Zakaria's scariest statistic
Apple CEO Steve Jobs. (Getty Images)
June 3rd, 2011
08:30 AM ET

Zakaria's scariest statistic

Here is the scariest statistic I found in researching the revision to my book, The Post-American World:

Apple is considered the most innovative company in America by far. It has the second largest market capitalization in America after Exxon. It has transformed industries and our lives.

Apple has about $70 billion in revenues.  The company that makes Apple's products called Foxconn is in China.  They have about the same revenue - $70 billion dollars.

Apple employees 50,000 people. Foxconn employs 1,000,000 people. So you can have all the innovation you want and tens of thousands of engineers in California benefit, but hundreds of thousands of people benefit in China because the manufacturing has gone there.

What does that mean? America needs to innovate even more to keep pace.  Check out my article in TIME on this subject.

Tune in Sunday at 8pm ET/PT for a GPS special, "Restoring the American Dream: How to Innovate."

Finally, come back here to the Global Public Square online on Sunday for the launch of our new "Global Innovation Showcase" highlighting the new ideas and innovations that will change our world.

What's your the scariest statistic?


soundoff (111 Responses)
  1. RRMON

    America is deeply burden by excessive government depth, banking manipulation and old corporate strategies’ to allow authentic innovation, creative thinking to sprout in conflict with tier investments. Of course, the practice will be encourage with venture cash and grants, but not with out holding the reign for expansion.

    And two, what can America create outside of some sort of convenient product that can go faster, smoother or taste better, look smarter or something the Jones don’t have. Which is what has been produced for the last 4 decades, nothing creatively just replicas with new costumes.

    So what is innovative or creative thinking? Try this one; America, get rid of that contemporary slave term, “employee” and start charging corporations a service fee for your time-function integration to their trade practice. Incorporate yourself as a service entity that can provide multiple areas of time limit expertise under the guidance of a pre-assemble look program submitted with no oversight or management involvement. A program/work order sent straight to your IT equipment with allotted time requirement, schedule, location and with an actual visual application to the work specification, nothing that a average 12th grade student can’t understand and apply. After the completion of the required work order and schedule time allotment, a service fee will automatically be deposited into your business account.

    Yes, a system as such can work and will work, but not here in the US, because of the massive dependency created by the employee practice for so many years. Though proving to be failing, most will wait for the return and it will in time (a long time) and with re-modified restriction, you will work the same with less money to abreast the growing global nations; Brazil, Russia, India and China (BRIC)(s).

    Any other creative ideals?

    June 3, 2011 at 3:18 pm | Reply
  2. Jack O'Fall

    Really? You don't understand the difference between commodity manufacturing and high-tech innovation? Apple could VERY easily take it's products and have them manufactured by a Foxconn competitor in South Korea, Taiwan, Maylasia, India, Mexico,... at similar prices. Because of that, there is no margin in the commodity manufacturing business and everything is done at the lowest cost possible (would you want to work there?). Compare that to Apple, which is not a commodity, can't be easily replaced (though many have tried to make cheaper versions of their products), and pays quite well for the technical innovations it's employees contribute.
    I suspect Apple's market capitalization is 50X Foxconn's and that doesn't even do it justice.
    Manufacturing is SO 20 years ago.

    June 3, 2011 at 3:47 pm | Reply
    • Non-Partisan

      The processes introduced and used in Manufacturing form the basis for all efficient production of all products. It is true that there haven't been any "Assembly Line" level improvements in the recent past, but its the simple fact that in the technology industry innovation is much easier. No matter where you go, no matter what you do, things will need to be made, manufacturing will never be obsolete, especially as companies like Apple continue to make products that need to be higher power and in a smaller package. Do you think the tech designers at apple design the machines that make their product. NO, its the industrial engineers and manufacturers that make any of that possible. Without them, the most we could ever hope to achieve is a prototype. Not the hundreds of thousands of iphones we come to expect

      June 3, 2011 at 4:01 pm | Reply
  3. Aces

    Liberals like to blame off shoring on Conservatives, but they love Apple; wonder how that sits with them?

    June 3, 2011 at 4:09 pm | Reply
    • jerry

      Not well, I'd imagine. On the other side of that coin is that nearly all of Silicon Valley votes Democrat. Republicans hold these IT and entrepreneur people up as examples of American exceptionalism and superiority, but they're all Democrat!

      June 3, 2011 at 4:44 pm | Reply
  4. FranzH

    Since you and I will always be choosing the cheapest products, there's only one answer to all of this. And it's not the childish Dems vs. Repubs nonsense that most of you morons always trot out because you don't have any real answers. The only way to deal with the uneven playing field between the US and China and India, etc., is to level it. And as much as I generally despise unions, in this case they could play a key role in fixing the problem. Since they are no longer a benefit in the US (and in fact a massive, catastrophic disability), send all of the union leaders/thugs to China and India, and get them to start unionizing those other countries in an attempt to create some sort of middle class. And maybe in 20 years they'll develop minimum wage, and start getting paid benefits and overtime and extra pay for work they aren't doing. And then send all of the environmental groups over there to start kicking some environmental butt, and force those foreign companies to expend huge amounts of cash to comply with ridiculous requirements. And then maybe in 40 years the US companies will have no reason to move overseas because they'll become as screwed up as we are.

    June 3, 2011 at 4:41 pm | Reply
    • Ben Franklin

      You call union leaders thugs and then claim to be non-partisan? I guess you also want to end Medicare and Medicaid, in a non-partisan way, of course. Throw the unemployed, granny, and handicapped people under the bus, it's the Republican way.

      June 5, 2011 at 1:36 am | Reply
  5. Dave

    What I'm reading is it takes a Chinese company 1,000,000 employees to earn as much as an American company with 50,000 employees. Why is that scary and why does that mean we have to be more innovative. Sounds like we're already 20 times as effective... ?

    June 3, 2011 at 5:30 pm | Reply
  6. joe

    USA should become good partners of china and help create a new world order

    June 3, 2011 at 6:59 pm | Reply
    • Ben Franklin

      Just ask the Tibetans, I'm sure they will agree. Not.

      June 5, 2011 at 1:34 am | Reply
  7. joe

    And USA should encourage china to have excellent relations with all the neighbouring countries such as taiwan, s.korea, japan, philippines, india etc. We should request china not to promote terrorism and nuke risks by supporting delinquent states like pakistan, north korea, iran etc– because imagine if the usa, japan, india, taiwan etc stop trading with china due to its terrorist support- then china"s economy will nose-dive, and millions of chinese will become unemployed – would they like to risk all this for terrorist states like pakistan???

    June 3, 2011 at 7:16 pm | Reply
  8. GOPisGreedOverPeople

    GOP solution = Turn the Old, Sick, and Poor into slaves. Then whip them until they are Young, Healthy, and Rich. Or until they are dead. Then turn them into Soylent Green to feed the military. A self sustaining system.

    June 3, 2011 at 11:19 pm | Reply
  9. cynik, Switzerland

    My scary statistic:

    Nearly two decades after the cold war ended, the victorious USA can compare the influence of the state upon the private sector in its own economy, and in the economy of Communist Vietnam. Communist Vietnam, you may recall, was the enemy that had to be defeated for the good of the free market and private property rights everywhere.

    So, the best marco way to look at how much a state influences the private "free" market is to look at the ratio of government taxation and spending to GDP. That tells you what percentage of the economic activity is the region is controlled by political parties and funded by taxation. Here are the stats:

    Free market USA: Tax to GDP = 26.9%, Govt Spending to GDP = 38.9%

    Communist Vietnam: Tax to GDP = 23.6%, Govt Spending to GDP = 28.8%

    1,2,3, what are we fighting for? Don;t ask me I don't give a damn...

    June 4, 2011 at 6:30 am | Reply
    • Ben Franklin

      The happiest countries are those which mix well regulated capitalism with a modest amount of socialism, such as Denmark. The least financial inequality = the most happiness.

      June 5, 2011 at 1:33 am | Reply
  10. Joseph W

    Foxconn is not as happy-go-lucky as this article makes it seem. 30,000 people at Apple are making comfortable salaries and working comfortable schedules. 1,000,000 people at Foxconn are living in horrible conditions and making very little compared to Apple employees.

    Some examples: http://www.bloomberg.com/news/2011-05-26/foxconn-worker-in-china-committed-suicide-hkcna-reports-1-.html

    http://www.wired.com/epicenter/2011/05/foxconn-no-suicide-pledge/

    June 4, 2011 at 4:54 pm | Reply
  11. Terris Linenbach

    Henry Ford wasn't perfect. However, he believed that his workers should be able to afford the things they made. Ford made it happen. That's Old American. Jobs might not like it (who knows), but nevertheless, he's New American – the result of the Democrat-Republican joint venture involving the exploitation of foreign labor costs and laws in order to subvert the American people. The number of Americans who can't afford Apple products is increasing monthly. That said, I hope Mr. Jobs' health issues get under control. The loss of Steve isn't going to help matters. Certainly, Steve is just doing what all shareholders expect: growth at any cost. Who do we blame first? As for Silicon Valley, the day when Chinese college grads can design gizmos is fast approaching. All those fancy car drivers who don't manage to part at least $1 million in a safe place will get their comeuppance.

    June 4, 2011 at 7:50 pm | Reply
  12. Roman Gil

    What Economic Recovery? Let's Get Doped Into Foreign Affairs to Forget the Failing Economy.

    In May, the American economy added the insignificant number of 38,000 jobs. America is overpopulated with over 311 million people (nobody knows how many illegal aliens) and cannot support its own population, but millions of new illegal and legal immigrants arrive each year. There is no industrial plan to bring back the millions of jobs and industries that global corporations exported and continue to export.
    My blog has solutions.

    According to the US government's own statistics, 36% of men 16 to 64 years old are out of the work force. Most don't count because they are not looking for work. It takes money to look for work, after a while people vanish from the unemployment statistics.

    In my blog, I loaded George Washington's "Farewell Address" advising America. I highlighted the parts that we are violating. Communist China is following this advice and we are committing the folly of ignoring it. My blog contains solutions to our problems that the politicians have failed to implement.

    While we drop bombs in Muslim countries financed with debt money, the Communist Chinese announced that they are buying large amounts of European government debt and that they opened a direct railroad linking China with Antwerp, Belgium in Western Europe. Europe is now China’s largest market. Europe is now globalized like America with their global corporations exporting their industrial base to China. Last year China announced that they have a controlling interest in Iraqi oil and are receiving oil from their Iraqi oil fields. The Communists understand capitalism better than we do and that economic power controls governments.

    In the USA, only 9% of the economy is industrial. 76% of the jobs created during the "recovery" pay $9 or less per hour with little or no benefits. 47% of American households are too poor to pay income taxes. The Federal Government must beg and borrow $1.65 trillion dollars this year. Many States and local governments are bankrupt. Local Property taxes are crushing the middle class in many States invaded by illegal aliens. Their children consume Medicaid and school services. Bankrupt States like New York have dumped welfare Medicare costs on the counties.

    In Europe from Spain to Greece, people are protesting that they have no future because there are no jobs. Europe like America exported its industrial base to China and Third World cheap labor countries. European governments are as deep in debt as America and their economies are failing under globalization.

    Obama got us involved into a third Muslim war to get us deeper into the Israeli-Muslim conflict that caused us to inherit Israel's enemies. The "war of Terror" has cost us in ten years $5 trillion dollars and now a powerful special interest group of war contractors will keep a permanent debt financed war going until we are in debt slavery.

    Roman Gil
    http://roman-gil1.blogspot.com

    June 4, 2011 at 10:39 pm | Reply
  13. Roman Gil

    The American War Contractor Business

    In 2011, the U.S. Department of Defense admitted that the U.S. military forces cannot undertake any major military operation without 50% of the total American forces being contractors. The major outsourcing of American defense started in 1992 after the end of the cold war with the Soviet Union. The American military turned over to contractors logistics and many military functions that are traditionally performed by military personnel subject to military discipline. In all cases, the contractors cost far more than military personnel that should be doing these jobs.

    The privatization of American wars has created an extremely dangerous situation because the military forces have to depend on contractors for logistics. This means that the American military forces in a war zone cannot control the supplies of food, fuel, armaments and the essential supplies that military forces need to fight. It is an established military science principle that to cut off an army’s supplies will force the armed forces to surrender. How will contractors that now make up over 50% of American forces in war zones perform under hostile fire from a powerful enemy? They are not soldiers fighting for their country, the contractor employees are doing a job for wages and their contractor employers are doing the job for the fabulous profits from the war contracts. If confronted by a powerful enemy, why should they risk life and limbs for a wage?

    In March 2011, the U.S. Department of Defense had 64,253 contractors in Iraq and 99,339 contractors in Afghanistan. Contractors made up 58% of American forces in Iraq and 48% of the American forces in Afghanistan.

    The U.S. Central Command (USCENTCOM) that is responsible for the military theater including Iraq and Afghanistan and other Muslim countries, reported that outside of the war zones of Iraq and Afghanistan that it has a total of 173,644 contractors. USA citizen contractors 45,650. Third country citizen contractors 71,895. Local/host country contractors 56,099. Obviously, the contractor employers that are making the big profits are very willing to use foreigners as employees to maximize their profits because they work for far less that American contractor employees. The American military has globalized its war business for the benefit of the contractors and for the ruin of America’s military power.

    The American economy is not large enough to support the present military forces or Federal government. This year Obama must beg and borrow $1.65 Trillion to add to the national debt of over $14 Trillion. The total annual value of American exports is only $1.5 Trillion and it has an economy that is only 9% industrial and technology. 36% of American men between the age of 16 and 64 years old are out of the labor force. People drop out when they run out of money. It costs money to look for work, so they don't count as unemployed.

    Roman Gil
    http://roman-gil1.blogspot.com

    June 4, 2011 at 10:49 pm | Reply
  14. Ben Franklin

    My scariest statistic is that people with graduate degrees make less than 1/10 in India than they make in the US.

    June 5, 2011 at 1:30 am | Reply
  15. djr124c41

    Watch for innovation info...

    http://vmsstreamer1.fnal.gov/Lectures/Users2011/110602Chu/index.htm

    June 5, 2011 at 2:36 am | Reply
  16. Austinite78745

    Personally, I can't wait for the day when there is no other country in which to outsource our jobs.Then what will they do? Maybe then they'll be forced to pay a true days wages, etc., etc.....

    June 5, 2011 at 9:01 pm | Reply
  17. Austinite78745

    btw....Fareed sucks! He's just another towel head like Obama.

    June 5, 2011 at 9:03 pm | Reply
  18. Francisco Gutierrez

    lot of work it consists in a network of Piping America from the Mississippi river to the west coast to reroute and pump millions of gallons of water in areas that today are overflowing to the drought areas in a form of Mist like a sprinkler system if you will with a sequence of censors computerized this system can sporadically wet the dry areas a network of piping that not only needs to be built but also installed operated maintained all year round winterized it can impact the agricultural well-being of America and the wild life preservation its a sprinkler system on the large scale with a series of towers spraying a mist of water were needed this idea is the first step to wild fire prevention green as it can be preventing flood we have the technology and the pump system that has been used in the New Orleans similar to the waterfall made under the bridge of New York this pump can pump a large amount of water were its needed with the difference that this water will not be salted so it wont harm the environment for any more information please call (631) 388-9824 Thank You for reading my idea. Francisco Gutierrez

    June 6, 2011 at 12:28 am | Reply
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    November 7, 2012 at 5:58 pm | Reply
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