Culmination Point: America's China War Fails

Washington's eighty-year offensive has failed. Will China's rare earth counterattack end America's reign of terror?

America launched its kinetic war on China in 1944 with the fire-bombing of Wuhan (yes, that Wuhan) which incinerated the city and 44,000 of its inhabitants. It continued through the 1999 bombing of China’s Embassy in Belgrade, and accompanied kinetic attacks with continuous attempts to destabilize China’s government and destabilize its food supply. Parallel to these physical assaults has been the multigenerational campaign of media vilification.

Now, with its loss of soft power, America’s campaign has clearly failed. Its economy is in recession while China’s booms and Washington’s war on China has reached its culmination point: it can no longer sustain offensive momentum and is, therefore, vulnerable to counterattack. And while China is counterattacking on fronts like currency substitution, its dominance of rare earth elements may end Americas global reign of terror before this year is out. Let’s quickly summarize why.

Rare IP

Every semiconductor manufacturing tool–including the most advanced lithography systems in fabs on Taiwan, Arizona, Seoul and Sapporo–uses lots of rare earth magnets. Chinese officials are considering imposing a de minimis rule on rare earth magnets, giving China veto power over shipments of these tools. Yes, Beijing and MOFCOM have learned well how to play the game. Paul Triolo

Worldwide, annual sales of rare earths total just $5 billion and extracting REMs is tiresome and environmentally fraught: turning radioactive ore into laboratory grade,

high-purity metals and alloys entails vast investment of capital and manpower, intellectual property and process experience that only China’s 500,000 geologists possess.

China hold 32,000 REE patents¹. 40% cover separation and purification, 25% cover EV battery and magnet recovery, e-waste processing and recycling, 20% cover aspects like NdFeB alloy optimization and reduced dysprosium use in high tech magnets and 15% cover environmental mitigation–like treatment of radioactive thorium waste. But it is China’s control of heavy REEs, HREEs, that sets it apart.

Heavy IP

Ninety-percent of the world’s HREE deposits are in China and there are few viable substitutes. All high-temperature, high-strength, and magnetic applications, wind turbines, EVs, missile guidance systems, jet engines and turbines, lasers and optics, display technologies, miniaturized electronics, MRI, lasers and imaging, nuclear reactor components, petroleum refining and specialty chemicals require HREEs.

The Ukraine and Middle East wars have depleted Western arms inventories, and Beijing now requires extensive disclosures by REE buyers so it can prevent diversion to Western arms makers, who must therefor halt production of jets, missiles and artillery shells. America’s capacity to wage war will cease and the world can turn its attention to becoming a community with a shared future for mankind–thanks to rare earth elements.

It would take twenty years and a hundred billion dollars to replace Chinese HREEs, and America doesn’t have twenty years. Says Kathleen Tyson, “Peace is being imposed by denial of the means of war”.

1. America holds 2,100 REE patents