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Format: Layer, Start, End, Style, Name, MarginL, MarginR, MarginV, Effect, Text
Dialogue: 0,0:00:00.16,0:00:04.24,Default,,0000,0000,0000,,President Trump's promised\Ntariffs on steel and aluminum imports have
Dialogue: 0,0:00:04.24,0:00:09.27,Default,,0000,0000,0000,,drawn mixed reaction from political leaders,\Nincluding pushback from top congressional
Dialogue: 0,0:00:09.27,0:00:10.69,Default,,0000,0000,0000,,Republicans.
Dialogue: 0,0:00:10.69,0:00:12.88,Default,,0000,0000,0000,,American businesses are also divided.
Dialogue: 0,0:00:12.88,0:00:17.38,Default,,0000,0000,0000,,Hari Sreenivasan spoke to one business owner\Nabout how the tariffs might affect his company.
Dialogue: 0,0:00:17.83,0:00:20.83,Default,,0000,0000,0000,,Paul Czachor is CEO of the\NAmerican Keg Company.
Dialogue: 0,0:00:21.62,0:00:25.79,Default,,0000,0000,0000,,It's the only domestic manufacturer of steel\Nkegs in the country.
Dialogue: 0,0:00:25.79,0:00:26.82,Default,,0000,0000,0000,,Thanks for joining us.
Dialogue: 0,0:00:26.82,0:00:30.98,Default,,0000,0000,0000,,First, we hear the president is about to sign\Noff on these tariffs as early as tomorrow
Dialogue: 0,0:00:30.98,0:00:31.98,Default,,0000,0000,0000,,perhaps.
Dialogue: 0,0:00:31.98,0:00:32.98,Default,,0000,0000,0000,,Are you a fan of it?
Dialogue: 0,0:00:32.98,0:00:35.69,Default,,0000,0000,0000,,Hari, thanks for having me on.
Dialogue: 0,0:00:35.69,0:00:38.36,Default,,0000,0000,0000,,I would say that we are very concerned with\Nthe tariffs.
Dialogue: 0,0:00:38.36,0:00:43.48,Default,,0000,0000,0000,,I think, when we first started discussing\Nthis, we were cautiously optimistic.
Dialogue: 0,0:00:43.48,0:00:45.79,Default,,0000,0000,0000,,And now that's turned to a concern.
Dialogue: 0,0:00:45.79,0:00:47.72,Default,,0000,0000,0000,,HARI SREENIVASAN: How come?
Dialogue: 0,0:00:47.72,0:00:55.28,Default,,0000,0000,0000,,PAUL CZACHOR: Well, today, our domestic-made\Nkegs are priced higher than several imports,
Dialogue: 0,0:00:55.28,0:00:56.94,Default,,0000,0000,0000,,mainly from China.
Dialogue: 0,0:00:56.94,0:01:02.05,Default,,0000,0000,0000,,And if these tariffs go through, domestic\Nsteel will continue to increase in price,
Dialogue: 0,0:01:02.05,0:01:07.01,Default,,0000,0000,0000,,but all of the import kegs will still use\Nthe low-cost steel from offshore, and those
Dialogue: 0,0:01:07.01,0:01:09.41,Default,,0000,0000,0000,,prices will stay the same.
Dialogue: 0,0:01:09.41,0:01:13.19,Default,,0000,0000,0000,,Therefore, the delta will be even higher to\Npurchase an American-made keg.
Dialogue: 0,0:01:13.19,0:01:16.38,Default,,0000,0000,0000,,So, how do you live through that?
Dialogue: 0,0:01:16.38,0:01:18.91,Default,,0000,0000,0000,,Do you end up absorbing the cost to try to\Nride this out?
Dialogue: 0,0:01:18.91,0:01:21.23,Default,,0000,0000,0000,,PAUL CZACHOR: I don't think we could live\Nthrough that.
Dialogue: 0,0:01:21.23,0:01:23.53,Default,,0000,0000,0000,,I mean, the cost will be significant.
Dialogue: 0,0:01:23.53,0:01:29.65,Default,,0000,0000,0000,,If steel goes up by $25 -- or 25 percent,\Nthat's going to be a significant increase
Dialogue: 0,0:01:29.65,0:01:32.46,Default,,0000,0000,0000,,to a stainless steel keg that's made domestically.
Dialogue: 0,0:01:32.46,0:01:38.06,Default,,0000,0000,0000,,HARI SREENIVASAN: You know, the administration's\Ncore reasoning for is that it's been unfair
Dialogue: 0,0:01:38.06,0:01:40.74,Default,,0000,0000,0000,,for a long time, and we're just trying to\Nfix it.
Dialogue: 0,0:01:40.74,0:01:44.06,Default,,0000,0000,0000,,Have you felt that kind of pressure when you\Nhave been running this business?
Dialogue: 0,0:01:44.06,0:01:49.68,Default,,0000,0000,0000,,PAUL CZACHOR: I think what the administration\Nis trying to do is fix a problem in the steel
Dialogue: 0,0:01:49.68,0:01:54.56,Default,,0000,0000,0000,,and aluminum industry, and not to deep enough\N-- I don't have a deep enough understanding
Dialogue: 0,0:01:54.56,0:01:59.56,Default,,0000,0000,0000,,to tell you how I feel about that, but I'm\Nsure they're trying to fix a problem.
Dialogue: 0,0:01:59.56,0:02:05.68,Default,,0000,0000,0000,,But the concern we have is for the downstream\Nproducts, such as stainless steel beer kegs.
Dialogue: 0,0:02:05.68,0:02:07.53,Default,,0000,0000,0000,,That's not going to help any downstream products.
Dialogue: 0,0:02:07.53,0:02:11.52,Default,,0000,0000,0000,,As I said earlier, those import kegs will\Nstill come in using the low-cost steel.
Dialogue: 0,0:02:11.52,0:02:15.48,Default,,0000,0000,0000,,HARI SREENIVASAN: So what I'm hearing is,\Nis if this is bad for your business, what
Dialogue: 0,0:02:15.48,0:02:16.72,Default,,0000,0000,0000,,happens to your employees?
Dialogue: 0,0:02:16.72,0:02:21.21,Default,,0000,0000,0000,,PAUL CZACHOR: Well, unfortunately, if it's\N-- if it's the worst-case scenario that we're
Dialogue: 0,0:02:21.21,0:02:26.24,Default,,0000,0000,0000,,looking at, we would be forced to shut down,\Njust because we couldn't compete using high-priced
Dialogue: 0,0:02:26.24,0:02:27.24,Default,,0000,0000,0000,,domestic steel.
Dialogue: 0,0:02:27.24,0:02:33.39,Default,,0000,0000,0000,,You know, the hope from the administration\Nis, you know, it's got to be a multistep process,
Dialogue: 0,0:02:33.39,0:02:38.45,Default,,0000,0000,0000,,and, somehow, we have to address the downstream\Nproducts that are coming into this country
Dialogue: 0,0:02:38.45,0:02:39.49,Default,,0000,0000,0000,,with low-cost steel.
Dialogue: 0,0:02:39.49,0:02:43.09,Default,,0000,0000,0000,,I don't know how we can get that done, and\NI don't know if it can happen quickly enough.
Dialogue: 0,0:02:43.09,0:02:45.34,Default,,0000,0000,0000,,HARI SREENIVASAN: So, how -- I was going to\Nsay, how do you do that?
Dialogue: 0,0:02:45.34,0:02:49.01,Default,,0000,0000,0000,,I mean, that would mean all the different\Nproducts that are made with low-cost steel
Dialogue: 0,0:02:49.01,0:02:52.12,Default,,0000,0000,0000,,that come in that we are consuming right now.
Dialogue: 0,0:02:52.12,0:02:57.49,Default,,0000,0000,0000,,PAUL CZACHOR: We certainly will try to, you\Nknow, petition for some tariffs on stainless
Dialogue: 0,0:02:57.49,0:02:58.49,Default,,0000,0000,0000,,steel kegs.
Dialogue: 0,0:02:58.49,0:03:04.21,Default,,0000,0000,0000,,But, again, there are several industries that\Nuse steel for their domestic-made products.
Dialogue: 0,0:03:04.21,0:03:07.96,Default,,0000,0000,0000,,And I don't know how the administration will\Naddress the multiple industries that will
Dialogue: 0,0:03:07.96,0:03:09.34,Default,,0000,0000,0000,,be impacted with this.
Dialogue: 0,0:03:09.34,0:03:12.42,Default,,0000,0000,0000,,HARI SREENIVASAN: How many employees do you\Nhave now?
Dialogue: 0,0:03:12.42,0:03:15.87,Default,,0000,0000,0000,,PAUL CZACHOR: I have approximately 20 employees.
Dialogue: 0,0:03:15.87,0:03:21.26,Default,,0000,0000,0000,,And, unfortunately, we had to let approximately\N10 employees, so we're at -- let them go.
Dialogue: 0,0:03:21.26,0:03:23.54,Default,,0000,0000,0000,,We were at 30 employees a couple of weeks\Nago.
Dialogue: 0,0:03:23.54,0:03:28.43,Default,,0000,0000,0000,,But we're already starting to see the steel\Nprices domestically go up, and we're starting
Dialogue: 0,0:03:28.43,0:03:29.63,Default,,0000,0000,0000,,to lose some business already.
Dialogue: 0,0:03:29.63,0:03:32.95,Default,,0000,0000,0000,,HARI SREENIVASAN: So, you know, for somebody\Nwho doesn't understand this business, kind
Dialogue: 0,0:03:32.95,0:03:34.22,Default,,0000,0000,0000,,of break that down for us.
Dialogue: 0,0:03:34.22,0:03:39.46,Default,,0000,0000,0000,,How does the cost of steel going up into your\Nkegs impact your business so profoundly that
Dialogue: 0,0:03:39.46,0:03:40.84,Default,,0000,0000,0000,,you have to start making cuts?
Dialogue: 0,0:03:40.84,0:03:46.94,Default,,0000,0000,0000,,PAUL CZACHOR: Well, when we go out, our customers\N-- we have approximately -- in the U.S., there's
Dialogue: 0,0:03:46.94,0:03:52.51,Default,,0000,0000,0000,,approximately 7,000 craft brewers, wineries,\Nand cideries that will purchase those kegs.
Dialogue: 0,0:03:52.51,0:03:56.97,Default,,0000,0000,0000,,And when we talk with our customers, they're\Ncertainly willing to pay a small price -- or
Dialogue: 0,0:03:56.97,0:04:03.60,Default,,0000,0000,0000,,a higher price for an American-made keg with\NAmerican steel, American workers, et cetera.
Dialogue: 0,0:04:03.60,0:04:07.97,Default,,0000,0000,0000,,But that price, the delta, is continuing to\Ngo higher and higher.
Dialogue: 0,0:04:07.97,0:04:13.19,Default,,0000,0000,0000,,So, maybe at $5 a keg, a customer is willing\Nto do that to support American-made products.
Dialogue: 0,0:04:13.19,0:04:16.82,Default,,0000,0000,0000,,But at $15 or $20, they're not willing to\Ndo that.
Dialogue: 0,0:04:16.82,0:04:21.45,Default,,0000,0000,0000,,HARI SREENIVASAN: Paul, what I'm hearing is\Nthat these workers that you have are exactly
Dialogue: 0,0:04:21.45,0:04:27.21,Default,,0000,0000,0000,,who the administration wants to save and want\Nto see their lives improve, but you're describing
Dialogue: 0,0:04:27.21,0:04:29.19,Default,,0000,0000,0000,,a scenario where this is actually making it\Nworse.
Dialogue: 0,0:04:29.19,0:04:30.19,Default,,0000,0000,0000,,PAUL CZACHOR: Yes.
Dialogue: 0,0:04:30.19,0:04:34.98,Default,,0000,0000,0000,,And, you know, I believe the administration\Nwants to fix several items, but they're going
Dialogue: 0,0:04:34.98,0:04:38.70,Default,,0000,0000,0000,,to have to certainly look at the downstream\Nproducts, as I mentioned earlier.
Dialogue: 0,0:04:38.70,0:04:43.42,Default,,0000,0000,0000,,And I'm sure there's many industries similar\Nto us that use domestic steel where it's going
Dialogue: 0,0:04:43.42,0:04:47.84,Default,,0000,0000,0000,,to increase, and not by a trivial amount,\Nbut by a significant amount in the case of
Dialogue: 0,0:04:47.84,0:04:49.12,Default,,0000,0000,0000,,stainless steel kegs.
Dialogue: 0,0:04:49.12,0:04:51.47,Default,,0000,0000,0000,,HARI SREENIVASAN: How do you resolve this?
Dialogue: 0,0:04:51.47,0:04:52.49,Default,,0000,0000,0000,,What do you hope happens?
Dialogue: 0,0:04:52.49,0:04:56.68,Default,,0000,0000,0000,,PAUL CZACHOR: Well, I would hope that we'd\Nreconsider some of these tariffs, at least
Dialogue: 0,0:04:56.68,0:05:01.70,Default,,0000,0000,0000,,delay them, or look at the holistic view of,\Nhow do we fix some of the downstream issues?
Dialogue: 0,0:05:01.70,0:05:05.14,Default,,0000,0000,0000,,HARI SREENIVASAN: All right, Paul Czachor,\NCEO of the American Keg Company, thanks so
Dialogue: 0,0:05:05.14,0:05:06.14,Default,,0000,0000,0000,,much.
Dialogue: 0,0:05:06.14,0:05:07.57,Default,,0000,0000,0000,,PAUL CZACHOR: I appreciate it.
Dialogue: 0,0:05:07.57,0:05:07.82,Default,,0000,0000,0000,,Thank you.