S2 E68: The Future of Rare Earth Elements: Insights from Jack Lifton

Dustin Olsen (00:40)
Hey everyone, welcome to the Rare Earth Exchanges podcast. I'm your host Dustin, joined by my co-host Daniel. And today our special guest is Jack Lifton. Jack has been probably an icon in the rare earth industry and is the co-chair of the Critical Minerals Institute, a globally recognized authority on rare earth elements and technology metals. And who coined the term technology metals at the turn of the century.

Daniel O'Connor (00:50)
Okay.

Dustin Olsen (01:06)
with over 60 years of experience spanning OEM automotive, rare metal processing, government advisory, and reputation for blunt commentary throughout the internet. Jack, you've been working in this industry since 1962. And before the show started, you were telling us the reason you got started is because your dad told you you needed a job and you wanted a car. So.

Daniel O'Connor (01:12)
.

Dustin Olsen (01:32)
If you could unpack some more of that, how you got started, why you were drawn to this space. And also like you've seen a lot of crises happen in your career. So tell us a little bit more.

Jack Lifton (01:43)
happened to me was I was 18 in 1958. I believe it was 57 or 58 when the Russians launched the Sputnik. This was a huge shock to the American psyche, which was that no one else could ever outdo us. As an aside, I'll tell you that when the cameras were off,

people would say, damn, our German scientists are better than their German scientists. What's going on? So the point is, I went to high school in Detroit called Cass Technical High School. I three years of chemistry, three years of math, things like that. my generation,

Everyone was going to be a doctor except me. I didn't like the sight of blood. So I got interested in chemistry. Then when Sputnik hit, everyone went into engineering and science. That was the world we lived in. Our fathers had fought in World War II. We didn't know anything about virtual signaling or any of that nonsense.

We just knew that to maintain America's position in the world, we had to always be ahead of the other guy. In those days, that was the Soviet Union. So I decided to go into chemistry. As my studies went on, I got very interested in metallurgy. So when I was in graduate school,

I got a job with an inventor in Detroit.

far out. His name was Stan Obshinsky and he is, if anybody ever looked it up, Stan had the second highest number of patents after Thomas Edison. He was in electronics, that's what he was doing. So he devised various switches and

So he hired me because in those days I was going to school full time and working full time and sleeping the balance of the time. So he didn't care what my hours were as long as I did the job. And so that was a wonderful opportunity. And one of the things I remember he said, we

going to dope semiconductors. And to do that you needed ultra high purity material. Well, we looked at all the plus three valence elements. That included the rare earths. The California crowd, had never bothered with this. They were doping their silicon with arsenic and things like that and phosphorus.

And so Stan decided we should look at all the plus three elements. Since he never, the most education he had was the eighth grade. So I was sort of the interpreter. And I would explain to him what he was talking about. But I didn't know that much either. I.

One of the things I chose in 1962 was dysprosium. Now, dysprosium had only been available in small quantities from Fisher Scientific for two years at that point. So nobody had looked at it, and that's what Stan liked, things that nobody else had looked at. Well, the problem was you got this cardy stuff in a glass bottle, and we needed high purity, so I…

became a specialist in producing ultra-high-purity materials to build ultra-high-purity silicon. I learned quite a bit because there was no teacher, had to do it on my own. And I purified gallium, tellurium, dysprosium, things like that. And it was wonderful because cost was not an object. When I told the management to do this, I need a very expensive machine.

and they'd say, okay, when can you get it? And I said, it's in England. And he said, we'll fly it over. And I said, it weighs a ton. And the answer was, so? So anyway, we got all the machines, and lo and behold, in 1963 or four, I made the first solid-state memory cell ever. And about…

Daniel O'Connor (05:32)
you

Jack Lifton (05:42)
40 years later, became, I think Sanyo, or I believe, started marketing this stuff. And so I called Stan, who was then in his 80s or so, and I said, the memory cell, somebody's finally commercialized it. He said, yeah, how long did it take? I said, hmm.

45 years he said, that's about how long it takes a genius to get something done. That's the end of my old man's So I've been working with rare earth chemistry for more than 60 years.

Daniel O'Connor (06:13)
Which is amazing, Jack, and as we've gotten to know you more, ⁓ you're a treasure trove of knowledge, an American treasure trove of knowledge, which brings me to a topic that's important. We're right now in the middle of a resurgence of industrial policy in the United States. Several billion dollars has been allocated in various forms, loans, LOIs, what have you.

Involving the federal government to various mind and magnet projects. Okay now But we see challenges we write about them we have more and more investors subscribing to learn about you know, what some of these challenges are as You see it, you know this theme of can money can money Buy our way out of this crisis. Can we can we talk about that? I think it's a very important topic

Jack Lifton (07:03)
I think the answer is no. Because the problem in the United States today is that we don't seem to have any technologically educated people in our federal government.

seemed to depend on the advice of bureaucrats. And some of them have multiple PhDs and all this stuff. And then as they would tell me, what was then called the Department of Defense when I was an advisor, they'd say, if we don't have anybody in the Pentagon, then we will simply go to the academic world for experts. And my answer was, here's a metric you guys ought to use. You ought to put a nail salon in the Pentagon.

and asked the nail specialist, any of these guys have dirt under their fingernails? Have they ever had dirt under their fingernails? Now they thought I was crazy, you know, I always talk like that. The fact is, none of their experts had ever been involved in industry. Okay, so they were strictly, even the bureaucrats in the Pentagon, they are, they're simply,

advisors you know based on academic training and and none of them has ever been a well they might have a geologist but none of them has ever produced built a mine or separate or a processing plant and I'm I'm getting

I'm amused now at my age by listening to people talk about supply chains when they have no idea what they're talking about. And I tell them…

The supply chain for hairpins is quite different from the supply chain for nuclear reactors, which is quite different from the supply chain for germanium, which is quite different from the supply chain for gallium. What are you talking about? Well, you you dig a hole in the ground and then you wind up with whatever gallium is. I no, no, that's really not how it works. And what intrigues me is the financialization of the U.S.

government is now complete. The only people they listen to are financial advisors. There's nobody that I can see in the federal government who has a background and experience. I don't mean any disrespect, but

you know, I don't even go to a doctor who isn't at least 50 years old. But I'm listening to government experts who are basically teenagers to me. mean, maybe they're 35 and they've had their PhD for five years and you know, I mean, this is ridiculous. And if any of you have ever bothered to read the Defense Production Act, I know it's boring, but there's something in it you need to know. Forget Title III, which is we print money and give it to you.

Title III. There's Title VII, which says the President shall convene a group of industrialists to work with them on the project. before the United States entered World War II, Franklin Roosevelt called in the Detroit automakers, the presidents of them. That included Edsel Ford at the time. And he said, can you guys make tanks and planes and guns?

Yeah, okay, sure. And Nutsen, the president of General Motors, said, there's this one question, Mr. President. How many do you need? When? And how do we get paid? And the president said, you'll have a draft on the United States Treasury and any bank will honor that. That was then, of course. Now I don't know. But the thing is…

Daniel O'Connor (10:28)
Huh.

Jack Lifton (10:31)
they made more planes, tanks, machine guns, naval rifles, cannons, than all of the Axis powers put together times two. So, that was then. And, I'll just give you an example of how America's changed. When I was 16,

They had a Jefferson Jackson Day dinner in Detroit. That was a Democrat party thing. And I was in Detroit. You were a Democrat or you weren't in Detroit in those days. The OEW. Okay. So I was a page, you know, this thing. And afterwards, John Foster Dulles sat down with us to talk. Okay. And the guy was brilliant. mean,

Dustin Olsen (10:55)
you

Jack Lifton (11:07)
sitting on the steps and smoke his cigarette, you know, and just talking to the boys and it was inspiring, okay. Now, fast forward, what is it, 60 years, 70 years? Do you have people like that anymore? Do you know that we had people like the Secretary of State in the Eisenhower administration?

His uncle was the Secretary of State in the Woodrow Wilson administration and his grandfather was Gover Cleveland's Secretary of State. Now, I'm not knocking the current Secretary of State too much, what's his background? Okay, I mean, these guys were statesmen. They were interested in the country, not in how much money they could make from manipulating the federal government. Okay.

That's your problem. It's all about money. Or should it not about…

Daniel O'Connor (11:50)
So,

yes, the financialization paradigm seems to be driving the driving force. Now, if we dial that back, and that probably was not the case in the 60s, okay, or 50s. Now, if we step back for a minute, practically there is a knowledge gap.

And so, you know, if you take rare, whether it's the mining or the separation, refining, we do not have, we hear from multiple people and we're looking at trying to constantly talk about industrial policy that develops knowledge and talent and having industry involved. You want to talk about why if that talent isn't there, we can't build mine to magnet operations at scale that are profitable.

Jack Lifton (12:39)
Well, in the western world, in United States, Canada, Australia, Africa, we're pretty good at mining. In fact, we have the cleanest, most efficient mining in the world because our governments don't allow us to create toxic tailings and kill people with no health and safety.

The problem is that what we gave away was all of the other steps. We know how to produce ore and if it's gold, silver, copper, iron, we're real good at that. We've been doing that for a long time. I'm talking the entire Western world. But the problem is that once we got into technology metals,

They are scarce and they're almost always companion metals. I only know of two primary rare earth mines on this planet. One is in California, Riverside Mountain Path. That's a Vastocite mine, that's an ore of the rare earth. The other one's in Australia, it's called Mount Weld, it's a Montocite mine. These two mines are the only ones in the world.

that are mined directly for rare earths. All other rare earths are produced as byproducts because they present in relatively low grades. The problem here is that it's very expensive to produce these rare earths, for example. Very expensive. requires a great deal of time. I think what people don't realize is that if I build

Let's say I mine red roots at Mountain Pass, California. And then I concentrate the ore, because it starts out, I think that stuff is eight or nine percent, okay, of the…

Well, they concentrate it to about 60 to 70 percent. Now that goes into the supply chain. And the first thing is you have to extract the rare earths from that material and get rid of everything else that isn't a rare earth.

Then you chemically tweet it so that you can set aside most of the rarest that have little value. And then that goes into what's called the solvent extraction circuit, a separation system, which was developed around 50 years ago. And after that, you wind up…

some more chemical processing, you wind up with an oxide. You convert that oxide to a fluoride. That fluoride is used to make the rare earth metal and alloys. And those alloys are then processed into particular shapes and they're made into magnets, for example. Okay? Now…

I don't know. think I just described six steps. Now here's the problem. At the present time, all we do in America is we have the separation. We have no commercial metal or alloy making. And we have

no commercial magnet making at this point. We have people that are making some magnets, they're just trial runs and samples. And then the most important thing that the government seems to not know is that to qualify your magnet for use…

an electric motor for use in a car, a wind turbine, a vacuum cleaner, a hand dryer in the bathroom, that kind of thing. It's easy to get Dyson to approve you for the bathroom hand dryer, but guess what happens at General Motors and at the military?

Those magnets as motor in motors have to be qualified for three years and more or thousands of hours of operation and it's very simple to understand what what goes on in industry you buy a car it says The powertrain is guaranteed for how many years six something like that. Okay, let's say it's an electric car I'll tell you let's they'll say six years. I'll be wrong. Okay, that means that electric motor

has to run for six years. Okay, and guess what the car companies do? They test, they buy motors from their suppliers and they test them for six years. Okay, now I was lucky when I was not a motor supplier. I supplied things that only took three years to approve. And guess what happens in 35 months when something fails? You start all over again. Okay, so these people think, well, we're gonna make these motors

And that's it. That's all it takes. Well what happens if you back the car to the garage and it stops because the motor failed? So the car companies don't like that. And so they require that you be qualified. Now let's say, I don't know if either one of you is a brain surgeon, but maybe you are. The thing is…

If I get you, let's say you're, maybe you're a thoracic surgeon, you're not a brain surgeon. So I get you a book on brain surgery and I say, read this over the weekend and then you can take my brain out on Monday. That's how I see the government operating. It is extremely complicated to make magnets to a specification. And here is the little problem. Nobody wants one magnet.

think that the average person thinks that the magnet, the rare permanent magnet in an electric motor is a bar. No it isn't. Okay. It's six or eight cubes.

which are stuck together with resin, okay? And then there's six of those around in the motor. So there's 36 individual magnets, 36, okay? Now, a million cars with one electric motor, 36 million identical magnets. Now.

I don't know about you gentlemen, but I've been in industry and I can tell you that like at General Motors, they would accept 1 to 2 percent failure in parts. I mean they were tested before they were put on the car. I was also supplying Daimler in Germany and their test was one part per million. You may notice their cars are better than ours.

is it was extremely hard to become a supplier. And once you did, you had to work to keep at it. And then, of course, the bottom line was…

they would say to you, won't pay your rate, we want it for 10 cents cheaper. That's my margin. Well, that's too bad because the guy across the street's got the same thing, you blah, blah, blah. Okay, so this is called business. None of this seems to affect the Pentagon because the Pentagon doesn't care about price.

Daniel O'Connor (19:10)
You

Jack Lifton (19:15)
They only care about capacity. They need so many units of something for their systems integrator, otherwise known as an aircraft or tank builder. And they do that. Okay. Now, in consumer industry, it's much tougher because there's this thing called price that determines whether they're going to buy from you. I mean, your product's got to work. That's given. Okay.

Daniel O'Connor (19:25)
Right.

Jack Lifton (19:40)
Nobody's paying attention to this because building a mine is extremely expensive. If you had to rebuild Mountain Pass today, you're looking at $500 million to $1 billion to get it into operation. They've already spent that. That's done.

So now we need, and I'm going to throw into that the part of the supply chain where the material is extracted and concentrated in mining that's called beneficiation. So now I need a separation plant. Well guess what? Mollicorp, the predecessor of MP, spent over a billion dollars building a separation plant that didn't work.

And they went bankrupt before they could actually fix it. So in the United States, I know of two separation plants that have been built in the last 25 years. Actually, they've both been built in the last three four years. And the problem is both of those companies don't have any feedstock.

But they're planning, one is a mining company, one is a military contractor. And they're planning to get feedstock. Next step. What comes out of the solvent extraction system cannot be made into metal until it's transformed into a chemical called fluoride. Now, in the United States,

Daniel O'Connor (20:55)
Jack, to interrupt

you. Just scientifically, is that? Why do you have to convert the oxide to fluoride to then metallize it? Why is that? I wasn't sure why that is.

Jack Lifton (21:07)
The procedure used to make rare earth metals and alloys is called molten salt electrolysis. What you do is you make a bath, liquid bath, of lithium fluoride, neodymium fluoride, fluorides, okay? Because it's turned out they have the lowest melting point and it's most efficient. Then you drop a graphite or…

an electrode in there and you electrolyze it. Well, it's molten. It's molten, you know, this is 1,100 degrees. Okay. So the metal forms on the electrode and if the bath is hot enough, it drops to the bottom and you tap it. I'm sure that somebody working with a Bessemer converter in 1870 would have understood immediately what's going on in this plant. Okay. Well, go a little further because the copper is produced this way. So…

The problem is that a great deal of time and effort has been spent on trying to determine the ideal composition of that molten salt bath. The best is lithium fluoride and rare-rhodes fluorides. Now, here's the problem. If you use a carbon electrode, a very high purity carbon,

you have a little problem because the byproducts are carbon tetrafluoride.

and HF and sometimes even F2. So these are extremely corrosive and toxic materials and so health and safety costs are just as big as the cost of the equipment. Now, you're saying why do they do that? Well, actually that's the most recent development. Prior to that it was done literally by using

what was called metalothermic reduction. So you would take the oxide of a rare earth, mix it with calcium, magnesium, or lithium, something like that, and then you'd cook it in a furnace, and you'd have a reaction, and you'd form the rare earth metal, and the calcium, magnesium, or lithium oxide, okay? And then you would distill that metal, and you have metal, okay?

And so you're saying why do they do that? Because that's that is up until now the traditional way, the legacy method of doing it. The Chinese produce hundreds of thousands.

Now, the interesting thing, no one in the United States is doing this today. No one. So that means, and I tell people the following. I say, okay, so you have now done the solvent extraction separation of the words into individual high purity chlorides, and now you've made oxides, okay, or carbonate, no, oxides, let's say.

Daniel O'Connor (23:23)
Right.

Jack Lifton (23:43)
Now the oxide has to be made into a fluoride. I only know of two companies in the United States that can do that, and that is not their business when a client of mine produced those oxides.

The company that makes the fluoride said, take about four months. And I said, why? They said, because it's a small batch. That's not what we do for living. We'll get it done. You want it to go first before for our other customers, you'll pay double. So you wait a few months. Okay. Now, the fluoride, I don't want to bore you guys, but you have to be concerned about the high growth scop pit.

whether or not the fluoride absorbs water from the air because if it does you can't use it so you have to keep it dry okay so now in america we have a group in one of our universities which has developed a way of using chlorides not fluorides we're chlorides okay in the same process uses like by the way the biggest cost of making the metals is electricity that is overwhelming the biggest cost

Daniel O'Connor (24:28)
Mm-hmm.

Wow.

Jack Lifton (24:49)
The chloride group in one of our universities, they've been able to do it with chloride to use a lot less electricity. And then the exhaust gas is only HCl, maybe some chlorine, carbon tetrachloride, you know. But the problem is health and safety. Okay, now let's say I've got the metal and I can make the alloy in a similar way in a specialized molten salt bath, okay? Some of the alloy.

Not all the rare earth metals can be done this way. Two of them, samarium and terbium, cannot be done in molten solid electrode. They have to be done by metal or thermic reduction. So your plant needs a separate system for that. Okay, now I've made the metals and alloys. So now I have to go through about a six-step process to prepare a blank, which is going to become a magnet.

All these steps have to be done. That's the supply chain for the magnet. So there's many, many steps.

They're specialized. The fellows who do the molten salt electrolysis probably aren't very good miners. The guys who run the solvent extraction plants know nothing about mining. They're chemical engineers. The guys who make the magnets don't care about anything except getting the blocks in the right shape and composition. We talk about this as if it's one thing. You have people who are saying, we're going to build a mine to magnet company. Wow.

That's going to take a long time.

Daniel O'Connor (26:10)
Well,

that, and if I may, that's a good transition to the topic of quote unquote wish factories. So remember a big audience of rare earth exchanges are investors and many retail investors want to know more about this. They want to understand what the risks are, what the real risks are. So if we look at this talent gap, we're learning how to do this again.

Jack Lifton (26:17)
Yeah, yeah.

Daniel O'Connor (26:35)
Sure, there are some experts out there yourself, but we have to learn how to be industrial again. The concept of a wish factory, does that mean that a company that's got financial backing will announce their intentions, but actually executing all of these steps, the division of labor, the human capital, it's going to be a lot more.

costly and time consuming than perhaps the plan says.

Jack Lifton (27:02)
⁓ it's going to be multiples of the time they say because we don't have people who have been sitting around, you know, just watching television and have to be experts at making magnets. We don't have people who have done molten salt electrolysis. Okay?

I'm going to get criticized that because we make a lot of metals by molten salt electrolysis other than rare earths but rare earth metal is really a challenge. So we haven't done that. 25 and 30 years ago our industrialists in America said you know what the focus of the entire world is money. If I have more money than you I'm better than you. So we can get all this stuff cheaper made in China.

Thailand, know, places like that. And so what? So they shipped all, they shut down the American processing industry and shipped it to, well, it was originally bought by a Canadian group, which then immediately sold it to a Chinese group. Okay? So the Chinese had already mastered mining.

and separation by the year 2000. Now they were making magnets and alloys, but now the US shut down, Europe shut down, all of it was shipped there to make more profit. And what they forgot was we don't know any way to store people cryogenically. So the guys who were 50 years old in 2000 are now approaching 80.

And they're just not interested in showing and going back to try and build a where of permanent magnet industry. And the problem is, if you've ever thought about engineering.

When you graduate university, I don't care how many degrees you have, you get a job in an engineering company, chemical engineering, electronic engineering, okay. And the first thing that happens is they assign a senior engineer to you. And he tells you, that book you brought in, Sonny, throw it in the trash pile. He said, I'm gonna show you how things are made and how they work. And you find out that that's true, okay. So guess what?

There's nobody left in the United States to teach people how to make rare metals, alloys, and magnets. Everybody is… cemetery assisted care or walking the street trying to remember their name. Okay?

Daniel O'Connor (29:24)
Yes, and Jack, this is a very important point and we're about pragmatic solutions for America. America has to become resilient again, okay? So does Europe, you know, and nothing against China. They've just done what they did for what's good for them. We have to, so, and I know we're getting close to us and towards the end, but the point is there is a knowledge gap. Jack, you know, if the White House called you in tomorrow,

and maybe they will after this podcast, and said, you know, Mr. Lifton, we're going to get real serious about this now. You know, we've put money, we've circulated money around, we've got projects, but we've got to go to this next level. What would be the biggest or the most important recommendation you would make to the White House?

Jack Lifton (30:06)
that they create a system whereby they select students and pay their way all the way through school to get degrees in these specialties. The reason they won't talk to me, they don't want to hear about it, is because it will take a decade at least. Now, the Chinese are quite smart.

Okay, because looking upon them as capitalists, not military enemies, here's what they said.

What are the Americans, what don't they have? And the answer is people. They don't have the skills. Okay? Now, I've got news for you. Until two years ago, what you did, if you wanted to get into these, you hired Chinese engineers. They would come over to the United States and they'd show you what to do. Okay. That's now forbidden by the Chinese government. Absolutely you can't do it. And even worse than that, because we've got smart engineers here too.

Daniel O'Connor (31:00)
Yeah.

Jack Lifton (31:09)
They will not allow the export of the machinery or equipment used to make any aspect of a rare earth enabled product. that's no, no, again, I'm not going to name names, but if you ask yourself, how come nobody's building magnet plants in the West? Well, guess what? They can't get the equipment.

And I'll tell you here's a freebie if you think Brazil is going to be a supplier anytime soon They can't get the equipment either okay, and even if they could get the equipment you need the people that know how to you know if you buy a complex industrial machine Do you do you honestly think that it it shows up in a box and your workers take it apart? And they plug it in it works the company selling you the machine sends technicians for I

remember the Japanese companies, technicians for robots for the automotive industry, those technicians stayed here for two years. Okay, so.

Daniel O'Connor (31:59)
Yeah, yeah, of course.

Jack Lifton (32:07)
You can buy the machine, maybe, and some of these companies have gotten some of them, but you have to put them into operation efficiently. What nobody seems to want to talk about, I always say to people, they tell me, I'm going to do this. I that's great. My question to you is, I want to buy a kilogram of neodymium metal from you when you're done making it. How much is that going to be? Well, we don't know.

I'm supposed to plan my production based on you don't know? Okay, so there's a lack of knowledge of how business runs. It's amazing because the current administration of Washington is loaded with extremely successful industrialists, I think. Okay, and the problem is they know better than to just throw money at people with wish factories.

Okay, so why are they, I don't want to speculate. Why are they throwing so much money at these people?

Daniel O'Connor (33:01)
Well, I think that there's any number of reasons, but culturally, we have become, and this is across the board, an instant gratification entertainment spectacle society. So we're going to go do something, we're going to make lots of announcements, we're going to throw money around, people are going to make money along the way. But this is a deadly serious matter. So whether it's…

the semiconductor supply chain or, you know, center rare earth magnets or other, other, you know, there's other critical minerals that are a real problem. You know, pharmaceuticals, pharmaceuticals Jack are a problem. So look, Dustin, I know we're getting close to the end. Do you want to maybe, this is a very important discussion with a legend in this industry. So please let's figure out how we can help Jack help the government.

Dustin Olsen (33:53)
Yeah, so just some quick commentary from what's been said already. And here on the show, we talk a lot about there's a time constraint, there's a resource constraint. And I think, Jack, you've echoed that more than well enough than we probably ever could have. I think the one perspective you shared is the supply chain and how products need to be tested for years on end before they're even accepted into.

the end product, whether it's an electric vehicle or a military defense application. And that's a huge deal in and of itself, not even to mention the time it takes to train somebody to even know what to do to even to get that far. And so, yeah, to Daniel's point, like, how can we broadcast this a little bit louder to the government and others who

are frankly wishful thinking, you know, that they can meet deadlines and provide all this stuff that probably won't even happen for another five years.

Jack Lifton (34:52)
If that, you know.

I'm just making this up. Why don't you call Elon Musk and say to him, we'd like to start a scholarship fund for STEM education focused on birth, permanent pregnancy. Okay? And we'd like $100 million and we will need to get people to select the students and then in five or 10 years we will have a flow of people. Now, I'm not a child psychologist so I don't know how you convince young Americans

to actually get interested in things that are difficult to do. One of the things is that chemical engineering is very mathematical.

And so everybody jokes about, the comedians on television say, I flunked third grade math, but they let me go. OK, that is not funny. in order to become an engineer or a scientist, you have to have very strong background in mathematics. Because in rare earth separation, for example,

There are, it's quite complicated and you need to understand it before you start. The point is this, the bottom line is you can't do it overnight. You know the Chinese mimic the Soviets with five year plans. say at the end of five years we're going to be doing this and that. But what we don't notice, they also have generational plans. I'll tell you how that works. Excuse me. What they do.

What they do is they say that by 2049, China will be the richest nation in the world. That's their plan. By the end of this, the next five year plan, I think it ends in 2029 or 30, they will be independent of the world in 10 technologies, including semiconductors.

That's their plan. And they focus on it. As you know, they have a national selection system where each year 18-year-olds take very difficult tests. And the top ones of them used to go to MIT, Caltech, Oxford, Cambridge, Servant. Now they go to Chinese universities whose professors were trained at the

Western

universities I just mentioned. They are so far ahead of us in being organized to do this. They want to become a modern, well they're the world's biggest manufacturing economy at this point, but they want to be the world's greatest industrial.

They want to be on top in all the high tech stuff. And guess what? They will do that. And who is going to surpassed? Us. Because we're not, what are we doing? Okay? Our universities aren't concerned about this.

And I don't know what they're concerned about. Washington is on the wrong track. We need to have a massive education, STEM education movement in this country if we're ever going to catch up and go even again with the Chinese and these technologies. I don't see it happening.

Daniel O'Connor (38:03)
You know, Jack, you know, just

for comparison, and that's really good point you make, at the end of World War II, the United States emerged really as the superpower. I mean, there was the Soviet Union, but about 40 % of the world's manufacturing happened in the United States, within the borders of the United States. Today, China is approaching 40 % of the world's production, maybe between 30 and 40.

You know, we have to really look at that seriously. You know, I think we've gone over, know, Jack, I just have to say, you know, we're very grateful for everything that you contribute. You know, we have to say, we speak with people all over the world. They come to Rare Earth Exchanges. I mentioned that one African country where we're working with a group that represents about 500 miners and Rare Earth, and they want to do business outside of the Congo.

out of DRC. who did they mention as someone they read? Every article is jack-lifting. So you're well known around the world and we're very grateful that you contribute your time and your brain power to helping to solve this problem. Dustin.

Dustin Olsen (39:13)
Yes, and Jack, think it would merit maybe a part two episode to kind of keep the conversation going with six decades of watching governments, companies and investors kind of get rehearsed a little bit wrong or a lot wrong. It would be great to have you back. And we could not be more excited and grateful to you to have you here on the show today to share your perspective.

Jack Lifton (39:36)
me close this.

Daniel O'Connor (39:37)
And

Dustin, sorry Jack, before we close, should also, Dustin, ⁓ share Jack's website if people want to get in touch with him.

Dustin Olsen (39:44)
Yes. Jack, can people find you?

Jack Lifton (39:45)
Cool.

Well, either at the Critical Minerals Institute or jacklifton at gmail dot com. don't have works on it. But I just wanted to tell you that the nations of the world, the developing nations, after World War II, what they asked us to do, because we were the only remaining wealthy power.

Dustin Olsen (39:53)
Perfect.

Jack Lifton (40:09)
was to help them industrialize. What they wanted was to stop being natural resource providers. They wanted to use those, add value to the resources in their own countries and make cars and things like that. One, import substitution, stop importing from the Westerners and make it themselves. Second, maybe even export. They would still sell natural resources.

This is completely ignored in Washington.

These people in Washington today think that it's the obligation of Africa, Asia, South America to provide us with the natural resources we need to fight them evil communists. And they couldn't be more wrong because the Chinese have basically done what the third world nations of 1946 asked. They come in, they build railroads, schools, they teach people. Now, they of course are

Chinese were capitalist 2000 years ago, they'll be capitalist 2000 years from now. They call themselves communists, that's a momentary thing. So the point is, they figured out what we did wrong when we were focused on the Soviet Union as the great enemy. And they have gone in all over the world and said to these countries, these global south countries,

Yes, we want your natural resources, but…

would you know will build a battery factory in your country using your lithium like chili okay and then we're going to export a lot of those batteries you pay us for doing this we'll export a lot of those batteries to China for our own companies and by the way we'd like to bring our Chinese electric cars into your country and we can use batteries made here okay for those cars and and also in Brazil we'll build

car factories. Brazil has 200 million people. Okay? Now what do Americans do? None of this. Our companies have withdrawn from them. When I was working in automotive, GM, Ford, Chrysler had plants all over the world. I traveled the world to those plants. Okay? All gone. And they're making their cars in China. Proposition approved.

Daniel O'Connor (42:23)
Yeah, yeah, no, it's some things have to change.

Dustin Olsen (42:26)
Absolutely. Jack, thanks for being here. And we'll definitely get you on in a future episode so we can get more perspective, keep the conversation going. I think there's a lot more to unpack in terms of how we move forward from here. But today's been great in just describing how we got here. So yeah, we'll see you here on the show again soon.

Jack Lifton (42:46)
Thank you. Thanks.

Daniel O'Connor (42:47)
Thanks, Jack.