If you want 5,000 skilled workers to assemble a new product that's shipping in three weeks, in the manufacturing districts of China and Taiwan you can snap your fingers and get them by the end of the day. In the US and Europe this would take weeks, if not months. There's no on-demand talent pool like this. It doesn't exist.
On top of that, if you want something made, nearly anything, you can get it sourced immediately. You want magnets for your new iPad? There's a factory down the road from Foxconn that makes billions of them. You want batteries? Specialized rubber pads? A particular adhesive? A solvent? A new type of display panel? It's all being made right there, and probably just miles away. It could be on a truck to your factory within the day. No customs. No duty. No logistics other than picking up a phone.
Don't forget Apple's original Macintosh computers were made in a state-of-the-art plant in California, but the scale of overseas manufacturers, who were making everything from toothbrushes to televisions, made it very difficult to keep competitive. It's not necessarily the wages of the workers, or their thrifty working conditions. It's the entire ecosystem.
Despite all this, Mac manufacturing is returning to the US: (http://tech.fortune.cnn.com/2012/12/08/apple-mac-pro-made-in...) Details aren't clear at this point, but it seems Apple's partnering with Foxconn to open up domestic manufacturing for selected products. This will probably make the supply chain a lot more complicated, but for something like the Mac Pro, which is low volume, high margin, and on a much more relaxed update cycle, it wouldn't be impossible. Same goes for other products like the Mac Mini.
Let's not forget how horrible Victorian working conditions were. People in those times would find working at Foxconn to be like living in a palace. Flush toilets? Showers? Beds with mattresses? Company provided health care? A hard limit on over-time? No beatings? Foxconn's wages are well above the norm in that industry, even if thrifty by American standards.