Delfield reported in ealy March, 2023 that tax reform could lead to leveling the playing field in the US-Chinese REE rivalry. The Hay-Seward Initiative of the Economic Security Council, a 501 (c)(3) organization, is focused on strengthening America’s economic, financial and national security. In order to unleash investment-led economic growth to win the US-China power rivalry, the Hay-Seward Initiative proposes a significant simplification of the tax code.
As founder Carl Delfeld makes clear in a new book Power Rivals: America and China's Superpower Struggle, “a much simpler tax code will supercharge the economic growth that America needs to stay the world’s superpower.” Power Elements: Rare Earths Supply Chain Security in an Age of US-China Rivalry, explains why America is dependent on Chinese rare earths/critical metals.
Critical and strategic rare metals and rare earths inputs necessary for clean energy such as electric vehicle (EV) production and national defense along with semiconductors and fiber optic materials are likely America and the West’s most pressing needs. The report profiles some North American companies working to increase production of key rare earths and critical metals including: Defense Metals Corp., Ucore Rare Metals, Geomega Resources, and Westwin Elements, which is a private company developing a nickel/cobalt refinery in the United States.
What exactly are rare earths? They are obscure rare metals that are in in all sorts of products from cell phones to advanced weapons systems, aircraft engines, robots, and hybrid batteries. The real value of these metals are their unique electrical and magnetic properties that allow for miniaturization and much lighter, stronger, resilient, and efficient components.
How did we ever become dependent on China for the supply of rare earths and rare metals critical to our technology and defense base?
In short, China’s massive advance over the past three decades to become a mining and refining superpower while Washington slept, is an unforced error in our age of US-China rivalry. The cause is not complex and can be traced first to post-Cold War complacency regarding the development of natural resources in North America.
In a nutshell, our leaders seem to have forgotten that America’s economic security is national security. A few highlights of this debacle include closing the U.S. Bureau of Mines in 1996, allowing America’s only rare earths mine to go bankrupt, winding down our defense stockpile, and standing passively by as China became a global manufacturing superpower while locking up strategic resources all over the world
The priority of rebuilding supply chain security should be developing the foundation of manufacturing - commodity inputs - in America or friendly countries. America needs begin to rebuild from the ground up to take back control of its supply chains for rare earths and critical tech metals.
Even now, shortages are emerging, and prices are rising. If the world moves toward a green-energy future and more defense spending, the demand for many of these materials will skyrocket as global output falls far short of anticipated needs.
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