Why Rare Earths Matter for National Security
Rare earth elements have become essential to modern life. They power fighter jets, missiles, smartphones, medical devices, and advanced electronics. Since the COVID pandemic disrupted global supply chains, Americans have become more aware of how dependent the country is on foreign sources for these materials.
China currently dominates both the mining and processing of rare earths. It controls a large share of global extraction and an even greater share of processing capacity. As a result, the United States relies heavily on Chinese supply chains for materials critical to its defense industry.
Supporters of President Donald Trump argue that this imbalance creates a national security risk. They say Beijing has already shown it is willing to use export controls as leverage during trade disputes. In recent years, China imposed restrictions on rare earth exports, including limits tied to military use.
The Origins of America’s Decline
The United States once led the world in rare earth production. The Mountain Pass mine in California played a central role during the early days of electronics manufacturing.
However, regulatory changes in the late twentieth century increased costs and slowed domestic production. Environmental concerns and a major wastewater spill in the 1990s led to the facility’s closure in the early 2000s. Lengthy permitting timelines, often stretching decades, discouraged new projects.
Although Mountain Pass resumed operations in 2017, experts say rebuilding a full supply chain will take time. Meanwhile, China expanded production under more flexible regulations and secured its global lead.
What Is Project Vault?
In response, the Trump administration launched an initiative known as Project Vault. The plan aims to reduce reliance on China while strengthening domestic capacity.
Project Vault would create a strategic stockpile of rare earth elements, similar in concept to the Strategic Petroleum Reserve established after the 1970s oil crisis. The goal is to ensure that the U.S. military and private industries have access to critical materials if China restricts exports.
The administration has also pushed for deregulation and permitting reform to speed up new mining and processing projects in the United States. Officials argue that these steps will encourage private investment and rebuild American production.
Funding and International Partnerships
To support the effort, President Trump directed the Export Import Bank to provide up to 10 billion dollars in financing. The funding would help establish the stockpile and expand American controlled rare earth production.
A public private partnership called Vault Company would oversee the project. Its role would be to manage investments and help restore domestic extraction and processing capacity.
In addition, the administration has pursued agreements with allies such as Australia. These partnerships aim to diversify supply chains and reduce dependence on Chinese sources.
The Broader Policy Debate
Supporters describe Project Vault as a necessary move to protect U.S. defense industries and counter China’s dominance. They argue that securing rare earth supplies is as important today as securing oil was decades ago.
Critics, however, question the costs and environmental tradeoffs tied to expanding domestic mining. The debate is likely to continue as Congress considers reauthorizing the Export Import Bank and reviewing the long term strategy.
What remains clear is that rare earth supply chains have become a central issue in U.S. economic and national security policy.
