China’s decision to suspend exports of rare earth minerals highlights a significant national security vulnerability that cannot be addressed by executive power alone. Three decades ago, the United States dominated the global rare earth minerals market. However, it frittered away this power because the government bowed to a combination of globalist naivete and environmental absolutism. The U.S. can become self-sufficient in rare earth mineral production again, but to do so, Congress must work with the White House to make policy changes.
Despite their name, rare earth minerals aren’t very rare. The U.S. has plenty of them underground and mines more than 10% of the global supply. However, raw minerals need to go through a complicated refining process before they become industrial-grade materials used in everything from electric and gas-powered vehicles to jet engines, medical equipment, semiconductors, smartphones, and televisions.
As recently as 1990, the U.S. processed a third of the world’s refined rare earth mineral supply. Then China, aided by its misguided admission into the global trading community, aggressively entered the market and flooded the world with cheap refined products. It drove most American producers out of business. There was consensus in Washington, D.C., at the time that trade would liberalize China toward democracy and the rule of law, so there was no need to worry about becoming dependent on a hostile communist oligarchy.
It is now clear how wrong this was. There were warning signs. In 2010, China halted exports of rare earth minerals to Japan in an effort to press Tokyo to give up control of fishing waters between the two nations. China flooded global markets with cheap rare earth minerals whenever another country brought new production online, forcing competitors into bankruptcy before it cut production and raised prices once its monopoly was secured.
Because raw materials are cheap but require capital-intensive refining, China has a strategic stranglehold on the global market. Rare earth minerals are also essential to weapons systems such as the F-35 fighter jet, the Virginia-class submarine, Tomahawk missiles, smart bombs, and drones, so China’s monopoly is a national security problem.
President Donald Trump and former President Joe Biden recognized the need to build domestic capacity to produce rare earth minerals, but more needs to be done. Trump has issued executive orders streamlining permitting as much as possible, and Biden worked with Congress to create subsidies for processors.
But just as Democrats have discovered that tax credits, loan subsidies, and outright cash payments aren’t enough to ensure that rural broadband is built or electric vehicle charging stations are installed, they have also discovered that the federal permitting process makes it nearly impossible to build anything.
Biden and the Democrats exempted new semiconductor manufacturing plants from burdensome permitting requirements under the National Environmental Policy Act, but they did not do the same for rare earth mineral production. Trump should work with Congress to repeal NEPA entirely, but even if that cannot be done, rare earth minerals should be added to the list of projects immune from NEPA costs and delays.
TRUMP IS FAILING TO PROVIDE COHERENT LEADERSHIP ON TARIFFS
Processing is dirty, and new plants will need to be regulated. However, the Clean Air and Clean Water acts can do that. NEPA does not protect anyone from harmful pollutants. It is purely a procedural tool used to delay and block development. Pollutant management has always been done through the two acts, and no one has advocated their repeal.
We can make rare earth mineral production great again here in the U.S. We just need to summon the political will to make it happen.