Against the backdrop of both sides preparing for a protracted battle, Jeff Green, president of Washington, D.C.-based government relations firm J.A. Green & Company and member of the ARPN panel of issue experts, zeroes in on the potential ramifications of a looming REE supply cutoff on the U.S. defense industry and appropriate responses in a new piece for Defense News.
Green laments that supply chain experts for years warned about the “potential for China to cut off access to the critical materials in almost every major weapon system”– but their concerns were often “downplayed by free-trade theorists and policy makers who claimed that China would not take such aggressive action to upset the market.” Green argues that recent statements made by China’s state economic planner, the National Development and Reform Commission, or NDRC, suggest otherwise, and says that “the Chinese strategy is based on a harsh calculus:”
“Depriving only defense contractors of rare earth supplies will drive costs and production lead times up for the U.S. military and cause concern within the U.S. government, but it will not lead to widespread public discontent. Any student of Clausewitz can see the targeting of a particular center of gravity in the U.S. with this move. The strategy threatens U.S. military supplies rather than cheap consumer goods in what may be an attempt by China to force U.S. policymakers to abandon efforts to counter abusive Chinese trade practices in favor of addressing greater national security concerns.”
This, coupled with DoD beginning to query American contractors about their “ability to begin rebuilding pieces of the supply chain, including rare earth separation and magnet production” are “prudent and necessary,” says Green, who concludes:
“[T]here is more to be done, particularly in Congress, to defend against hostile foreign actions. Mine-permitting reform would help get U.S. supplies of critical minerals flowing again, and Alaska’s Republican Sen. Lisa Murkowski’s American Mineral Security Act and Nevada’s Republican Rep. Mark Amodei’s mine-permitting reform bill both provide strong momentum forward on that effort.
Pentagon programs such as the Defense Production Act Title III — which was responsible for the inquiries into rare earth separation and magnet production — and the Industrial Base Analysis and Sustainment are both good avenues through which the government can directly invest in promising American manufacturers. Congress now must provide them with adequate funding (…).
The U.S. needs to seriously address its critical materials vulnerabilities, which it has begun to do with recent reports. But reports can only show the way forward; it is now time for Congress to enact prudent policies and to provide the resources to finally blunt the rare earth and critical materials trade weapon once and for all.”
In a statement, Rubio explained that:
“[c]ontinued U.S. dependence on China for the mining and processing of rare earths and the manufacture of those metals into useful products is untenable,” because “[i]t threatens our national security, limits our economic productivity, and robs working-class Americans of future opportunities for dignified work.”
With the stakes so high, it is good to see that policy makers appear willing to move beyond the report stage.