00:01Thank you. Chair now recognizes Representative Sherman from California for five minutes.
00:10China controls most of this market.
00:14Is that because China is uniquely blessed by ores of all these rare earth minerals,
00:22or is that just because China decades ago decided to do the mining, which is difficult,
00:28and the processing, which I believe is even more difficult?
00:31I'll ask any of the witnesses.
00:33Let me just say, if I can, very quickly, everything you just said was correct.
00:36They did something nobody else wanted to do.
00:39And if you won't do it in your own backyard, don't expect someone else to do it.
00:42China filled the void, and they saw it back when we got into the WTO in 1990s,
00:47and they went after work and they captured some markets and basically hold us hostage,
00:51and they've done it extremely, extremely efficient.
00:53But other countries in the world have the ore deposits and could have done it.
01:00China did it.
01:02China put the resources to it.
01:03They put the money to it.
01:08There are those who advocate us that America should have a strategic cryptocurrency.
01:16What?
01:18I guess one of our witnesses needed to leave.
01:20A cryptocurrency reserve, which seems bizarre.
01:28I've never heard of a short of cryptocurrency.
01:31As a matter of fact, if you want to get some mongoose coin or some skippity-toilet coin,
01:35that's available to you right away, as are all the currencies.
01:40Do we have a rare-earth minerals strategic reserve of any significance?
01:49We have a defense reserve, which is woefully underfunded and not terribly well-stocked,
01:57wherein there are some critical minerals I don't have insight into.
02:01And that's not designed to support our economy.
02:05That's just designed to allow us to make weapons that we might not have-
02:09For defense.
02:10And I'd point out we have a strategic petroleum reserve that we should be refilling now
02:16because oil is under $70 in both administrations, particularly the prior ones,
02:21that they would refill the reserve when oil went below $70.
02:24And that hasn't been done, but we continue to hold over $10 billion worth of cryptocurrency
02:30for reasons I have yet to figure out.
02:38China wants us to give them, sell them, the most advanced chips.
02:43NVIDIA is apparently going to be allowed to do that.
02:47To what extent did they get that incredible concession from us
02:52because otherwise they wouldn't sell us the rare-earth minerals?
02:56Was that their big stick?
03:03I'm not going to-
03:04I have no insider information on that one.
03:07But I will say that its dominance, China's dominance of critical minerals is a weapon.
03:13And they weaponize it and they're good at it.
03:17What other countries are moving toward developing rare-earth minerals in a major way?
03:23Australia is a big, is very much in the game.
03:31The Japanese are one of the leaders in some of the refining and magnet production as well.
03:38There's actually joint development programs with those three countries already in a company or two.
03:45China has lower labor costs than us and most of those other countries.
03:49Is a low labor cost critically important to being able to be competitive in this business?
03:55I think when we talked about the rare-earths, it's more than just the labor.
03:58It's also the cost of the capital to run the plants.
04:02And I think what someone has already alluded to, the way in which they do it is a manner that would be objectionable in the United States
04:09or in most other Western countries.
04:11What would be objectionable in the United States?
04:12The way in which they refine the rare-earths.
04:14Are you talking about the local environmental impact?
04:17Correct. That's right.
04:17If you spend a bit more money, can you refine these minerals and still meet the community standards we expect in America?
04:27For sure, yes.
04:29I think the announcement we talked about earlier, the MP announcement, that's what they're seeking to do.
04:35There are other companies that are doing it as well.
04:38Of course you can.
04:38I mean, it goes back to capital and the fact that the PRC doesn't have the same standards that we do, environmental standards and labor standards.
04:52But that's an opportunity.
04:53That's why countries want to run back.
04:55We certainly have capital.
04:57Much of it we bring in from China.
04:59And I'm going to yield back 10 seconds.
05:01If I can just say one thing to you.
05:03Yes, go ahead.
05:03As far as you have United States, you have Canada, and you have Australia.
05:08Three main caches of where we know we have critical minerals we all need.
05:12Then you have the ability of Japan to do the refining.
05:15And South Korea is coming on strong, too.
05:17So these are all allies of ours in a free world.
05:20It's something we should be building an alliance with.
