Trump Offshoring Policy Faces Big Test Case in Apple Inc

Questions about whether the president-elect Donald Trump can actually return offshored jobs back to the United States would be proven to be true or false by Trump’s negotiations with Apple, said CEO Jason Calacanis in the TV interview.

A clear and a consistent strategy that would address the issue of U.S. companies that hire abroad is yet to be presented and established by the President elect and the real estate mogul,  Trump, beyond tweets and public appearances.

“Trump obviously likes to negotiate,” Calacanis said referring to the recent Carrier deal. “He likes to bully you, then brings you to the lobby, take a selfie and then have some victory laps with you,” Calacanis added.

However, more creative financial incentives would have to be used by him if the president-elect wants to lure wealthier companies like Apple, Calacanis contends. In order to spur domestic hiring and wage increases in the U.S., Trump could offer tax amnesty to a firm like Apple, Calacanis suggested.

“Trump wants to be a hero to the people, and he’s got a little bit of negotiating room with the repatriation of taxes,” Calacanis said. “I can see him using it as a real big carrot and stick to companies.”

However whether these tactics would still work is a matter of conjecture.

“Apple is going to be the big test case,” Calacanis continued. “Apple under Steve Jobs said, ‘Listen: These jobs are never coming back.’ Can these jobs come back?” Calacanis asked. “It’s a big question.”

At the present moment and with the current regulations and norms, in order to avoid the high production costs, Apple would not move back to the United States, Calacanis believes. However, the U.S. employment situation could get improved if tax breaks for Apple products made in the U.S. were combined as an offer for the company along with tariffs on Apple products made in China, by Trump, Calacanis said. However there can be a resultant disaster by such heavy interference with Apple’s operations, Calacanis also believes.

“That’s I think the danger of Trump. It’s all fun right now to have everybody going to Trump Tower. It’s great theater,” Calacanis said. “What if Trump, who is answerable to no one, puts a $50 tariff on iPhones coming from China?”

“The guy is complete loose cannon,” Calacanis said. “I think this is what the American people wanted. They wanted to clean house. And you know what, it’s going to be an interesting experiment.”

(Adapted from CNBC)


Categories: Economy & Finance

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