Bringing iPhone Assembly to U.S. Would Be a Hollow Victory for Trump
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The president’s tariffs on Chinese imports could hurt Apple without addressing the real challenge of China.
President Trump says there’s an easy way for Apple Inc. to avoid his tariffs on China: make its products in the U.S. But this would be a hollow victory. If Apple follows his advice, Mr. Trump will have grabbed the least valuable link in the electronics supply chain with little net benefit to Americans, without addressing the real contest in global trade.
That contest is over the more valuable production steps like research, design and the manufacture of more sophisticated components where the U.S. is dominant but China is closing the gap. Mr. Trump has correctly identified Chinese practices—such as forcing U.S. companies to transfer technology to Chinese competitors—as a threat to that dominance. But an all-out trade war could end up doing more long-run harm than good.
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