By Anietie Anii-Bassey
A bipartisan group of U.S. lawmakers is moving to reshape the nation’s approach to securing rare earths and other critical minerals, proposing the creation of a new agency backed by $2.5 billion to stimulate production and stabilize supply chains that underpin everything from consumer electronics to advanced weapons systems.
The legislative push comes as the Trump administration intensifies its own aggressive strategy to reduce U.S. dependence on China, which dominates the global processing of materials essential to cellphones, electric vehicles, jet fighters and missile technology.
The proposal reflects mounting concern in Washington over the country’s vulnerability to Beijing’s control of critical minerals, a leverage point China has repeatedly used in trade disputes.
Although it remains unclear how the bill would ultimately align with White House policy if enacted, both Congress and the administration are operating under a shared sense of urgency to sharply curb reliance on China following recent trade confrontations.
That urgency was underscored last year when China imposed sweeping restrictions on critical mineral exports in response to U.S. tariffs, exposing the extent of American dependence on Chinese processing capacity.
The standoff ultimately eased after President Donald Trump and Chinese President Xi Jinping agreed to a one-year truce in October, under which China would continue exporting key minerals while the United States would relax some technology export controls. The temporary détente, however, did little to reassure U.S. officials who view long-term dependence as a strategic liability.
Over the past year, the Pentagon has spent nearly $5 billion to secure access to critical minerals, stepping into markets in ways that have surprised even seasoned analysts. China currently processes more than 90% of the world’s supply of many of these materials, and U.S. officials say that imbalance leaves both the military and civilian industries exposed to supply disruptions and price manipulation.
To counter that dominance, the federal government has begun taking equity stakes in select mining and processing companies and, in some cases, guaranteeing commodity prices—an approach more commonly associated with Beijing’s state-directed economic model than with a Republican administration.
The bill introduced by Sen. Jeanne Shaheen of New Hampshire and Sen. Todd Young of Indiana seeks a different path, emphasizing market mechanisms while still relying on federal coordination.
The legislation would establish an independent body tasked with building a strategic stockpile of critical minerals and related products, stabilizing prices and encouraging production in the United States and allied nations. Supporters argue the measure would help ensure reliable supplies not only for defense needs but also for manufacturers across the broader economy.
Shaheen described the proposal as a historic investment aimed at strengthening U.S. economic resilience and reducing exposure to what she characterized as China’s ability to exert economic coercion. Young called the creation of a new reserve a necessary and forceful step to protect both national security and long-term economic interests.
The sense of urgency intensified after last spring’s tariff battle, when China paired retaliatory duties with sharp curbs on mineral exports, forcing Washington to reassess its position.
Speaking earlier this week, Defense Secretary Pete Hegseth said the Pentagon has committed more than $4.5 billion over the past five months alone to close six major deals designed to insulate the United States from market manipulation.
Among those deals is a $150 million preferred equity investment in Atlantic Alumina Co., aimed at preserving the nation’s last alumina refinery and establishing its first large-scale gallium production facility in Louisiana. Gallium is a key component in semiconductors and advanced electronics.
In another move, the Pentagon agreed to purchase $400 million in preferred stock in MP Materials, which owns the only operational rare earths mine in the United States, located at Mountain Pass, California. The government has also entered into a $1.4 billion partnership with ReElement Technologies Corp. to help build a domestic supply chain for rare earth magnets.
These steps have prompted debate over whether Washington is embracing a form of state capitalism to compete more effectively with Beijing. Some analysts argue the strategy carries risks of political interference but acknowledge its strategic rationale. Others say the unprecedented involvement reflects the reality that market forces alone have failed to challenge China’s dominance.
Industry executives, for their part, have largely welcomed the intervention. Leaders at mining and processing firms say the administration’s actions recognize the national security stakes involved. One executive described the strategy as long overdue, arguing that decades of reliance on imports left the United States dangerously exposed in the production of materials fundamental to modern technology and defense systems.
Alongside domestic investment, the Trump administration has sought to secure alternative supplies through close allies. In October, the president signed an $8.5 billion agreement with Australia to expand mining investment there, and he has pursued a controversial effort to gain control of Greenland, citing its potential rare earth resources.
This week, finance ministers from the Group of Seven met in Washington to discuss shared vulnerabilities in critical mineral supply chains, signaling growing coordination among advanced economies.
Treasury Secretary Scott Bessent, who has played a central role in trade negotiations with Beijing, urged allied nations to strengthen supply chain resilience and thanked them for their willingness to work toward durable solutions, according to a Treasury statement.
The Shaheen-Young bill would reinforce that cooperative approach by explicitly encouraging production partnerships with allied countries alongside domestic development.
Congress has grappled with the rare earths challenge for years, often reacting when China restricted supplies or flooded markets to depress prices and squeeze out competitors.
Previous efforts were typically narrow in scope and tended to fade once Beijing eased restrictions. Under the Biden administration, policy focused on boosting demand through incentives for electric vehicles and renewable energy, while the Trump administration has largely dismantled those incentives in favor of directly expanding mineral production.
What distinguishes the current moment is the scale and persistence of the response. Unlike earlier initiatives that stalled once immediate pressure subsided, the measures now underway signal a broader shift in U.S. industrial strategy—one driven by the recognition that access to critical minerals is no longer just an economic issue, but a central pillar of national security in an increasingly competitive global landscape.
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