Apple’s Wednesday announcement of new investments in U.S. facilities, jobs, and companies is real news and good news. But, reading between the lines, it’s also a carefully crafted PR drill intended to stave off criticism and curry some favor with Washington.
The company is perhaps the nation’s biggest beneficiary of a new tax code that hands out massive tax breaks to U.S. corporations, especially multinationals. Along with a lower corporate tax rate, Apple can now bring back some or all of the roughly $252 billion in cash or cash equivalents it has parked abroad at a thrifty 15.5% tax rate.
The company said it plans to pay $38 billion in repatriation taxes to bring home about $246 billion in cash. (It had already earmarked $36 billion for the tax payment back in November.)
The major point of Apple’s statement—complete with tweetable images and infographics—is that it plans to spend about $30 billion of its repatriated cash, along with money it saves from lower corporate tax rates in general, to invest in new facilities that create U.S. jobs.
This type of statement from big U.S. companies has become commonplace since the passage of the GOP’s tax bill. Such announcements are designed to create the look that corporate tax breaks will be used to create jobs and help the country, not just enrich executives and investors. They often contain lots of bluster about the wonderful things a given company does for the economy. The bold initiatives mentioned, and the reasons for them, often have nothing to do with the tax breaks. When those irrelevant factoids are all cleared away, the real picture of how…