Opinion

Trump Strikes Gold in Proposed Fix to America’s Broken Mineral Mining Process

With America’s reliance on imported minerals rising rapidly, the last thing we need is a trend that makes them rise even faster than they should. Yet that is what is happening in the production of weapons systems and commercial products such as cellphones and flat-screen televisions: U.S. dependence on foreign countries for strategically important minerals has doubled in the past two decades.

China is now our leading supplier of minerals ranging from commodity metals to rare earths, locking up supplies with a combination of state-directed investment and state-backed capital, giving it great leverage over our supply chains for advanced technologies. It’s reasonable to ask: What if China decides to retaliate against the United States by restricting the export of some critically important minerals?

That the Trump administration recognizes the danger is a dramatic understatement.  For starters, the Defense Department is bolstering a reserve of minerals deemed critically important for national security and the economy. The administration’s larger goal is to reduce our nation’s dependence on all foreign minerals and encourage domestic mining instead. In a report issued by the Department of Commerce, the administration cites the need to raise public awareness about the strategic importance of minerals, and it calls for improvement in the permitting process for mining on public lands, which account for 75 percent of our nation’s minerals production.

But the administration should have taken the danger of foreign dependence a step further by urging Congress to pass a bill introduced by Sen. Lisa Murkowski (R-Alaska), head of the Senate Committee on Energy and Natural Resources, that would require immediate changes in the complex and antiquated permitting process, which takes 10 years or more. It would end duplicative reviews by different government agencies and establish timelines for each major step of the process. This would help reduce the permitting process to an average of three years, more in line with the process in other mining countries.

What’s important to recognize is that the United States has unparalleled mineral wealth — an estimated $6.2 trillion in mineral reserves. Yet we’ve become totally import-reliant on 18 minerals — 14 of which have been deemed “critical” by the Defense and Interior departments. It’s nonsensical that mining companies must wait a decade before they can get the necessary permits to mine for minerals such as copper, lithium and cobalt that are components of batteries in electric vehicles, or rare earth elements that are needed for missile guidance systems and satellites.

Meanwhile, there are already signs that China is using America’s reliance on its minerals for geopolitical advantage. A decade ago, during a dispute, China banned the export of rare earth minerals to Japan. China eventually lifted the ban but not before the world price of rare earths had jumped dramatically.  

Today, China accounts for about 80 percent of U.S. rare earth imports, which are critical to building night-vision goggles, armored vehicles, laser-guidance systems for weapons, jet engines and smart bombs. In fact, China is the primary supplier of 26 out of the 48 minerals the U.S. imports. In a tense trade war, mineral dependence gives China considerable leverage.

A transition will take many years — we need to begin now.

 

Matthew Kandrach is president of CASE, Consumer Action for a Strong Economy, a free market-oriented consumer organization.

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