China Raises Threat of Rare-Earths Cutoff to U.S. – Foreign Policy
China Raises Threat of Rare-Earths Cutoff to U.S. – Foreign Policy
With a simple visit to an obscure factory on Monday, Chinese President Xi Jinping has raised the specter that China could potentially cut off supplies of critical materials needed by huge swaths of the U.S. economy, underscoring growing concerns that large-scale economic integration is boomeranging and becoming a geopolitical weapon.
With the U.S.-China trade war intensifying, Chinese state media last week began floating the idea of banning exports of rare-earth elements to the United States, one of several possible Chinese responses to U.S. President Donald Trump’s decision to jack up tariffs on hundreds of billions of dollars’ worth of Chinese goods and blacklist telecoms maker Huawei.
I think trade wars are a bad idea, as we should be bringing the world together for our collective good, rather then tearing it apart. While the United States, over time could find alternatives to imported rare earths, including more domestic mining and alternative product formulations, it could be unneccessarily harmful in the short-term for both the United States and China. It's no different then the OPEC trade embargo in the 1970s -- it was very harmful in the short-term, although in the long-term increased domestic production and fuel economy standards helped dull the pain, as did a loosening of the embargo.