We need rare earth metals in order to facilitate a modern, electrically powered world. We also know that China is the world’s major supplier of those metals.
Considering the poor state of U.S. relations with China, we need some homegrown production in order not to be at Beijing’s mercy. But how serious is the problem?
Well, the U.S. military represents only 5% of America’s total rare earth metals consumption. There are also plenty of places to get that small amount when so needed. Still, sponsored by Sens. Tom Cotton and Mark Kelly, there is now a bipartisan bill afloat that insists the Pentagon now build up a stockpile. Despite the Department of Defense saying it’s not needed, it’s being told it must do so. The basis of the bill is that there should be a stockpile and also that the Pentagon must buy from American producers in order to encourage domestic production of these metals.
One problem: In the bill itself, rare earths are listed as including tungsten, tantalum, lithium, and beryllium — none of which are rare earth metals, none of which suffer the same Chinese production dominance problems, and none of which require the same treatment the actual rare earth metals do!
It could be that the people writing the bill are simply too ignorant to know what a rare earth metal is. My own view is rather darker. For beryllium, for example, there’s only one U.S. company (Materion Corporation) that produces to DoD specifications, and their only possible competition is from abroad. So, if the Pentagon can’t buy from abroad, then there’s only that one supplier, and no competition is likely to emerge either (it would struggle to get licensed given the dangers of beryllium metalworking). The result: In the name of increasing supply to protect the United States, we’ve just created an effective monopoly.
The takeaway: It’s not that good government isn’t possible, it’s that we rarely get such government.
