Odd Lots: "This Is How The US Can Become a Player in Rare Earth Metals"

Date: February 5, 2026
Hosts: Joe Weisenthal & Tracy Alloway
Guest: Heidi Krivo Rediker, Senior Fellow at the Council on Foreign Relations, former State Dept. Chief Economist, and co-author of a new CFR report on US rare earth strategy

Episode Overview

This episode delves into the United States’ vulnerability in the supply of strategic minerals—especially rare earth elements—where China currently dominates the market. Joe, Tracy, and guest Heidi Krivo Rediker discuss why the US fell behind, what new technologies could allow America to leapfrog China’s grip, and what policy, innovation, and industry collaborations are needed if the US is to become competitive in critical minerals. The conversation is rich with analogies to past industrial challenges, as well as eye-opening details about how “waste” could become a major domestic resource in this sector.

Key Discussion Points and Insights

1. The Rare Earths Problem and China’s Dominance

• Problem Identification:
  Joe and Tracy reflect on how Odd Lots often identifies US strategic "choke points" (e.g., China’s dominance in rare earths) without proposing actionable solutions. They set up the episode to explore feasible ideas to address America's vulnerability (01:01–02:35).

• China’s Strategic Advantage:
  Heidi explains that China’s dominance was the result of a “slow train coming at us for decades.” China invested heavily, created a full domestic ecosystem (from mining to manufacturing), and accepted lower profitability for strategic advantage (04:12–06:27).

  "[China] did a very good job of creating an entire ecosystem... both domestic extraction, processing, and then they came up with all of the products that would be the leading demand."
  —Heidi Krivo Rediker, 05:22

• US Missed Opportunities:
  The US once led in mining but offshored the environmental impact, becoming dependent on low-cost Chinese supply. Environmental and economic tradeoffs played a role (09:56–10:26).

2. How the US Can Leapfrog with Innovation

• The Need for Leapfrogging:
  Heidi stresses that the US cannot simply "out-mine, out-process, or outspend" China; instead, the US must leverage innovation (07:27–08:40).

• Role of National Labs:
  Many breakthrough technologies originate in US national labs, like the Ames National Lab, which fosters collaboration between science, academia, and startups (08:52–09:36).

• Groundbreaking Technologies:

  • Material Science Advances:
    The US Dept. of Energy’s ARPA-E funded research post-2010 led to new magnet materials that drastically reduce or eliminate rare earth requirements. Niron Magnetics, for instance, is scaling up rare earth–free magnets (11:38–13:00).

    "A scientist in Minnesota... created a rare earth free magnet... and it's actually scaling up massively."
    —Heidi Krivo Rediker, 12:20

  • Biotech Extraction:
    New companies (e.g., Alta Research Technology) engineer proteins or even viruses that extract specific elements from waste, offering clean and efficient extraction from U.S. waste resources (13:00–14:47).

    "It's a protein that is altered so that it can go in and micro-target specific rare earth elements…it's kind of revolutionary."
    —Heidi Krivo Rediker, 14:10

  • Mining the Waste Stream:
    Rather than mining fresh ores, the US has vast stockpiles of industrial waste, coal ash, and electronic waste (“e-waste”) that can be mined domestically for rare earths (13:00–14:47, 19:37–21:02).

    "We shouldn't consider waste at this point to be a liability. It's literally America's next mine."
    —Heidi Krivo Rediker, 13:36

3. Policy, Demand, and Commercialization

• Crossing the “Valley of Death”:
  Persuading investors to back early-stage rare earth startups is hard when Chinese suppliers are currently cheaper. The solution? Secure offtake agreements—guaranteed demand, often from the government or industry consortia—to foster commercialization (16:57–19:22).

  "You have to have... companies actually coming together more in a consortia type of arrangement to have collective offtake agreements."
  —Heidi Krivo Rediker, 17:07

• Success Stories and Examples:

  • Vulcan: A new example of a co-funded, vertically integrated rare earth recycler that has combined military funding, tech innovation, and private investment to accelerate US production (17:40–19:22).
  • Niron Magnetics: Partnering with auto manufacturers for forward-leaning offtake agreements (17:07).

• Who Owns “Waste”?
  There are legal/policy questions about who owns industrial or electronic waste, which will need to be resolved to unlock this resource for domestic rare earth supply (19:37–21:02).

4. Policy Levers and Structural Recommendations

• Holistic, Non-fragmented Strategy:
  The US must coordinate across agencies and sectors—a patchwork approach loses game-changing innovations. Capture and analyze data on domestic waste, restrict unassessed exports, and create a parallel “critical mineral innovation strategy” alongside traditional mining (21:58–24:31).

• Filling the Venture Capital Gap:
  Early-stage innovation is constrained by lack of capital. US government-affiliated VCs like In-Q-Tel (the CIA’s venture arm) are filling gaps, but broader government and private support is needed (24:31–25:48).

  "There's a specific equity valley of death that a venture-like entity could help solve... Until we have solved for that market failure, these [innovations] will just lie on the shelf."
  —Heidi Krivo Rediker, 24:31

• Lessons from History:
  Analogies to the WWII synthetic rubber effort illustrate that industrial policy, recycling, and urgent action can crack choke points (26:15–27:50).

  "Without synthetic rubber we would not have won World War II... We did it with a rapid warp speed Manhattan Project."
  —Heidi Krivo Rediker, 26:36

• National Labs as Crown Jewels:
  US national labs and university research play pivotal roles and should be protected from funding cuts, especially in periods of urgent need (32:37–33:54).

• Embracing Risk:
  The hangover from Solyndra-like flops has stifled willingness to fund risky but necessary tech. Bipartisan buy-in and risk-taking are essential (34:09–34:30).

5. Environmental and Societal Trade-Offs

• Cleaner Mining Through Innovation:
  Traditional mining is inherently dirty, but new biotech and material science offer cleaner, faster, and more efficient alternatives. Example: Rio Tinto using proprietary microbes to extract copper from old mines (35:11–36:45).

• Win: National Security and Profitability:
  Technological breakthroughs may allow for both strategic security and economic competitiveness—even US exports—not just loss-making defense outlays (38:15–39:02).

  "It's interesting the prospect that there are technologies that not only could solve perhaps the sort of strategic element, but that actually could be cost competitive, perhaps could create export opportunities..."
  —Joe Weisenthal, 38:15

Notable Quotes & Memorable Moments

• "We shouldn't consider waste a liability. It's literally America's next mine."
  —Heidi Krivo Rediker (13:36)

• "It's a protein that is altered so that it can go in and sort of micro-target specific rare earth elements. And that is, I think it's kind of revolutionary. It's super disruptive."
  —Heidi Krivo Rediker (14:10)

• "There is a specific equity valley of death that a venture-like entity could help solve this for because you don't have... risk takers that will invest in difficult technology." —Heidi Krivo Rediker (24:31)

• "Without synthetic rubber, we would not have won World War II... We did it both through a rapid warp speed Manhattan Project."
  —Heidi Krivo Rediker (26:36)

• "The US has the capacity, the know-how, the science, the natural resources, the money to do it. I only question... whether we have the sort of organizational capacity."
  —Joe Weisenthal (39:44)

Timestamps for Major Segments

• Problem Setup & China’s Strategy: 00:36–06:27
• US Missed Opportunities and Current State: 09:36–10:26
• Leapfrogging with Science & Technology: 07:27–14:47
• Biotech in Rare Earth Extraction: 13:00–14:47
• Commercialization, Demand & Valley of Death: 16:55–19:22
• Who Owns Waste?: 19:37–21:02
• What Policy Needs to Change: 21:58–24:31
• Funding Gaps, In-Q-Tel Example: 24:31–25:48
• WWII Synthetic Rubber Analogy: 26:15–27:57
• Policy Continuity and Recent Urgency: 30:26–32:37
• National Labs’ Role and Funding Threats: 32:37–33:54
• Risk Tolerance Post-Solyndra: 34:09–34:30
• Environmental Trade-Offs and Clean Mining: 34:30–36:45
• Final Reflections on Potential & Coordination: 38:15–40:41

Tone and Language

The tone balances urgency, optimism about US innovation, and pragmatic concerns about coordination and risk aversion. The hosts frequently inject humor and analogies (WWII rubber, Jurassic Park microbes), and showcase genuine curiosity and excitement about science and engineering.

Key Takeaways

• China's advantage is deep and multi-faceted, but not insurmountable if the US uses its innovation edge.
• Game-changing tech already exists in labs; the challenge is scaling and de-risking commercialization.
• The US can’t outcompete China using traditional mining alone, but biotech and material innovation can “leapfrog” choke points—especially by mining waste.
• Strategic government intervention is crucial: VC-style investments, policy coordination, and demand assurance through offtake agreements.
• The window is open to turn a vulnerability into a strength—if the US acts boldly, coordinates efforts, and embraces risk.