Highlights
- The U.S. is losing the rare earth minerals competition with China due to a lack of integrated industrial policy and strategic approach.
- A comprehensive national strategy must cover the entire value chain from mining to production, with centralized leadership and regulatory reform.
- Developing domestic capabilities, education, and international partnerships are crucial to competing in the critical minerals race.
The United States can no longer afford to rely on market forces, current technologies, and the existing talent to compete in the rare earth and critical minerals race. China has cemented its monopoly by controlling mining and key processing and production stages through state-owned enterprises that play the long game. While U.S. ingenuity has driven innovation in the past, the current reality is stark: China doesn’t play by the same rules—and we’re losing.
A comprehensive industrial policy is the only way to level the playing field. Such a policy must cover the entire value chain, from mining and separation to processing, refining, and producing magnets and other strategic products. It’s not just about extraction; it’s about building an integrated ecosystem that can compete on quality, efficiency, and scale.
A radical overhaul of regulatory agencies is essential. Appointing a critical mineral Czar with the authority to cut through bureaucratic red tape can accelerate project approvals and foster innovation across the value chain and supply chains. This centralized leadership would ensure that policy, regulation, and investment are aligned with national security and economic priorities.
Education and training programs must be reinvigorated to create a skilled workforce ready to tackle the technical challenges of rare earth extraction and processing. Research and development should be bolstered with public-private partnerships, ensuring that cutting-edge technologies are developed and commercialized. From using alternative products to next-generation recycling of rare earth inputs, advancing education has never been so important.
Financial and logistical support for emerging domestic firms is crucial. Incentives, grants, and tax breaks can help U.S. companies scale operations quickly. These funding sources need to be committed for the long run, based on performance. Equally important is forging an open network of allied countries—especially Canada and Australia—to create a diversified, secure supply chain. These partnerships can counterbalance China’s dominance and provide stable sources of critical minerals.
America’s competitive edge in the global economy hinges on a robust, end-to-end strategy for critical minerals and rare earth elements. Without an industrial policy encompassing mining, separation, processing, refining, and final product production, the U.S. will remain a bystander. At the same time, China dictates the future of high-tech industries, at least in the earth sciences.
Haphazard, ad hoc deals in peripheral sectors won’t secure our future. An industrial policy may seem daunting—even for today’s government—but inaction means continued subordination.
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