Apple CEO Tim Cook announced today that the iPhone maker will be putting $1 billion of its roughly $256 billion cash hoard into a US advanced manufacturing fund. The news, which Cook disclosed in an interview with CNBC’s Jim Cramer, indicates that Apple’s executive leadership is intent on heading off any potential conflicts between the company and President Trump, who has promised to bring jobs back and pressure corporations to invest more domestically.
“It’s $1 billion of our US money, which we have to borrow to get. That’s another whole topic,” Cook said, lightly commenting on current US tax policy that Apple claims prevents it from repatriating a majority of its overseas cash. “But yeah, we’re really proud to do it. And by doing that, we can be the ripple in the pond. Because if we can create many manufacturing jobs around — those manufacturing jobs create more jobs around them, because you have a service industry that builds up around them.”
Cook says Apple will be announcing the first investment from the fund later this month. “And so you can see, we’re really looking at this thing deeply. How do we grow our employee base?” Cook said. “How do we grow the developer base? How do we grow manufacturing?”
An investment in domestic manufacturing could be a way for Apple to win favors in Washington, especially on controversial topics like immigration. The flow of foreign tech workers to the US is a contentious issue at hand, as the Trump administration has started looking at reforming visa programs, like the H-1B, favored by Silicon Valley companies. Apple could also be trying to coax Trump into following through on his promise to help corporations repatriate overseas earnings.
When asked about tax reform, Cook launched into an attack on the current tax code, one he’s repeated in one way or another many times over the last few years:
I actually think comprehensive tax reform is so important to this economy. If you think about it, what many, many companies now sell globally. If you sell globally, you earn money globally. If you earn money globally, you don’t — you can’t bring it back into the United States unless you pay 35 percent plus your state tax. And you look at this and you go, “this is kind of bizarre.” You want people to use this money in the United States to invest more. We are in a good position, but an unusual one. Our good position is we can borrow. And so to invest in the United States, we have to borrow. This doesn’t make sense on a broad basis, and so I think the administration you saw that they’re really getting this, and want to bring this back. And I hope that that comes to pass.
When asked directly about Apple’s relationship with Trump, Cook was slightly more cryptic. “You know, my view on working with any government in the world is that there are things that you will agree upon and things that you will not,” he said. “Because what we want to do when we disagree is we want to say why we view the way we do.” Cramer explicitly followed up with mention of immigration, prompting Cook to say, “Yes, immigration is one of those where you saw how we talked out about the executive order and how we felt about that.”
“You know, again, I think with each administration, in every country in the world, there are things you disagree and things you agree,” Cook added. “And you look to find common ground and try to influence the things you don’t. If you don’t show up, I think that’s the worst scenario. Because then you’re quiet and this doesn’t do your cause any good, or your point of view any good.”