The CCP fired a ‘loaded gun’ at the U.S. economy by placing export controls on critical minerals, says Representative John Moolenar.
The U.S. recently experienced an inflection point in the great power competition against China — on the level of the launch of the Sputnik satellite during the Cold War — and most Americans are entirely unaware that it happened.
Representative John Moolenaar (R., Mich.), chairman of the House Select Committee on the Chinese Communist Party, is setting out to change that, urging Americans to wake up to the threat of Chinese critical mineral domination, a threat that was recently made explicit when the Chinese Communist Party placed export controls on the vital materials that go into everything from electric vehicle batteries and phones to advance missile systems.
“I think China actually helped us when they put those restrictions on and basically fired that loaded gun at the American as well as the world economy. I’ve heard from different countries around the world who are concerned about this very thing. I think it was a wake up call, almost like when Sputnik was launched and people realized the Soviet Union is is trying to gain leverage in the space race,” Moolenaar told National Review last week in a wide-ranging interview at his congressional office.
“This was an example of China flexing its muscles and showing the world that they are dependent on China. And I think people around the world are waking up to that fact and saying, that’s not a place where we want to be.”
True to his Michigan roots, Moolenaar is trying to remind people of the importance of a robust U.S. defense industrial base and the perpetual relevance of manufacturing to the broader U.S. economy.
“Well, it turns out, for our information society, you need a lot of manufacturing and so I do think there’s a strong connection there, especially when it comes to our defense industrial base, because it’s never been clear that we need a defense industrial base that does not rely on foreign entities of concern,” he said.
In October, China enacted new restrictions on its exports of critical minerals and rare earth materials, a move that reflected the Chinese Communist Party’s growing willingness to use its critical mineral dominance for strategic purposes. China scaled back some of the export restrictions in November after President Trump and CCP ruler Xi Jinping met in South Korea on October 30 amid a trade war between the world’s largest economies.
The House China Committee, the panel Moolenaar chairs, produced a bipartisan report in November detailing China’s decades-long strategy to gain control of critical mineral supply chains and manipulate prices to their benefit. Critical minerals are vital for the U.S. economy because of their usage in electronics, medical equipment, defense systems, and other major sectors.
The China Committee’s report also contains various recommendations for what the U.S. can do to reduce China’s advantage in critical minerals. Those policies include financing U.S. supply chain development, expediting permitting timelines, providing a critical minerals tax credit, and creating a strategic resources reserve.
When it comes to U.S. national-security, especially China’s mineral foothold, Moolenaar is willing to subordinate his free market principles to advance American industrial capacity, a common view among conservative China hawks.
“As it’s defense related, I think the government has always had a role of creating a demand signal, as you know, setting priorities, and we recognize you can’t have some of our military capabilities without access to these resources. It’s, you know, if we have our fighter jets dependent on Chinese raw materials, that’s a huge problem,” Moolenaar asserted.
“We’ve always had a policy to try and buy American for our military whenever possible. And this is a case where, when it comes to some of these rare earths and critical minerals, we do not have that capability, and unfortunately, are relying on our foremost adversary.”
A prominent example of this strategy is the Trump administration’s deal with MP Materials, a company that owns the only operational rare earth mining and processing facility in the U.S.
The Department of Defense acquired a $400 million stake in MP Materials in July, a deal meant to help bolster the company’s rare earth processing and magnet production. The public-private partnership made the Pentagon the largest shareholder in MP Materials.
Moolenaar takes a similar approach to handling trade with China. He believes it is necessary to eliminate China’s trade designation, Permanent Normal Trade Relations, because of China’s unwillingness to follow trade rules and the CCP’s requirement for businesses to be subservient to its demands. He also supports limited tariffs on China to address critical technologies, despite his broader belief in free trade.
“But at the same time, we have to recognize we’re not dealing with the usual partners in this effort, and that someone we are our economy is very intertwined with, is not playing by the rules. And so I’ve advocated [for] eliminating China’s, you know, most favored nation, PNTR status. I think we need to recognize they’re not playing by the rules,” he said.
Moolenaar emphasized the need for U.S. allies to cooperate in a potential push to combat China’s mineral dominance, even if it might become complicated. European allies remain deeply entwined with the Chinese economy and seemingly disregard China’s proactive role in financing Russia’s war in Ukraine. Moolenaar acknowledged this obstacle and cited French president Emmanuel Macron as an example of a European leader who has sought to deepen his country’s ties to China while firmly backing Ukraine’s fight against Russian encroachment.
Domestically, Moolenaar emphasizes the need for bipartisan cooperation in Congress and across administrations to handle the China issue. He is hoping the 250th anniversary of the American founding next year will further inspire companies to take a longer term, patriotic outlook in how they handle doing business with China, especially with a potential Chinese invasion of Taiwan on the horizon.
“A rising China, which at one Point was viewed as a benign developing country, when you look at their military, their technological capabilities, their human rights abuses and their threats to the security in the region and around the world, we need to rethink that, because they’re ultimately trying to export their surveillance society and their leverage around the world, the critical minerals warning shot was a wake up call,” he stated.
“But there’s a lot more at stake, and my hope is that the private sector will see it’s in their long term interest to support the values of this country, the foundational values and not simply be drawn in by short term financial incentives.”
Between Trump’s first and second terms, the Biden administration retained many of Trump’s China tariffs and added new measures for other sectors. Trump quickly launched a trade war against China this time around through escalatory tariffs paired with inflammatory rhetoric. But Trump has tempered the trade dispute and taken stances China hawks have criticized over the course of the administration.