Trump Mulls Using Defense Powers to Fund Rare-Earth Projects
(Bloomberg) -- The Trump administration is developing a plan to use Cold War-era powers to prioritize and fund rare earth projects it deems critical to national security, people familiar with the matter said.
Shuttered NY College Has Alumni Fighting Over Its Future
Trump's Military Parade Has Washington Bracing for Tanks and Weaponry
NYC Renters Brace for Price Hikes After Broker-Fee Ban
Do World's Fairs Still Matter?
NY Long Island Rail Service Resumes After Grand Central Fire
Officials are discussing using the Defense Production Act to tap financing, loans and other means for rare earths element-related projects, including mining, processing and other downstream technologies to bolster the US's capability to build a domestic supply chain, the people said. A specific course of action or a timeline have yet to be finalized, the people said.
MP Materials Corp., the sole domestic producer of rare earths, would be a prime beneficiary. Deputy Defense Secretary Steve Feinberg is working to line up funding for the company, people familiar with that matter said. The Nevada-based mineral processor has received millions in funding from the Defense Department.
MP Materials rose as much as 17% to $29.96 at 3:45 pm in New York, the highest on an intraday level since March 14.
A spokesman for MP Materials declined to comment. Representatives for the White House and the Pentagon didn't immediately respond to requests for comment.
Defense Secretary Pete Hegseth in a congressional hearing this week said that MP Materials 'is a great example of a place where we can partner with industry' and that Feinberg is focused on sourcing rare earth supply.
The US currently lacks the so-called mine-to-magnet capability at scale, and invoking the emergency authority will give the Defense Department and other agencies tools to speed up sourcing that severely lags China's dominance in the industry. The urgency has only increased since Beijing flexed its rare earths capacity as leverage in trade talks with Washington over the past month.
Beijing's decision to block exports of rare earths focused Trump administration attention on China's dominance in processing the materials used in semiconductors, jet engines and other technology, and it's stoked a surge of interest in rapidly developing US supply chains.
'This is a wake-up call for America,' Interior Secretary and National Energy Dominance Council Chairman Doug Burgum told Bloomberg News in a June 1 interview. 'We are so exposed, right now — precariously exposed — to China's grip on not just the mining, but the processing. They're mining all over the world, but they control 85% of the processing.'
An existing US stockpile is 'massively insufficient' Burgum said, adding that billions of dollars could be needed to build a bigger mineral reserve.
The latest discussions come more than two months after President Donald Trump signed an executive order to boost production of critical minerals that encouraged faster permitting for mining and processing projects.
White House Efforts
While that order encompassed rare earths, one of the people familiar with the matter said issuing a new directive is essentially a chance for Trump to publicly message that he's countering Beijing on a US vulnerability that's inflamed trade tensions between the world's largest economies.
At the National Energy Dominance Council, David Copley is leading work on the rare-earths issue and has been tasked with coordinating most efforts related to critical minerals, people familiar with the matter said.
Copley, a former executive with the mining company Newmont Corp., has been receiving proposals for how the US can quickly build out its own critical minerals supply chains and lists of potential shovel-ready projects the government can quickly invest in through DPA and other funding avenues.
Copley's role has taken on new prominence as a result of Elon Musk's efforts to downsize the federal bureaucracy that have led to a wave of buyouts, resignations and retirements at key federal offices working on supply chain issues.
The Trump administration revived Biden-era efforts to create a domestic supply chain for rare-earth magnets after China in April clamped down on exports of the materials, Bloomberg News reported last week.
As part of the effort, officials solicited proposals to bolster domestic supplies of the magnets within the next six to 12 months as pressure mounted that China's recent retaliation was putting serious pressure on the Pentagon's stockpiles, as well as the inventories of US automakers and some aerospace-related companies.
--With assistance from Courtney McBride, Yvonne Yue Li and Jeran Wittenstein.
(Updates to add share moves in the fourth paragraph)
American Mid: Hampton Inn's Good-Enough Formula for World Domination
New Grads Join Worst Entry-Level Job Market in Years
The Spying Scandal Rocking the World of HR Software
US Tariffs Threaten to Derail Vietnam's Historic Industrial Boom
The SEC Pinned Its Hack on a Few Hapless Day Traders. The Full Story Is Far More Troubling
©2025 Bloomberg L.P.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
21 minutes ago
Conservation group makes $60M land deal to end mining threat outside Okefenokee Swamp
SAVANNAH, Ga. -- A conservation group said Friday it has reached a $60 million deal to buy land outside the Okefenokee Swamp from a mining company that environmentalists spent years battling over a proposed mine that opponents feared could irreparably damage an ecological treasure. The Conservation Fund said it will buy all 7,700 acres (31.16 square kilometers) that Alabama-based Twin Pines Minerals owns outside the Okefenokee National Wildlife Refuge in southeast Georgia, halting the company's mining plans. 'It's a big undertaking, but it was also an existential threat to the entire refuge," said Stacy Funderburke, the Conservation Fund's vice president for the central Southeast. 'We've done larger deals for larger acres, but dollar-wise this is the largest deal we've ever done in Georgia." Twin Pines President Steven Ingle confirmed the sale through a spokesman, but declined to comment further. Twin Pines of Birmingham, Alabama, had worked since 2019 to obtain permits to mine titanium dioxide, a pigment used to whiten products from paint to toothpaste, less than 3 miles (5 kilometers) from the southeastern boundary of the Okefenokee refuge near the Georgia-Florida line. The Okefenokee is the largest U.S. refuge east of the Mississippi River, covering nearly 630 square miles (1,630 square kilometers) in southeast Georgia. It is home to abundant alligators, stilt-legged wood storks and more than 400 other animal species. The mine appeared to be on the cusp of winning final approval early last year. Georgia regulators issued draft permits in February 2024 despite warnings from scientists that mining near the Okefenokee's bowl-like rim could damage its ability to hold water and increase the frequency of withering droughts. Twin Pines insisted it could mine without damaging the swamp. Regulators with the Georgia Environmental Protection Division agreed, concluding last year that mining should have a 'minimal impact' on the refuge. The decisions by Georgia regulators played an outsize role in the Twin Pines project after environmental rollbacks during President Donald Trump's first term stripped the federal government of any oversight. Advocates battling Twin Pines said there is still a potential threat to the Okefenokee, with thousands of acres of privately owned land remaining unprotected. Georgia lawmakers have batted aside multiple attempts in recent years to prohibit mining near the refuge. 'There's maybe 30,000 acres that's still vulnerable outside the Okefenokee on Trail Ridge that needs to be conserved,' said Rena Ann Peck of the Georgia River Network. Josh Marks, an Atlanta environmental attorney who fought the mining project, called the land sale 'a huge victory.' But he also called on conservationists to redouble efforts for a state law protecting the Okefenokee and to keep pressure on other companies to refrain from mining near the refuge. Funderburke said the steep purchase price for Twin Pines' land was driven largely by its mineral-rich soils that would have been highly valued by other mining operations. Reaching a deal became more urgent with the company so close to obtaining its final permits. 'It became pretty clear once a draft permit was issued last year that this was the final exit ramp' to stopping the project, Funderburke said. He said his group was closing Friday on about 40% of the property that includes the 820-acre (332-hectare) site for which Twin Pines' had sought its mining permit. The Conservation Fund plans to close on the rest by the end of July. Funderburke said he hopes there is eventually a deal for the land to pass into government ownership and protection. The U.S. Fish and Wildlife Service, which oversees the Okefenokee refuge, in January approved a plan to expand the refuge by buying up to 22,000 acres (8,900) along its perimeter from private owners. The proposal included land owned by Twin Pines. Negotiations with the Conservation Fund might explain why Twin Pines had yet to follow through on a financial commitment required before Georgia regulators could make a final decision on its mining permit. The Environmental Protection Division recently confirmed Twin Pines had been notified in February 2024 that it needed to set aside $2 million for future restoration of the mining site. The company never followed through in the 16 months before the sale was announced.
21 minutes ago
Judge asks if troops in Los Angeles are violating the Posse Comitatus Act
SAN FRANCISCO -- California's challenge of the Trump administration's military deployment in Los Angeles returned to a federal courtroom in San Francisco on Friday for a brief hearing after an appeals court handed President Donald Trump a key procedural win. U.S. District Judge Charles Breyer put off issuing any additional rulings and instead asked for briefings from both sides by noon Monday on whether the Posse Comitatus Act, which prohibits troops from conducting civilian law enforcement on U.S. soil, is being violated in Los Angeles. The hearing happened the day after the 9th Circuit appellate panel allowed the president to keep control of National Guard troops he deployed in response to protests over immigration raids. California Gov. Gavin Newsom said in his complaint that 'violation of the Posse Comitatus Act is imminent, if not already underway' but Breyer last week postponed considering that allegation. Vice President JD Vance, a Marine veteran, traveled to Los Angeles on Friday and met with troops, including U.S. Marines who have been deployed to protect federal buildings. According to Vance, the court determined Trump's determination to send in federal troops 'was legitimate' and he will do it again if necessary. 'The president has a very simple proposal to everybody in every city, every community, every town whether big or small, if you enforce your own laws and if you protect federal law enforcement, we're not going to send in the National Guard because it's unnecessary,' Vance told journalists after touring a federal complex in Los Angeles. Vance's tour of a multiagency Federal Joint Operations Center and a mobile command center came as demonstrations have calmed after sometimes-violent clashes between protesters and police and outbreaks of vandalism and break-ins that followed immigration raids across Southern California earlier this month. Tens of thousands have also marched peacefully in Los Angeles since June 8. National Guard troops have been accompanying federal agents on some immigration raids, and Marines briefly detained a man on the first day they deployed to protect a federal building. The marked the first time federal troops detained a civilian since deploying to the nation's second-largest city. Breyer found Trump acted illegally when, over opposition from California's governor, the president activated the soldiers. However, the appellate decision halted the judge's temporary restraining order. Breyer asked the lawyers on Friday to address whether he or the appellate court retains primary jurisdiction to grant an injunction under the Posse Comitatus Act. California has sought a preliminary injunction giving Newsom back control of the troops in Los Angeles, where protests have calmed down in recent days. Trump, a Republican, argued that the troops have been necessary to restore order. Newsom, a Democrat, said their presence on the streets of a U.S. city inflamed tensions, usurped local authority and wasted resources. The demonstrations appear to be winding down, although dozens of protesters showed up Thursday at Dodger Stadium, where a group of federal agents gathered at a parking lot with their faces covered, traveling in SUVs and cargo vans. The Los Angeles Dodgers organization asked them to leave, and they did. On Tuesday, Los Angeles Mayor Karen Bass lifted a downtown curfew that was first imposed in response to vandalism and clashes with police after crowds gathered in opposition to agents taking migrants into detention. Trump federalized members of the California National Guard under an authority known as Title 10. Title 10 allows the president to call the National Guard into federal service when the country 'is invaded,' when 'there is a rebellion or danger of a rebellion against the authority of the Government,' or when the president is otherwise unable 'to execute the laws of the United States.' Breyer found that Trump had overstepped his legal authority, which he said allows presidents to control state National Guard troops only during times of 'rebellion or danger of a rebellion.' 'The protests in Los Angeles fall far short of 'rebellion,' ' wrote Breyer, a Watergate prosecutor who was appointed by President Bill Clinton and is the brother of retired Supreme Court Justice Stephen Breyer. The Trump administration argued that courts can't second-guess the president's decisions. The appellate panel ruled otherwise, saying presidents don't have unfettered power to seize control of a state's guard, but the panel said that by citing violent acts by protesters in this case, the Trump administration had presented enough evidence to show it had a defensible rationale for federalizing the troops. For now, the California National Guard will stay in federal hands as the lawsuit proceeds. It is the first deployment by a president of a state National Guard without the governor's permission since troops were sent to protect Civil Rights Movement marchers in 1965. Trump celebrated the appellate ruling in a social media post, calling it a 'BIG WIN' and hinting at more potential deployments.
The Hill
an hour ago
- The Hill
How Senate Republicans want to change the tax breaks in Trump's big bill
WASHINGTON (AP) — House and Senate Republicans are taking slightly different approaches when it comes to the tax cuts that lawmakers are looking to include in their massive tax and spending cuts bill. Republicans in the two chambers don't agree on the size of a deduction for state and local taxes. And they are at odds on such things as allowing people to use their health savings accounts to help pay for their gym membership, or whether electric vehicle and hybrid owners should have to pay an annual fee. The House passed its version shortly before Memorial Day. Now the Senate is looking to pass its version. While the two bills are similar on the major tax provisions, how they work out their differences in the coming weeks will determine how quickly they can get a final product over the finish line. President Donald Trump is pushing to have the legislation on his desk by July 4th. Here's a look at some of the key differences between the two bills: The child tax credit currently stands at $2,000 per child. The House bill temporarily boosts the child tax credit to $2,500 for the 2025 through 2028 tax years, roughly the length of President Donald Trump's second term. It also indexes the credit amount for inflation beginning in 2027. The Senate bill provides a smaller, initial bump-up to $2,200, but the bump is permanent, with the credit amount indexed for inflation beginning next year. Trump promised on the campaign trail that he would seek to end income taxes on tips, overtime and Social Security benefits. Also, he would give car buyers a new tax break by allowing them to deduct the interest paid on auto loans. The House and Senate bills incorporate those promises with temporary deductions lasting from the 2025 through 2028 tax years, but with some differences. The House bill creates a deduction on tips for those working in jobs that have customarily received tips. The House also provides for a deduction for overtime that's equal to the amount of OT a worker has earned. The Senate bill comes with more restrictions. The deduction for tips is limited to $25,000 per taxpayer and the deduction for overtime is limited to $12,500 per taxpayer. The House and Senate bills both provide a deduction of up to $10,000 for interest paid on loans for vehicles made in the United States. And on Social Security, the bills don't directly touch the program. Instead, they grant a larger tax deduction for Americans age 65 and older. The House sets the deduction at $4,000. The Senate sets it at $6,000. Both chambers include income limits over which the new deductions begin to phase out. The caps on state and local tax deductions, known in Washington as the SALT cap, now stand at $10,000. The House bill, in a bid to win over Republicans from New York, California and New Jersey, lifts the cap to $40,000 per household with incomes of less than $500,000. The credit phases down for households earning more than $500,000. The Senate bill keeps the cap at $10,000. That's a non-starter in the House, but Republicans in the two chambers will look to negotiate a final number over the coming weeks that both sides can accept. The House bill prohibits states from establishing new provider taxes or increasing existing taxes. These are taxes that Medicaid providers, such as hospitals, pay to help states finance their share of Medicaid costs. In turn, the taxes allow states to receive increased federal matching funds while generally holding providers harmless through higher reimbursements that offset the taxes paid. Such taxes now are effectively capped at 6%. The Senate looks to gradually lower that threshold for states that have expanded their Medicaid populations under the Affordable Care Act, or 'Obamacare,' until it reaches 3.5% in 2031, with exceptions for nursing homes and intermediate care facilities. Industry groups have warned that limiting the ability of states to tax providers may lead to some states making significant cuts to their Medicaid programs as they make up for the lost revenue in other ways. The Medicaid provision could be a flashpoint in the coming House and Senate negotiations. Sen. Josh Hawley, R-Mo., was highly critical of the proposed Senate changes. 'This needs a lot of work. It's really concerning and I'm really surprised by it,' he said. 'Rural hospitals are going to be in bad shape.' The House bill would allow companies for five years to fully deduct equipment purchases and domestic research and development expenses. The Senate bill includes no sunset, making the tax breaks permanent, which was a key priority of powerful trade groups such as the U.S. Chamber of Commerce. Republicans in both chambers are looking to scale back the clean energy tax credits enacted through then-President Joe Biden's climate law. It aimed to boost the nation's transition away from planet-warming greenhouse gas emissions toward renewable energy such as wind and solar power. Under the Senate bill, the tax credits for clean energy and home energy efficiency would still be phased out, but less quickly than under the House bill. Still, advocacy groups fear that the final measure will threaten hundreds of thousands of jobs and drive up household energy costs. The House bill would allow millions of Americans to use their health savings accounts to pay for gym memberships, with a cap of $500 for single taxpayers and $1,000 for joint filers. The Senate bill doesn't include such a provision. The House reinstates a charitable deduction for non-itemizers of $150 per taxpayer. The Senate bill increases that deduction for donations to $1,000 per taxpayer. Republicans in the House bill included a new annual fee of $250 for EV owners and $100 for hybrid owners that would be collected by state motor vehicle departments. The Senate bill excludes the proposed fees. ___
