China Monopolizes Crucial Rare Earth Minerals

August 11, 2017
Submitted by: Love Knowledge
Category: Politics

Victoria Bruce, author of Sellout: How Washington Gave Away America’s Technological Soul, and One Man’s Fight to Bring it Home. Photo credit: Twitter / Bloomsbury USA

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The post China Monopolizes Crucial Rare Earth Minerals appeared first on WhoWhatWhy.

Crucial technologies developed in the United States, from smart phones to advanced weapon systems, can only be produced with rare earth minerals from China. How did the US get to a point where it has to rely on a strategic adversary to build its high tech products?

The US once mined and produced these minerals. No more. It has now handed China an almost total monopoly on the industry. In this week’s WhoWhatWhy Podcast, Victoria Bruce talks to Jeff Schechtman about how this came to be, and how one man, a whistleblower by the name of Jim Kennedy, embarked on a journey to try and bring the industry back.

Bruce, the author of Sellout: How Washington Gave Away America’s Technological Soul, and One Man’s Fight to Bring it Home, discusses several important questions. How is the production of high tech components being threatened by China? How does the Asian superpower manipulate the price of essential products and commodities to drive all other manufacturers and countries out of the market? Why has Congress failed to examine or address the critical rare earth supply problem?

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Full Text Transcript:

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Jeff Schechtman:	Welcome to radio WhoWhatWhy. I’m Jeff Schechtman. Most of you have heard all the bellicose talk about the possibility of a trade war with China — saber rattling between China and the U.S. The next step is that the stock markets react to the impact that it might have with respect to China, as our largest market and as a supplier of so many goods coming into the U.S.
	What we don’t hear talk of, is the fact that virtually all of our technology that we depend on — from the phones in our pockets to the fighters, carriers, and missiles that keep us safe — are all totally dependent on what’s called rare earth minerals from China. Without them, we become technologically paralyzed. And the funny thing is that right now we have no alternative. How did this happen? Does it matter? And what if anything are we going to do about it?
	We’re going to talk about this today with my guest Victoria Bruce. She holds a master’s degree in geology from the University of California, Riverside. She is a recipient of the Alfred DuPont-Columbia University Award for excellence in broadcast journalism. She’s the author of the previous book, No Apparent Danger. And it is my pleasure to welcome her here to talk about Sellout: How Washington Gave Away America’s Technological Soul and One Man’s Fight to Bring it Home. Victoria Bruce, thanks so much for joining us.
Victoria Bruce:	Thanks, Jeff. Thanks for having me.
Jeff Schechtman:	It’s great to have you here. Let’s begin by talking about what these rare earth materials, rare earth minerals are — other than perhaps the things that we never really learn very well from the periodic table.
Victoria Bruce:	Well, they’re definitely that because even as a geologist they were obscure to me. I first learned about rare earth elements when I was in undergraduate school as a geologist in southern California. And we went to a mine called Mountain Pass and we were given a tour by the geologist there. They were saying, “Here are these rare earth elements.” This was in the ’90s, right, the mid ’90s. “They’ve become very important to magnets, to making very small magnets. All of our technology was able to become smaller and faster because you can make a tiny rare earth magnet. This is one of the mines that can do that, but we just invited some Chinese geologists here and they came here and they went home and found a deposit a hundred times bigger. And now we’re going out of business.” And I thought, “Well, that’s pretty bad strategy,” you know, even back then when no one was talking about it.
	The minerals themselves are very obscure. They’re tiny. They’re not a huge economic product. You don’t find them traded like steel, like gold, like iron, but they’re absolutely essential. So that’s where we are now. Like you said, with China holding all the cards.
Jeff Schechtman:	Talk a little bit about how that happened. Was the U.S. in this business? Did the U.S. cede the business? I guess there was a company that was doing this that got bought by the Chinese.
Victoria Bruce:	Right. So what happened was, in 1985 a man named John Croat, he was a magnetic specialist, his job … General Motors said, “Listen, we want to make cars lighter. We have these heavy motors everywhere, from the window motors to the starter motors, and we need to make these cars lighter. Fuel economy’s a big thing. John, Dr. Croat, can you look into this?”
	He discovered rare earth magnetism, like the fact that you can have a magnet ten times stronger than a regular magnet that is safe at all temperatures, right. So a lot of things would get magnetic, then lose their magnetism. So he found this. This company ended up, at that point, not able to use them for cars because they were highly rusted, they would rust really bad in situations with cars.
	The company started selling them to Japan. Japan was like, “This is awesome. We can make everything faster and smarter and we can make little tiny headphones.” And then the defense contractors got hold of him and they said, “We can make little fins on these bombs and make smart bombs that have directional capabilities.” So they became ubiquitous. It was an entire technological revolution that you really didn’t hear but that’s what was really fueling it all, was this new invention called rare earth magnets, rare earth lasers, and things like that.
	So that company ended up, 10 years later, being bought by the Chinese because America started selling off everything. And that was post-1991 when Clinton came into office.
Jeff Schechtman:	Why didn’t we hear more about it? I mean, certainly this was a giant leap in terms of technology.
Victoria Bruce:	Right. I think what happened at the time is that so many products were being developed and things were happening exponentially that … We look back at the makers of the atomic bomb technology and we celebrated them independently and the science behind it. But that was really about creation of sort of the war product and one big project, the Manhattan Project.
	This was more piecemeal, everything being created by lots of different companies and it was all about the economics of it; we’re making money off these products. It wasn’t about celebrating the science. So it’s kind of like we’ve gone forward and moved and this great explosion that’s been wonderful for the economy and for science. But I think that we sort of lose the science and we just expect our technology to be moving at a thousand miles an hour.
Jeff Schechtman:	Talk a little bit about the interface with China, how that’s worked so far with respect to American companies that need these materials.
Victoria Bruce:	What my book Sellout talks about is that we’ve put ourselves in a terrible position as Americans. Our government used to control the technology. They used to say, “Okay, if this can be used in military technology, then we won’t export it.

Related front page panorama photo credit: Adapted by WhoWhatWhy from rare earth oxides production rare (USGS / Wikimedia) and earth oxides (USGS).

Last modified on Thursday, 17 August 2017 18:52