Speaker 1: You're listening to Comedy Central, from.
Speaker 2: The most trusted journalists at Comedy Central is America's only
Speaker 2: source for news.
Speaker 3: This is the Daily Show with your host.
Speaker 2: John Stewart, the show man.
Speaker 4: Minam is John Short. What a program we have designed
Speaker 4: for you tonight, have bespoke or teasonal effort that I
Speaker 4: think you were gonna truly love. And Patrick McGee is
Speaker 4: gonna be here. Here's this guy. They call them McGee heads.
Speaker 4: That's the fandom, the Patrick McGee fandom, here to discuss
Speaker 4: this new book about how Apple's actions in China shifted
Speaker 4: the entire global economy. The book is phenomenal for a
Speaker 4: book about Apple. It's banana. That's a little, that's a
Speaker 4: fruit pun. I don't about you, folks, but me, I'm
Speaker 4: on the pins and needles. I'm very anxious right now.
Speaker 4: I'm very nervous, very anticipatory. And it's not about whether
Speaker 4: Russia and Ukraine will be settled. It's not whether somebody
Speaker 4: can stop net and Yahoo somebody please. It's not whether
Speaker 4: Taylor's unfriended Blake. I don't know. No, Like most people
Speaker 4: in America, I am most looking forward to reading a book.
Speaker 4: But when.
Speaker 5: Word go back with Breaking News in our Politics lead
Speaker 5: and a brand new excerpt from my upcoming book with
Speaker 5: Axios is Alex Thompson.
Speaker 4: It's called Original Sin.
Speaker 3: I'm not sure if you've heard of it. It's on
Speaker 3: Biden's Decline. It's called Original Sin. I'm sure you've heard.
Speaker 3: On May twentieth.
Speaker 4: That's Tuesday, Original Sin.
Speaker 5: That's coming out in three weeks, on May twentieth. That's
Speaker 5: just nineteen days away. In one week and one day
Speaker 5: coming out in just a few days, comes out Tuesday.
Speaker 5: You will not believe what we found out.
Speaker 4: Don't news people have to tell you what they know
Speaker 4: when they find it out, isn't Isn't that the difference
Speaker 4: between news and the secret You won't believe when we
Speaker 4: found out. No, that's why I'm watching Breaking News in
Speaker 4: a week now. I don't know how the rest of
Speaker 4: the country is feeling about this book coming out, but
Speaker 4: I know New York is hyped.
Speaker 6: New York City by me, the city the city that
Speaker 6: never stops reading.
Speaker 1: That's our motto, is.
Speaker 4: I'm kidding of course? That is footage from the reopening
Speaker 4: of the Frick Museum. By the way, it is New York,
Speaker 4: So you know the real name of the museum is
Speaker 4: the collection. They just put it up there, like, Hey,
Speaker 4: the freaking collection. What are we doing? So what is
Speaker 4: this bombshell book about?
Speaker 7: A new book is outlining new claims about former President
Speaker 7: Biden's physical and mental health. The book Original Sin, claims
Speaker 7: Biden's health had become so severe that there were internal
Speaker 7: discussions about putting the president in a wheelchair.
Speaker 3: He allegedly was napping during debate preparations.
Speaker 5: Another bomb show, former President Biden apparently forgot the name
Speaker 5: of his longtime nade Jake Sullivan, and called him Steve.
Speaker 4: O my god, to be fair when you forget a
Speaker 4: white guy's name, to be fair, And I'd say it
Speaker 4: with respect for the bombshell Steve. It's not a bad guess.
Speaker 4: I think even Jake Sullivan at some point was like,
Speaker 4: is my name Steve? Because when I look in the mirror,
Speaker 4: I could be or Scott maybe a c. The point
Speaker 4: is the American news media were hungry for.
Speaker 8: More, a new Biden bombshell, dropping bombshell allegations.
Speaker 4: A steady drip of new revelations, dans damaging new details.
Speaker 4: Oh my goodness, they're dripping with the tails a mass
Speaker 4: of tsunami the drip drip on Joe Biden's decline. Oh God,
Speaker 4: Fox News built an entire Biden sucks border.
Speaker 6: Wall to hold back the raging drips of details in bombshells.
Speaker 4: Nothing could slow down this coming feeding news frenzy about
Speaker 4: Biden's cognitive health, other than maybe a report on his
Speaker 4: actual physical health, which was not good. But now we
Speaker 4: got ourselves a little problem. You've prepared an entire Schmortgish borg,
Speaker 4: schmorgisborg shercuterary boards. I mean you know what I'm talking about.
Speaker 4: I mean, jeez, entire schorgishborg based on what you thought
Speaker 4: would be a relatively uncomplicated story about mental decline. News
Speaker 4: has the countdown clock, they got the book graphics, they
Speaker 4: got the CNN Happy Meal tie in toys, But now
Speaker 4: doing the story seems almost disrespect Can CNN thread the needle?
Speaker 4: How do you pivot from excitedly promoting your anchor's book
Speaker 4: to somberly and respectfully promoting your anchor's book.
Speaker 9: Iidam's health was very much in the news even before
Speaker 9: the cancer diagnosis was announced on Sunday.
Speaker 3: That's because of a new book by CNN's Jake Tapper.
Speaker 10: This was already going to be a tough week, and
Speaker 10: this makes it much harder. And that is a reference
Speaker 10: to the fact that our colleague Jake Tapper and Alex
Speaker 10: Thompson have a book that's set to publish on Tuesday.
Speaker 9: This very tough news, this very challenging news, and at
Speaker 9: the same time, the backdrop of our colleague Jake Tapper's
Speaker 9: book with Alex Thompson coming out this week.
Speaker 4: It's so hard, it's such a difficult time, so unfathomable
Speaker 4: in terms of the pain this family must be feeling.
Speaker 4: And yet if you act now now, and you use
Speaker 4: the code backslash tap that book, you will Obviously, this
Speaker 4: twenty percent off offer is not act available for some
Speaker 4: reason in Tennessee. But the point is forgetting about the
Speaker 4: fact how fuck weird it is that the News is
Speaker 4: selling you a book about news they should have told
Speaker 4: you was news a year ago, for free.
Speaker 11: It's just fun.
Speaker 4: It's just fun to watch them not only continue to
Speaker 4: push the book in light of this news, but to
Speaker 4: actually frame this difficult news as perhaps even more of
Speaker 4: a reason to buy this book.
Speaker 8: The timing of former President Joe Biden's cancer diagnosis is
Speaker 8: certainly dramatic, coming on the eve of a blockbuster new
Speaker 8: book about his health and his time in the White House.
Speaker 8: Go on, I'm sure some observers will say that the
Speaker 8: reporting in the book is even more important now.
Speaker 4: Yet nobody's saying that. No observers will say it's more
Speaker 4: important now. Some observers might think, do these CNN people
Speaker 4: work on commission? Like, why are they hawking this fucking thing?
Speaker 4: So is this a girl scout cookie situation? Whoever sells
Speaker 4: the most tap of books gets a shwin. Now, Well,
Speaker 4: that is not necessarily the model they will get. I
Speaker 4: don't want to disincentivize people from working hard. Obviously, I
Speaker 4: don't go through all the graphics before the shell. Well,
Speaker 4: CNN had to shift from somber and caring to always
Speaker 4: be closing. Fox and the rest of the right wing
Speaker 4: media had a very different problem. How to shift from
Speaker 4: let's go Brandon to get well Brandon, and then as
Speaker 4: quickly as possible back to let's go Brandon. Watch them
Speaker 4: work their magic and see how much weight the word
Speaker 4: butt carries. That's a terrible thing for him and his family.
Speaker 4: So I hope he beats it, but look, I hope
Speaker 4: he beats it, but not too fast. You want to
Speaker 4: enjoy this, but what But look, I don't believe that
Speaker 4: they just found out Friday, but because they're not credible
Speaker 4: on anything they've done so far. True, Yeah, I'll bet
Speaker 4: I bet he didn't find out Friday. I'll bet he
Speaker 4: found out like Wednesday. And then they were all like,
Speaker 4: oh my god, this is terrible. Should we tell this guy?
Speaker 4: And then they're like, I don't know whyt to we
Speaker 4: tell the family first, And then they're like, well, I
Speaker 4: really wasn't help. I gotta tell you. I think this
Speaker 4: all really highlights an opening in the greeting card market.
Speaker 4: We don't have enough cards that swing wildly from sympathy
Speaker 4: to accusation. Praying you get well soon, but there are
Speaker 4: some holes in your timeline.
Speaker 11: We're all, I don't know.
Speaker 4: Friday, Wednesday, anyone else want to do this, but pivot
Speaker 4: the tush push.
Speaker 3: Obviously hope for a speedy recovery. I will say it
Speaker 3: does raise serious questions.
Speaker 9: You hate to see something like this happen, but it
Speaker 9: just raised all these questions.
Speaker 10: We're all, of course, praying for President Biden's full recovery,
Speaker 10: but the reality.
Speaker 3: Is, you know, I hope it's over this, but.
Speaker 4: Number one, very sorry for his diagnosis and wish him
Speaker 4: the best. Number two, I am trying to make a
Speaker 4: very serious point here, and I find it very difficult
Speaker 4: to do that when you're throwing a totally weird looking
Speaker 4: dude right in the middle of ass.
Speaker 11: That is not fair.
Speaker 4: That is not fair to do. That is I don't
Speaker 4: know if that was like a green screen thing, but
Speaker 4: whatever's happening here. I imagine if I had a nodule
Speaker 4: on my pro state, this is what it might look like.
Speaker 7: I believe.
Speaker 11: It's a little bit.
Speaker 4: Why would you get the worst possible haircut for your
Speaker 4: head shape?
Speaker 11: Why would you do that?
Speaker 4: My head is long and thin.
Speaker 1: Amplify that.
Speaker 4: Looks like I have a kosher hobdog asked for a Hitler
Speaker 4: youth haircut?
Speaker 1: How respectfully?
Speaker 4: Yes, right wing media definitely pivoted from concerned accusation, but
Speaker 4: perhaps the most shocking response of all was from the
Speaker 4: Commander in Chief himself.
Speaker 12: President Trump posted, Milania and I are saddened to hear
Speaker 12: about Joe Biden's recent medical diagnosis. We extend our warmest
Speaker 12: and best wishes to Jill in the family, and we
Speaker 12: wish Joe a fast and successful recovery.
Speaker 4: That's it. No exclamation points, no off taps, no insults,
Speaker 4: whole thing spelled correctly. It's really got all the telltale
Speaker 4: signs of a post definitely written by Donald Trump. I
Speaker 4: look at I just want to god, Social I wonder
Speaker 4: when I saw this poke true Social Centema security alert
Speaker 4: the Cente we noticed some suspicious humanity on your account.
Speaker 4: If this was in fact you, President Trump, please reply.
Speaker 4: Nancy Pelosi's husband is gay. But the fact that Trump
Speaker 4: responded to Biden's diagnosis with the most pro forma bare
Speaker 4: minimum chat GPT's statement was so astonishing even the corrupt
Speaker 4: lamestream media gave Trump his props.
Speaker 9: This is a very traditional comment in this moment from
Speaker 9: President Trump to former President Biden.
Speaker 10: I mean, it's a very human, very traditional response from
Speaker 10: President Trump. I was very, very pleased to see President
Speaker 10: Trump putting forward such a kind statement.
Speaker 4: I will note, as an ardent Democrat, it's really important
Speaker 4: that I speak up and thank President Trump for his
Speaker 4: gracious statement. A couple of things. It is not important
Speaker 4: that you speak up at all as a Democrat. As anything,
Speaker 4: it is not important. What we did was not noteworthy
Speaker 4: and important. Has any president has any person ever had
Speaker 4: a lower bar to clear than I have to salute
Speaker 4: the president. I have to salute the president, and I
Speaker 4: certainly disagree with him on many things, but I have
Speaker 4: to applaud that, after hearing this devastating news about Joe Biden,
Speaker 4: that Donald did not take cancer side. Yeah, I'm swinging
Speaker 4: to night so important as we as an argue, and
Speaker 4: by the way, Trump maintained that level of gravitas for
Speaker 4: almost an entire day being diagnosed with cancer.
Speaker 9: I'm surprised that it wasn't you know, the public wasn't
Speaker 9: notified a long time ago, because they get to stage nine.
Speaker 4: That's a long time. To be fair, I do think
Speaker 4: Biden was at stage nine. We should have found out
Speaker 4: about that.
Speaker 11: I don't.
Speaker 4: I don't even know that. And he's the one that's fine, right,
Speaker 4: there's no book coming out on him. He's fine. He's
Speaker 4: that'll be the next to stage nine cancers. That that's
Speaker 4: the kind that grows up like an ivy into a building.
Speaker 11: I'm playing.
Speaker 4: But you know what, maybe it is another cover up.
Speaker 4: I don't know. If they came out and said, yeah,
Speaker 4: Biden knew about it five years ago, I wouldn't be
Speaker 4: shocked if they came out and said Biden found out
Speaker 4: on Friday. I wouldn't be shocked, and I understand the
Speaker 4: excitement over an insidious democratic cover up about Joe Biden's
Speaker 4: mental decline. The thing is, though, it was.
Speaker 13: A terrible cover up because we all he knew, all
Speaker 13: of our knew.
Speaker 4: There weren't no cover acts. Pole after poll showed vast
Speaker 4: majorities of the public thought Biden was too old and
Speaker 4: too out of it to run again. Dean Phillips mounted
Speaker 4: an entire primary campaign because of it. I really don't
Speaker 4: know if that's Dean Phillips, is.
Speaker 11: That Dean Phillips.
Speaker 6: My point is this, there is a very real person
Speaker 6: in this shot, probably named Dean Phillips or.
Speaker 4: Steve, and he might be in the shot, but he,
Speaker 4: along with most of the public, knew that it was
Speaker 4: a bad idea for Biden to run. We knew it.
Speaker 4: And that's what's so hilarious about politicians. The cover up
Speaker 4: doesn't work when everyone knows you're lying, and everyone knows
Speaker 4: you're lying. The tell is when you're so over the
Speaker 4: top about what you don't want to tell the truth about.
Speaker 12: Joe Biden is incredibly competent, and he's incredibly effective.
Speaker 7: This is a man who is sharp, who is on top.
Speaker 4: Of his game. He has more energy than I do.
Speaker 4: He works us all under the table. I can't even
Speaker 4: keep up with him.
Speaker 13: Three hours on photo lines, I'm three events a day,
Speaker 13: then giving speeches.
Speaker 1: Are you kidding?
Speaker 4: I mean, come on, that's insane. Three hours on photo line,
Speaker 4: three events a day, that's not free. Hours of photo lines,
Speaker 4: and then giving speeches, and then at night fighting crime.
Speaker 4: I have done too much. God, they gotta fucking steroid
Speaker 4: test these dudes. Look. They used to say, it's not
Speaker 4: the crime, it's the cover up, but it's starting to
Speaker 4: feel like politics is all cover up crime or not.
Speaker 4: In an attempt to hold on to power, political actors
Speaker 4: do anything they can to project a reality distortion field
Speaker 4: when all known evidence is to the obvious contrary, and
Speaker 4: the media tasked with covering them has somehow ended.
Speaker 1: Up inside the bubble with them.
Speaker 4: So for those of you watching at home who might
Speaker 4: like to know what the reality of what they're hiding
Speaker 4: about our current president would be, look not to the Democrats,
Speaker 4: Look not to the media. Look to the president's political allies,
Speaker 4: because their hyperbole is the indictment.
Speaker 3: Trump is one of the most transparent presidents of all time.
Speaker 5: The bravest, toughest man in the world, enormous compassions.
Speaker 4: He's only been bound to we the People's frankly ridiculous
Speaker 4: that anyone in this room would even suggest that President
Speaker 4: Trump is doing anything for his own benefit.
Speaker 5: Nobody believes that Donald Trump could be bought.
Speaker 14: One of the most moral leaders we've had, his.
Speaker 9: Pure honesty, the most ethical American I know.
Speaker 6: Tafrick twenty thirty one book, It's gonna be way.
Speaker 4: When we come by, Patrick madeil join.
Speaker 11: Us, So go away, Jar Trump?
Speaker 4: Are you doing that? Pitts My guest tonight, is an
Speaker 4: award winning journalist whose groundbreaking new book is called Apple
Speaker 4: in China, The Capture of World's Greatest Company. Please welcome
Speaker 4: to the program, Patrick McGee, I thank you for joining us.
Speaker 4: The book called Apple and China, The Capture of the
Speaker 4: World's Greatest Company. I've got to tell you something. You know,
Speaker 4: I'm not much of a reader. I was gonna wait
Speaker 4: for the movie to come out, but honestly, like this
Speaker 4: is jaw dropping. This book is jaw dropping and so
Speaker 4: well researched. It's not a polemic, it's not hyperbole. It's
Speaker 4: the story of how China, how China basically was built
Speaker 4: as a country by Apple.
Speaker 3: Is that Yeah, Like I say that sometimes and it
Speaker 3: sounds totally unhinged, and I get that, yes, And yet
Speaker 3: like what happened is like I came across the internal
Speaker 3: documents after speaking with two hundred people, and I figured
Speaker 3: out that Apple was investing by twenty fifteen, fifty five
Speaker 3: billion dollars a year into China. So this is mostly
Speaker 3: like they spend loads of money, billions of dollars on
Speaker 3: machinery that they put on Apples sorry, on production lines
Speaker 3: that are sort of orchestrated by Apple but not owned
Speaker 3: by them.
Speaker 4: So they're they're they're building the machinery. Yeah, but they're
Speaker 4: outsourcing that. They're they're hiring companies to build this.
Speaker 3: They like outsourcing is the word. And yet there's something
Speaker 3: so they own it.
Speaker 4: They own it.
Speaker 3: So I compare it to like the way Uber is
Speaker 3: the largest taxi provided in the world without owning any cars.
Speaker 3: It's the same thing for manufactured So none of the
Speaker 3: factories are owned by Apple, and yet they have like
Speaker 3: maniacal control over the machinery within those factories, right, And
Speaker 3: so they're and then they're doing like I quote someone saying,
Speaker 3: we treat the workers like our arms and legs, like
Speaker 3: you do this, and you do that. And the number
Speaker 3: of people they've trained like that is twenty eight million,
Speaker 3: so larger than the labor force of California since two
Speaker 3: thousand and eight. And the number of billions of dollars
Speaker 3: they spend on machinery is you know, fourteen billion dollars
Speaker 3: I think is the peak year. So some of that's
Speaker 3: public and other of this material these doarguments.
Speaker 4: The numbers seem fantastic, of course.
Speaker 3: And you will they do and they don't, right, So
Speaker 3: so fifty five billion is a year. Fifty five billion
Speaker 3: is per year. That's the investment. A lot of that
Speaker 3: is training costs for the employees in China, and the
Speaker 3: number of employees, like per Tim Cook's public estimate, right
Speaker 3: is three million people are assembling iPhones and other MAC
Speaker 3: products in China.
Speaker 4: But these are just low level like oh, it's a million,
Speaker 4: lots of fun skilled.
Speaker 3: Jobs, the ones that Howard lutn Like wants to bring
Speaker 3: back to America. Yes, yep, and lots of PhDs at
Speaker 3: fox con I lefiscated, right. But my point is like
Speaker 3: lots of times people think there's great vocational training in China.
Speaker 3: The vocational school in China is Apple.
Speaker 4: They've trained all these workers.
Speaker 3: Yes, they've done a huge job. So let me just
Speaker 3: put the fifty five billion context. I could not find
Speaker 3: any corporate equivalent for how much someone would is investing
Speaker 3: in another country, so I had to go to government efforts.
Speaker 3: So you look at something like the chipsacked, right, Biden's
Speaker 3: flagship plan. Let's bring chip fabrication back to America. That's
Speaker 3: fifty three billion over four years, right, another way of
Speaker 3: saying that Apple is investing quadruple what the Commerce Secretary
Speaker 3: called a once in a generation investment in America. So
Speaker 3: that's nuts. And then you go back to then you
Speaker 3: go back to the Marshall Plan, and you're thinking, okay,
Speaker 3: so maybe it's like half of the Marshall Plan something
Speaker 3: like that, Like that's going to be crazy. People are
Speaker 3: going to relate to that. So I take the Marshall
Speaker 3: Plan spending from nineteen forty eight to nineteen fifty two. Right,
Speaker 3: this is sort of like America saving saving Europe after
Speaker 3: the World War Two, And you convert it to twenty
Speaker 3: fifteen dollars and it's half the annual spending of what
Speaker 3: Apple is investing in China.
Speaker 4: And this is one hundred and thirty million dollars in
Speaker 4: sixteen countries.
Speaker 3: Sixteen countries versus one versus one country. Yeah, and it's
Speaker 3: not one, right, it's like the modern equivalent of the
Speaker 3: Soviet Union, Like it's our biggest adversary. And so, you know,
Speaker 3: I sort of ends the book not to sort of
Speaker 3: like get so ahead of my self here no spoilers.
Speaker 4: Yeah, yeah, oh my god, this Apple.
Speaker 3: Time well payperback version.
Speaker 4: I don't want to tell people.
Speaker 3: So I say that as China, you know, as their
Speaker 3: GDP eventually overtakes America, and especially because they're doing so
Speaker 3: good in the advanced electronics sector, more people are going
Speaker 3: to ask how did they do it? Like, how did
Speaker 3: they go from such poverty fifty years ago into the
Speaker 3: world's greatest maker of like military weaponry and advanced electronics.
Speaker 3: And a big portion of the disquieting answer is you're
Speaker 3: in year out. Apple taught them they do this.
Speaker 4: By the way, this is chrya. This is not to
Speaker 4: single out. This was a decision that that Apple made,
Speaker 4: not with this intention, no, not at all. It was
Speaker 4: you know, it began. I guess, well, it began with
Speaker 4: shareholder capitalism. I guess in the eighties. Yeah, yeah, I
Speaker 4: mean not to.
Speaker 3: Well, that's very much in the book. Yeah, absolutely right.
Speaker 4: I mean it's that ethos of you do what's best
Speaker 4: for the shareholder, so you're you're searching out the cheapest
Speaker 4: laybor of the lowest product. But it really it seemed
Speaker 4: like Jijingping in was it twenty thirteen is what made
Speaker 4: this so fraught? Would that be correct to say, well, yes, because.
Speaker 3: I would say so. My thesis is really that they
Speaker 3: sleepwalked into this crisis. I mean, you cannot blame Apple
Speaker 3: for moving into China in the early two thousands. For starters,
Speaker 3: the American consensus was that we're going to inculcate.
Speaker 4: That they joined the WTO.
Speaker 3: They came in, I mean, there was broad political support
Speaker 3: to do that. The problem was when Xijinping really turns
Speaker 3: China in an authoritarian and belligerent direction. It's not like
Speaker 3: Apple was on the sidelines not noticing they were attacked
Speaker 3: within thirty six hours. If she ascending to the president.
Speaker 4: Tell them about Consumer Day.
Speaker 3: Consumer Day is something that happens March fifteenth every year
Speaker 3: in China and basically goes back to the nineteen ninety
Speaker 3: one and there's someone in the audience like, I know
Speaker 3: Consumer Day. I have read this.
Speaker 4: Where are the ex Consumer Day? Okay?
Speaker 3: So companies are called out for like not living up
Speaker 3: to the socialist ethos okay, and it's increasing the Western
Speaker 3: companies in the mid two thousands. And in McDonald's twenty
Speaker 3: twelve and the book opens with twenty thirteen, Apple is
Speaker 3: attacked on Consumer Day and it's for warranty differences of
Speaker 3: all things the store.
Speaker 4: It turns out to be not actually true.
Speaker 3: Well it's okay, so little how much time do we have?
Speaker 3: It's the most fascinating part.
Speaker 4: Of the AGA program. There's no other program, chickens.
Speaker 11: There nothing.
Speaker 3: I'm going to give you that thirty second version of
Speaker 3: this is four chapters in the book. Okay, demand for
Speaker 3: iPhone in China after twenty ten is wild. Okay. There
Speaker 3: are four stores for one point four billion people. Okay,
Speaker 3: so one store per three hundred and fifty million people,
Speaker 3: and the iPhone becomes the most conspicuous like status symbol
Speaker 3: imaginable on the country in the country. And so what
Speaker 3: happens is these gangsters called yellow cows notice this imbalance,
Speaker 3: and they begin paying migrants by the busload to come
Speaker 3: over to the store and snake around the store six
Speaker 3: seven thousand people at times to buy as many iPhones
Speaker 3: as possible. And then they go to a city like
Speaker 3: chong Qing, population thirty two million, number of Apple stores zero,
Speaker 3: and they find ways legal and illegal to sell iPhones
Speaker 3: at more money. They're making more money than Apple per iPhone, right, Okay,
Speaker 3: so it's absolutely wild. What happens is Apple eventually catches
Speaker 3: onto this a little bit because they're doing nefarious things.
Speaker 3: They're buying phones in the US, They're using fake ID,
Speaker 3: they're buying phones for less than one hundred dollars so
Speaker 3: that they can, you know, make even more fat margins
Speaker 3: on them and stuff. And so they begin actually burning
Speaker 3: out the CPU of the phone, deliberately breaking it in
Speaker 3: the process, but rendering it. You can you can no
Speaker 3: longer see where it's come from, so they're masking the
Speaker 3: retail origin. Okay, So what happens is Apple catches wind
Speaker 3: of this and they begin refurbishing these deliberately broken units
Speaker 3: rather than replacing them. By refurbishing it, they're doing something
Speaker 3: that they're not doing in other countries, right, so they're.
Speaker 4: Actually take that as an insult.
Speaker 3: So they're exactly so without probably knowing the full story. CCTV,
Speaker 3: that's just like the state sponsors be at CNN of
Speaker 3: China attacks Apple for treating the Chinese in a way
Speaker 3: that's inferior to the rest of the world. That was
Speaker 3: twelve years ago reported by every media, and like they
Speaker 3: never figured out what the story was with the yellow
Speaker 3: cows and how it came to be. So that's why
Speaker 3: it's so Significant's why it's the prologue.
Speaker 4: And so at that moment, shares of Apple then start
Speaker 4: to go down. It becomes less popular in China. Yes,
Speaker 4: I honestly don't.
Speaker 3: Remember if shares really fall down. To be honest, the
Speaker 3: media is like eyeballs, we're not on China at all
Speaker 3: during this time, I mean in China, but sales in China,
Speaker 3: sales in China.
Speaker 4: Yeah.
Speaker 3: They first they sort of freeze and then they actually
Speaker 3: think that's right.
Speaker 4: Yeah. So Apple's response to that is what playcate.
Speaker 3: Local officials hire a team of people that call themselves
Speaker 3: the Gang of Eight. These are the first senior people
Speaker 3: in China title yeah and yeah, so these are the
Speaker 3: sort of eyes and ears of Coupertino living in China,
Speaker 3: first time they've had senior people that live there, and
Speaker 3: they basically strategize like what's our message to Beijing, Like
Speaker 3: why are we in the country, and how do we
Speaker 3: demonstrate to them we're not this exploited of power. Look
Speaker 3: at how much we're doing for you. They're the ones
Speaker 3: who come up with we're investing like a nation building
Speaker 3: effort in China, like get off our back. You have
Speaker 3: no idea how much we're helping you. And the fruit
Speaker 3: really is in the pudding, fruit and putting whatever proof
Speaker 3: is in the pudding, proofs in the pudding. The top
Speaker 3: smartphone makers in the world these days are are all Chinese, right,
Speaker 3: so Oppo, Vivo, Huawei, shout mate. They had fifty five
Speaker 3: percent global market share. And my sort of you know
Speaker 3: comment on this is like we think iPhone killed Nokia.
Speaker 3: iPhone never had more than twenty percent global market share.
Speaker 3: They're not big enough to have killed Nokia. Who killed Nokia?
Speaker 3: The Chinese competition? Why did the competition? Chinese competition do
Speaker 3: so well because Apple trained all their suppliers, So.
Speaker 4: They trained their competitors to build a product that would
Speaker 4: be commensurate with their product, but would be a Chinese
Speaker 4: own company, and those companies start to gain Apple start
Speaker 4: to gain market share on Apple.
Speaker 3: Yeah. So the early years of making the iPhone, Apple
Speaker 3: was really proprietary about all its processes. It would not
Speaker 3: want those suppliers to like market their opportunities, their their
Speaker 3: technical capabilities to everybody else. But what happens is when
Speaker 3: they like obviate the need for a new design. By Johnny,
Speaker 3: I've taking a corner and like getting rid of aluminum
Speaker 3: or something like.
Speaker 4: That's the whole deal for Apple, like beautiful, the shit's beautiful.
Speaker 3: Yeah, But if if you sort of remove some aspect
Speaker 3: of the phone and you no longer need that supplier
Speaker 3: and they're so dependent on you, well what happens They
Speaker 3: go bankrupt. So instead Apple begins to say, that's a
Speaker 3: problem for us. So we deliberately say to our suppliers,
Speaker 3: however fast you're growing with us with Apple, grow that
Speaker 3: fast with somebody else, because otherwise you're going to be
Speaker 3: too dependent.
Speaker 4: Because they don't want to get blamed for exactly.
Speaker 3: But if I'm building a component for an iPhone, what
Speaker 3: is the skill set I have and what can I
Speaker 3: do with it? Of course I'm going to supply Huawei
Speaker 3: and Opo and Vivo. That's the only logical thing to do.
Speaker 4: So they now have a real problem on their hands.
Speaker 4: They have trained their competitors and made it part of
Speaker 4: their business model that their competitors get healthy and do that.
Speaker 4: And they're about to face a real struggle and someone
Speaker 4: saves them. Who is it that saves them? Patrick my
Speaker 4: record books, somebody declares something about Huawei that puts Apple
Speaker 4: back on.
Speaker 3: Somebody's cleared something. But what that's my.
Speaker 4: Trump administration said that huawe was a security there.
Speaker 3: Oh yeah, okay, right correct. So in two thousand nine,
Speaker 3: two the books I give you, So in twenty nineteen, Huawei,
Speaker 3: China's national champion, outsells the iPhone globally. Apple is panicking
Speaker 3: about this, and I've got all these internal emails that
Speaker 3: have never been reported on where I mean, Tim Cook
Speaker 3: and others basically understand for weeks ahead of an earnings
Speaker 3: call that huaweih is the reason why their phone isn't
Speaker 3: selling well, and they deliberately obfuscate this from from And.
Speaker 4: That's one of my favorite parts of the book.
Speaker 3: I mean, the chapter is called five alarm Fire because
Speaker 3: a VP at Apple. That's what he describes the situation, like,
Speaker 3: how do we get sales to be better? And Tim
Speaker 3: Cook tells deputies, quote, this is a disaster. We need
Speaker 3: all hands on deck now. And then when he speaks
Speaker 3: to investors a week or two later, all is fine. Internally,
Speaker 3: china sales forecast is actually shrinking. It's not growing slowly shrinking,
Speaker 3: and they don't tell investors any of this. So that's
Speaker 3: some that's a crazy thing. Now Trump comes into office
Speaker 3: basically saying he's going to get his users, his consumers
Speaker 3: as his citizens. What am I trying to say? His
Speaker 3: fans his fans to boycott Apple. Yes, he really harsh
Speaker 3: on Apple, that's right. Wants everything to be built in America, that's.
Speaker 4: Right, wants them to come back. He just laying the
Speaker 4: wood on.
Speaker 3: Instead, he totally saves them because when Huawei's at its peak,
Speaker 3: he goes after Huawei, deprives them of using Google, which
Speaker 3: of course makes androids.
Speaker 4: To clear them a security threat, just clears them.
Speaker 3: A security threat, and it deprives them of using you know,
Speaker 3: wonky things like Qualcom five G chips. Huawei's business nearly collapses.
Speaker 3: They lose thirty billion dollars of revenue in a year,
Speaker 3: and their market share really tanks. They have to like
Speaker 3: hive off assets and stuff great for a while. I mean,
Speaker 3: the only company that really benefits from that is Apple.
Speaker 3: So their market share in China like doubles from nine
Speaker 3: percent to seventeen percent. So they do really well. But
Speaker 3: now in Trump two point out who always had all
Speaker 3: this time to really work hard, and so now they're
Speaker 3: sort of back with the vengines. So now in the
Speaker 3: global smartphone world, there's iOS, there's Android, and there's harmony Os.
Speaker 3: This is my guess, harmony OS will become the de
Speaker 3: facto standard for all operating system phones in China. Wow,
Speaker 3: that's a guess, right, I think an educated one. And
Speaker 3: then the question is do they then market that overseas
Speaker 3: and you sort of have like a Chinese firewall iPhone
Speaker 3: becoming you know, it's quay phone.
Speaker 4: What I find so interesting about so we think about
Speaker 4: step out Now in a macro view, we think about
Speaker 4: these companies as kind of monoliths, as monopolies and all
Speaker 4: this sort of thing. And the American viewpoint is always
Speaker 4: trust busting. We got to go in and break up
Speaker 4: these companies. This is a somewhat of a monopolistic operation,
Speaker 4: but they are going to break themselves up by training
Speaker 4: competitors to compete with them. They're actually creating a far
Speaker 4: more competitive market than ever would have given our standard
Speaker 4: business practices. So that the irony is they create a
Speaker 4: more competitive market in an authoritarian state.
Speaker 3: Yes, it's so much worse than that.
Speaker 11: Come on, come on, okay, so talk to me. So
Speaker 11: much worse than that?
Speaker 10: Really, Okay.
Speaker 3: The reason it's worse than that because they're not just
Speaker 3: creating phones. What else can you do if you've got
Speaker 3: like world leading electronic skills. First of all, what's an
Speaker 3: EV It's a smartphone on wheels. So the reason why
Speaker 3: evs and China are so damn good is that Apple
Speaker 3: taught all their suppliers and the suppliers of phones like
Speaker 3: Bawe and China.
Speaker 4: Factory.
Speaker 3: And I have a fascinating section on Tesla who specifically
Speaker 3: hires Apple people in China to run the same playbook. Like, So, okay, yeah,
Speaker 3: I'm sorry. The reason why I said it was worse
Speaker 3: I haven't got to that point. Oh god, alright, what
Speaker 3: else can you build?
Speaker 4: Drones?
Speaker 3: Military? Your weaponry? Right, So you're sort of facilitating the
Speaker 3: potential annexation of Taiwan by giving out these skill sets
Speaker 3: for the last quarter century.
Speaker 4: You know, you could have said that in the book.
Speaker 4: I didn't see that. It's it's it's it's fascinating. But
Speaker 4: here's the other part that I think is that's when
Speaker 4: you realize this whole idea of reshoring in industrialization, that
Speaker 4: the idea that tariffs, this weirdly simplistic, you know, cudgel
Speaker 4: that we're going to do there is so woefully short
Speaker 4: as far as this. This is the result of years
Speaker 4: of intense state run industrial planning that was intentional, it
Speaker 4: was purposeful. It is I mean, it's literally called Project
Speaker 4: twenty twenty five in China. It's China's Project twenty twenty five.
Speaker 2: Yeah.
Speaker 4: So when you think now in Apple says, oh, we're
Speaker 4: going to spend five hundred billion back in the United States.
Speaker 3: Where Okay, so I'm so glad you mentioned this. It's
Speaker 3: such ludicrous nonsense. Okay. It is the press release that
Speaker 3: says that we're going to spend five hundred million dollars
Speaker 3: in US literally says, and we'll create twenty thousand jobs.
Speaker 3: Like how bad would a government program be if it
Speaker 3: spent five hundred billion dollars and all I got was
Speaker 3: twenty thousand jobs.
Speaker 2: Right, right, So the mighty.
Speaker 11: Makes those sad.
Speaker 15: But if it were true, nice, If it were true,
Speaker 15: then you would have factories springing up in every state
Speaker 15: you could think of, with jobs for engineers here, there,
Speaker 15: and everywhere.
Speaker 3: This is only my educated guests, but I can't think
Speaker 3: of how the math adds up anywhere else. They are
Speaker 3: counting in the five hundred million dollars share buybacks and
Speaker 3: dividends because Apple spends more than one hundred billion dollars
Speaker 3: a year on share buybacks, seventy percent of their investors
Speaker 3: are in America. If so facto, that's kind of an
Speaker 3: investment in America, right. So that's the only way.
Speaker 4: That because we are now living through an announcement presidency,
Speaker 4: because that really is what we are limiting through this
Speaker 4: presidency is the missionccomplished presidency. It's just a dude on
Speaker 4: a destroyer with a giant banner behind him that says
Speaker 4: mission accomplished, even though it has no basis in reality.
Speaker 4: And that's how we get things done. And so this
Speaker 4: idea of like fifteen trillion dollars in investment coming back
Speaker 4: to America. You're like, where how But what's so despicable
Speaker 4: about the entire thing is we could have done all
Speaker 4: this here, all of it.
Speaker 3: Oh, we can actually disagree.
Speaker 15: Ah, okay, so friends, what is happening?
Speaker 3: So China has things will never compete with, like density
Speaker 3: of population and the way that the rural population sort
Speaker 3: of is actually not allowed to raise their children in
Speaker 3: places like Shenjin, so they have to be floating around.
Speaker 4: We can do that here.
Speaker 3: So, like, I'm a big fan of friend shoring rather
Speaker 3: than reshoring. Right, we should be doing what we did
Speaker 3: in China, but with allied nations like India, like Mexico.
Speaker 3: But it's probably not going to happen in Pittsburg.
Speaker 4: But we have to also though those ancillary businesses. It's
Speaker 4: our by allowing this, we really did hollow ourselves out.
Speaker 4: Oh I'm convinced.
Speaker 3: The only thing I would say is that that really
Speaker 3: happened in the eighties and nineties. Yes, and the Apple
Speaker 3: was the last holdout that did not do that.
Speaker 4: Yes, by the way, to be so hypercritical Apple, this
Speaker 4: is the example, but this is merely one of myriad
Speaker 4: examples of how our industrial policy got the way it got.
Speaker 3: So completely I sort of refer to the book sometimes
Speaker 3: as a trojan horse, where what I'm trying to sell
Speaker 3: you on is the sex appeal of the world's greatest company.
Speaker 3: But what you're actually going to learn about is some
Speaker 3: Chinese history, the importance of the US China Tech Battle,
Speaker 3: and things like supply chains. But if I said, John,
Speaker 3: can you have me on this job? I got a
Speaker 3: great book about supply chains, you'd be like, no, thanks, Yeah.
Speaker 4: I'm sorry. We were saying something about something, but I
Speaker 4: don't remember what that was. The book is phenomenal and
Speaker 4: truly like jaw dropping and like generally true. Thank you
Speaker 4: so much for Lena Apple in China. Avail Now, Patrick,
Speaker 4: no show, but we're gonna check in with yours for
Speaker 4: the rest of the week. Ronnie Chang, Ronnie, what's happening
Speaker 4: to my man?
Speaker 11: Nys Sean.
Speaker 14: I'm hosting a daily show this week, and I have
Speaker 14: no idea what the hell Jordan Klepper is doing here.
Speaker 4: Well, I don't want to interrupt your week, but my
Speaker 4: new special is airing tonight right after the Daily Show.
Speaker 14: Oh special, let me guess it's called something like MAGA
Speaker 14: the Next Generation.
Speaker 3: Yeah, that's exactly what it's called it's oh.
Speaker 11: Oh yeah, oh yeah.
Speaker 14: And I bet you're talking to like young Trump's voters
Speaker 14: about the future of America or whatever.
Speaker 4: Again, that nailed at that spot on that's what it is.
Speaker 14: Yeah yeah, And I bet as on Comedy Sandra and
Speaker 14: it streams on Paramount Plot and then it goes up
Speaker 14: on YouTube at midnight.
Speaker 4: Yeah, all of that, All of.
Speaker 3: That is true.
Speaker 5: Yes, but I like, why are you why are you
Speaker 5: using that voice?
Speaker 14: Because I love and respect your work. I just u
Speaker 14: sarcasm to shield my real emotions.
Speaker 4: Dull. You know.
Speaker 3: Actually, you know some of us We're gonna go out
Speaker 3: and watch it together. You're welcome to to come. Oh
Speaker 3: it sounds like a nightmare.
Speaker 14: Thank you, Thank you so much for your friendship. I'll
Speaker 14: see you there.
Speaker 4: That was really beautiful, guys, that's really nice.
Speaker 11: Probably taking Joint Club. Everybody right, check out Joint in
Speaker 11: special airing tonight.
Speaker 4: Here it is your moment is that special?
Speaker 6: Let's go five, Let's go some first experience with the
Speaker 6: New York nig Listen to the Greatest Damn My Life.
Speaker 7: Explore more shows from the Daily Show podcast universe by
Speaker 7: searching the Daily Show wherever you.
Speaker 11: Get your podcasts. Watch The Daily Show weeknights at eleven ten.
Speaker 2: Central on Comedy Central, and stream full episodes anytime on
Speaker 2: Paramount Plus
Speaker 11: Paramount Podcasts