Donald Trump Claims He Will Force Apple to Manufacture in the US: Why It's a Bad Idea

The American public has gotten used to outlandish claim and declarations for Donald Trump over the course of his campaign. Now the billionaire businessman has announced his determination to require Apple to start manufacturing in the US. That's a bad idea.

One of the reasons Apple manufactures it's products primarily overseas (there's a Mac Pro factory in Texas) is due to reduced manufacturing costs, which results in cheaper products for us consumers. Furthermore, Asia has a much better infrastructure for producing electronics than we have here in the US, often because they can do everything more cheaply. Labor is a significant portion of most manufacturing costs.

And Donald Trump, despite being a business mogul, does not seem to have a firm grip on economic standpoint of companies who do outsource. In his remarks at Liberty University, Gizmodo reports that "First, in the span of a few sentences, he insisted that he'd impose a 35 percent tax on businesses producing goods overseas while claiming to support free trade." An article at Forbes corroborates that this isn't the first time Trump has made claims like this: "What he's just told the New York Times he wants to try: a 45% tax on all imports from China. "

Part of the problem of penalizing outsourcing is that Americans simply won't work as cheaply as those living in less developed countries. It's not really financially feasible to try and live on the U.S. minimum wage, especially if someone has loans or debts to pay off. It would also require companies to build facilities in the US dedicated to manufacturing their products. Penalizing goods coming from other countries through tariffs would simply increase prices significantly as most companies aren't going to sacrifice their profits just to keep costs down, especially if everyone is having to charge higher prices to keep up profit margins.

Uproxx summed it up well: "In other words, what Trump is promising could, technically, be pulled off. It just would be somewhat poorly considered."