How dumb is Donald Trump's iPhone tariff? Let me count the ways

US President Donald Trump: chasing manufacturing jobs that are never coming back - at least not in any numbers or at high pay, thanks to automation. Photo / File.

COMMENT:

US President Donald Trump told the Wall Street Journal that he might slap a 10 per cent tariff on iPhones and other Apple gear imported from China.

Given that earlier GM today announced it was closing four factories in the US, at the cost of 14,800 autoworkers' jobs - in part because of Trump's steel tariffs - it's hard to regard the president as much of an economic guru.

Still, he's the guy in charge, so let's count the number of ways his suggestion is brainless.

1. As with any Trump tariff (or tax, to be blunt), US consumers will pay the price, not China. Specifically, Apple's top-of-the-line iPhone XS Max would cost Americans US$200 ($295.18) more.

2. Trump will argue that the tariff will incentivise Apple to move assembly jobs to the US. Why does the president want Apple to manufacture in the US? Apple is one of the world's most valuable, most profitable companies in part because it outsources the mean, low-margin business of assembly, mostly to Foxconn in China.

True, Foxconn recently opened a factory in the US, but only after receiving a stunning US$4 billion in corporate welfare, and it scored those government slush funds without giving any guarantees of ongoing employment as manufacturing becomes more and more automated.

Worse, US taxpayers on the hook if the project flops. And let's face it, that's possible. US workers just won't have the same enthusiasm for living onsite in cots, the better to jump out of bed to instigate a quick production line tweak if Tim Cook has a last-minute change-of-mind about a particular iPhone feature.

3. Apple does employ a lot of Americans (47,000 directly and around 300,000 including US-based partners). It's just that they're in design and marketing and other service-economy roles, as you would expect in 2018.

4. More broadly, China has a systemic advantage in any trade war. Like any US president, Trump has to worry about mid-terms and his own re-elections. China's leaders have no such concerns about short-term popularity.

5. Trump uses an iPhone. If you're going to bash Apple so often, at least use a competitor's product. No wait, that would involve adopting a Samsung smartphone from South Korea, or maybe one of Huawei's handsets from China. Though maybe it could be argued that was patriotic, since both Huawei and Samsung owe a lot of their smartphone success to Android software from US company Google. Tricky cove, Johnny Trade.