APPLE IN CHINA

An exposé of how the quest for profit put a once-iconoclastic tech company into the orbit of a totalitarian regime.

Founded in 1976 in Silicon Valley, Apple once prided itself on building its own hardware and software, eventually offshoring some manufacture to Ireland and Singapore. Then, writes Financial Times correspondent McGee, came the advent of “contract manufacturers” in places like South Korea, Mexico, and China, the last of them characterized by an irresistible-to-capitalists competitiveness built on what one Chinese scholar calls “low wages, low welfare, and low human rights.” That image does not square with Apple’s “think different” branding (or, for that matter, its iconic 1984-themed ad of old), but Apple has long relied on China as not just a source of production but also a huge market, earning the company, by McGee’s account, some $70 billion a year. Apple has also trained huge numbers of Chinese engineers and fueled a homegrown computer and phone industry that in effect was built on its intellectual property. The flow of cash goes both ways; McGee writes that Apple spent so much money in China—by the company’s reckoning, to the tune of $55 billion a year by 2015, but possibly much more—that over time it has become “the world’s biggest corporate investor” in the country. Under Xi Jinping’s rule, Apple’s freedom of market movement has been curtailed, yet the savings in labor and materials keep the company captured there in the technical sense, even as Apple tries to placate the government by blocking virtual private networks (VPNs), restricting the use of AirDrop “after it emerged that Chinese citizens were using it to organize,” and otherwise bowing to the Chinese Communist Party. To no avail, McGee suggests: Apple is likely to come to an unhappy end in China as its chief domestic rival, Huawei, outstrips its market share, while Donald Trump’s trade wars may harm its bottom line in the near term.

A well-argued, eye-opening look at the dark side of globalism, and those who win and lose because of it.