The Chris Voss Show - The Chris Voss Show Podcast – Apple in China: The Capture of the World’s Greatest Company by Patrick McGee

Episode Date: May 14, 2025

Apple in China: The Capture of the World's Greatest Company by Patrick McGee Amazon.com For readers of Walter Isaacson’s Steve Jobs and Chris Miller’s Chip War, a riveting look at how Apple helped build China’s dominance in electronics assembly and manufacturing only to find itself trapped in a relationship with an authoritarian state making ever-increasing demands. After struggling to build its products on three continents, Apple was lured by China’s seemingly inexhaustible supply of cheap labor. Soon it was sending thousands of engineers across the Pacific, training millions of workers, and spending hundreds of billions of dollars to create the world’s most sophisticated supply chain. These capabilities enabled Apple to build the 21st century’s most iconic products—in staggering volume and for enormous profit. Without explicitly intending to, Apple built an advanced electronics industry within China, only to discover that its massive investments in technology upgrades had inadvertently given Beijing a power that could be weaponized. In Apple in China, journalist Patrick McGee draws on more than two hundred interviews with former executives and engineers, supplementing their stories with unreported meetings held by Steve Jobs, emails between top executives, and internal memos regarding threats from Chinese competition. The book highlights the unknown characters who were instrumental in Apple’s ascent and who tried to forge a different path, including the Mormon missionary who established the Apple Store in China; the “Gang of Eight” executives tasked with placating Beijing; and an idealistic veteran whose hopes of improving the lives of factory workers were crushed by both Cupertino’s operational demands and Xi Jinping’s war on civil society. Apple in China is the sometimes disturbing and always revelatory story of how an outspoken, proud company that once praised “rebels” and “troublemakers”—the company that encouraged us all to “Think Different”—devolved into passively cooperating with a belligerent regime that increasingly controls its fate. About the author Patrick McGee led Apple coverage at the Financial Times from 2019 to 2023 and won a San Francisco Press Club Award for his coverage of the company. He joined the newspaper in 2013, in Hong Kong, before reporting from Germany and California. His reporting in the last decade has centered on upheavals in technology, including autonomous cars, electric vehicles, and major developments in the supply chain. Previously, he was a bond reporter at the Wall Street Journal. He received a Master's in Global Diplomacy from SOAS, University of London, where his thesis focused on the US military budget and competition with China. He has also a degree in Religious Studies from the University of Toronto. Originally from Calgary, Canada, he and his family make their home in the Bay Area. Patrick is a keen runner, reader of history, and traveller.

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Today we have an amazing young man on the show. We're going to be talking about his hot new book that's going to be coming off the presses and we're going to get into all the deets as they like to say. It comes out tomorrow, May 13th, 2025. It is called April. Try again, Chris. Try again. You know, I was doing the date and for some reason I was like, May, April?

We're in May? We're in May? I'm still in April, evidently. That's usually how I roll through the year. His book is entitled Apple in China, the capture of the world's greatest company. Patrick McGee joins us to the show. We're going to get into it with him and we're going to find out the deets and boy, there, we have some authors on the show and they, they deliver with a book

sometimes that hits the mark on what the news is currently, even though they probably put the book in the can to be edited, I don't know, a year ago or six months, maybe we'll talk to them about it. So Patrick was the financial times principal app reporter from 2019 to 2023, during which time he won a San Francisco press club award for coverage. He joined the newspaper in 2013 in Hong Kong before reporting from Germany and California. Previously, he was a bond reporter at the Wall Street Journal. He actually helped bail me out of jail one time. No, I'm just kidding. That's a different kind of bonds. He has a master degree in global diplomacy from SOAS, University of London,

and a degree in religious studies from the University of Toronto. He and his family make their home in the Bay Area. Welcome to the show. Patrick, how are you? I'm doing very well. Excited to tell you all about the book and your listeners. What? You have a book?

Let's get into it. So, give us your dot coms. Where do you want people to find you on the interwebs? AppleInChina.com is great. I'm surprised that was not taken. It seems like all the good dot coms are taken. So, give us a 30,000 review. What's inside your new book? Jared Larsen

Most people think China saved Apple to some degree. And my book is really about how Apple built China. So, you think I'm saying it wrong. I'm not saying it wrong. Apple's influence on China has been extraordinary. And all the more so because it's unheralded. There's just no narrative about this over the last 25 years. But just to give you some of the staggering numbers, since 2008, Apple has trained 28 million workers in China, bigger than the labor force of California. In 2015, when it sort of did its own math, its own supply chain study, Apple realized it was investing $55 billion a year in China.

That's basically the training of the workers, wages of its workers, machinery that it actually buys and then puts into its suppliers factories. Apple doesn't manufacture anything itself, but it orchestrates a hell of a lot. It's worked with these companies that basically didn't have the money, didn't have the skills, didn't have the expertise. Apple began 20 years ago flying engineers out, really America's best engineers, coming out of Caltech, Stanford, MIT, maybe hired from Dell, Tesla, Motorola, SpaceX, and sending them by the plane load to train, audit, supervise, and just do engineering 101 to train just

an amazing workforce in China to such a degree that they are now stuck. And the big nuance that I'm offering here, I don't think it's too contentious to say that Apple is stuck in China in that there's not another place on the planet where they could build 230 million perfect iPhones every year at the cost and quality level that China allows. But they're not stuck on capabilities they found in China. They're stuck on capabilities they created there. And in your mind, they're kind of trapped,

or in your thesis, they're kind of trapped in the situation they're in, where they've actually given power to China. Now China kind of holds power over them, and probably in some way through to us as the US, I guess. Absolutely, I mean, if you become a world leader in electronics, you know, guess what? You also have the same skill sets for building military weaponry, you know? I mean, even something like drones, you know, just to make this sort of more obvious point.

But I mean, you know, think of something like World War II. You know, Hitler was terrified of America entering the war because of its industrial capacity. Remember Detroit, the arsenal of democracy. We've sort of willingly given that title up to China and whoops, it became an authoritarian surveillance state. Pete Yeah. And that's interesting because technically, we kind of funded. Good job, iPhone people, you funded communists. No, I'm just kidding, you did and it was there before. But kind of really, maybe, I mean, let me ask you this, because this is kind of the first question that popped off of what you said. You know, there's this conversation

and actually your book is perfectly timed. Those of you watching the video five to 10 years from now on YouTube, like you do, and you leave weird comments because you never look at the date the video was made. But you know, right now we're in this thrust to this terra four. In fact, today, as of this morning, they're saying they have 10 and a day of 90 days sort of agreement. Of course, I want to caveat this that you never can trust what the Trump administration is saying these days. There seems to be a lot of misinformation that's opposite of whatever posted on the

White House site. Welcome to fascism, folks. But the conversation is that we can move manufacturing here and that we should have people investing here. And of course, that ultimately the conversation is, you know, it's too expensive with regulations. You know, Americans aren't willing to work for pennies on the dollar, although there's still time the way we're going. And but if they invested that money here, would it have made the difference to build

that, you build that massive infrastructure that we hear about in China? And now we hear not only those people, it's not so much that anymore those people work cheaply and that they're just a bunch of low paid workers. They're evidently really highly qualified now and that cheaper sort of cheap product thing has moved to different other countries and they're saying that they have more people there. So would that money have been better spent, invested and could it have worked here in

America? So I am bearish that any of this could really be happening in the US and frankly, the best evidence would be that Apple for political reasons following the Romney versus Obama debates in 2012 decided for political reasons to build what ended up being called the trash can Mac, so the Mac Pro in Texas. And it was basically a fiasco. I mean, I spoke to multiple engineers on that project and they called it the most difficult project they ever worked on.

One person actually says Tim, as in Tim Cook, hated it. And that was a struggle to build five or 600 units a day. Apple builds a million iPhones a day in peak season. So if you're struggling to build 500, you are not going to build five or six hundred units a day. Apple builds a million iPhones a day in peak season. So if you're struggling to build five hundred, you are not going to build a million. Yeah. And think about those iPhones. Each iPhone has a thousand components inside. So if you're doing a million of them, that means you are doing the manufacturing, logistics, the orchestration of one billion parts per day. That is never coming to America. That's the thing that people don't get. It's not just the quality.

You know, it's not just that we don't have the population density. Like it's the quantity that we could just never achieve. So I'm pro friend shoring, meaning maybe this could take place in India if there are substantial investments and a vast acceleration on Apple's part and the part of its suppliers.

Maybe it could take place in Mexico just because there's more of a sort of manufacturing push there, but that's not really what we do anymore. And it's not just about building a factory, right? People always think, why didn't you just put a Foxconn factory in another country? Because Foxconn is surrounded by an industrial cluster two, three decades in the making, where they're doing everything from, you know, I don't know, raw material refinement and plastic injection molding. I mean, so many things and there are factory towns in China. I shouldn't call them factory towns. They're like factory towns. There are factories where there are more workers than people that live in Boston, right? I mean, we are not going to compete with this anytime soon, but maybe an allied country like India could. Do you think that the

tariffs that are, it looks like they've been put on some sort of 90-day hold and semi-reduced and assuming what we're hearing is true. Do you think the tariffs, is the tariff situation a way to fix this? What are you seeing with what's currently going on? It's certainly not helping America because Apple knows how difficult it is to build things in America from experience. So it's not going to do it. I mean, just to be clear, I mean, Apple's history from 1976 to about 1996 and even into 2003, they were build things in America from experience. So it's not going to do it. And just to be clear, Apple's history from 1976 to about 1996 and even into 2003, they

were building things in America. I mean, they know what it takes, they know what the country lacks and so forth. Obviously, never at the scale that they are at now. They were quite a small company at that stage. But no, I mean, tariffs are really all it's causing right now is that if you slap 135% tariffs on China, all Apple's done in response is moved assembly to India. Some people think, oh, this is a major win. It's not a major win. If there are a thousand steps in building an iPhone and the final one is now being done

in India so you can stamp it made in India, you have not de-risked your supply chain from China by one iota, but you have avoided tariffs. Yeah. I imagine a lot of companies are probably trying to do that right now, figuring a way to get around the system of stuff and all that. Or some, I know Apple flew like tons of, what was it, five or six airplanes. Jared Slauson Planes, yeah. Which, you know, understand for Apple, that's, you know, a week or two supply. I mean, this is an enormous company.

I don't think we understand how large it is. Pete Slauson Yeah. I mean, you know, and you see a lot of these people that support President Trump's administration saying, yeah, let's move manufacturing here. The literally mentality of what you see on social media is they think you can just, you know, five minutes, you just build a building that can do all this high quality state of art funding. But the other thing, I don't know if it's true, but I remember I used to see the Foxconn,

the lines outside the gates every day from all the people who come from the rural places to try and find work. And they live in, like you said, work cities. And they live there, they live in dorms, like bunk beds, and there's four or eight of them, you know, this is a place where it's, you know, it's such a work regime, maybe is the right word. And almost to a point of, I don't know, attention servitude, maybe, I don't know. But and they can fire these people at will and churn and burn them because they got so many people show up at the gate every day. But they had to put in suicide nets because this is place and Americans like, we need

to build that here. Oh, you want to live in a dorm work job and suicide nets? I don't know if that... So all of this resonates and this is... So I try to shift the narrative a little bit away from this, not because it's not important, it's really important, but it's the only narrative we've had in China over the last 25 years is the tedium of assembling iPhones. So I'm not here to say that's incorrect and it's really fun to build iPhones. Of course it's not, but I flip it on its head. So instead of the narrative being look at how Apple exploits Chinese workers, I look

at how Beijing allows Apple to exploit Chinese workers so that Beijing can in turn exploit Apple. Not to pull away from your books focus on Apple, but would you say maybe Tesla is in the same sort of bucket where they've got themselves trapped in China? I have a great section on Tesla as to why they became the first wholly owned company in the automotive space working in China. That sounds kind of jargony, but every other car maker like Volkswagen, Mercedes, etc. Ford, GM, they're all joint ventures, right?

So the specific model there is that the local company in a 50-50 joint venture, half of it is Chinese, and the whole idea is that the Chinese learn how to do what the Volkswagen, the GM is doing, and then they can thrive on their own. And that was the sort of the price of market access, if you will, if you wanted to operate. their own. And that was the sort of the price of market access, if you will, if you wanted to operate. Tesla was allowed to operate without that. And the whole reason is that they were following the Apple model, quite specifically hiring people that had Apple engineers, and they had done this for Apple. And so the idea was that if you understand how Apple works in the sense of Californians coming over with the best expertise and training all of their

suppliers to make them better, that's what what Tesla did and I think Tesla had an immense impact on why EVs are now five years later So good in in China, but to answer your question more directly. Yes and no I mean Tesla has followed Apple models to some extent but Apple really I'm sorry, but Tesla really does manufacture things themselves, right? Apple orchestrates it and Everything is in China for Apple. But Tesla, of course, famously builds in California, in Texas, in Germany, and in Shanghai. So only one part of those four operations is as exposed as Apple. I mean, it seems like there's deep into China and, you know, now we're seeing the real politics of it, where it can be used as, Apple's kind

of stuck in the middle. You've got these terra-fors that are going on and these fights over political stuff. You've got China, the saber rattling over China and chips. And we're seeing a lot of interesting things coming to that. You did over 200 interviews with former executives. I think you've got some stories about unreported meetings held by Steve Jobs, emails and different things. Tell us about some of that one, just to tease out if you would. Yeah, I really tell a three-decade story here. And in a way, I think if we, the media, had

reported on Apple the way that I think the company should be reported on, slightly more adversarial and with a lot more interest in how things get made and how wide Apple's influence is, I mean, literally geopolitical levels, then I probably could have started the book in 2013, which is when Apple has its political awakening. And that's because Xi Jinping comes to power and essentially attacks Apple within 36 hours of taking power. But I would argue that although we think we know the Apple story really well, we just know Apple's version. We know Steve Jobs' version. I mean, as strange as it is to say, I've written the first 21st century history of Apple. And now that probably sounds insane, but the examples that every listener of yours is thinking of right now

are biographies. The biography of Steve Jobs, biography of Johnny I, biography of Tim Cook. There is not a book that explains how the candy-colored iMac saved Apple in the late 1990s, you know, where the iPod came from and then takes you through to how they worked with Foxconn, etc. to build up the iPhone and then what else they did, right? So even without MyChina angle, there just hasn't been a one coherent story of how did they go from near bankruptcy to a trillion dollar company and now they're almost a four trillion dollar company. It's a really strange thing to have omitted from the narrative and I don't have great reasoning for it other than my favorite saying about journalism is we cover all of the plane crashes and none

of the landings. And Apple is one big landing. I mean, it's a very successful company. So what journalists wants to write the go Apple, rah rah narrative. And so in a way, what allowed me to write it is that I think they got themselves stuck in China, they sleepwalked into a geopolitical crisis. And that I guess sort of allowed me to write it is that I think they got themselves stuck in China, they sleepwalked into a geopolitical crisis. That allowed me to write a balanced narrative that had the good and the bad and made it more of a book, something to sell to a publisher and for the publisher to sell to your listeners. Lyle Ornstein Because we get plenty of the rah-rah books on Apple and the celebration of American capitalism and innovation and great ideas and the Steve Jobs story of they

came out of the garage and yada, yada, yada, all that Silicon Valley lore, I guess you would maybe might call it. Great word. Yeah. But I like knowing, I mean, there's a lot of people that have written books. I don't know there's a lot of books written about it. Maybe Walter Isaacson's book or I know, I mean, it's interesting how they gloss over the assholeness of Steve Jobs and what people close to him knew him as.

And also, some of the evil shit he did, where he basically went to all the Silicon Valley people and said, let's cap people's income across the board and we won't cross hire them and all that stuff. And that really got plastered over and no one really talks about it when it comes to that lore of how, you know, you look at the impact of what that probably made in people's lives. You know, one of my friends was the original iPhone team, Andy Grignon. And you know, I mean, what they dealt with, on one hand, they built a great iPhone. the original iPhone team, Andy Grignon. What they dealt with, on one hand, they built a great iPhone.

On the other hand, they dealt with threats against their family with Steve Jobs. He was the nicest guy in the world. So it's kind of interesting how you've created a story that kind of challenges that lore that all night things were perfect and great. And maybe, you know, the Pandora's box, you know, we saw this with social media when social media came about, I was one of the first, you know, supporters of it and everyone's, oh, the world's gonna unite and everything's gonna come better. You know, we saw the Arab Spring, we're like, oh, you know, the world, the world's becoming one, you know, we're all singing John Lennon's, John Lennon's song, Imagine. And then, and now it's, you And now it's, you know, we found the evil part

of the Pandora's box. You know, you've got narcissism rising, insanity rising, death of, you know, expertise and journalists, you know, because any idiot with a mic can start a podcast and start making his own opinions. Wait, what? What? Anyway, I don't know if you, you're welcome to replying some thoughts you have on there. And I'm also curious about the Mormon missionary story that you have. Oh, the Mormon missionaries, one of my favorite characters. And it's, it's, it's a great segue, just because I agree with you that there was a delay in covering some of the things you mentioned there. But of course, you know, it, because it did eventually get covered. Whereas

I feel like every story I was telling in this 400 page book was essentially novel. I mean, there are a few parts where I have to explain to the reader what the iPod was, you know, just so they understand and in case they don't. But aside from a little bit of hand holding there, I mean, we're talking about stories about the first iPhone being first iPhone contract being signed on Terry Guo's yacht the founder of Foxconn. We're talking about iPhones I'm sorry IMAX being made in the Czech Republic in Mexico iPods being made in Taiwan before they went to China how Foxconn won a deal by building a replica, you know Unbidden and convincing Apple that they could do the bidding for the next iPod

We're talking about the first major profile of Isabel Mahi She is an executive that very few if any of your listeners have ever heard of. She's been the head of Greater China since 2017. Why don't we have profiles of this person? I have an in-depth profile of someone named Jackie Haynes. She worked with Tim Cook for three decades and tried to lead supplier responsibility to improve all the conditions in the factories that we're talking about. It's basically a tragic story because she's unable to accomplish

what she wants to accomplish because China is in this like hardening stage where they're making it difficult for Apple to meet with civil society groups. And it's made even more difficult by the operational demanding culture of Apple. So I'm just trying to give you a sense of like how much new stuff there is.

This isn't just a story about, you know, Steve Jobs isn't a very nice guy, but boy, is he brilliant. I really go in a different narrative. So the Mormon missionary, just to give one example, my God, this is a fascinating story. Apple builds its first Apple Store in 2008 solely for the Beijing Olympics. Nobody expects it's going to make any money. They don't see the Chinese, which is a poor developing country at the time, as buying quite expensive phones.

And yet by 2010, it just goes absolutely gangbusters, where the iPhone becomes the iconic conspicuous status symbol for a country just coming into a capitalist experimentation world. And so there are so many people that want iPhones that these gangsters known as the yellow cows in China, take control of the distribution within China, so that they're amassing iPhones literally by the thousands, take control of the distribution within China so that they are amassing iPhones literally by the thousands, the tens of thousands, and they're going to – they're paying migrants to stand in line, okay? So thousands of them outside the Apple Store. Each individual Apple Store – there's only four at the time – is selling about

25,000 iPhones a day. And these gangsters are going to a city that doesn't have the Apple Store, okay? So think of a city like Chongqing, population 32 million, and they become the monopolist sole distributor of the world's most iconic product. And they're basically finding ways, legal and illegal, to sell the phones at hawked up prices, and they're making more money per iPhone than Apple. So there's this crazy narrative, and it gets to the point where they're having factory connections and they are basically tampering with the insides of the phone. They're taking the expensive bits like memory and selling those on, and then they're tricking

Apple by returning them to Apple in such a sophisticated way that it takes Apple about five years to figure out which phones are tampered with and which aren't. And so there's this incredibly lucrative trade because the number of phones sold in China, iPhones, goes from hundreds of thousands in 2009 to more than 20 million by 2012. And these gangsters are just making an absolute killing. And it leads to what I call the political awakening where Apple realizes by 2013, we are in way over our heads here. We are wildly successful and yet we don't understand this country.

We don't understand the politics at all. Wow. And of course, the warm missionary, sorry, is just the guy sort of like, you know, in the driver's seat handling this, he's got street smarts, he speaks Mandarin, but he's sort of unable to communicate, you know, what's going on to Cupertino who just doesn't understand it. Pete Wow. And he set up the first ice phone store, was tasked with it? Ben? Ben Yes. Pete Or Apple Store, I should correct that.

That's extraordinary. No one has talked about this. No, crazy narrative. And he's a super fascinating guy. I mean, he would do things like his brother would be visiting, and they'd pull up at a stoplight and there'd be a policeman right beside them. And he would just burst through the red light. And his brother would be like, how are you doing that in front of a cop? And he would have the streets bars to stay.

If you do that right in front of a cop, the cop assumes you are in the position of power to be able to do that. And so this is the sort of thing he's trying to sort of communicate back to Cupertino about how Chinese culture, how politics, how the institutions work. And they just don't have the experience on the ground. And so they're not really listening. So I mentioned him because he's the sort of figure who's saying we're consolidating way too much into China. We should be building some factories in Vietnam just to sort of help our leverage because the more we go deep into China, the more the Chinese have us over a barrel.

And this is the warning he's trying to give 13 years ago and nobody's listening. You know, that's really interesting. Wow. What an amazing story. I mean, this is good. This should be explosive. Like the people should be reading this book and understanding the narrative because it definitely goes Against this sort of this sort of blue sky sort of thing. That was good and blah blah blah. But yeah, it's it I Learned a long time ago in the 90s reading, I don't know where I picked up Harvard Business. I think I picked it up in a magazine, but it was, I forget the name of the company. I used to remember who it was, but it was a very large company.

But they talked about how it was the CEO talking about how when you have vendors for a product or a development or something, you always have two or three so that they compete against each other. And I learned that a long time ago. So all of my companies have ever had, we never have one sole vendor to everything because I've learned the hard way too, specifically firsthand, that if once they know you're exclusive with them, things go to hell and, or they, or there's abuse that can start. But if they know that they are competing with two or three of your vendors, and you make that clear too, we do business with two or

three vendors to make sure that everyone knows they're competing and giving us the best service and that we have options. Because there's nothing worse when you have a sole vendor, you know, that can, can grab, hold you by the throat. If you, you know, you're like, Hey, we need to dump these people. This is, this whole situation has gone bad. And then if you don't have anything set up, you're stuck in hey, we need to dump these people. This whole situation has gone bad. And if you don't have anything set up, you're stuck in the supply chain sort of problems that we have right now with the tariffs and locking out China and all that good stuff.

Big mistake. Let me just jump in. You were totally right about all of this. This is supply chain 101 and Apple doesn't follow any of it. So Apple often- It sounds like they fucked around and found out though. Okay. So, Apple has a totally different model, which is actually that in the 2005 to 2010 period,

they often only had a single supplier for all sorts of components. And the reason why is what you're describing is the way to get good prices, right? You've got different vendors of commodity components and you bounce them off each other and you get the lowest price. Apple doesn't care so much about price per se, it cares about quality more than anything else. And so what it does is it does, where what it does not do, which is basically what every other company does,

every other company hopes that component makers come up with something and then they use the latest innovations. Apple embeds its engineers in its suppliers and it comes up with the next components. Not only does it create the parts in a proprietary sense, it creates the machinery that builds those parts, right? The machine that builds the machine. And Apple is limited in how many companies it can work with because it needs to focus on the quality and train the engineers to do the perfectionist jobs that they are the perfectionist tasks

that Johnny Ive and Steve Jobs demand. But what happens when their scale just absolutely blows up is that then they really do need two or three suppliers. But the problem is, if you have three suppliers all building one thing, one of them is inherently going to be better than the other two. And Apple can't really deal with that. Apple needs the best quality and you can't have suppliers working in different ways to come up with something because they have zero defects. They have zero tolerance for defects. Apple gets into this funny position, and this is actually outside the book, but I'll tell

you about it, which is that engineers at Apple tell me that they would engage in what a critic would call corporate espionage. Usually, when you're thinking corporate espionage, you're thinking of how the Chinese are stealing from Apple. But this is how Apple would develop a process with a supplier and it would need its other suppliers to learn those processes. But it's something that the supplier came up with. And so Apple would infuriate its suppliers by videotaping the processes that it had come

up with with its supplier and then giving the footage to the other suppliers, right? Because it needs a uniform standard of how something is created even though they are different companies. And so Apple would like legally control the IP and yet they would piss off their suppliers by so sort of flagrantly copying from one to the other to make sure that everything was perfect. Wow, that is crazy. What do you see from your book, and I don't know if you talk about this in the book, what should the future be for Apple to do based upon what you're writing about?

Or where do you see the things going with the current state of political affairs? Unfortunately, my thesis is that Apple is stuck, that there is no place on the planet that is remotely capable of performing the right combination of cost, quantity, quality that China allows. Now again, it's because Apple created it there after a quarter century of investment. If there were an easy way out here, my book wouldn't be compelling because that wouldn't be my thesis. But my point is they're stuck. I don't know what they can do.

It's going to be pulling a rabbit out of a hat because India, as much as we want them to be able to accomplish this and they're a democracy and we'd love to have them thrive, their government is not putting in the manufacturing know-how, expertise, everything from building the right ports, building the eight-lane highways, having a command and control culture that Xi Jinping has. I mean, unfortunately, I want to be pro-democracy, but India is a fragmented government. Where government gets in the way, corruption gets in the way. India is just not going to be the partner to Apple that China has been the last 25 years.

Mexico probably couldn't pull it off either then. I'm not a Mexico expert. I wish that they can do it. The real appeal of Mexico, to be honest, is that they do have a sort of manufacturing directive. But the best thing, of course, is that they border America. You think of something like the aerospace sector around San Diego. If you're building really, really cool computers that

rely on aerospace grade metals and things like that, then you're inherently going to have intermediary trade between Mexico and California. So even if a computer, let's say, is quote unquote built in Mexico, it will rely on a bunch of expertise in America. And then that's obviously you've got American investments, you've got American jobs, if you're doing everything in China.

I mean, all you have to do is look at Apple's own annual supply list. It just becomes increasingly Chinese over time. Either the foreign multinationals are increasingly setting up shop in China, or more, more, more recently, the Chinese companies themselves are displacing those multinationals that have set up shop in China. So there's a very big difference between a factory in Ohio closes down between if that work goes to Mexico or that work goes to China. It is far better when it goes to Mexico than when it goes to China. Wow.

It would be interesting if we could open up that area. We're going to seize control of Canada and Greenland evidently, because that's what you do to your friendly allies. Yeah, I'm Canadian by the way, just for the part of the discussion. Yeah, I've been picking up on your Canadian-ness. I'm a big Rush fan and I love everything Canadian. I think you guys are a nicer brothers to the North. We're like the drunken brother who's always starting fights and you guys are like, oh my God, this is going to, we're going to get nuked with these idiots. But yeah, so anyway, that's a joke people. It's not really, I don't have, whatever. Anyway, so the question I have for you, you know, India, India has some democratic concerns as well. I mean, it's not,

there's some concerns about they're really, they're a democracy and of course, there's the political hedge, whatever things I can't dispel on, I can't think of terms on Monday morning, evidently. But I think they're selling oil or they're doing something to support the Ukraine war on the Russia side. Some of their alliances, I think with some of our enemies like Iran and other things, there's kind of some questionable things that would put Apple back in the hedge money, I think that was the word I was looking for, of being under some sort of political sort of issues, you know, wars, India, Pakistan, now is it no, it's Pakistan and India.

Yeah, Pakistan and India fighting. But what do you think about that? I mean, it seems like anywhere they go, they're going to have some political problems in the world nowadays. Yeah. So I mean, under Narendra Modi, India is definitely going in a direction that I think a lot of us wouldn't support. On the other hand, if you have an understanding of just how impactful investments in from Apple can be in another country, then I think you can understand that that could be a bargaining chip, right? Yeah.

Because Apple investments really are on sort of a nation building like effort. And so more of that, if more of that was moved to India, then that's part of any deal you might have. So perhaps, you know, that's a sort of bargaining chip to be used against India having a tighter relationship with Russia. Sort of above my pay grade to get into that, but I think that's at least a potential. Pete Slauson One thing we've also seen is, it was interesting to me that Donald Trump's administration exempted the phones and that kind of happened fairly quickly over the tariffs where they were supposed to exempt them in some way, because people were starting to go, wait, my iPhone's going to double in price? Oh my God! You know, it's almost, how does that work? And not only that, but Apple in a matter of days lost nearly $800 billion of value. And you don't have to buy Apple products to be exposed to them because if you have a retirement fund

that's based in index funds, guess what? Apple is your biggest investment. Yeah. The other question I have for you is, did you get any, I'm sure you reached out to the Apple corporation and Tim Cook, did you get any, I'm sure you reached out to the Apple Corporation and Tim Cook, did you get any answers back? So I did not. I reported on Apple for four years. So I know, you know, many of their PR people by name. But when you're reporting for a newspaper, you give Apple 48 hours, maybe 72 hours to respond to something. The book world is different. I submitted this manuscript last September. There is just no way I could give Apple six or seven months to get their ducks in a row, their counter narrative, their smear campaign, whatever it is they wanted to do to go after the book. So I just had to exclude them from

the equation. And the thing is, you don't get anything from working with Apple's PR department. And they're not incompetent, but they are deliberately useless, let's say. I would agree with you. I've seen how they work with PR. If you don't give good PR reviews on the iPhone, this has been going on the whole time, they kick you off the review panel. Of course. And I was trying to tell the most insider tale I could tell.

So if they knew at the beginning of my research that I was going to try to reach out to thousands of people that had worked for Apple specifically in China, guess what? They probably could have sent out a mass letter reminding people of their NDAs and I would have had no calls returned. So I just had to exclude them. And look, I felt strange as a reporter because I like having a no surprises policy, but that is not the case. The book comes out tomorrow, there's going to be a lot of surprise in Cupertino. Pete Slauson Hey, I'm getting a C&D right now from Apple on the phone. No, I think it's an important story to be told and I think it's even more amplified. So, thanks for having the foresight, Mr. Nasser Damis, of what was going to happen. Your book is at least tied completely to perfectly

timed political things. And then, you know, this is the narrative we're having and the conversation we're having. The other thing I've seen in this war of iPhones and politics and all that is the war over the minerals and some of the expensive minerals that it's used for these phones. You know, you see China hoard them all over Africa. I mean, they've been after the African continent for a long time. You see them seizing and declaring bankruptcy and seizure of ports and airports. I know one of the first things, or my understanding is, let's put it that way, I'm not a journalist and I don't report on this, but my understanding is from the journalists is that one of the

first things China did in their reply to our terrorists was they locked down the minerals because they know that we use them in phones, we use them in everything. And that's another, I think probably curmudgeon tool they're using and for politics with Apple and every place else. Is that correct? Yeah. I mean, that's what you would do if you were put in the same position.

Yeah. So you call that weaponization of the supply chain. You could also maybe call it common sense. I mean, Trump likes to say who has the cards. Unfortunately, in this case, China does. What a great flip of that line. I haven't fact checked this, but Nicholas Kristof in the New York Times says an F-35 jet contains 800 pounds of rare earth metals.

That's one jet. I mean, to be honest, I'm certainly ignorant that if you told me an F35 weighed 800 pounds, I would nod. Right? That sounds about reasonable. Of course, I'm way off. But I mean, the degree to which China doesn't just have a hold over the raw materials, but the refining of those raw materials is insane. And the other sort of shoot a drop is I mean, China controls the battery supply chain, whether the batteries are for phones, any other electronic or for EVs, that's all coming out of China. I mean, we're talking north of 80, 90% for basically everything from the lithium to the anode to the cathode. It's extraordinary. To go after this country in a trade war thinking we're just going to have some easy victory is just, I mean, nonsense. We do not have the cards at all.

Yeah. There's a quote that's stuck in my mind, it'll probably be there infinitely. There was one of the, I don't know if he was a spokesman for China, but he basically said on, it was one of the initial responses to the trade war. He initially said, China's been here for 5,000 years. We plan to be here another 5,000 years and we've been here much longer. The United States has been a democracy. And that sort of vision, China does play with that 5D, 10D chess, they think 5,000 years

in the future, maybe a little bit much, but they are master planners. Where we're over here just debating, I don't know, pick your meme. You know, is it, we're, we're debating, you know, whether Kim Kardashian should to get another butt lift or something, you know, that's our focus in life over here. Well, I like the chess analogy, but so let me riff on it a little bit. You know, under Trump 1.0, the Washington went after Huawei, which you could sort of call China's Apple. They played it like a chess match, right?

What do you do in chess? You go after the king, right? You go after the one-time kill. What didn't work, and Huawei is now back with a vengeance, and they're now sort of doing more proprietary technology than using Qualcomm and Google for their hardware and services. So we didn't do very well here.

Now China doesn't play chess. China plays a game called Go. And in Go, you encircle your enemy. There is no point in which the game is over. There's no equivalent of checkmate. The enemy just has to concede that there's no more move for them to play. That is what I think they've done to Apple, right? By luring them in and having the entire supply chain there, they've effectively encircled the world's greatest company and put them in a position where they can't make any moves and so now when China does require joint ventures for like data localization in the country Apple has had to do that. If they say

ban the New York Times app, ban VPNs, Apple has had to do that. Apple does not have the political capital to go after Xi Jinping which is why when riots happened in COVID-0 you, in China and Foxconn workers were being beaten for being free, you know, for coming out against the policies and such, Tim Cook was asked for very deliberate questions by a Fox News reporter in Capitol Hill and he said zero in response. He was absolutely silent. This is a stunning position for a billionaire CEO of the world's most, you know, world's

most valuable and I would say greatest and most iconic company, but subdued into silence, a sort of complicit silence because what is he supposed to do? I mean, if anyone doubts that they're stuck, watch the footage of when he's asked those questions. Pete Yeah. Yeah, I think I may have seen that. Pete Yeah, this was a couple years ago and it was absolutely viral. Pete Yeah. And it's interesting, the other question I have for you, the ties to that, I saw Walter Isaacson on CNN, is the Uyghurs situation with the human rights crimes that are going

on there almost a genocide, it's interesting that the scale of that thing is going on comparative to maybe what you would, the camps in Nazi Germany and Poland and other places, you know, what's going on there and how, you know, Apple presents itself as this ethical company, highly moral, involved in causes, maybe at one point a little woke, you know, or trying to present themselves as such, you know, and so there's that narrative as well with the Uyghurs. Do you talk about that in the book? Matthew 20.30

So I don't, not because it's not important, it's very important, but because that's, again, that's the Apple narrative we know. We know about the labor abuses or the allegations of labor abuse. We know about the tedium of the jobs. What has just gone totally unnoticed the last quarter century is, you know, what did Apple see in China that Dell didn't see? We just haven't asked those questions. What is Apple's relationship with the government? How does it negotiate for this, that or the other thing? Because they have remarkable access, right? And Apple has a $70 billion business in China. I mean, it's not bigger than other corporations. It's bigger than other industries. It is difficult

to understand how big Apple is. I mean, just to give you a sense, 3 million people work on manufacturing for Apple products in China. By contrast, all Chinese demand for all American products across the country, like put it this way, all Chinese demand for any product across any industry in America creates 1 million jobs in America. So in other words, Apple has more of an influence on job creation in China than

all of China has on American job creation in America. So it boggles the mind how large and powerful this organization is. And so I just try to take the narrative in a totally different direction, frankly, from the one that I think most readers are expecting. Pete And definitely, we need to have, you know, we're having these conversations now about all this stuff. So, definitely, this needs to come to light. I commend you for writing the book and all that good stuff. And I know how Apple's PR department is. They're some of the best PR agents in the world, let's put it that way, next to my last nine divorces. But…

Jared I should just tell you, people like, love this kind of the most, just as you mentioned divorce. So many marriages ended in the first five years of Steve Jobs' comeback because Apple engineers were flying so frequently to Asia that Apple had to institute what engineers called the DAP, the Divorce Avoidance Program. And it was, yeah, it was a series of measures to basically assuage spouses because so many marriages were on the rocks because they were working so hard. And at first it was just allowing Chris to have a couple days off because I don't know what your wife's name is, let's just call her Sally, because Sally was saying marriage

is almost over if you go to Asia one more time. But that only worked for a little bit of time because they need Chris on the production line. They need Chris doing the teaching. So instead, it was give $10,000 bonus to Sally and make her feel better about you being away. Pete Slauson Bribing wives at this point? Chris Bounds

Your words not mine, but yeah. Pete Slauson It sounds like a military thing where, you know, a lot of divorces happen in the military because, you know, our good men and women go overseas. Chris Bounds Yeah, they took the call of them calling each other and themselves Apple widows because their husbands were around so infrequently. Apple widows. Wow. I'm going to ask my friend Andy about this. He went through a divorce

too. Oh, really? And correct me if I'm wrong. He is in the book Dogfight, right? About Apple versus Google. I believe he should be. I don't know about Dogfight, but you know he's in a few dog meetings. Peter Bell Unless I'm mistaken, he is in the 2007 iPhone presentation worried it's not going to do right and sitting there with a bottle of whiskey chugging after everything that goes right. And by the end, he's just plastered but so excited that it all worked out.

Pete Slauson That's Andy. It wasn't, that was the only time when they shuffled the iPhones that it worked. He didn't shuffle the iPhone. He did the three to four movements or three to four app movements that should have shut it down on the fourth one and it had failed 100% of the time until... Yeah. I knew Andy back before he even hit media and started telling those stories and told us those stories. I was like, you got to tell more people this shit.

It was the greatest presentation ever I mean people at Blackberry literally thought it had been faked somehow because it was just so far ahead of anything they were working on and they were sitting there watching him make I think it was the third or fourth movement that would crash 100% of the time the phone yeah fuck he's going for he hasn't switched phones and you know he told me about it and then there's a lot of other stories I don't even know if Andy's told all the stories, but that's up to Andy. But I've heard all the stories. Andy Buehler Have him call me.

Pete Slauson Yeah, it, I mean, it was interesting because it was kind of the first exposure that I saw that Steve Jobs wasn't this great, loving, wonderful human being who cared about his, you know, his strange daughter and all that sort of stuff. But you've got the book out. As we go out, tell people what you hope they learn from the book, where to pick it up, any dot coms you want people to find you at. Patrick McGee So, appleinchina.com. You can just as easily just go to Amazon or bookshop.org or Barnes and Noble and look up Apple in China. Patrick McGee, I would absolutely love if you read

this book. I would say the book to some degree is a little bit of a Trojan horse. I want to sell you on the sex appeal of Apple and tell you lots of fun Apple stories, but really what I want you to learn about is supply chains, the US-China tech rivalry and why all this matters just so much. There you go. It's an interesting conversation, boy. You nailed it. Perfect timing, my friend. You saw this guy. When did you start the book by chance? Two years ago. Two years ago. Two years ago. Thank you for having the foresight.

Can you tell me what the best stock is going to be over the next year to buy? If you saw my portfolio picks over the last 10 years, you would not ask the question. You might take the reverse of anything I were to say. My was investing in eight marriages. We changed the, it's a callback joke on the show. We call it and change the number every time. So anyway, thank you very much, Patrick, for coming to the show. Very insightful, perfect timing and something everyone should read because it's top of mind

in our conversation news today. Thank you very much for coming on. Appreciate it, Chris. Thanks so much. Thank you. And thanks very much for tuning in. Go to order the book where refined books are sold. Apple in China, the capture of the world's greatest company out May 13th, 2025.

Thanks for tuning in. Be good to each other. Stay safe. We'll see you guys next time. That's an episode. Great show, man.