NEW YORK Several
congressmen and a retired U.S. Army brigadier general are
calling on the federal government to reduce its dependence on
foreign-sourced raw materials used in defense equipment,
arguing that defense-related metals should be produced in the
United States for reasons of national security.
In a May 8 press conference on
Capitol Hill, a panel of speakers that included Sen. Chris
Murphy (D., Conn.), Rep. Mo Brooks (R., Ala.), Rep. Tim Ryan
(D., Ohio), and retired Brig. Gen. John Adams released a report
prepared by the Alliance for American Manufacturing that claims
U.S. national security is threatened by a "dangerous reliance"
on imported raw materials, parts and finished products used in
The U.S. military depends on
foreign-sourced raw materials like rare earths, specialty
metals and finished equipment for many of its security
capabilities, with products like lithium-ion batteries,
lanthanum and high-technology neodymium-iron-boron magnets
increasingly produced overseas, particularly China, the report
"We incur unacceptable national
security risks as we outsource key sectors of our material
base," Adams said during the conference. "Foreign control over
U.S. supply chains ... puts the United States at risk."
Some components of crucial
defense equipment like night-vision devices, missiles and
battleship parts are also sourced overseas, the panel said.
Rare earth metals are a
particular area of concern for report author Adams, president
of Tucson, Ariz.-based consulting firm Guardian Six Consulting
LLC. According to the report, as demand for rare earths for use
in electronics, communications and green technologies has
surged, U.S. production of these materials has plummeted.
"For (rare earth elements), the
result of reduced U.S. production and increased global demand
is that the United States now relies on imports for at least 60
different elements, with a total lack of domestic production
for 19 of them," the report claims.
There are some domestic
producers of rare earths, with Greenwood Village, Colo.-based
Molycorp Inc. producing a number of rare earths at its flagship
mine in Mountain Pass, Calif., and a handful of exploration and
development companies looking to ramp up their own domestic
mining or leaching operations. Heavy rare earths exploration
company Texas Rare Earth Resources Corp., for example,
announced May 8 the recovery of beryllium and lithium at its
early-stage Round Top project in Sierra Blanca, Texas, where it
is based. This marks another would-be domestic producer making
a step toward commercial production.
Nonetheless, supply concerns
remain. "The U.S. government, the defense establishment and
analysts have raised alarm about the (rare earth) situation and
encouraged the reopening of (rare earth) mining in the United
States. ... At this point, there is sufficient supply of (rare
earth elements) on the market, but the fabrication and
manufacturing of defense items and gadgets continues to take
place outside the United States, in China," the report
In addition to more domestic
production of metals and related parts, the country also needs
stronger trade laws, the panel said.
Murphy, for example, warned that
exceptions to Buy America Act provisions in American
Recovery and Reinvestment Act of 2009 are chipping away at the
law and making it easier for importers to source
defense-related materials from overseas.
"(The Buy American Act) has
atrophied over the years," Murphy said. "Its been
rendered almost useless. Now is the time to put the teeth back
into the law."
Ryan noted that unfair trade
practices put U.S. businesses, as well as the U.S. military, at
a competitive disadvantage. He pointed specifically to
Chinas alleged currency manipulation and its effect on
the steel business in his home state of Ohio.
"Because of currency
manipulation, Wheatland Tube (Co.)s raw material costs
are the same cost as Chinese finished product landing in the
United States," Ryan said, advocating for a law to halt
currency manipulation. "If we are going to have an economic
renaissance in the United States, its going to be because
Adams report calls for new
legislation and long-term federal investment to support the
U.S. industrial base.
"Without a healthy defense
industrial base, the United States will be unable to supply the
weapons and equipment our warriors need to defend this
country," Adams said at the conference.