Better Offline - Tariffs and The End Of Affordable Computing w/ Steve Burke

Episode Date: May 7, 2025

In this episode, Ed Zitron is joined by Steve Burke of GamersNexus to talk about how tariffs are throwing the PC gaming industry into disarray, and how the era of affordable computing is coming to an end.GamersNexus: The End Of Affordable Computing: https://www.youtube.com/watch?v=1W_mSOS1Qts&t=2s&ab_channel=GamersNexus https://www.youtube.com/gamersnexushttps://gamersnexus.net/https://bsky.app/profile/gamersnexus.bsky.social https://x.com/GamersNexus YOU CAN NOW BUY BETTER OFFLINE MERCH! Go to https://cottonbureau.com/people/better-offline and use code FREE99 for free shipping on orders of $99 or more.You can also order a limited-edition Better Offline hat until 5/22/25! https://cottonbureau.com/p/CAGDW8/hat/better-offline-hat#/28510205/hat-unisex-dad-hat-black-100percent-cotton-adjustable --- LINKS: https://www.tinyurl.com/betterofflinelinks Newsletter: https://www.wheresyoured.at/ Reddit: https://www.reddit.com/r/BetterOffline/  Discord: chat.wheresyoured.at Ed's Socials: https://twitter.com/edzitron https://www.instagram.com/edzitron https://bsky.app/profile/edzitron.com https://www.threads.net/@edzitronSee omnystudio.com/listener for privacy information.

This is an IHeart podcast. Guaranteed Human. Run a business and not thinking about podcasting. Think again. More Americans listen to podcasts than ads supported streaming music from Spotify and Pandora. And as the number one podcaster,

IHearts twice as large as the next two combined. Learn how podcasting can help your business. Call 844-8-4-i-heart. Another podcast from some SNL late-night comedy guy, not quite. Unhumor me with Robert Smygel and friends. Me and hilarious guests from Bob Odenkirk to David Letterman,

help make you funnier. This week, my guest, SNL's Mikey Day and head writer, Streeter Seidel, help an a cappella band with their between songs banter. Where does your group perform? We do some retirement homes. Those people are starving for banter.

Listen to humor me with Robert Smigel and friends on the IHeart Radio app, Apple Podcasts, or wherever you get your podcasts. Why are we all so obsessed with romance? On the Radio 831 podcast, join us, Sanjana Basker and Tyler McCall, as we unpack all the trending tropes, fuzzy adaptations, book talk drama,

and celebrity love stories with hot takes and sharp guests. Each episode digs into what these stories reveal about desire, fantasy, identity, and how we love now. Listen to the Radio 831 podcast on the IHeart Radio app, Apple Podcasts, or wherever you get your podcasts. I'm Joey Dardano, and on my new podcast, hope from a hypocrite, I'll be changing lives, helping people in need with thoughtful solutions.

Syke, I'm a comedian. I'm not qualified to give good advice. Join me and my comedian friends as we riff, rant, recommend some of the most legally dubious advice known to me. This is Help from a Hypocrite, the worst advice from the dumbest people you know. Listen to Help from Hypocrite Wednesdays on the Iheart radio app, Apple Podcasts, or wherever you get your podcasts.

Coming up, will Steve Burke of Gamer's Nexus be able to help Ed Zitron understand tariffs. Should we treat Sam Altman's new startup like a venereal disease? And who is the mysterious identical man living in Kevin Ruse's mirror? All this and more on this week's Better Offline. Good grief. That's right, you're listening to Better Offline. I'm your host Ed Zittron.

As a reminder, you're now able to buy Better Offline merch. Check the episode notes for a link, of course. More importantly, today I'm joined by Steve Burke, the host of The Incredible Game is nexus. Someone I've wanted on the show since I started it. Steve recently put out a three-hour-long video called The Death of Affordable Computing, and it's the single best way I've seen anybody explain the current tariff situation. Steve, thank you for joining me.

Oh, thanks for having me. Yeah, I'm excited to talk more about it. So is there any way you can break down in simple language, how these tariffs actually work? I mean, effectively, the tariffs are, they're effectively attacked. right that's paid on imports so the goods come in from any any other country that's potentially tariffed and the company bringing those goods in has to pay some amount uh in order to complete bringing them in and so that then gets passed on to somebody maybe they absorb some of the cost maybe they increase the price of the product but tariffs in general of course not a not a new concept

and it's just this particular round of them has as affected the computer hardware industry in a larger way. So they're paid by the people receiving the goods. So the, the computer, so like height or cyber power, whomever, receiving a case, for example, would pay the tariff before they even shipped it to someone. Correct. Yeah. I mean, it's the same, all the way down to the smallest companies. We spoke to Lewis Rossman as part of that piece. He's known best for probably right to repair. And he's a good example where as a small repair shop in Austin, Texas, he's got maybe six or so employees. He personally doesn't, as he said in the video, bring in the goods, but he buys them from someone who does. So, you know, then that person

would be the one importing them and paying the tariff. So what made you want to make this video? Because you've done a good amount of PC industry stuff, but tariffs feels like a jump from you. Not an illogical one, though. Yeah, tariffs, it's a big topic. And it was very challenging to try and approach because for us, the number one reason to get into it was just we're starting to see the impact on computer hardware and a lot of companies had things to say about it. So that was the obvious reason to maybe look into it. The hesitations from us initially were this is a topic that is it's very difficult to completely isolate from politics, which we try to stay away from. but it's also important and it does affect what we talk about every day, which is value and pricing.

But the other challenge is that this is not something where I can claim to be an expert, like global trade, you might imagine. Yeah, a little bit big. Yeah, it's a very large topic. But that made it interesting to us because it was one of those like, okay, so we're closer to where you might expect most viewers to be in terms of knowledge where you're just getting the information daily with the one exception that we might have better access

to companies that do have a lot of experience with this stuff and maybe no one person can break down global trade for us and we've all seen economists on TV and whatever but what we could get is people talking about just how does it affect them and their company and then hopefully with that put together a fuller picture that's, you know, a little more maybe like a pragmatic approach to it. So that was, yeah, that was the way to break it down for us. So for the listeners who haven't watched the video, and I say this is someone who can barely make it through a half an hour video, watch the whole bloody thing. What are the current effects? What are the things happening today to say PC manufacturers that people might not know about? It's interesting. So might not know about makes that interesting. The ones that people do know about, I'll keep brief here, but just days ago Microsoft moved to increase pricing of its Xbox's Logitech has increased prices

of its peripheral components, keyboards and mice, so forth. And this is something we're going to see at Coursera. I was just speaking to them. They're about to increase the price of some their computer cases that were in the process of reviewing. And that's kind of the obvious one. That's the one people expect. There's also, and having listened to some of your previous episodes. I think this this might be a topic you'd want to get into. But there's also some room for greed, corporate greed, where this is a great cover story for them to change some prices. But then as far as answer the question of like what effects might people not know about, I think there's some really interesting ones sort of downchain in the in the supply chain

where things like logistics and freight and shipping companies are starting to have to deal with potentially reduced hours. And so you think about the supply chain, like to get a product from a country to another country, just to make it in, say, China, a motherboard might require something like 100 factories if you tally all of them, meaning including the metals factories. And so you've got all those impacts. And then you have the freight and the couriers, the port, the dock workers, the couriers on the other side, the warehouse workers, right? It's just a huge chain. And it's really, it can't be elastic.

It's got to be pretty rigid. One of the interesting ones we're seeing, though, is some of the factories from some of the company that I was just speaking with are beginning to adjust their terms. So factories will allow terms of payment to be potentially partially up front and partially on completion of order. Some of them are starting to adjust to front load more of the upfront cost or all of it. And that's because they have kind of gotten scared of potential order abandonment when companies can't afford the tariff. They abandon the container and stiff the factory.

Yeah. And so that'll have this unseen impact later where it's going to affect the cost of money. he's have to borrow money a lot of times to bring this stuff in. They have to pay more up front. Oh, so they might be borrowing more money up front because otherwise because otherwise they won't be able to afford the orders that are now more expensive on the front end. Yeah, and then they pay interest for a longer period of time.

That gets factored in. And so it's just really like, the more you talk to people, the more there's all these hidden consequences that pop up. And the one thing everyone kind of drove home was it's not to them, the tariffs themselves. that are necessarily the problem. It's sort of the way they were being rolled out where it was at least for a couple weeks, they're nearly daily changes and unpredictable. I did like during the video watching as you went from person to person saying, okay, right now, this tariff is this, by the end of this conversation, it may not be. Yeah. Insane way to run global trade. You had a few

examples as well where it kind of looked like certain things would just double in cost for the company, that they would just be paying effectively nearly double or like if it's a hundred and twenty bucks to buy something they're paying a hundred bucks on top. How is any of this sustainable? I think, I mean, for the computer industry, I'm not sure that it is sustainable. There's already, there's already been price creep that is not any. anything to do with tariffs. Just over the last several years, the companies... Yeah, I mean, they have big markets to sell into, and so if you're a small-time

consumer or gamer, you use Adobe Premiere with the Kuda GPU, you're just not at the top of the priorities. And the only way to get closer to the top is to pay a whole hell of a lot more for the component. So, like, there's already been price creep. When you say pay a lot more for the components, who is paying more there? It's the consumer. I mean, right.

Yeah. So it's really the high-end stuff is the best. Why do you have to buy the more expensive stuff? Is it just that it will be the cheap ones are having to use lower quality components, or is it something else? Well, it's interesting because it's almost like this question I think is, it, the real answer is that cheap stuff doesn't exist anymore. Huh.

Like the cheap products are gone. And this is pre-tariffs. This is like, it's only getting worse, but you look at GPUs and Nvidia with its dominance has managed to slowly shift the low end into the mid-range in terms of pricing and the mid-range into the high end in terms of pricing, but not in terms of necessarily performance scaling. And so you're already paying disproportionately more for what you're getting versus several years ago. and this is beyond inflation, this is beyond tariffs. You stack something like massive tariffs on top of it, and people who are already kind of struggling to justify a purchase of an expensive GPU, I was looking at RTX 5090s, which are supposed to be about a $2,000 video card,

about a week or two ago. I haven't checked today, and the cards were typically in the $2,900 to $3,000 range. Jesus. Yeah. That includes on shelves at microcenters. And some of that's going to be tariff impact, and some of it is just kind of price creep. Another podcast from some SNL late-night comedy guide,

not quite. Unhumor me with Robert Smygel and friends. Me and hilarious guests from Jim Gaffigan, to Bob Odenkirk, to David Letterman, help make you funnier. This week, my guest, SNL's Mikey Day and head writer Streeter Seidel, help an Acapella band

with their between songs, The first singer in the group? The worst? Yeah. Me. Is there anything to the idea that because you're from Harvard, you only got in because your parents made a huge donation. The group.

The yard birds, right? That's the name. The Harvard yard, but they're open. Do you have a name suggestion? We're open. Since you guys are middle aged, one erection. Listen to humor me with Robert Smigel and Friends on the I-Heart Radio app,

Apple Podcasts, or wherever you get your podcast. Human me. I need some jokes to make me seem funny. Run a business and not thinking about podcasting, think again. More Americans listen to podcasts than ad-supported streaming music from Spotify and Pandora. And as the number one podcaster, IHearts twice as large as the next two combined. So whatever your customers listen to, they'll hear your message.

Plus, only IHeart can extend your message to audiences across broadcast radio. Think podcasting can help your business. Think IHeart. Streaming, radio, and podcasting. Call 844-844-I-heart to get started. That's 844-8-4-8-4-I-heart. What would you eat if you had to start over? Real simple, poor man's, poor woman's food.

Black beans, chicken, rice, plantains. Yeah. That's poor people's food, man. But being in Nigeria, and that's, come on, a go-to. On the podcast eating while broke, I sit down with celebrities, entrepreneurs, and creators as they revisit the meals they once relied on and the moments that shaped their journey, named Best Food Podcasts at the

2006 I Heart Podcast Awards. This show is all about real conversations on money, growth, and what it really takes to make it. It was times where me and Lex were like definitely getting into it, because we're not making any money. Like, I need to start making money. Like, why are we doing this? But I don't know. I think we just always knew that we had something really good. And eventually people were going to catch on. And so we just thugged it out. full season is available to binge right now listen to eating while broke from the black effect podcast network on the iHeart radio app apple podcasts or wherever you get your podcast it's your responsibility to not just seek help but to identify that you need help this is mental health

awareness month tune in to the podcast just healed with dr jay and take real steps toward healing growth and becoming your best self when you hear the word healing what does that mean for you What came right back to mine are the three P's that I live by. I'll go through the process of healing so that patience, that perseverance, and that prayer equals healing to me. From understanding your mental health to doing the work, we break down practical tools, real conversations, and the mindset shifts you need to move forward and thrive. You matter too.

Your mental health is your responsibility, not your wife, not your partner, not your children, not the church, not the pastor, not the council. is your responsibility. It's time to stop putting your healing on hold and start doing something about it. Listen to Just Here With Dr. Jay on the IHeart Radio app, Apple Podcasts, or wherever you get your podcast. It does kind of feel like, well, to the title of the video, it's like the end of affordable computing has already kind of happened. Because it doesn't seem for and for our less technical listeners when we say 50, 70, 50, 80, 5090 referring to, Nvidia graphics cards on the consumer side, so the things you put a computer, so you can see

what's on your monitor and also play games. Steve, I'm sure you love that technical explanation. Yeah, that's great. But it's, I nearly said 3DFX there for a second, aging myself. But it feels like those lower end ones aren't even anyone near as good as you did a video on this as well, that the 50, 70, 50, 80, the lower end or mid-range ones just are nowhere near as good as mid-range and lower end used to be. Yeah, it's the, I think the most understandable version of this in terms of when we were trying to figure out how do we communicate what's happening to people, was we came to the word shrinkflation, which people are familiar with, except instead of a bag of chips where you get.

Well, maybe you should explain what it means. Sure. Yeah. Yeah, so the concept being that, and again, to preface this, you know, we're experts on hardware or not economy, but like this is stuff that it all kind of bleeds together in a way we get familiar with it. But shrinkflation being the concept of

you go to a store to buy your bag of chips or your bundle of toilet paper or whatever and you get fewer items for minimally the same cost as it used to be. Right? So it sort of disguises

the change in value, the cost per unit or whatever that you're getting. Then you apply this to electronics, and the version of it is you buy the video card or the CPU and maybe you have fewer lower performance, relatively speaking, than you would have had in previous generations while still spending at least the same but likely more. And one of the things that, you know,

this kind of deviates from the tariffs discussion, but one of the things I'm concerned about is as cost for consumer electronics goes up, especially things like computers and especially as caused by things like the current tariffs there's an opening for companies like Nvidia to push for more of a lack of ownership model so like they have services where you can play games

over the internet streaming kind of like Netflix was it G4S now that's right yeah and this creates a great opening for these companies to step in and say we're so sorry you can't afford our cheapest model $550 video card to play games or to render videos or do 3D modeling but good news we have something for you and it's $50 a month and you can use it for you know this many hours and in between

maybe we'll do ads or may we turn on and off the different services you have access to and so that's one of my concerns is it's it's another step in furthering the you-own-nothingness of the current consumer economy. It kind of feels as well, and you hinted at it earlier as well, where it's like these companies are, Microsoft's raising the price of the Xbox. I don't imagine that's coming down. I don't get the sense that Microsoft is going to say,

don't worry everyone. Everyone on Wall Street, by the way, the markets love it when we charge less. so we're going to bring this down as an ethical company. It just feels like that there are the immediate near-term effects where its prices are going to increase, but just no one is going to, no one's going to bring these prices back down at the end of the tariffs.

No one really understands what's going on. So it almost feels like they'll be able to kind of push it under the rug and obfuscate what they've actually done as well. Yeah, I think there's a couple of things going on where there's, it's interesting. Normally, we, as in GN, we're in a very cynical mindset for a lot of our coverage, and that's just the nature of it. It's not necessarily adversarial, but it's untrusting, I would say, of what companies are saying. And so part of that in this situation is, okay, there are avenues here for companies to get the price increases they've wanted,

they've needed an opportunity to do it. But at the same time, unlike most the other stories we cover, this one is so wide-reaching and industry impacting with the sort of sporadic nature of the tariffs application and also the high percentage of them, that there are real consequences and it is hurting companies. So you've got this mix, right, where it's like we can't be too cynical this time because there are real-world impacts, like with height where they were just going to lose money for computer cases that they sell if they continued to sell them into the U.S. market. So they've abandoned it.

They decided we don't need to sell the U.S., we'll send them somewhere else. Which is crazy. That's a large part of their business. Yeah, it was, I want to say the number the product director, Rob Taylor, shared during the interview, I think he said 65% revenue was from the U.S. Yeah. But at the same time, you know, so that. That's a real, that's where it's not helpful to be cynical, because this is a real impact to this company.

We've seen their numbers. But then on the flip side of that, back to the cynicism, you look at a company like Microsoft, where they've increased not only the cost of their physical hardware, which is impacted by tariffs, because a lot of it does come from China, but also they've increased the price of their digital downloads, like video games, where they're saying they're going to start moving towards an $80 per game model from typically. typically 60. And digital video game downloads are not currently, as far as I understand it, are not tariffed. No. In fact, that's the whole point of digital downloads. Why are they $80? You're saving money selling this. Right. And I think what's happening here is they have one real reason to increase the price, which is their cost has gone up on the hardware. And that is, giving them sort of cover fire to also increase the price of things that haven't gone up. Maybe you can make an argument for inflation affecting development costs or something like this,

but packaging it all together and doing it at the same time, I think it's also, it sort of exhausts the consumers' attention where it eases the acceptance of this higher price, because at some point you get hit with this news, so frequently, you're like, I just, I don't care anymore. I get it. It's all expensive. And you lose the capacity to be mad at a specific company. But it's just, I, truly, I'm learning about this in real time. So Microsoft is raising the price of first party games to $7,99. That's completely insane. And I think there is a delineation of cynicism here, where you can be cynical about a company, but all of the companies you talked to in this video were very much, I mean, you had competitors

hanging out with each other to tell you stuff. It feels like there is a market difference between a company saying, yeah, every two minutes a wheel spins and we pay more on stuff and having a real reason to do that. And a company just saying, yeah, games are 80 bucks now. I don't know what to tell you, mate. Yeah, and I think the companies we spoke to, and they range, like I said, from someone with six employees

who's a sort of true small business owner, like you think of an American small business owner and that's exactly the representation you think of all the way up to multi-billion dollar publicly traded corsair components which makes memory keyboards computers they even have some assembly in the u.s and all of them feel the impact in comparable ways but where they differ is their ability to cope with it and so i think it's these small companies that are going to get hit particularly hard. And this actually came up a couple of times in the interviews as well. One of them that we didn't include was a comment that someone from Coursera made.

I think we weren't filming yet, but we were talking about GN. And my goal with this wasn't to insert ourselves into this story. So we kind of kept anything about Gamer's Nexus out of it. But the tariffs impact us too. and one of the comments he made, I asked him, who do you think this affects the most? And he said, well, it's guys like you, right? Like, it's small businesses and medium-sized businesses because the big ones are large enough to have levers to pull. Right.

And I guess I'm going to ask you one of the most annoying questions that I possibly could, which is, and you do cover this in the video, why can't they just make in America? And I know that the answer is it's going to be very obvious, but still, people are going to want to hear. Sure. Yeah, it's really, it is actually a great question. It's obviously very common. It's complicated. So the easiest answer to that, I think if you try to boil it down into kind of like two components,

there's cost, which everyone's familiar with, and we can kind of get into that. So there's things like labor costs, real estate costs, all this. And there's maybe some greater social discussions to have there with regard to labor cost. But then there's also supply chain. And so if we ignore the cost component for a moment and just assume it costs exactly the same amount of money to make it in China or Vietnam or Thailand as it does in the U.S. Which it doesn't. Which it doesn't. It's the global manufacturing average cost in terms of wage per hour is, according to Coursier's CEO, in our interview, is two to four dollars per hour.

Jesus. It's obviously not even close, yeah. And so if we just assume it's equal, though, for take of conversation, the new challenge is in China in particular, but just that part of Asia in general, there's already a huge factory presence. they have the tooling, they have the people, they have supply chain. And so what that really means is you can go to Hua Chambay in Shenzhen right now and you can go talk to someone to get, tell them you have this brilliant idea for a new electronic device. You can have someone design the PCB. You can have someone print the PCB.

The printing can be delivered same day for a prototype. And you can also start sourcing factories for the capacitors, the inductors, the semiconductors, the mosfets, the shell or case, if there's going to be one, all of that can happen in the same spot. And it can all be sourced from sort of the same, say, 50-mile radius for the most part. And that doesn't exist in the U.S. And if you want to make a motherboard as an example that came up in the video in the U.S., we didn't get too deep into it in the video, but there's probably 10 to 30 major component,

complete component suppliers for that board. So if you want to make that motherboard in the U.S., which your CPU and your GPU go into, it's sort of the brainstem of the computer, you bring that over here, and what you might have first is the assembly line. It's an automated line. It's primarily done by machine these days.

So you bring over the SMT line, the surface-mount technology line. That line has machines that, first of all, are made all over the world. Yeah, so that's already a different thing. But, and then those machines have reels of components like capacitors. The capacitors come from a factory in China. So you'd have to bring that factory over.

That factory to make the capacitors has factories. So it uses factories for maybe ceramics or for aluminum or steel or copper, whatever they may use, copper coil for someone doing the winding for the coil for things like going power supplies. And all of that is downchain factories. So this one motherboard, quote unquote, factory, what they're doing is effectively equivalent to someone assembling a pre-built computer and a pre-built computer assembly plant in the U.S. like Lenovo. They're doing the same thing. They're putting all the parts together, but they're buying them from elsewhere. And that's fine.

That's how it works. But to just bring that over, it's not something you can flip a switch on. Another podcast from some SNL late-night comedy guide, not quite. Unhumor me with Robert Smygel and friends. me and hilarious guests from Jim Gaffigan to Bob Odenkirk to David Letterman help make you funnier. This week, my guest, SNL's Mikey Day and headwriter, Streeter Seidel, help an a cappella band with their between songs banter.

There's the worst singer in the group. The worst? Yeah. Me. Is there anything to the idea that because you're from Harvard, you only got in because your parents made a huge donation. The group. The yarn herds, right?

That's the name. The Harvard Yard. They're open. Do you have a name suggestion? We're open. Since you guys are middle aged, one erection. Listen to humor me with Robert Smigel and Friends on the IHeart Radio app, Apple Podcasts, or wherever you get your podcast. Humor me.

I need some jokes to make me seem funny. Run a business and not thinking about podcasting, think again. More Americans listen to podcasts than ad-supported streaming. music from Spotify and Pandora. And as the number one podcaster, IHearts twice as large as the next two combined. So whatever your customers listen to, they'll hear your message. Plus, only IHeart can extend your message to audiences across broadcast radio. Think podcasting can help your business.

Think IHeart. Streaming, radio, and podcasting. Let us show you at iHeartadvertising.com. That's iHeartadvertising.com. What would you eat if you had to start over? Real simple, poor man's, poor woman. food. Black beans, chicken, rice, plantains. That's always, that's poor people's food, man. But being Nigerian, that's, come on, a go-to. On the podcast eating while broke, I sit down with celebrities,

entrepreneurs, and creators as they revisit the meals they once relied on and the moments that shaped their journey. Named Best Food Podcasts at the 2006 I-Heart Podcast Awards, this show is all about real conversations on money, growth, and what it really takes to make it. It was times. where me and Lex will, like, definitely get into it. Because we're not making any money. Like, I need to start making money. Like, why are we doing this? But I don't know.

I think we just always knew that we had something really good. And eventually people were going to catch on. And so we just thugged it out. The full season is available to binge. Right now, listen to Eating While Broke from the Black Effect Podcast Network on the IHeart Radio app, Apple Podcasts, or wherever you get your podcast. It's your responsibility to not just seek help, but to identify that you need help.

This is Mental Health Awareness Month. Tune in to the podcast, Just Healed with Dr. Jay, and take real steps toward healing, growth, and becoming your best self. When you hear the word healing, what does that mean for you? What came right back to mine are the three P's that I live by.

I'll go through the process of healing so that patience, that perseverance and that prayer equals healing to me. From understanding your mental health to doing the work, we break down practical tools, real conversations and the mindset shifts you need to move forward and thrive. You matter too. Your mental health is your responsibility, not your wife, not your partner, not your

children, not the church, not the pastor, not the council. It's your responsibility. It's time to stop putting your healing on hold and start doing something about it. Listen to Just Here with Dr. Jade on the IHeart Radio app, Apple Podcasts, or wherever you get your podcast. And it seems like a big part of it as well is that China already has this infrastructure to manufacture these things to a point that they have someone who can do the prototype, that they have someone. I don't know, like, I assume there are like screw factories and things that don't exist in America or if they do, they are geographically inefficient in comparison. Yeah, I think that's a big part of it is there are factories in the U.S. that can do various things.

I mean, certainly you get down to physical hardware like screws. I'm absolutely certain there's factories that make screws in the U.S. There's factories that make cardboard boxes in the U.S. But like you said, these things are not on the same block. And while that can be reconciled, making a company eat an extra cost is basically impossible. And so if the approach is to do some form of taxes, it would have to be so extreme that there really is no other choice.

boys, but to start building factories in the US. But the problem then is that this takes years. And it just doesn't hear, yeah. Right. Yeah, it would just, it just takes forever to start building. I mean, then you've, it's also just, it's an enormous amount of money. You can't just have it. You know, you need to plan for it. So, um, so that's a big challenge. It kind of feels like that on, on the cynical side, I mean, it kind of feels like it is the case where it's so much of our economy is based on just cheap labor that we've outsourced our entire manufacturing to other countries, and it all relies upon a certain kind of discount labor that just doesn't exist and probably can't exist in America. I think it not only can't exist in America, but the amount of

available people is probably not high enough to create that many manufacturing jobs, especially instantaneously. One thing that's interesting, though, I don't think I've really spoken in anywhere about this side. But something that's interesting with contract manufacturing, especially in China, is at least for the factories we've toured and visited over the years, a lot of the contract factories, you know, they shut down for Chinese New Year for a while. It's their biggest holiday. So similar to Christmas in the U.S., you have several weeks off. a lot of people. And they're at last pretty long. So the one factory we work with, and we've toured, they shut down for nearly a month for Chinese New Year. And when I once asked them,

when it was my first time over there, you know, I asked the factory owner. It was basically, hey, no, absolutely no disrespect. Don't take this the wrong way. I'm just curious. Why such a long time? Like as an American, right, you come from a work culture in terms of just, you're always at work. Four weeks is a big stretch of time. Doesn't that have a bit. affect your production. And he said something really interesting to me where that factory in particular, a lot of their laborers come from all over in China. China's very large, and they come from all these different provinces. And so they sort of migrate out to do the work locally at the factory, and then they might go back, and maybe they're going back to work at home, or they just bring

the money home and spend time with the family. And the interesting thing there is that kind of opened my eyes to how can you how can a place like shenjin exist where almost everything you need to make a product is in like one city that seems insane right like the amount of people you would need for that is crazy uh and i guess that's part of it and i don't you know obviously don't claim to be an expert in it but just from personal experiences talking to people and visiting these places these are kind of the pieces that have really clicked for me to help me better understand uh how how manufacturing works Yeah, it's just Every time I think about what these tariffs are meant to do, I feel insane

Because it's like, okay, we're going to charge more for things to the people shipping them in Which will cause them to build things in America, which they can't do But they should Like that feels like most of the logic here But we'll just factories will sprout out of the ground like weeds Like it's just bizarre Yeah, and even the companies that do make stuff here, this is what's interesting too, is that... Yeah, because you spoke to one, an actual manufacturing company in America.

That's right. Yeah, so we spoke to three companies that we spoke to have sort of different levels of manufacturing here. So there's one of them, the one you're probably referring to, is called Protocase, and they stamp cases. So they assemble servers and network-attached storage devices, and then they can stamp their own cases for those. They take the metals, they put them in a big press with their own tooling, and they press it, and then they can kind of bend the metal into a server case. So they do some manufacturing here, and they do a lot of it in Canada.

The other two companies we spoke to are a different type of manufacturing, where it's assembly. And actually, Coursher, through their credit, has assembly as well. so I guess three. And the assembly groups, they, so Cyberpower PC makes pre-built computers mostly for gaming. And they employ hundreds of people in the city of industry, California area, to assemble computers. And so those people take about eight to ten components that Cyberpower does not make. They buy them from other companies. And they assemble them right into a computer.

And it's really that straightforward. But this is effectively a factory job. It's an assembly job. And the PC that's made ultimately, it's branded a cyberpower PC, but just like any PC on the market, Dell, HP, ASUS, it doesn't matter. They don't make the CPU. They don't make the GPU. That's probably Intel, Nvidia, AMD. They often don't make the cooler, the storage device, the memory.

So all this stuff. Yeah, it's got to come from other people. And for the most part, the places it ends up coming from are going to be China, Vietnam, Thailand, Singapore, Malaysia, Taiwan, I don't think I named yet, and some stuff from Japan. But that's kind of the – that's where the stuff comes from, and then they assemble it in the U.S. But those companies that assemble the computers in the U.S., they still get hit by tariffs because they're bringing stuff in to complete the product. But what's interesting is it's almost like these components like CPs and GPs. You can think of them as raw materials where the products, the computer, can't exist without those raw materials. But they're not blanket exempted as raw materials.

Yeah, and it feels like you can't actually exempt any particular industry because of the manifold different parts. I think Lewis Rusman made the point as well where it's customers are going to get pissed off about the price increases. and it's kind of like, well, you're the one buying these things that are made with Chinese parts. It's not like you can avoid that. Right. Yeah. No, I mean, that was an excellent point by him where he's a repair shop. And as he was saying, for the device to even get to him, someone else has to exist before him.

And that's going to be the customer buying from the original manufacturer. If the original manufacturer chooses to make their product, let's say entirely in Detroit, and they use parts entirely from Detroit, then Lewis, the repair shop, will probably buy replacement parts from Detroit. Right. Because that's where they come from. And so it's, yeah, I think, like, him just as much as the assembly plants that put a product together, the consumer's familiar with, they're affected by the same thing,

which is there's forces so much larger than you. You don't have the option to move it because it's not yours. And so what do you do, right? Yeah. One thing, as we come to the end here, one thing that did strike me is, how did you get all of these competing companies to actually hang out and talk to you quite candidly at the same time? Yeah, it's, I've known a lot of the people in that video I've known for,

pretty close to some of them like 12 to 14 years. Fortunately, like we've run across each other at conventions a lot. And so for like the backstory, I guess, Cyber Power and Iowa Power are two competing pre-built companies. And I pain to them both. And I was like, hey, it would be, it would really send a message. If you guys agree with each other on this particular issue, I think it would help people understand that it is impacting,

both of you in similar ways because these are companies that they're fighting for the same market chair, for the same customers, and you know, if you can get them together in a room and they were even sharing numbers with each other, how many employees they have, how many units

per year they make, like this is crazy information to share. But I think it was sort of a solidarity moment where the read on the situation I had was the companies were all looking at this as this is our opportunity to try and explain why the prices are going to go up and whether or not it's for legitimate reasons or for the

more cynical reasons we've discussed to them it was an opportunity to talk about that and um i think our timing was a big part of that where we booked our tickets uh as soon as the pause went into effect on some of the international tariffs or actually i'm i was it was just before that It was like a day before that. So we booked the tickets a day before the pause right around when they went into effect. We landed and then some of these changes like pauses and exemptions and non-exemptions were happening already. But because of the chaos in that four-day window, I think everyone was willing to talk to us on record because nobody knew what was going on. And just to close us off, you mentioned it cost a ton of money and a ton of time.

How long and how much money, roughly? because this was, I do not watch videos of these links. Casey, Casey, friend of the show, Casey Kagawa knows this well. But I watch the whole thing, like, how much, like roughly? Because I want to make the video. To make the video, so it was probably, if you count my time at zero dollars, then we should have been over 10 grand in total cost. So that's travel plus editing time.

There's a lot of editing time because we had over eight hours of footage. And the way it kind of came together and it was interesting where, you know, we got the news down the wire about the new, the word, the government has officially named them is reciprocal tariff. So when those came out, that was when we started booking the flights. And like I said, it was right before the pause on some of them. And so we booked the flights with no return flight. It's a 12 hours away until we got on that first plane. We had the first hotel booked. And then Vitale and I, my camera operator, we flew out there.

And we played it day by day. And I used the hotel I knew. So I was basically like, hey, yep, we need to extend one more day, you know. And then we just kept booking them based on who I could get in touch with. I was just on the phone constantly calling every company I knew, and they're kind of all in the, you know, they're either in San Francisco or they're in L.A. for most of them. Stephen, it's been such a pleasure having you on the show. Where can people find you? They can check out gamers nexus.net if they want the written adaptation of videos or the YouTube channel Gamers Nexus is where everything goes. And you can find me on the internet. You were listening to Better Offline, of course, following this will be an extremely old liner that I swear I'll update one day.

Thank you for listening. And Stephen, thank you for joining us. Thank you. Thank you for listening to Better Offline. The editor and composer of the Better Offline theme song is Mattersowski. You can check out more of his music and audio projects at Mattisowski.com. M-A-T-T-O-S-O-S-K-I.com. You can email me at E-Z at Better Offline.com or visit Better Offline.com to find more podcast links and, of course, my newsletter.

I also really recommend you go to chat. Where's Your Ed dot at to visit the Discord. and go to our slash better offline to check out our Reddit. Thank you so much for listening. Better Offline is a production of Cool Zone Media. For more from Cool Zone Media, visit our website, coolzonemedia.com, or check us out on the IHeartRadio app,

Apple Podcasts, or wherever you get your podcast. Another podcast from some SNL, late-night comedy guy, not quite. Unhumor me with Robert Smygel and friends. Me and hilarious guests from Bob Odenkirk to David Letterman help make you funnier. This week, my guest, S&L's Mikey Day and headwriter, Streeter Seidel, help an a cappella band with their between songs banter.

Where does your group perform? We do some retirement homes. Those people are starving for banter. Listen to humor me with Robert Smigel and friends on the IHeart Radio app, Apple Podcasts, or wherever you get your podcasts. Why are we all so obsessed with romance? On the Radio 831 podcast, join us, Sanjana Basker and Tyler McCall.

As we unpack all the trending tropes, fuzzy adaptations, book talk drama, and celebrity love stories with hot takes and sharp guests. Each episode digs into what these stories reveal about desire, fantasy, identity, and how we love now. Listen to the Radio 831 podcast on the IHeart Radio app, Apple Podcasts, or wherever you get your podcasts. I'm Joey Dardano, and on my new podcast, Hope from a Hypocrite, I'll be changing lives, helping people in need with thoughtful solutions. Sike, I'm a comedian. to give good advice. Join me and my comedian friends as we riff, rant,

recommend some of the most legally dubious advice known to me. This is Help from a Hypocrite, the worst advice from the dumbest people you know. Listen to Help from a Hypocrite Wednesdays on the Iheart radio app, Apple Podcasts, or wherever you get your podcasts. The story I've told myself can then shape my behavior, and that can lead me to sabotage the possibility of connection. This mental health awareness month, tune into the podcast Deeply Well with Debbie Brown.

If you've been searching for a soft place to land while doing the work to become whole, this podcast is for you. To hear more, listen to Deeply Well with Debbie Brown from the Black Effect Podcast Network on the Iheart radio app, Apple Podcasts, or wherever you get your podcast. This is an IHeart podcast. Guaranteed Human.