Ho-Ho-NO! Xi Just Found Another Way to Ruin Your Christmas Shopping

AP Photo/Los Angeles Times, Jay L. Clendenin, Pool

“Scared” Chinese manufacturers of Western electronics components are being starved of electricity by their own government, causing some to consider leaving the country — and putting a real pinch on this year’s Christmas shopping.


It was just over two weeks ago that I reported for our VIP supporters that supply chain disruptions “might lead to some empty stockings this Christmas.”

There’s a month’s backlog of ships to unload at the Port of Los Angeles as supply chains struggle to work out the kinks caused first by the collapse in consumer demand during the shutdown, and then by the surge in consumer demand when the shutdowns ended and Washington shoved all that funny money into our bank accounts.

The chaos in transport hubs like Los Angeles, Chicago, and New York was probably inevitable once governments around the world decided — against good sense and science — to shut down the global economy in April of 2020.

The chaos in China, however, is deliberate.

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Beijing has been cracking down on energy use and production. Last month, the Communist government banned bitcoin mining, which can be done on souped-up personal computers but requires a lot of electricity. (They also banned the use of bitcoin, but I believe that was a purely political decision; can’t have the proles using their own currency in ways Xi Jinping can’t trace.)


But the power was cut — again, on purpose — to Chinese manufacturers, too, leading to fears of “shortages of global goods” this Christmas.

At the time, Chinese manufacturers had hoped the power cuts were temporary.

But Apple Insider reported on Friday that firms now get “weekly notifications of which days they will have no power,” making the cuts look permanent.

It must be nearly impossible for supply-chain management to work, even at a local level, when companies don’t know more than a week in advance which days they’ll be allowed to operate.

The growing chaos has some firms looking for the exit, according to Apple Insider:

“If you don’t bring as much value as, say, displays or high-end semiconductors but consume a lot of energy, sorry you are out!” said an executive in a company that provides Apple with printed circuit boards. “It’s better that you just shut down and move away.”

Left unsaid: What use are high-margin semiconductors without low-margin circuit boards to plug them into?

And it probably doesn’t need to be said that adding production woes on top of already snarled logistics in Los Angeles and elsewhere can mean only one thing: Whip out that Christmas shopping credit card right now because things are only going to get worse.


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“It is very chaotic and confusing,” one executive told Nikkei Asia. “Some suppliers managed to secure power supplies based on their friendly relations and negotiations with the local governments, while some were affected badly.”

“Pay to plug-and-play” seems to be the official policy now.

If there’s a method to the madness, it might be the madness itself.

An iPhone supplier who preferred to remain anonymous told Nikkei, “From Jack Ma [the Alibaba billionaire who has disappeared after being a nuisance to Xi] to the crackdowns on gaming and education … these all suggest increasing uncertainty for enterprises operating in China. People are scared.”

My first thought on reading these stories was that perhaps local Chinese governments were using Beijing’s mandated power cuts — ostensibly about reducing pollution — as a way to extort money out of Western and Japanese firms like Apple, Sony, and Samsung.

And, given what you just read about how political pull and favoritism can get the power turned back on, maybe extortion is the name of the game.


But only at the local level.

Nationally, it might be that Xi is using the very madness he’s unleashed in the same way his spiritual and political predecessor Mao Zedong used the madness of his so-called “Cultural Revolution” to cement Communist Party control over every aspect of Chinese life.

That control loosened a bit after Mao’s death and Deng’s economic reforms.

Xi, however, has been on a mission to reduce or destroy any potential rivals to the Chinese Communist Party and to secure his position at the very top of it.

If doing so risks ruining Christmas for American shoppers, I can’t think of anything that would put a bigger smile on the face of Beijing’s own Grinch.


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