A couple of weeks late for April Fool’s day, Illinois Congressman Jesse Jackson Jr. denounced a previously unsuspected enemy of American progress, claiming the China-produced iPad is responsible for the loss of thousands of American jobs – i.e. the closing of Borders.
First, I’ll just make a general observation that perhaps Borders missed the boat where B&N did not. I’m speaking as someone who took a $45 gift card to 3 different borders stores and couldn’t find anything worth spending it on. Their bargain books were not interesting, the stores were badly organized – and they just didn’t carry interesting games, journals or anything else. I couldn’t bring myself to purchase hardcover books that were priced at $6-7 more than what I could get them for on amazon, even understanding Amazon’s crazy power over publisher prices. And honestly – I’m already locked into the Kindle, so it’s hard to pick up physical books, unless it’s a collector’s book, for my husband, or for my research.
Secondly, iPad is probably not the major threat to the jobs created by Borders. You could probably stick that flag in Amazon. And maybe B&N. I love B&N. Also, I live in Berkeley and I still buy a lot of books at Pegasus.
But this is a blog about ICT and development, so I will highlight a point from Kyle Smith at Forbes:
The iPad is made in China, which means the wage-earners of the People’s Republic get to do all that cool assembly-line labor while back in California Apple’s employees suffer the indignity of being highly paid software developers, tech engineers, style consultants and marketing magicians.
I have a couple of takeaways from this (albeit sarcastic) observation. Apple, with all of their technical and design innovation is creating jobs, both in Cupertino and in China. China gets to manufacture all of the Apple products (including my shiny new 13″ Mac Book Air) because they can do high quality at low cost, and somehow despite reputation of the country as a whole, certain companies can secure data such that companies like Apple are confident that their designs won’t be sold or copied to other companies. (One Chinese businessman once told me that while Americans were popularizing B2B and B2C, the Chinese loved C2C models: Copy-to-China.. Another Chinese entrepreneur proudly showed us how even his windows were secure from privacy intrusions.)
There is a divergence in the types of jobs being done in different countries, in part based on the current development of the country. Friedman once attributed this to globalization – claiming that the world was flat, enabling a car to be made all over the world. And yet, this very phenomenon points to the inequality inherent in the world market. While, yes, I hope that Apple’s partner company benefits from the exchange and doesn’t exploit its workers, there are many manufacturing companies in China that are known to exploit workers. Their pay goes to rural families who are at the bottom of a food chain that supports our consumer needs. As far as human rights goes, I call that a bumpy ride, not anything flat.
More and more we see and hear about Indian call centers – an audible signal that the services sector is not only growing in the US and Europe. Indeed, African countries like Ghana, South Africa, and Kenya are seeking to leverage their connections to the Internet and build Business Process Outsourcing (BPO) markets. Will they succeed? Is this a threat to American progress? Well, they’re probably supporting our businesses, or, more likely given the time zone, British or European businesses. But this is also a separate question from a long unanswered issue of local manufacturing. These countries export raw materials, and import processed ones at a high cost. They also import lots of low quality goods from China. But China is making huge investments in African infrastructure. In particular – a deal with DRC will enable investments in road building and agriculture, but also give China access to DRC’s mineral rich mines, including coltan, which is used in chip manufacturing.
So, the iPad is no threat to American Progress. My question is whether and how American investment in Africa might be beneficial to both African and American progress like we potentially see benefits to China and DRC in this instance. Or, conversely, how lack of American investment might lead to Congressman Jackson Jr’s worst fears: China taking more jobs, with DRC in a continued unknown state. Currently, the US invests in Africa as a rescue state, giving aid money in 3-5 year budgets (or 1-2 year budgets) and sending troops out to keep peace as necessary. What would it mean to be able to invest in infrastructure with hopes of return? Is it possible? Is it political? The African gov’ts deal with the US on an aid basis because that’s their history with us. But if Dambiso Moyo is right, that relationship needs to change, or the iPad will always be made in China.