UPDATED: How China Displaced U.S. Leadership In Weapons Technology

Hollywood movies and institutionalized patriotism within our culture has helped the Pentagon maintain the mirage of overwhelming U.S. military dominance across the globe based on the presumption of our technological leadership.  

Recently the Pentagon requested the largest Research and Development (R&D) budget in its history (here). The increase mostly targets hypersonic weapons and President Trumps new Space Force.   

The budget request is not about maintaining American leadership in defense technology. That ship sailed long ago. China leads the U.S. in both of these areas. The targeted request is in response to our delinquency. 

China and Russia have already developed hypersonic weapons and the Pentagon first acknowledged China’s military space program back in 2001 (here), including a successful kill-satellite test back in 2007.  

Most American’s will be surprised to learn that China has also eclipsed the U.S. in nearly every next-generation weapon system on the Pentagon’s outdated chalkboards. 

There is overwhelming proof that China has developed, deployed, controls or will develop the following weapon systems:

• Quantum computing, satellite & encryption technology
• Kinetic Energy weapons 
• Hypersonic weapons
• Directed Energy weapons & controls U.S. access
• Space Force weapons and deployment
• Nuclear powered weapon systems

China has developed and deployed quantum computing, quantum satellite technology and quantum radar technology (here, here, here, here). Quantum computing is a rare earth dependent technology (here).

China had developed and deployed kinetic weapons like the rail gun (here, here, here) and is developing other kinetic systems such as magnetized plasma artillery (here). Kinetic weapons are rare earth dependent.

China has developed and tested hypersonic weapons. China has the world’s largest hypersonic research facility (here, here, here). All hypersonic propulsion systems are dependent on rare earth alloys. 

China developed, tested and deployed (here) ‘space force’ weapon systems prior to 2007 (here). Rare earths are used in all directed energy weapons, secure communication systems, alloys for supersonic and hypersonic vehicles and directional control functions for all precision missile guidance systems.  

China has developed and deployed directed energy systems (here) and controls U.S. development and deployment of rare earth dependent directed energy weapons through its control over rare earth resources, metals, alloys, magnets and other value added materials (here). 

China plans on developing next-generation nuclear energy systems, including the development of nuclear-powered mega-drones and other energy based weapons (here, here, here). Current and next generation nuclear technology requires rare earth materials in the fabrication of control rods, radiation shielding and other functions.  

All of these achievements are directly related to China’s leadership in rare earths. 

None of the above is speculative (there are dozens of stories and in some cases hundreds stories related to China's leadership or control over resources necessary for U.S. development of these technologies) . These are facts on the ground, in the air and possibly already deployed in space.  

It gets worse when you start combining them. For example Chinese nuclear powered mega-drone bombers would be controlled by quantum communication systems (something we don't have). Quantum systems are un-hackable: literally un-hackable (here).

Each of these mega-drones would be equivalent to four B-52 bombers based on existing air frame designs and proven propulsion systems designed by Oak Ridge in the 1950s and 1960s (yes, this is a U.S. technology that our DoE transferred to China in 2010).

They would be armed with conventional, hypersonic and directed energy weapons. They could circle the globe endlessly, just outside international waters. This would allow for near instantaneous striking power for any spot on the planet.

The mega-drones would have nuclear powered defensive escorts armed with conventional, hypersonic an directed energy weapons, making our traditional air force next to useless. They could even have kill-satellites above, to provide additional cover.

China could develop a dozen or more [i] of these mega-bombers for the price of a new U.S. aircraft carrier. They would develop hundreds of them. The U.S. Navy would become obsolete: a monkey should be able to understand that (but it must be a bit foggy to the folks in the Pentagon).

All of this begs the question, how did this happen?  

The simple answer is that our government’s foreign policy has been highjacked by neoconservatives [ii], in what is now a 20-year odyssey of failed regime change projects intended to preserve the Petro-dollar and promote U.S. hydrocarbon hegemony.  

Of course, these plans, developed under Vice President Dick Cheney’s 2001 Energy Task Force, remain classified. The estimated cost of these failed projects ranges from $2 to $7 trillion dollars, or 20 to 65 times the current Pentagon budget request for R&D spending. All of China’s technological achievements were accomplished on a defense budget that is less than one-third the U.S.’s annual commitment [iii]. The consequences of this misdirection are manifest in our crippled economy, national debt and compromised national security.  

During this period of American military adventurism the Chinese government managed what amounts to a WWII styled Manhattan Project across all sectors of its economy. Most of its triumphs were fueled by the transfer of U.S. technology and capital (here). A significant portion of China’s advances were largely built on its unparalleled commitment to leading the world in rare earth resource production, refining, material science, metallurgy, intellectual property (IP), research and development (R&D), and commercial and defense applications. China leveraged its control over access to these materials to force U.S., EU, Japanese and Korean companies to move technologies and entire industries inside China.  

Rare earths are at the heart of nearly every technology-based consumer product (smartphones, computers & automobiles), industrial good (aircraft, medical imaging & green technology) and modern weapon system (guided missiles, smart bombs, radar, sonar, communications, advanced aircraft, targeting systems, night vision, GPS and other field equipment for our troops).  

China controls U.S. access to these materials. China is also leveraging its control over all rare earth related IP. U.S. technology companies can expect to be challenged over IP infringement in the world courts. Apple and Samsung are already facing infringement challenges from China’s smartphone industry. Consider the irony. 

It is worse for U.S. defense contractors, held hostage to China’s supply chain, who continue to operate on special Defense Department waivers, built entirely on subterfuge, to get the materials they need. In fact, one of the largest U.S. defense contractors told us that if they were forced to speak on the matter “China could get to them”.  

The following graphics were derived from an exhaustive international rare earth patent search by country of origin (ROW = Rest of World). 

The search dates were unbounded: from the first filed patent to the last filings of August 2018. The data set includes over 80,000 patents. Search terms: rare earth(s), lanthanide(s), lanthanum, cerium, praseodymium, neodymium, promethium, samarium, europium, gadolinium, terbium, dysprosium, holmium, erbium, thulium, ytterbium, scandium and yttrium.

Assessing the Data:

• China has filed more rare earth patents than the rest of the world combined every year since 2011.
• By early 2021 China will have accumulated more rare earth patents than the rest of the world combined.
• Chinese companies can use patent-trolling and patent-ring-fencing legal strategies to undermine or nullify existing non-Chinese patents.
• China’s rate of filings is accelerating relative to the rest of the world – increasing 250 percent from 2011 to 2018.

China’s first international rare earth patent filing was in 1983, and just fourteen years later, China surpassed the U.S. and every other nation in total patents filed as shown below.

As of August 2018, China has accumulated 23,000 more rare earth patent filings than the U.S. This suggest that America will wake up one day to find China as the new global champion of IP enforcement.

Meanwhile, America’s focus on rare earths has been limited to rare earth resource production. The Pentagon, mine production promoters and other so-called rare earth experts’ only yard-stick for rare earths has been resource production outside of China (here). Few bother to consider that these resources have no meaningful defense or technology application until they are converted into metals, alloys, magnets or other value-added material. China is the only country in the world with a fully integrated rare earth value chain. China controls the production of nearly all post-oxide rare earth materials: directly or indirectly. Almost none of these so-called experts are aware of how extensive China’s global dominance in rare earth IP is.

The next graphic tracks China’s ramp-up in resource production (mined rare earths and oxides) and patent filings vs. the Rest of the World. China’s own internal reporting suggest that its so-called ‘black market’ production is at least 150 percent larger than its official production figures shown below. U.S. rare earth ‘experts’ have not fully accounted for this discrepancy in any public document that I am aware of.   

The series of graphics above are astounding, yet the Pentagon did not respond to or make any further inquiry after I presented the data above [iv]. In fact, the Pentagon ignored all warnings regarding the geopolitical consequences of China’s multi-level rare earth monopoly strategy designed to undermine U.S. technology companies and defense contractors for a decade or more [v].

In fact, at no time over the last 40 years was China’s rare earth production, or its growing number of rare earth patents, listed as an issue of serious concern by the Pentagon in any of its past Manufacturing and Industrial Base Policy reports (here), reports to Congress on China threats (here) or acquisition reports (here).

Finally, in a September 2018 report (here) ordered by the White House, the Pentagon finally acknowledged after nearly four decades:

“China represents a significant and growing risk to the supply of materials deemed strategic and critical to US national security.”

All of this is bad news for the Pentagon whose central plan for our Nation’s security, termed “The 3rd Offset Strategy (here),” just assumed U.S. technological leadership over our rivals. The ‘plan’ did not self-execute. U.S. technological leadership has been largely off-shored to China while the Pentagon focused on a series of intractable / unwinnable wars and the continued production of rare earth dependent, unreliable and over-priced weapons systems that perform disastrously in war game simulations (here).  

Putting all China-phobia aside, China has boldly crossed this threshold in plain view. In fact, most of what it did or planned to do was outlined in the 1999 Cox Report (here) or was publicly available in Chinese documents. The Pentagon, Congress and the last 2 Administrations were repeatedly briefed on China’s strategy but failed to take any corrective action.

The total global value of mined rare earths is less than $500 million, while refined rare earth oxides are worth about $3 billion per year. The annual refined production of these resources is less than 200,000 metric tons per year[iii]. However, China controls access to all[iv] post rare earth oxide materials that are critical to over $7 trillion in technological goods and other refined resources[v]. This gives China leverage over U.S. and NATO defense contractors and global technology companies.

China’s lever and fulcrum strategy has shifted the global balance of power, using one of the world’s smallest commodity markets in a way that would impress Archimedes himself. 

James Kennedy is president of ThREE Consulting and works on critical materials, energy and national security policy issues at the federal level. He is the subject of the book “Sellout” by Victoria Bruce. He can be contacted vis [email protected]

[i] America’s newest aircraft carrier cost over $16 billion (here). A nuclear powered mega drown would cost far less than $1 billion. Why? There is no need to build anything new or exotic… Existing cargo-airframes could fitted with small Molten Salt Reactors (as proven by Oak Ridge in the late 1950s and early 60s) and thermal propulsion systems. The elimination of all cost related to supporting crew life support systems and liquid fuel storage would help to offset necessary modification costs. U.S. cost estimates for building MSRs on a megawatt basis are range between one-third to one-fourth the cost of traditional LWRs (or, about $2 million per MW). Based domestic cost estimates China could produce a 10-megawatt MSR powerplant for each of its mega-bomber drones for as little as $20 million. It is worthy of note that China has recently demonstrated that it can build LWRs for one-fourth of our costs (here).  Based on a Boeing C-5A airframe, each mega-bomber could deliver a payload equal to over 20 F-35s. 

[ii] Neoconservatives are the sort of military interventionists that gave us the Iraq, Afghanistan, Libya and Syrian war (a proxy war, not a civil war).

[iii] Of course, some would say that the Chinese budget hides much of its defense spending within other government programs. But that is also true for the Pentagon. A true accounting of U.S. national security spending would include all spending related to the NSA, TSA, Veterans care and historically over 70 percent of the Department of Energy’s budget that supports our many nuclear weapons related programs within the National Laboratory network, dating back to the Carter Administration.

[iiv] There is a proposed solutions to overcoming China’s stranglehold over our economy and national defense as it relates to rare earths (here). This proposal is circulating in the House, Senate and has been in front of this Administration for nearly 2 years. 

[v] This author has spent a decade warning the Department of Defense, Congress and the last two Administrations of China’s techno-hegemonic strategy.

[vi] However, Internal Chinese documents suggest that it could be as much as 350,000 tons per year, still a nominal amount when compared to most commodities.

[vii] Japan is the only country outside of China that produces rare earth metals, but Japan only produces a fraction of its internal needs and most of its rare earth oxides, necessary for the production of metals, are produced or refined in China. 

[viii] Lanthanum and Cerium are used as catalysts in the production of petroleum and other industrial products.