As a thank you for his tax bill, Apple CEO Tim Cook has apparently decided to stroke Donald Trump’s ego a bit.
On Wednesday, Apple blasted out a press release announcing that it planned to invest some $30 billion in the U.S. over the next five years, while building a new campus and hiring an additional 20,000 workers. In the same statement, the company also explained that, as a result of the Republican tax plan, it would be required to pay only $38 billion to the IRS in order to repatriate the roughly $250 billion in profits it has stashed overseas.
Nowhere in the announcement did Apple say these two things were actually related. But juxtaposing the fruits of tax reform with its new investment projects certainly encouraged readers to interpret it that way, and Republicans, including president Trump, seized on the opportunity to take credit.
In an interview that aired Thursday on Good Morning America, Cook got a bit more explicit. “Without these policy changes, would you be able to announce today the creation of 20,000 new jobs?” ABC’s Rebecca Jarvis asked him. “No, there clearly—let me be clear, there are large parts of this that are results of the tax reform, and there are large parts of this that we would have done in any situation,” Cook responded.
You can choose to believe Cook or not. Personally, I don’t. As I wrote Wednesday, Apple already lays out billions of dollars every year on capital expenditures and has never been constrained by a lack of cash. Even the money it kept overseas was easily accessible. All the company had to do was borrow against it with low interest, which Apple did happily in order to reward its shareholders with dividends and buybacks. Cook is obviously thrilled to be bringing his overseas profits home with a reduced tax rate (Apple had more profits sitting overseas than any other U.S. company). But there’s no reason to think it would make a major difference in his company’s long-term planning. My guess is that when Cook says Apple would have made “large parts” of these investments in any circumstances, he means almost all of them.
But saying that out loud wouldn’t flatter our prickly president. And right now, it behooves any corporation that wants favorable treatment from the government to tie all of their investment decisions to the GOP’s tax bill, no matter how tenuous. As one analyst told the New York Times, “This is Apple putting its best foot forward consistent with objectives of the administration.” In other words, Cook is paying Trump back by giving him a precious win to tweet about.
