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Fools!

"America's continuing reliance on critical Chinese materials"

"U.S.' chief rival continues to control chokepoints in supply chains that provide urgent military assets, key technologies, and important
medicines"

<https://www.wnd.com/2026/06/americas-continuing-reliance-critical- chinese-materials/>

"At the onset of the COVID-19 pandemic in 2020 u with face masks, gloves,
and other basic protections in high demand u Chinese leaders threatened
to plunge America into the "mighty sea of coronavirus" by withholding essential medical supplies in retaliation for measures such as the U.S.
travel ban on visitors from China.

The threat, issued through a Chinese Communist Party organ, brought into
stark relief China's strategy to subdue would-be foes by rendering them reliant on its exports for life's necessities u prompting a pledge from
U.S. policymakers to address supply chain issues that made the country vulnerable to a hostile power.

Six years later, despite a raft of initiatives u including tariffs, made- in-America requirements, and the makings of a responsive U.S. industrial policy embraced by the Biden and Trump administrations u America's effort
to reduce dependence on China in pivotal sectors has been slow and faces
a slew of challenges.

Headlines heralding the decline in U.S. imports from China to levels not
seen since the depths of the pandemic mask the fact that America's chief
rival continues to control chokepoints in supply chains that provide
urgent military assets, key technologies, and important medicines.

The Chinese government recently demonstrated its ability to weaponize
critical sectors when it responded to U.S. tariffs by restricting exports
of rare earth materials and magnets that are critical to American defense systems and weapons. War-gamers have indicated that the control over
those supply chains may become paramount should China invade Taiwan or
engage in other hostilities that might draw an American military
response. Some estimates have indicated that such a struggle could wipe
out 10% of global GDP u albeit damaging China and the U.S. alike.

Some experts say the major stumbling block is the private sector, which remains at odds with policymakers in tilting away from China, and has
long relished its large market and cheap labor pool. Isaac Stone Fish,
the CEO of Strategy Risks, a China-focused business risk analysis firm,
told RealClearInvestigations that "Despite all the tough talk," and
economic and geopolitical tensions, his firm's analysis shows that dozens
of major U.S. companies have increased their engagement with China during 2026.

To treat supply chain threats as an economic problem and leave it to be addressed by free enterprise u rather than as a national security
challenge requiring whole-of-society mobilization u is a fatal error, according to Leland Miller, a U.S.-China Economic and Security Review Commission member.

"[A]s long as you allow market dynamics to dictate what the U.S. is doingayou're going to lose," Miller said.

China's Commanding Position

The Trump and Biden administrations have both highlighted the
significance of the supply chain challenge to our national security,
economic security, and public health. These include China's commanding positions in:

Global rare earth materials, where China controls more than 60% of
production and nearly 90% of refining capacity, giving it a chokehold on inputs vital to the manufacturing of everything from automobiles and
medical equipment to defense products and spacecrafts;
Components or materials key to U.S. military hardware, ranging from U.S. aircraft carriers to missile defense systems and tanks, which are
produced in or sourced from China;
Foundational semiconductors, used in practically all applications that
include advanced chips from vehicles to medical devices and military
systems, where China is the global production leader;
Printed circuit board fabrication, a core component in modern
electronics, from telecommunications satellites to ventilators and smartphones, where Chinese firms control more than two-thirds of the
global market;
Medicine, a field in which China controls approximately 90% of the global supply of key starting materials in active pharmaceutical ingredients in generic drugs, with over 60% of U.S. drugs containing key inputs from
China and India.
To attain these positions, the U.S.-China Economic and Security Review Commission wrote in its 2025 annual report, "China has deliberately
pursued a strategy of expanding production and deepening global
dependence on Chinese exports while reducing its own reliance on imports.
This strategy builds on decades of industrial policy that led to a concentration of supply chains in China and undercut competitors by
flooding global markets with subsidized, underpriced goods."

China's tactics in pursuit of this strategy have ranged from government subsidies and currency manipulation to intellectual property theft and industrial espionage, forced labor, and product "dumping at artificially
low prices u and, as it has increasingly been met with resistance, export controls."

Tariffs and Stockpiles

The tariff regime, enacted during the first Trump administration and
mostly continued under the Biden administration, is one key tactic the
U.S. government has used to counter China's playbook. Other policies have included directly stockpiling critical resources; securing strategic
sectors through fostering international alliances and public-private partnerships; permitting reform; trade enforcement actions; incentives
for re-shoring; and export controls.

"This is a whole-of-government effort across key industry sectors
including critical minerals, pharmaceuticals, semiconductors, autos,
steel, aluminum, and copper," White House spokesman Kush Desai told RCI. "Hundreds of billions of dollars in private investment commitments across these sectors reflects how the administration's long-term agenda
continues to bear fruit."

Still, experts remain concerned that the U.S. is ill-equipped to solve
the complex problem.

Ideally, experts say, the U.S. government would comprehensively map the
supply chain risks and work with all relevant stakeholders to mitigate
them. The Trump administration has focused in particular on rare earth minerals and artificial intelligence technologies. Similarly, the Biden administration laid out a number of areas of concern from batteries to
biotech as detailed in its Quadrennial Supply Chain Review. And, to
varying degrees, both administrations attempted to coordinate their risk- mitigation efforts with foreign governments and the private sector.

Yet experts lamented that the government lacks the information necessary
to comprehensively identify and attack supply chain vulnerabilities u rendering policies to date "ad hoc," according to Meg Reiss, a former
national security staffer on Capitol Hill and founder of SolidIntel,
which uses AI to identify supply chain risks.

Leland Miller, who was appointed to the USCC by Republican House Speaker
Mike Johnson, told RCI that the U.S. still has to do a lot of
foundational work to "map the [various] supply chains" and to identify
"the vulnerabilities."

Miller pins the slow progress to the lack of data from an often resistant private sector.

USCC Vice Chair Mike Kukien, an appointee of Senate Democratic Leader
Chuck Schumer, concurred, asserting that "anytime Congress has attempted
to wade into this space ofapulling information out of the supply chain,
the first people to come and bang on your door and say, 'Don't do it,' is industry."

Pushback From Business

Companies argue that identifying areas where they are reliant on China
and transitioning operations elsewhere would threaten their business
models. They also claim it is costly and onerous to collect information
on the multiple tiers of suppliers on whom they rely, and in some cases,
they lack the wherewithal to do so. For its part, China has sought to
impose costs u including ending market access u on companies that
cooperate with supply chain transparency efforts.

Miles Yu, who served as principal China policy planner on strategy at the State Department during the first Trump administration, identified "Wall Street and Silicon Valley globalists" as influential opponents of
Washington's efforts to combat China's supply chain chokepoints more
broadly.

The task is further complicated by China's efforts to avoid Trump's
tariffs by routing their products through more U.S.-friendly countries as
a workaround.

"China's ability to sort of hide its hand from a manufacturing
perspective, unless there's a real attempt to do country of origin work,
is pretty strong," Joshua Hodges, a former senior director at the
National Security Council, told RCI. "And you're seeing that in the
defense industrial complex. You're seeing it in cell phones. You're
seeing it really in any place where there are parts of a supply chain
that have become commodities."

Miles Yu concurs. "[T]oo many opportunistic allies and partners in EU and
Asia [are] not in sync with Washington," as well, making grappling with
the global nature of the problem even harder, he said.

On the U.S. side, basic problems of coordination within the government threaten even the most comprehensive effort to take on the supply chain challenge. The National Defense Authorization Act is perhaps the seminal
bill aligning the executive and legislative branches on China policy.
Reiss notes that "the wayathe legislative cycle works," when it comes to mitigating supply chain risk, "everything's based on NDAA timing."

Should one NDAA cycle pass in which vulnerabilities go unaddressed, then remedies will not be included for the next "year and a half for beginning implementation, much less being fully implemented. So the timelines start becoming significant if we don't have movement."

Bright Spots

Despite their bearish conclusions, experts did note some bright spots.
Stone Fish called tariffs "the biggest forcing mechanism yet u high
enough costs might finally do what politics couldn't. But China controls critical minerals that American factories can't do without, so escalation
cuts both ways."

Miller noted that tariffs may be an effective defensive tool for
protecting industries under attack from a China that often floods the
market with goods to undercut foreign competitors. Tariffs, he says,
should be used to ringfence critical sectors as their participants shift
to alternative suppliers and rebuild their domestic production
capacities. "But you can't just throw around a tariff wall and expect
industry to miraculously develop domestically as a result of that," he
says.

Miles Yu has a more sanguine view. He said that in the areas of defense, automobiles, and telecommunications services, the U.S. has been making progress on mitigating supply chain risk from China. And he believes that prohibitive tariffs on Chinese steel and aluminum, automobiles, including electronic vehicles, green products, and "enhanced SEC scrutiny" on
publicly traded Chinese companies in the U.S. have borne fruit.
Conversely, he argued that pharma and bio product restrictions remain
wanting.

While concerned about the lack of strategic coherence in America's risk mitigation efforts to date, Reiss hopes that efforts from the Defense Department reflect increasing strategic discipline. She cites, for
example, initiatives out of the Office of Strategic Capital u which has
backed domestic processing of rare earth minerals u as positives.

In the long term, Miller says, the U.S. only has to modify, not reinvent,
the supply chain. "It's not that we have to go back and figure out where
every single input to every single supply chain is," he says. "We have to
make sure that enough of it comes from outside of Chinaa so that China
doesn't have a stranglehold over any particular supply chain no matter
what happens."

In the interim, in the wake of the May 2026 summit between President
Trump and Chinese leader Xi Jinping, the American side touted China's
stated commitment to "address U.S. concerns regarding supply chain
shortages related to rare earths and other critical minerals," as well as "prohibitions or restrictions on the sale of rare earth production and processing equipment and technologies."

Still, the conflict between the two nations continues. Earlier this
month, the Department of War added nearly two dozen Chinese companies to
its blacklist. In apparent response, Chinese authorities imposed trade restrictions on dozens of U.S. defense companies, including barring
exports to two American rare earth producers"
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