that’s useful.

    Before you leave it is highly recommended that you see a doctor, or an engineer to remove that flag shoved up your ass.

    It might surprise you but most places in the free and civilized world ask questions first then possibly shoot depending on the response, so if someone is asking you a question there is no need for you to check for wounds and bullet holes.

    When people talk about you being welcome with open arms it does not mean that their weapons are loaded pointing right at you with the safeties off and the triggers on the fingers. It means you can sit with them and have lunch.

    ************************* WHERE? *************************

    While you may be geographically challenged it is not a big deal for most situations as long as you land somewhere in that time zone. You will have to watch out for some hot spots though, you don’t want to get East and West Korea mixed up.

    Those strange sounds you may hear coming from some people in other countries are called languages. Since you don’t have to worry about your patriotic duty anymore, you can learn one other than English.

    The Metric and imperial systems are used for measuring things. Pretty well everyone uses the Metric system so you’ll have to learn it. It’s easy to convert, for example 100 km/h means 100 kar miles/hour.

    Don’t forget to migrate when you can, otherwise you might be leaving as refugees.

    1. I would not be surprised if the republican senate successfully impeaches Trump within the next year or two (for gross violation of ethics / conflict of interest) and installs Pence as the president.

      There are still some people who hope that the electoral college will do its duty (as originally envisaged by the framers) and vote independently of the popular vote. As much as many in America would love that, there is absolutely no chance it will happen. Trump has already been talking about a “rigged system”. After winning the election earlier this month, there is simply no chance his followers would peacefully accept an unprecedented outcome (electors voting against the state’s popular votes and installing Clinton), regardless of how legal it may be. Such an outcome would undoubtedly plunge the country in much greater chaos and uncertainty than letting Trump take office in January.

      One thing is quite clear, though. American political system is systematically rigged to favour conservatives against the liberals, rural against urban voters. Sparsely populated districts and states have significantly higher proportion of representation (25 smallest and most sparsely populated states have 17% of population, yet 50% of senators, all republican), and in the congress, that disproportion is even more pronounced. Even though the country has an obvious and consistent liberal majority (and had had it for quite a while), they are held hostage by the rigged system that consistently favour conservatives. Not even their perceived liberal media is capable of neutralising that powerful bias.

      And yet, I’m pretty sure Americans have just elected their last Republican president in a long while. In 2020, there will be very little chance of them re-electing Pence (or Trump, in the very unlikely scenario that he completes his first term in office). Demographic forces are extremely powerful: Hispanics, blacks and other minorities are rapidly becoming the plurality (and together, majority) of the US population, and no amount of gerrymandering will be able to suppress that force. Unless the conservatives figure out how to attract their votes in marge enough numbers, they won’t have another president in a long while.

      1. I agree with your thoughts and characterization of the situation, but depending on Republicans to do the right thing isn’t likely to have a good outcome. Look at the obstruction for 8 years of the Obama administration.

        Articles of Impeachment start in the House of Representatives. Will Paul Ryan have the spine? It might cost him his job. I know he would have hounded Hillary relentlessly, but that’s just a sport among Republicans in Washington. All in all, though, I follow Maya Angelou “The first time someone shows you who they are, believe them.” We already know who Trump is. Change is not coming.

  2. “Some say that the crux of the H-1B visa system is about securing cheap, immobile labor.”

    correct…the key word being “immobile.” Very similar to the vassal state exemplified in feudalism of the European ninth century.

  3. how much you wanna bet he tries to hold mr. apple up for ransom “you won’t be allowed to repatriate your money at the reduced rate unless you forgo end to end encryption and allow us a back door…”

    1. You’re not far off…but encryption can never be bargained. It’s a binary argument, you either have it or you don’t.
      I don’t expect the tech world, led by Apple, to give in over this.
      Offshore cash repatriation? – only if the carrot is big enough and I would expect/hope Apple to use their renewable energy policy to claw some of that back despite Trumps negative stance on the environment and green energy in general.

      1. Part of the problem is that ‘encryption’ is being tied with ‘access’, the former which is binary and the latter has ‘levels’ that can be assigned. The two need not be mutually exclusive. Otherwise we would be arguing nothing that has access levels is truly ‘encrypted’.

    1. Of course it’s not academic, unless you ignore the fact that ‘that’phone you refer to was running iOS7, had no Touch ID nor secure enclave.
      I understand your need to try and puncture the encryption debate to make the man_child agent orange seem normal…but it ain’t dead nor is the other thing remotely possible.

    2. botty, it has been a while since I read about the San Bernadino iPhone situation. I do not know if the technique used in that case is still relevant given the continued evolution of the iPhone and iOS

      Either way, that does not render the encryption issue “academic.” Even if current encryption technologies can be defeated (with varying degrees of effort), that does not mean that future versions will share those same vulnerabilities. Encryption technology continues to evolve and the issue is whether the U.S. Government will attempt to mandate the inclusion of a back door in future software/devices.

      There is a big difference between the previous iPhone encryption battles and the transition to a fully compromised encryption approach that would allow people/organizations to bypass encryption protection at will and on a mass scale.

      I would much rather deal with the risks associated with readily available secure encrypted communications than give government (and anyone sufficiently rich, powerful, or knowledgeable) to access a backdoor.

      After all, people would never snoop into private data just because they had access… /s

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