Shipbuilding

The Surface Navy in an AI World: Rethinking the FFX

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By James J. Wirtz

No one disagrees that the Navy has not had much luck constructing warships this century. It also continues to face significant challenges when building the next small surface combatant, the Future Frigate (FFX). It is becoming increasingly difficult to pack meaningful warfighting capability into a ship that is smaller and cheaper to build and operate than today’s Arleigh Burke-class destroyers. Case in point: the Constellation-class Frigate program was terminated with two vessels under construction as the price per unit began to approximate the cost of a destroyer.1 Making matters worse, the U.S. industrial base and shipyards lack the wherewithal to build more than a few ships at a time, and even then, only at a measured pace. Those imagining, designing, and building the FFX confront a wicked problem: efforts to balance competing missions, construction costs, and time requirements tend to produce a suboptimal outcome that satisfies none of them.

Instead of hoping for different results from the same approach to force design by balancing competing requirements and ship construction, it is time to return to first principles to ask what unique qualities the FFX brings to the Navy in a future increasingly shaped by artificial intelligence (AI). Today’s effort to update well-known design and operational concepts with more advanced and expensive weapons, propulsion systems, and electronic accoutrements will likely produce disappointing results. What is needed is not a better ship based on traditional thinking, but new thinking about how a frigate can contribute to future combat effectiveness and national security. The U.S. Navy must look toward the future by ending the effort to gussy up old ways and rethink the role of the FFX in an AI world. It is time for the U.S. Navy to build its first ship designed intentionally to exploit the synthetic reality created by AI and operate with Large Unmanned Surface Vessels (LUSV), Extra Large Unmanned Undersea Vehicles (XLUUV), and Medium Unmanned Surface Vessels (MUSV), ships that can exceed frigates in terms of endurance and carrying capacities.

 

FFX and the Art and Science of War

Already, AI is having a profound impact on conflict, especially when it comes to the science of war, that is, the domain of war that can be quantified. In maritime affairs, this manifests in growing platform and weapons autonomy. Range, precision, and lethality are increasing, while cost and the need for human direction are decreasing. When it comes to calculating combat power, the importance of relatively inexpensive and increasingly autonomous weapons in theater and magazine depth is superseding the number of platforms available.2 Additionally, AI is creating a new, synthetic reality as it curates and analyzes nearly limitless amounts of data from myriad sensors, while presenting tactically useful information at a pace that would completely overwhelm even the largest staff. Commanders need computer assistance to make sense of the massive amounts of data available to them. Well-implemented AI workflows can provide operators with superhuman situational awareness to identify thousands of targets in real time, allocate available weapons efficiently, and update this synthetic reality faster than opponents can respond.3 The results are staggering: in the first 11 days of the war against Iran, U.S. forces struck more than 5,500 targets, including mobile missiles and drones on land and over 60 ships at sea.4 This stands in stark contrast to the fact that no SCUD missiles or their transporter-erector-launchers were destroyed on the ground by Coalition air attack or special operations during the 1991 war against Iraq.5

By contrast, the impact of AI on the art of war, which involves making decisions that require self-awareness, is a matter of debate. Some fear the emergence of a “Frankenstein’s Monster” that will lead to a creeping loss of control as humans grow too reliant on its advice when making key political or strategic decisions about the initiation, conduct, or termination of hostilities. Any human-in-the-loop, notes Anthony Becker, “may find their intent edited, eroded, or even eclipsed by the operation of the human-machine system, creating an inexorable pull toward deference to the machine.”6 Others envision the emergence of a human-machine team, which is often described as the best way to exploit AI’s ability to analyze and present data and the human ability to act on this synthetic reality.7 From this perspective, the synthetic reality created by the AI-enabled science of war will greatly empower humans as they make decisions that only humans can make (the art of war), that is, judgments made by the self-aware and eyes-on, hands-on actions. This human-machine teaming is already emerging in society: AI is replacing entry-level computer programmers, but not electricians, who are being enabled, but not replaced, by machines.8 All this suggests that the FFX’s most important role in the future is to gather this human-machine team together locally, allowing the humans aboard to bring the art of war to a micro setting. It is the people on board the FFX, not the weapons it will carry, that constitute the new ship’s unique contribution to national security. After all, precision-guided and increasingly autonomous weapons can arrive from all directions, but in situ human judgment and action are not so easily replaced.

The FFX’s primary function, then, is not as a warship but as a locus of American human-machine integration in a local setting. It brings human senses, judgment, “skin in the game,” and the ability to influence situations where a U.S. presence is desirable for tactical, operational, or strategic reasons. Its organic and distributed sensors feed synthetic reality at a local, regional, or theater-wide level, while the people on board integrate synthetic reality with human judgment and action to address immediate tactical situations. The FFX should be deliberately designed as the first ship built with human-machine integration as a priority. It should empower and protect the humans aboard as they interact with synthetic reality and autonomous weapons. In other words, at a minimum, the FFX should be built to operate with a mix of LUSVs, MUSVs, or XLUUVs depending on mission requirements. The autonomous platforms that accompany the FFX can provide the combat power and flexibility the Navy wants from a new frigate, but only if the Navy accommodates a new operational philosophy.

FFX: The Human Node in the Local Network

So, what would the FFX look like? Following a compelling assessment of how the Navy’s recent forays into shipbuilding came a cropper, Kevin Eyer, provided a bottom-line description of the FFX, which is currently based on the Coast Guard’s Legend-Class National Security Cutter: “The FF(X) should essentially function as a ‘horsed-up’ Coast Guard cutter equipped with a 5” gun, RAM point-defense missiles, and even the Naval Strike Missile, but nothing more sophisticated.” Eyer also suggests that the primary purpose behind the FFX would be to stimulate U.S. naval shipbuilding and that the vessel “will never be a pocket Arleigh Burke-class.” For Eyer, the FFX would augment and eventually replace the existing fleet of Littoral Combat ships, while bolstering the U.S. industrial base. Eyer believes that the new frigate would undertake maritime interdiction, mine countermeasures, and presence missions, although there is no reason why a new “drone frigate” could not undertake anti-submarine warfare and surface strike operations too.9

Eyer’s conception of the Future Frigate’s capabilities, missions, and impact on the defense industrial base makes perfect sense; it only requires four minor modifications before his platform can serve as the integrator of the human-machine team. First, one might remove piloted aircraft from the FFX and instead equip it with recoverable reconnaissance and one-way strike unmanned aerial vehicles capable of a mission kill against a similar platform at whatever range is deemed appropriate.

Second, the FFX should incorporate a spiral development philosophy; that is, it should be deliberately built to accommodate future technologies iteratively. Instead of spending months or years waiting for new systems or experimental weapons, FFX designers could settle on an 80-percent solution that would give warfighters access to the ship as quickly as possible for experimentation and training. Nevertheless, ship customers and developers must acknowledge that foundational design choices are generally locked into a minimum viable product – as illustrated by the lasting impact that the Littoral Combat Ship program’s high sprint speed requirement had on so many other elements of the platform. Changing the engine or hull length is not usually possible once a ship is built.10

Third, the ship should be built to accommodate a separate battle staff and significant command, control, and communication capabilities – capabilities not usually found on frigates. Initially, this battle cell might only require a few personnel. It should not be too hard to keep tabs on a couple of MUSVs built for autonomous operations, or to monitor synthetic reality, or to supply higher-level systems with local data. As more and different types of autonomous vessels are added to the ship’s reconnaissance-strike network, the size of the battle staff will probably increase. A division of responsibility would emerge. The ship’s commander and crew would operate the vessel, and its organic weapons, and supply the sailors needed to undertake hands-on, eyes-on activities, while the battle staff would operate the drone network and interact with higher echelons.

Fourth, to accommodate spiral development involving new types of weapons, and the eventual need for additional personnel, the new frigate should incorporate excess capacity, which means ample space, cooling, electricity, and whatever the best guess is about the additional resources that are likely to be required in the future. In other words, while the FFX would be optimized for drone operations, it would have the capacity to accommodate spiral development, especially new types of organic sensors and weapons. This is not the traditional tradeoff between mission-specific and general-purpose weapons procurement.11 Instead, it constitutes a hybrid approach to force design. Put somewhat differently, because it arrives with excess capacity at the outset, the FFX itself would be more of a general-purpose platform with a drone command center optimized to operate autonomous vessels and utilize theater-level synthetic reality.

All this requires a new way of thinking about what a warship is and what a warship does. Its fighting capability is not centered on its organic capabilities, but on its ability to support and capitalize on synthetic reality and organize its autonomous weapons into a local, or maybe a regional, reconnaissance-strike complex. Instead of a weapons platform, it is the human node in an AI-enabled network that can generate significant combat capability, far more capability than can be carried on any frigate. The LUSVs, MUSVs, or XLUUVs that accompany the new FFX would allow it to punch above its weight; it would have capabilities that cannot be packed into a vessel smaller than the Navy’s Arleigh Burke-class destroyer.

FFX: Spiral Development

Although spiral development generally refers to a process of continuous improvement in a platform’s capabilities, it can also occur across the drone network that accompanies the new FFX. Exactly how this network will operate is currently a matter of conjecture and needs to be worked out by designers and operators. The drones themselves should all be equipped with an intermediate force capability to drive off the curious or disable smaller vessels that approach too closely. Some LUSVs or MUSVs, under the appropriate circumstances, can also be equipped with the ability to self-destruct, especially if they can hold at risk a target that arrives in their immediate vicinity.12 In any event, one can imagine how this human-machine integration might be used to achieve several important missions.

Maritime Security and Surveillance

The new FFX should enter service with a complement of intelligence, surveillance, and reconnaissance (ISR) MUSVs that would enhance the frigate’s ability to generate situational awareness. Whether or not the ISR drones are made for broad ocean and air surveillance or to respond to queuing provided by synthetic reality, they would solve the Navy’s enduring problem of placing too many eggs in one basket.13 Active sensors would no longer signal the position of the FFX for thousands of miles in all directions, allowing it to approach potential targets in electronic silence. It would be desirable if the ISR drones could serve as decoys, mimicking the electronic and acoustic signature of an FFX, an Arleigh Burke-class destroyer, fishing boats, freighters, etc. The ISR drones would provide the Navy with a way to experiment with non-lethal autonomous systems in a variety of settings, paving the way for more lethal payloads.

Counter-Mine Networks

As recent events in the Strait of Hormuz suggest, even the threat of mined waterways and harbors can curtail commercial shipping and greatly restrict maritime operations. This situation is exacerbated by the fact that the counter-mine mission has been a low priority for the U.S. Navy for decades. MUSVs or XLUUVs equipped for the counter-mine mission might be a logical second capability to add to the ISR drone network. There is a real need to experiment with counter-mine capabilities to protect the approaches to U.S. harbors.

ASW Operations

Future ASW operations in the Navy will have to contend increasingly with crewed and autonomous underwater threats. Although the impulse will be to equip the FFX with organic ASW capabilities, force designers should keep the threat at bay and configure autonomous systems to counterattack submarines and subsurface drones that are themselves hunting for targets. Whether these systems can support Carrier Strike Groups or Surface Action Groups on the move remains to be seen; nevertheless, the combination of decoys and hunters creates interesting ASW possibilities in support of carrier operations. ASW MUSVs and XLUUVs should be more capable of patrolling American and allied littorals, searching for crewed and non-crewed subsurface threats. This capability would immediately help to secure Guam, Pearl Harbor, San Diego, and the approaches to the Panama Canal from subsurface drone and submarine attacks.14

Littoral Strike

While the previous drone networks would immediately enhance the Navy’s tactical capabilities, equipping drones with surface-to-surface strike systems to augment the FFX would bolster a deterrence-by-denial strategy, especially along the First Island Chain archipelago. Placed among coastal traffic and the clutter of the shoreline, the FFX’s reconnaissance-strike complex would provide an immediate sea denial capability to the United States as the remainder of the Joint Force moves toward the area to respond to aggression. Instead of abandoning the area and allies as the long-range battle plays out overhead, the FFX and its drone flotilla can confront the opponent, creating immediate opposition to an attempt at a fait accompli before the Navy can overcome the tyranny of distance and respond accordingly.15 The FFX would also confront the opponent with the harsh reality of war immediately by responding at the point of aggression; Washington would no longer be faced with the onus of horizontal or vertical escalation after a fait accompli, but would instead be able to defeat an opponent at the point and time of attack by responding in kind. Control of the waters surrounding the archipelago would also help protect allied and U.S. land forces operating long-range strike weapons to influence events along the Asian mainland’s littorals.

Air Defense

Today, the Navy operates two types of surface combatants: a large air-defense cruiser (Ticonderoga-class guided-missile cruisers) and a small air-defense cruiser (Arleigh Burke-class guided-missile destroyers) equipped with the highly capable Aegis system that relies on the SPY-1 radar and a family of Standard Missiles. Unfortunately, the Aegis system will not fit on a vessel much smaller than an Arleigh Burke-class destroyer, so the FFX cannot provide high-end air defenses. An FFX could escort and control LUSVs carrying Standard Missiles that might be fired by Aegis-equipped warships in a local reconnaissance-strike complex, but high-capability air and missile defense is not an option for the new frigate. It was the absence of a significant air defense capability that might have led to the cancellation of the Constellation-class Frigate.

LUSVs accompanying the FFX, however, could be configured to provide relatively low-cost and distributed air defenses against drones, cruise missiles, helicopters, and low-flying aircraft. The Marine Air Defense Integrated System (MADIS) might be adapted for LUSVs to detect and destroy low-altitude drones and piloted aircraft using its organic radar, Stinger missiles, 30mm cannon, and 7.62mm miniguns. MADIS can backstop more capable Aegis-equipped warships by supplying an inexpensive way to defeat drones, cruise missiles, and piloted aircraft, saving high-cost Standard Missiles for more demanding ballistic and cruise missile targets.16 The FFX and its MADIS-like autonomous system might be a way to provide the Fleet with a cost-effective air defense against the drone threat.

Search and Rescue

Today, if a major surface combatant is lost, the Navy would be hard-pressed to rescue hundreds, or even thousands, of sailors who might find themselves in the water.17 If assigned to a Carrier Strike Group, the FFX might be equipped with a LUSV “lifeboat” that operates nearby but out of harm’s way. One could place hundreds of inflatable rafts on the vessel so that they can be jettisoned to survivors in the water. It might also be possible to create a system to retrieve sailors in the water and to bring them on board where temporary shelter, food, and medical supplies would be stored. Of course, retrieving injured sailors from the water is easier said than done; nevertheless, necessity is the mother of invention. Warfighters should be realistic about warfare.

Conclusion

Nearly all the drone missions described above are a matter of active consideration or increasingly ambitious experimentation by the Navy. New organizations and personnel designators related to the operation of autonomous platforms are also standing up, providing a way to institutionalize drone operations within the Fleet.18 Nevertheless, amid all this activity, there is a tendency not to see the forest for the trees: more effort is needed to achieve the human-machine teaming demanded by AI to best exploit the potential of synthetic reality and autonomy. There is a tendency to proceed willy-nilly, without a guiding philosophy and an associated concept of operations that is designed to exploit new opportunities. The Navy will have to do things differently before it can use new technology to its full potential. It remains to be seen if Navy culture will foster the requisite change or impede it.

The FFX is a case in point. Instead of going back to the drawing board to pack more high-end warfighting capability into an ever-smaller package, rethinking what a frigate contributes to the human-machine team allows us to see a small surface combatant in a new light. Instead of a platform for employing weapons, it provides a ringside seat for the humans to influence events, especially when mindful, eyes-on, hands-on actions are needed for success. It is a way to use the science of war to empower the art of war. It is a way to demonstrate that the United States is willing to risk involvement in a sticky situation and engage opponents in a meaningful way. The LUSVs, MUSVs, or XLUUVs that could serve as the primary weapons systems for the FFX will help its crew give as good as they get until the Joint Force Arrives. Even in the age of sail, no one could realistically expect a small surface combatant to do more than that.

James. J. Wirtz is a Professor of National Security Affairs at the Naval Postgraduate School in Monterey, CA. He has written extensively about intelligence, strategy, nuclear and conventional deterrence, and maritime affairs. 

Endnotes

1. As Secretary of the Navy John Phelan noted, “the reason Constellation Class frigate was canceled because, candidly, it didn’t make sense anymore to build it. It was 80% of the cost of a destroyer and 60% of the capability.  You might as well build destroyers,” see Ronald O’Rourke, “Navy Constellation (FFG-62) and FF(X) Class Frigate Programs: Background and Issues for Congress,” R44972 Congressional Research Service January 5, 2026, p. 2. https://www.congress.gov/crs_external_products/R/PDF/R44972/R44972.133.pdf

2. Jeffrey E. Kline, “Impacts of the Robotics Age on Naval Force Design, Effectiveness, and Acquisition,” Naval War College Review, Vol 70, No. 3, Summer 2017: 63-78.

3. James J. Wirtz, “Artificial Intelligence, Synthetic Reality, and Future Warfare,” Political Science Quarterly Advance Publication 12 February 2026. https://doi.org/10.1093/psquar/qqaf159

4. Miriam Sela-Eitam, “US destroyed over 5,000 targets across Iran, including 60 warships, CENTCOM chief says,” The Jerusalem Post, March 11, 2026. https://www.jpost.com/middle-east/iran-news/article-889602

5. Mark E. Kipphut, “Crossbow and Gulf War Counter-SCUD Efforts: Lessons from History,” AU/AWC/RWP126/94-96. Air War College, Maxwell Air Force Base, Alabama, 1996:52 https://apps.dtic.mil/sti/tr/pdf/ADA393984.pdf

6. Anthony Becker, “War Threatens Control of Military AI,” U.S Naval Institute Proceedings, Vol. 151/6/1,468 June 2025.

7. Robert O. Work and Shawn Brimley, “20YY: Preparing for War in the Robotic Age,” Center for New American Security (January 2014): 30.

8. “Unleashing developer productivity with generative AI,” McKinsey & Company, June 27, 2023. https://www.mckinsey.com/capabilities/tech-and-ai/our-insights/unleashing-developer-productivity-with-generative-ai; and “AI Automation Could Replace 300 Million Jobs, Skilled Trades Remain Safe,” Business Honor November 6, 2025. https://businesshonor.com/2025/11/ai-jobs-trades-automation-risk

9. Kevin Eyer, “Three Shipbuilding Failures and A Future” USNI Proceedings, Vol 153/4/1,478, April 2006.

10. Austin Gray and James Wirtz, “Spiral Development as a Strategic Asset,” USNI Proceedings Vol. 151/12/1,474 December 2025.

11. Stephen Peter Rosen, Winning the Next War: Innovation and the Modern Military (Ithaca: Cornell University Press, 1991): 243-249; J. Ding and A. Dafoe, “Engines of power: Electricity, AI, and general-purpose, military transformations.” European Journal of International Security. 2023;8(3):377-394. doi:10.1017/eis.2023.1

12. Collin Fox, “Taking Notes from Narcos: Semisubmersible Unmanned Ships for Great Power Competition,” Center for International Maritime Security (CIMSEC), May 1, 2020, https://cimsec.org/taking-notes-from-narcos-semisubmersible-unmanned-ships-for-great-power-competition/.

13. James J. Wirtz, Jeffrey E. Kline, and James A. Russell, “A Maritime Conversation with America,” Orbis Vol. 66. Iss. 2, Spring 2022: 178-180.

14. The Coast Guard should incorporate these counter-mine and ASW capabilities to protect U.S. littorals.

15. Wirtz, Kline, and Russell: 175-178.

16. MADIS Marine Air Defense Integrated System,” Global Defense News, June 5, 2026. https://www.armyrecognition.com/military-products/army/air-defense-systems/air-defense-vehicles/madis-marine-air-defense-integrated-system

17. James J. Wirtz, “Imagining Maritime Conflict in the Indo-Pacific: Can Analogies Substitute for Strategy?” Defense & Security Analysis 38, no. 3 (2022): 349–68, https://doi.org/10.1080/14751798.2022.2093433.

18. Jodesz Gavilan, “US Navy to Deploy First Medium Unmanned Surface Vessels,” The Defense Post, January 19, 2026. https://thedefensepost.com/2026/01/19/us-navy-usvs/

Featured image: Aircraft from the Carl Vinson Carrier Strike Group (VINCSG) and French Carrier Strike Group (CSG) fly in formation over the Philippine Sea with ships from VINCSG, French CSG, the Japan Maritime Self-Defense Force (JMSDF), and U.S. Military Sealift Command (MSC) during Pacific Steller 2025, Feb. 12. (U.S. Navy photo by Mass Communication Specialist Seaman Apprentice Pablo Chavez)

Training and Exercises

Strategic Messaging, Deterrence, and RIMPAC 26

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By Adam Lockyer

Between June 24 to July 31, Exercise Rim of the Pacific (RIMPAC) 2026 took place on and around the Hawaiian Islands. RIMPAC is the world’s largest international exercise. In this, its 30th iteration, RIMPAC boasted 25,000 personnel, 40 surface ships, 5 submarines, and 140 aircraft. Beyond the impressive headlines, however, RIMPAC has become a relic of the Cold War and needs revitalization and reorientation.

Major maritime exercises serve a range of functions, including to certify crews, and for the participants to learn new skills, test equipment, and gain experience working alongside units from near and from afar. In addition, however, a good major maritime exercise should also be a vehicle for strategic messaging. Major maritime exercises are relatively rare and expensive enterprises. So, they send a strong signal to the participants and to onlookers what the exerciser considers to be its main strategic challenges and helps to outline how they plan on responding to those challenges. In my newly released book – Conventional Maritime Deterrence: The Operational Foundations of Influence at Sea – I unpick how major maritime exercises can contribute to deterrence. I explain how they have a performative dimension. They tell opponents (as well as friends and one’s own forces) a strategic story about the future. If you do this, then this is how we will respond and we are very good at it, so it is probably best that you don’t.

Yet, RIMPAC is symptomatic of many of the current suite of international maritime exercises in being wedded to an international strategic environment that has long moved on. At best, it is a missed opportunity. At worst, it negatively affects strategic messaging and, therefore, the effectiveness of our overall deterrence posture.

RIMPAC’s Origin Story

RIMPAC was first held in 1971 and, after being repeated in 1972, became the US Pacific Fleet’s largest biennial multinational exercise. The Cold War in the Pacific had a very different cadence to that across in the Atlantic. Few doubted that Europe and the Atlantic would be the epicenter of any future conventional war between the United States (and its allies) and the Soviet Union (and its aligned states). The Pacific, on the other hand, was likely going to be a relatively quiet backwater. Indeed, until the 1980s, US naval strategy called for the Pacific’s aircraft carriers to be swung over to Atlantic to reinforce, or replace, the Atlantic’s carrier forces. Through the 1970s, the Soviets in the Far East were more concerned about the Chinese land forces that were amassed along their shared border, than American naval power. They feared that Beijing might seize the opportunity of a war in Europe to mount a surprise attack in the East. Moreover, America’s Pacific allies – Australia, the Philippines, Japan and South Korea – were quietly pleased that they might be able to sit out the conventional phase of World War III.

So, unlike the NATO members in the North Atlantic and Mediterranean, who regularly participated in more realistic and warlike exercises (e.g., OCEAN SAFARI or NORTHERN WEDDING), America’s Pacific partners were less enthusiastic about rocking the boat by conducting forward exercises directed towards the Soviet Union’s Pacific periphery. As a result, the US Pacific Fleet largely conduct unilateral forward exercises (such as the FLEETEX series in the 1980s) with some occasional Canadian involvement.

RIMPAC was an exercise for its times. In addition to the pleasant climate, beaches, and shopping, Hawaii was far enough away from the Soviet Union so not to be provocative. The participants were attracted by the prospect of working alongside the world’s best navy and undertaking activities that they often did not have the opportunity to do back home. The exercise scenario usually involved some creative writing so that all the foreign units could practice what they came to do, and no-one would be left out. Unsurprisingly, the prospect of traveling to Hawaii and doing fun things continues to make RIMPAC very popular. In 2026, there were once again contingents from around the world, including Israel, Germany, Poland, and Greece.  

This is not to imply that RIMPAC, in its current form, has no strategic value. Indeed, its inclusive scenario, its non-provocative setting, and its ability to attract partners from far and wide, has several positive outputs. First among these is that signals the breadth of the United States-led coalition without forcing any one nation to choose a side. The mere fact that the US Pacific Fleet pulls contingents from over 30 nations is a tangible example of America’s enduring soft power. Second, attracting thousands of foreign personnel, from around the world, allows the participants to build inter-personal relationships that can be drawn upon later. Establishing and maintaining international friendships – at all levels – banks valuable social capital that can be spent later in the pursuit of the national interest. Finally, the argument could be made that the sight of over 25,000 personnel, all working to advance interoperability, contributes to deterrence by influencing perceptions of the balance of power across the Pacific.

The argument here is not that RIMPAC has no strategic value. If we could continue to hold an old and new RIMPAC, then we certainly should. But this would be lazy analysis when we know that budgets are not keeping pace with demands and, therefore, regional navies are already operating beyond their stretching point.

The argument here turns on the opportunity costs. If we accept that the Pacific has the capacity to hold one large regional-wide biennial exercise, is RIMPAC, under its current guise, the very best option?

RIMPAC for a New Era

The Pacific is no longer a quiet strategic backwater. For exercises to better contribute to strategic messaging, and deterrence, they should evolve to reflect the challenges that the region is now facing. Some exercises should concentrate upon responding to the most likely flash points. For example, exercise scenarios that challenge participants to respond to localized conflicts in the South China Sea or in Japan’s near seas.

China’s exercises around Taiwan that rehearse a blockade or maritime quarantine (e.g., its JOINT SWORD series), for example, should be treated as a message that has been delivered, and now requires a reply. The response being a US-led anti-blockade exercise. This exercise should employ the same strategic language as the Chinese (e.g., an emphasis on jointness, etc.) so that nothing is lost in translation. The resulting strategic message will be clear: if you do that, we will respond this way, and as you can see, we are very good.

There is some movement in this direction. VALIANT SHIELD, for instance, is a Western Pacific exercise that has evolved from being a unilateral exercise in 2006, into now being multinational (the 2026 iteration is primarily a US and Japan affair with Australia, Canada and New Zealand sending smaller contingents). VALIANT SHIELD rehearses defensive sea control operations through the Pacific Rim island chain. That is, integrating land-based missiles, aircraft and drones with naval units to achieve sea control through the choke points and island chains. VALIANT SHIELD ’26, held between June 22 and July 1, highlighted some of the challenges with putting theory into practice. For example, although during VALIANT SHIELD the USS George Washington Carrier Strike Group and the Japanese flat-top JS Kaga (DDH-184) along with other vessels exercised around Guam and the Northern Mariana Islands, the land-based activities – that included the Japanese Typhon Missile System and HIMARS – were all 1,600 miles away on the Japanese main island of Kyushu. While this simply reflected many of the political, logistical, and geographic realities of running a large multinational exercise, it remained some way from the ideal case of strategic messaging that would be far more geographically focused and have a sharper exercise scenario.

In addition, to localized scenarios, there is need to rehearse how America and its allies would respond to a regional-wide conflict. The leading candidate would be a reimaged RIMPAC.

In the future, rather than traveling to Hawaii, participants could enact how they plan to respond to regional war. RIMPAC would become the umbrella exercise under which regional allies and security partners rehearse their part in a regional war. For Pacific Rim nations (e.g., South Korea, Japan, and Australia), this would mean exercising in their own near seas with contributions from extra-regional states. For its part, the US Pacific Fleet would practice coordinating its efforts with its regional allies. A Western Pacific RIMPAC would also be a valuable opportunity for land forces to rehearse racing forward to important maritime choke points to assist in seizing and holding sea control through the littorals. The US Marine Corps’ Expeditionary Advanced Base Operations (EABO) concept could be tested and refined at scale and alongside allies. Indeed, in addition to the US Marines, several of America’s allies and friends are moving in a similar direction. The Australian Army, for example, is being equipped with large landing craft and long-range missiles, with the explicit expectation that it will surge forward into the Melanesian archipelago to its north and contribute to achieving defensive sea control through the choke points.

It would be valuable to the participants to observe how their own operational concepts work in conjunction with their partners and begin working through the inevitable initial kinks in coordination and logistics. Equally as important, the strategic messaging would sharpen. For Beijing, this would be a jarring image of a how a regional-wide war may unfold. This, more than any other factor, will reinforce conventional maritime deterrence.

Of course, not all will be happy. The ASEAN states, for instance, could be expected to quietly communicate objections. And their views would not be entirely wrong. On balance, the economic opportunities offered by engaging with China still outweigh the security risks for most Indo-Pacific nations. Furthermore, the Indo-Pacific region has no choice but to learn to live alongside a great power whose diplomatic, military, and economic strength already casts a long shadow over the entire Pacific and will continue to do so for the foreseeable future. However, it should be explained to concerned parties, that regional peace, stability and economic prosperity is reinforced by making it clear through words and deeds what a conflict would look like should Beijing decide to walk down the wrong path. Although counter intuitive, the best way of securing our business ties with China might be to reimagine our major maritime exercises so they are much better at telling a story about the future no one wants to see play out.

For similar reasons, it wouldn’t be surprising if the number of participating nations in RIMPAC shrunk. Those nations that don’t have vital national interests at play in deterring China will likely sit future RIMPACs out. But a RIMPAC that reorients towards depth rather than breadth would not necessarily be a bad thing. In the post-Cold War era, when America sought to advance the international rules-based order under its leadership, signing up as many member states as possible made sense. Even a token contribution to an international exercise, such as RIMPAC, signaled a commitment to the principles that the exercise represented. Today, however, the depth of the participants’ commitment matters more. An authentic depiction of how the participants plan to respond in different situations will produce both higher quality training and strategic messaging.  

Effective deterrence requires a fine calibration. If a posture of a deterring actor appears too risk-averse or lacking in force, then an opponent may decide that the actor’s heart really isn’t in it and accepts the gamble. On the other hand, if a posture is too reckless or aggressive, then it might lead to a security dilemma. Many years ago, Robert Jervis, Richard Ned Lebow and Janice Gross Stein convincingly presented historical cases of deterrence that exacerbate the sense of insecurity in the target and triggered the exact war the deterring states were attempting to avoid. The challenge is calibration. Major exercises should not be too provocative nor too timid. The direction of movement in the defense posture of America’s key Pacific Rim partners is towards variations of a strategy of denial (e.g., see Australia’s National Defence Strategy). These are not offensive nor overly aggressive strategies. The new RIMPAC would simply breathe life into these strategic documents. The activities themselves would likely resemble VALIANT SHIELD ’26 but stretch the length of the Pacific Rim island chain. This Goldilocks exercise would, on the one hand, clearly demonstrate unity, commitment, capability and provide a compelling strategic narrative, while also being decidedly defensive in orientation and located in the near seas of the Pacific Rim partners.  It would be a RIMPAC for our times.

Adam Lockyer is the Executive Director of the Geopolitical Risk Research Centre and Associate Professor in Strategic Studies at Macquarie University. He is the author of four books, including his latest: Conventional Maritime Deterrence: the Operational Foundations of Influence at Sea (Georgetown 2026). He was awarded the 2015 Fulbright Scholarship in US-Australian Alliance Studies at Georgetown University, and before joining Macquarie held positions at the University of New South Wales, the United States Studies Centre at the University of Sydney, and the Center for Strategic and International Studies, in Washington, DC.

Featured image: Multinational ships sail in formation during Exercise Rim of the Pacific 2026 in the Pacific Ocean, July 22, 2026.  (U.S. Navy Photo)

 

Africa

Beyond Drug Seizures: What Nigeria’s Meth Labs Reveal About the Flow of Transnational Crime

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By Ebunoluwa George Ojo-Ami and Dr. Ian Ralby

The recent discovery of covert methamphetamine laboratories in southwestern Nigeria should not be viewed simply as another successful drug raid. Instead, these operations provide a glimpse into an emerging reality, revealing a fundamental shift in how transnational criminal organizations are actively adapting their production models, expanding their geographic footprint, and embedding themselves deeper within West Africa.

In June 2026, Nigeria’s National Drug Law Enforcement Agency (NDLEA) uncovered an industrial-scale methamphetamine laboratory hidden within a forested area of Oyo State, arresting a Mexican national alongside four Nigerian accomplices. The operation came only weeks after authorities dismantled a Nigerian-Mexican methamphetamine syndicate operating another clandestine laboratory in Ogun State, resulting in the arrest of three Mexican nationals and six Nigerians.

The presence of foreign meth “cooks” operating in Nigeria is particularly significant. It shows that criminal networks are not merely using West Africa as a transit corridor for narcotics, but increasingly as a production hub. This shift suggests a deliberate strategy: relocating portions of the drug manufacturing chain closer to the markets, exploiting areas perceived as lower-risk operating environments, and diversifying logistics networks to improve concealment from law enforcement. If drug production can occur in Africa to supply both the African and European markets, it reduces the maritime visibility of the supply chains. Precursor chemicals can come from other parts of the world, complicating patterns of maritime drug enforcement in the region that have been working to improve their effectiveness in recent years and testing the legislation of coastal states.

The maritime dimension of this shift deserves closer scrutiny. The move from trafficking finished products across oceans to producing drugs closer to destination markets does not make the maritime angle disappear; it changes what security agencies and authorities need to detect. A laboratory hidden inland may have no obvious narcotics signature at the port, yet the production chain will still depend on the movement of raw material or precursor chemicals, equipment, solvents, financing and other inputs across borders. The United Nations Office on Drugs and Crime (UNODC) has documented how precursor chemicals can enter West Africa through commercial channels and then be relocated to the site that is most logistically convenient, complicating efforts to differentiate between legitimate commerce and illicit diversion. Nigeria’s current enforcement experience also shows how central the maritime domain remains: in June and July 2026, NDLEA reported major seizures at Lagos ports involving containers that had moved through multiple international transshipment points before reaching Nigeria. The implication is that maritime enforcement cannot focus only on identifying finished narcotics. It increasingly has to understand the wider supply chain that makes inland production possible. That places greater importance on intelligence sharing among customs, port authorities, navies, coast guards, police forces, drug-enforcement agencies and international partners, particularly where legitimate commercial cargo can provide cover for illicit movements.

Two Mexican criminal organizations are driving this expansion: the Sinaloa Cartel and the Jalisco New Generation Cartel (CJNG). According to Vanda Felbab-Brown of the Brookings Institution, the Sinaloa Cartel pioneered the African cocaine corridor, focusing initially on routing cocaine through Africa into Europe. CJNG followed with a characteristically more brutal and intense approach, an organization described by the International Institute for Strategic Studies as “more aggressive, ruthless and less willing to negotiate with rival power centers when moving into new territory,” with a presence on every continent except Antarctica.

Historically, West Africa’s role in the global narcotics trade has centered on transshipment. The region became an important corridor for cocaine moving from South America to Europe and, increasingly, for synthetic drugs destined for international markets. However, recent events show the region in an active phase which has been tested before, one in which it is becoming a site of industrial-scale production itself.

The choice of remote forest locations for these labs is equally telling. Such areas provide concealment from authorities, reduce the likelihood of accidental discovery, and allow criminal groups to establish secure operating bases with minimal scrutiny. This mirrors trends observed elsewhere in the world, where organized crime groups have increasingly moved production facilities away from certain areas into isolated environments that offer operational security.

The involvement of Mexican nationals also raises important questions about knowledge transfer. The global methamphetamine trade relies heavily on technical expertise and specialized production methods. As foreign criminal actors establish themselves in West Africa, there exists the possibility that these skills could gradually be transferred to local criminal networks, reducing dependence on external expertise and potentially enabling indigenous production capabilities to emerge over time. This might not be accidental, but could be a franchise model, where international expertise is embedded locally to build sustainable capacity.

A consequential question may be whether specialized knowledge becomes locally reproducible. The arrest of a foreign methamphetamine expert is an important enforcement success, but the long-term strategic concern is what happens if foreign expertise is gradually converted into local capability. Nigeria already has established chemical, pharmaceutical and logistics sectors, and UNODC has noted the country’s capacity to produce synthetic drugs alongside its role as an importer of precursor chemicals for legitimate pharmaceutical activity. That dual-use environment creates a difficult enforcement problem: the same commercial ecosystems that support legitimate industry can also provide knowledge, materials, equipment or logistical services that criminal actors may seek to exploit. The concern is not that legitimate industry is inherently complicit, but that criminal networks can draw on expertise and infrastructure that already exist. Over time, this could make production more resilient, because the network would no longer depend on a small number of foreign specialists. What begins as imported expertise could become embedded capability.

With distinctive drug production – particularly West African Kush and some forms of cannabis resin – already creating new directions in drug flows from Africa to other parts of the world, including to Latin America and the Caribbean, the expansion of drug production in Nigeria could spell trouble.  In a country known for innovation and enterprise, establishing domestic illicit drug-making facilities could help fuel not only a growing demand for drugs in the African market, but a global demand for novel substances.

From a strategic perspective, these events may reflect broader changes within the global narcotics economy. Intensified counter-narcotics operations in the Americas, increasing maritime interdiction efforts, and heightened surveillance of established trafficking corridors have forced criminal organizations to adapt. Organized crime thrives on flexibility. When one route becomes difficult, another is created. When one production center becomes too risky, new locations emerge.

Africa may increasingly present itself as an attractive alternative offering lower operational risks, growing consumer markets, enforcement capacities gaps in certain jurisdictions, and access to new smuggling networks. The continent’s extensive coastline, busy commercial ports, and historical role in illicit trafficking routes also provide opportunities for integrating locally produced narcotics into existing maritime logistics chains.

This is where the issue transcends narcotics enforcement and becomes a broader security concern. Drug trafficking networks are rarely isolated enterprises. They are interconnected with money laundering, corruption, arms trafficking, document fraud, prostitution and sex trafficking and other forms of organized crime. The same criminal ecosystems that move drugs can also facilitate other illicit activities that undermine governance and regional security.

These developments deserve close attention. The recent events on industrial-scale drug production in Nigeria highlight how transnational criminal networks continue to adapt and exploit gaps across both land and maritime domains. While the laboratories themselves may be hidden deep within forests, the networks that sustain them are inherently transnational, relying on logistics, financial flows, and trafficking routes that extend far beyond Nigeria’s borders.

There is, of course, an irony to all of this. As global supply chains begin to crack and break under the strains caused by various strategic shocks (most notably conflicts at critical maritime choke points currently impeding the flow of about 20% of global energy), we see a general trend towards shrinking supply chains. By localizing food supply chains and others that are critical for human needs, we can potentially avoid the long shipment requirements, costs, and uncertainties around accessing goods in the globalized marketplace.

Drug cartels seem to be doing something similar while, at the same time, diversifying their footprint so as to ensure greater business resiliency and continuity amid these turbulent times. As many of the counter-narcotics entities, agencies, and mechanisms are focused on historic styles of drug flow, the cartels will likely have an advantage for some time, waiting for bureaucratic mechanisms to catch up and change mandates to focus on the necessary elements, including precursor chemicals and African-origin drugs. The question is how much damage can be done during that time delay?

The latest NDLEA operations are therefore more than drug seizures; they are indicators of an active threat environment. They suggest that West Africa’s role in the global narcotics trade is changing from a corridor of transit to a node of production.

Ebunoluwa George Ojo-Ami is a senior analyst specializing in maritime security, intelligence analysis, and unmanned systems across Africa’s maritime domain. His expertise spans Gulf of Guinea security dynamics, OSINT-driven intelligence analysis, maritime domain awareness, port and offshore security, drone threats, and the evolving use of unmanned systems in maritime security and operations by both state and non-state actors across Africa. His analysis has been featured in international security and maritime publications, and he has previously appeared on CIMSEC’s Sea Control podcast to discuss security challenges in the Gulf of Guinea.

Dr. Ian Ralby is President of Auxilium Worldwide, a charitable nonprofit that, among other things, focuses on ocean governance, and he is CEO of I.R. Consilium, a maritime and resource security consultancy. He is a globally recognized expert in maritime law and security and has worked in over 100 countries around the world, including having done extensive work on counter narcotics in the Caribbean and the Gulf of Guinea.

Featured image: Nigerian Navy and Police Force personnel conduct Visit, Board, Search and Seizure training during exercise Obangame Express 2023 in Lagos, Nigeria, Jan. 25, 2023. (U.S. Navy photo by Mass Communication Specialist 2nd Class Andrea Rumple)

Economics and Trade

Elemental Leverage: How the United States Can Stop China’s Rare-Earths Squeeze Before the Next Crisis

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By Josh Richards and Joseph Hanacek

The Elemental Weapon

When China threatens to close its fist, the world listens. In August 2025, Li Chenggang, Beijing’s chief trade negotiator, didn’t bother with euphemism. If the United States continued tightening controls on advanced technologies, he warned, China would answer by restricting exports of the metals that make those technologies possible.1 Rare-earth elements, the invisible foundation of jet engines, electric vehicles, and precision weapons, had become bargaining chips in a new kind of power game.

It was a small statement with continental consequences. Within weeks, Chinese ministries began slowing export licenses for certain alloys and magnetic materials, sending nervous tremors through markets from Tokyo to Detroit. The message was unmistakable: what Washington thinks of as global supply chains, Beijing sees as instruments of leverage.

That moment captured the logic of the age. Over the last two decades, the United States and its allies treated the materials that underpin modern life, rare-earths such as lithium and cobalt as the anonymous plumbing of globalization. China treated them as strategy. Today it controls most of the world’s processing and virtually all of the stages that matter: refining, separation, and magnet manufacturing. In total, Beijing controls roughly 70 % of global mining, about 90 % of separation/processing, and more than 90 % of high-performance magnet manufacturing.2 The result is an asymmetry more dangerous than most weapons systems because it operates quietly, through dependency rather than force.

This is not simply a rehearsal for war over Taiwan and the global semiconductor market, though that flashpoint looms over everything. It is part of a broader campaign to reorder the global balance of power, to remind every nation that in the 21st century, the flow of materials can be as decisive as the movement of troops. Rare-earths have become Beijing’s favorite pressure point because they embody the new reality of competition: the next crisis may begin not in the Taiwan Strait, but in a factory that can no longer get the magnets it needs.

And yet, the story is not just about China’s dominance, it is about America’s choices. Whether the United States treats this as a passing market fluctuation or a defining national-security test will determine not only its industrial resilience, but its ability to deter coercion before a single shot is fired.

The Strategic Context: Material Leverage in a Post-Industrial Age

Beijing’s threats over rare-earth exports are not a sudden innovation; they are the predictable evolution of a decades-long strategy. China benefits from low-cost mining and lax environmental regulation, but their dominance in rare earth elements did not emerge purely from geological luck. Rather, China employed deliberate statecraft, leveraging industrial policy fused with geopolitical vision. Since the late 1990s, the Chinese government has poured billions into refining, separation, and magnet-making infrastructure, while the United States dismantled its own. By the 2010s, Beijing had learned to turn economic scale into political leverage: subsidize the middle of the supply chain, flood global markets, drive out competitors, and then consolidate control. What began as a commercial edge became a coercive instrument. 3

The results are stark. China now accounts for the overwhelming majority of global rare-earth processing and nearly all of the world’s high-performance magnet production—the beating heart of everything from precision weapons to renewable-energy systems. In a global economy where advanced technologies are the currency of power, control of materials is control of tempo. Beijing understands this intimately. Its 2023 export-control laws, followed by tightened magnet licensing in 2025, were not about profit; they were about signaling. 4 Each new bureaucratic delay or “security review” serves as a reminder that dependency is a policy choice, and that global markets operate at China’s discretion. 5

For the United States, this is not merely an economic vulnerability—it is a strategic liability. Every day that the refining, alloying, and magnet-making that feed America’s defense and technology sectors remain concentrated overseas, Washington’s deterrent posture weakens. The lesson is familiar to anyone who watched Russia’s manipulation of Europe’s gas supply in 2021: energy dependence and material dependence both collapse deterrence long before the first crisis erupts.

Why the U.S. Can’t Wait for Taiwan

It is tempting to treat China’s tightening grip on rare-earths as a prelude to war over Taiwan, a crisis to be managed “when the time comes.” That would be a mistake. The rare-earth squeeze is already here, unfolding in boardrooms and customs ports rather than battlefields. The August 2025 remarks from Li Chenggang were not idle bluster. They marked a deliberate escalation in Beijing’s campaign to use industrial interdependence as leverage, an offensive waged through permits, tariffs, and export licenses instead of missiles. 6

Beijing’s logic is simple and effective: coerce early, not late. By testing Western vulnerabilities before open conflict, China forces companies and governments into self-censorship and hesitation. It pressures investors to think twice about U.S. manufacturing projects and signals to allies that Washington cannot protect their supply chains. In other words, the weaponization of trade happens during peacetime precisely because it is more efficient than war.

Yet this economic coercion is not separate from Beijing’s territorial ambitions, but a prelude to them. The same strategic vision that seeks dominance in the Taiwan Strait also seeks dominance in the global flow of strategic materials. In both cases, the goal is the same: to make resistance costly and compliance inevitable.

If the United States waits for a military crisis to address these dependencies, it will have already lost the contest that matters most over industrial sovereignty. A credible response must begin now, while the tools of competition are still commercial and the battlefield still economic. The coming decade will test whether Washington can rewire its supply chains faster than Beijing can weaponize them.

The question of how to outmaneuver China is not abstract, but physical: how to rebuild the industrial arteries that power American strength. The contest over rare earths is a contest over the tangible ingredients of deterrence, the metals inside every jet, missile, motor, and microchip. What Beijing has achieved through decades of patient investment is not just control of markets but control of manufacturing tempo. To understand why this matters, and how deeply it runs through the U.S. economy, one must look beneath the headlines of trade disputes and into the machinery itself: where magnets, alloys, and sensors meet strategy.

Where the U.S. (and Allies) are Exposed

The United States’ advanced-technology economy is built on foundations most citizens never see and fewer understand. Every modern instrument of power, whether a fighter jet banking over the Pacific, a hypersonic missile guiding at Mach 5, an electric vehicle gliding through traffic, or a smart phone depends on the same microscopic ingredients: rare-earth elements. Neodymium, praseodymium, dysprosium, and terbium are not household names, but they are the metals that turn electrical energy into movement and precision. They make magnets that can survive the heat of jet engines, sensors that can detect the faintest electronic signals, and motors that spin with unmatched efficiency. When the ability to mine, refine, and magnetize those materials sits almost entirely overseas, dependency becomes a design flaw and a geopolitical risk. A shortage wouldn’t just slow production; it would stall entire defense and clean-energy programs at once.

The vulnerability lies not only at the start of the chain where ore is mined, but more critically in the middle, where those ores are refined, separated, and transformed into alloys and magnets. This “midstream” is where complexity, not geology, determines control. The United States can mine all the raw material it wants, but if it must still send concentrates overseas for separation or metallization, it remains at the mercy of those who own the processing plants. The Mountain Pass Mine in California illustrates the dilemma perfectly. It sits atop one of the world’s richest rare-earth deposits and can produce thousands of tons of concentrate each year, yet for much of its modern history those concentrates were shipped abroad to China for processing. Even as domestic separation resumes, the legacy of dependence lingers: until the U.S. can transform raw ore into finished magnets within its own industrial base, its security rests on someone else’s permits.

Analysts warn that even as mining diversifies, with new projects in Australia, Canada, and parts of Africa coming online, the choke point has simply shifted downstream. The “systemic trade risk,” as researchers call it, now clusters around the intermediate tiers: the solvent-extraction circuits that separate individual elements and the precision magnet plants that turn them into usable parts. China holds dominance over both.7 These are capital-intensive, chemically complex, and environmentally sensitive operations that Beijing spent decades perfecting and subsidizing while Western economies outsourced them. The United States today may have more mines in motion than ever before, but its midstream, the critical infrastructure for processing and magnet-making that turns geology into power remains fragile. Without it, every ton of ore dug in Nevada or Texas is still just another shipment waiting on a license from somewhere else.

A Strategic Blueprint: Five Interlocking Tracks

If the rare‐earth supply-chain shock is a plausible act of coercion, the U.S. must respond with a layered strategy. Here are five tracks—each reinforcing the others, each aimed not merely at mining more, but at transforming structural dependence into structural resilience.

A Strategic Reserve That Buys Time, Not Trophies. The United States doesn’t need a warehouse of geological curiosities—it needs a reserve that buys time in a crisis. That means stockpiling what defense and energy programs actually consume: refined oxides, metals, and magnets, rotated through active contracts to keep quality current. The reserve should function like an insurance policy, bridging weeks or months of disruption while diplomacy and supply adjust. Time, not tonnage, is its true measure. 8

An Allied Sourcing Compact. The path to resilience runs through partners. Australia’s separation plants, Canada’s deposits, Japan’s precision engineering, and Vietnam’s emerging reserves all form a foundation for shared security—if bound together by long-term offtake agreements and reciprocal release protocols. The Minerals Security Partnership already convenes these players; what’s missing is teeth. A formal compact—backed by price floors and clear crisis procedures—would convert goodwill into capacity. 9

Finishing the Middle at Home. America’s rare-earth story cannot end at the mine gate. True independence depends on the midstream—refining, separation, and magnet fabrication. Federal incentives through the Defense Production Act and DOE’s loan programs must target this stage, where every new processing line multiplies the effect of every new mine. Shared “tolling” facilities could let smaller miners buy processing services rather than build redundant plants, creating an ecosystem rather than a patchwork of projects. 10

Permitting That Moves at Strategic Speed.
Time is the ultimate enemy. A mine that takes ten years to permit is a strategic liability. The solution isn’t cutting corners—it’s aligning process with purpose: single-agency coordination, concurrent reviews, and designated industrial corridors with infrastructure in place. Projects that meet the highest environmental and community standards should move fast because they meet them, not despite them.

Recycling and Substitution That Close the Loop. America’s next rare-earth supply may come not from mountains but from scrapyards. Every retired wind turbine, EV motor, and hard-drive array contains magnets rich in recoverable material. A national recycling framework—paired with research into lower-dysprosium magnet designs—can reclaim what would otherwise be waste. Substitution doesn’t eliminate dependence overnight, but it bends the curve, turning scarcity into opportunity. 11

Rare-earth projects die in the troughs. Contracts-for-difference, floor-price puts, and anchored offtakes are not industrial charity; they are anti-whiplash technologies that make private capital rational. Pair those tools with Export-Import Bank and DFC support for allied projects in exchange for delivery rights, and suddenly the spreadsheet’s “downside case” looks financeable. The effect is cumulative: every financed separator or magnet line reduces the premium Washington pays for emergency barrels of oxides later.

A Phased Timeline

The first phase should begin immediately, focusing on shock absorbers rather than monuments. Within a year, the U.S. could establish a functioning Strategic Rare Earths & Magnets Reserve, buying and rotating modest quantities to work out logistics, and negotiate ten-year offtake and stock-swap agreements with close allies like Australia and Canada. These are achievable within existing authorities and budgets. At the same time, Washington should channel current Defense Production Act and Department of Energy funding toward the midstream: separation, metallization, and magnet lines that are already half-built. The goal is not to design new programs but to finish those that exist, turning ribbon-cuttings into production runs. Finally, a Five Eyes–EU monitoring cell should start quarterly stress-tests, with dry runs for a 90-day licensing freeze so that when friction appears in a port or a ministry, policymakers see it before procurement officers feel it.

The second phase, spanning roughly two to three years, must consolidate what the first began. Domestic refining and magnet lines should transition from pilot to full-scale operation, the reserve should grow into a buffer measured in months of defense and grid demand, and allied offtakes should begin steady delivery. This is also when recycling must move from experiment to infrastructure, with federal procurement preferences creating a guaranteed home for recycled content. On the regulatory side, the first industrial parks and brownfield re-mining projects should clear the new permitting regime, signaling credibility to investors that timelines are finally predictable.

By years three through seven, America’s resilience becomes clearly visible. Allied supply chains mature; U.S. magnet production satisfies a majority of domestic needs; and the strategic reserve gives Washington options when China flexes its licensing power. At that point, the geopolitical logic changes: when Beijing threatens to tighten a licensing screw, markets still move, but U.S. production schedules remain steady.

Strategic Implications for the Indo-Pacific and Taiwan

Although this paper does not hinge on a Taiwan invasion, that scenario illuminates the stakes. Taiwan remains central to the U.S.–China competitive equation. If Beijing were to blockade or invade Taiwan, U.S. and allied capabilities will depend on magnets, sensors, propulsion systems, many of which rest on rare-earth chains. If now the U.S. enters crisis mode and cannot spin up magnet production or import alternatives, the tactical decisions in the Strait will be made under supply shock, not strategic coherence and once the US military’s supply of expensive high-end munitions is exhausted, replacement will be difficult if not impossible

Moreover, an early rare-earth crisis, whether linked to Taiwan or technology competition (AI, cyber, semiconductors), can blunt U.S. response before kinetic conflict begins. Therefore, the rare-earth strategy is less a “nice to have” and more a mission-critical enabler of defense and economic posture in the Indo-Pacific.

Cost, Risk, and the Iron Law of Trade Leverage

The scale of investment, though nontrivial, is modest compared to the cost of being caught unprepared. Billions of dollars over five years for a reserve, tens of billions over a decade for full mid-stream build-out. The risks: project cost overruns, permitting delay, price collapses, partner country policy shifts. Many commentators have noted the U.S. faces a “rare-earth delusion” if it assumes mines alone solve the problem.12

But the alternative risk is far greater: if China decides to throttle supply, the industrial base, defense production, and allied manufacturing face cascading effects. The cost of doing nothing, or doing too little, is catastrophic strategic leverage left in the hands of an adversary.

Making the Blueprint Real

Blueprints don’t move metal; politics does. The architecture for rare-earth resilience already exists; the challenge now is execution. Turning strategy into supply will require coordination across institutions that rarely move in sync: Congress, the White House, the private sector, allied governments, and the capital markets that finance them all. Each has a role that only it can play.

Congress must provide consistency where markets cannot. It can modernize the Defense Production Act to treat separation, metallization, and magnet-making as enduring national-security priorities, not emergency programs that expire with each appropriation cycle. Long-term procurement authority, multi-year funding, and statutory stockpile mandates would tell industry that the rare-earth effort will outlast the next budget fight.

The executive branch holds the levers of speed. The White House and its interagency partners can cut permitting timelines, streamline environmental reviews, and integrate the work of DOE, DOD, and Commerce under a single critical-materials coordinator. The Minerals Security Partnership should evolve from a diplomatic forum into an operational alliance, tasked with financing and synchronizing projects across allied supply chains.

Industry and finance are the builders. Public capital can launch projects, but private capital must scale them. To draw investment into a volatile sector, Washington should expand price-stabilization mechanisms, such as floor-price guarantees, offtake contracts, and export credit support, so investors can model predictable risk. Without those tools, every project remains a gamble on Beijing’s next export decree.

Allies can be force multipliers when relationships are properly balanced and maintained. Australia, Canada, Japan, Vietnam, and the EU already have the geology and the expertise; what they need is U.S. demand certainty and shared strategic planning. Reciprocal stockpile release agreements, joint procurement, and common standards for refining and magnets could convert fragmented national efforts into a collective shield against coercion.

Finally, the public sector, from state governments to research institutions, must fill the innovation gap. Recycling systems, magnet reclamation, and material substitution will determine whether this decade’s investments build independence or simply delay dependence. Federal and state coordination on industrial parks, tax credits, and workforce training can ensure that new facilities are not just built but sustained.

If there is a single lesson from recent history, it is that resilience is rarely won in crisis, it is built in advance, when the costs are political rather than existential. China’s command of rare-earths supply is not destiny; it is the product of time, will, and coordination. The United States can still match it, but only if it acts with the same discipline and purpose.

The next confrontation may not unfold in the Taiwan Strait but in a shipment log, a licensing bureau, or a factory floor. The question is whether Washington will treat the rare-earth race as a line item, or as the front line.

Conclusion

In the decade ahead, warfighting and deterrence will not only be determined by fleets, missiles, and satellites; they will be shaped by mills, magnets, alloys and processing lines. Here is the dilemma: the United States has for too long treated rare-earth elements as an economic commodity subject to market forces. China treats them as strategic infrastructure subject to Party control.

The good news: the U.S. still has time. The moment of kinetic conflict in the Taiwan Strait, or a wider Indo-Pacific war is not today. But the moment of supply shock may well come before. When it does, the margin between success and failure will likely be defined by how quickly the U.S., its industry and its allies can spin those magnets, feed those sensors, roll those motors. The bets made today on stockpiles, allied contracts, processing plants, recycling and permitting reform are not optional; they are structural.

Deterrence is not just about sending ships and jets. It is about ensuring the industrial base behind those systems is resilient, trusted and redundant. When the next adversary contemplates turning off the tap on rare-earths, the United States should be the one saying: go ahead, the supplies are already on deck, production lines are humming, and we have a plan B at the ready.

That is how you turn elemental leverage into resilience, and how you ensure that supply chains become part of our defense, not part of their coercion.

Josh Richards is the Chief Commercial Officer of Pacific Peering. He serves on the UN’s Joint Task Force on SMART Cables as a member of the Steering Committee, and chairs the Business Development Committee. He is a Security Fellow with the Truman National Security Project, a Tech Policy Fellow with the Aspen Institute, and a Senior Fellow with AI2030.

Joseph Hanacek is a Surface Warfare Officer in the United States Navy. He serves as a Warfare Tactics Instructor at the Surface Advanced Warfighting School detachment of the Naval Surface and Mine Warfighting Development Center in San Diego, CA. The views and opinions presented herein are those of the author and do not necessarily represent the views of the Department of War, the Department of the Navy, or its components.

References

1. Hidayat, Muflih. “China’s New Rare Earth Export Controls: Global Supply Chain Impact.” Discovery Alert, October 16, 2025 https://discoveryalert.com.au/news/china-rare-earth-export-controls-2025-impact/

2. Baskaran, Gracelin. “China’s New Rare Earth and Magnet Restrictions Threaten U.S. Defense Supply Chains.” Center for Strategic and International Studies, October 9, 2025 https://www.csis.org/analysis/chinas-new-rare-earth-and-magnet-restrictions-threaten-us-defense-supply-chains

3. Klimek, Peter, Sophia Baum, Markus Gerschberger, and Maximilian Hess. “Systemic Trade Risk Suppresses Comparative Advantage in Rare Earth Dependent Industries.” arXiv, August 1, 2025 https://arxiv.org/abs/2508.00556

4. Baskaran, Gracelin. “China’s New Rare Earth and Magnet Restrictions Threaten U.S. Defense Supply Chains.” Center for Strategic and International Studies, October 9, 2025 https://www.csis.org/analysis/chinas-new-rare-earth-and-magnet-restrictions-threaten-us-defense-supply-chains

5. Reuters. “China Expands Rare Earths Restrictions, Targets Defense and Chips Users.” Reuters, October 9, 2025 https://www.reuters.com/world/china/china-tightens-rare-earth-export-controls-2025-10-09/

6. Hidayat, Muflih. “China’s New Rare Earth Export Controls: Global Supply Chain Impact.” Discovery Alert, October 16, 2025 https://discoveryalert.com.au/news/china-rare-earth-export-controls-2025-impact/

7. Klimek, Peter, Sophia Baum, Markus Gerschberger, and Maximilian Hess. “Systemic Trade Risk Suppresses Comparative Advantage in Rare Earth Dependent Industries.” arXiv, August 1, 2025  https://arxiv.org/abs/2508.00556

8. Baskaran, Gracelin. “China’s New Rare Earth and Magnet Restrictions Threaten U.S. Defense Supply Chains.” Center for Strategic and International Studies, October 9, 2025 https://www.csis.org/analysis/chinas-new-rare-earth-and-magnet-restrictions-threaten-us-defense-supply-chains

9. Kozul-Wright, Alex. “Can Australia Provide US with Rare-Earth Metals Which China Has Restricted?” Al Jazeera, October 17, 2025 https://www.aljazeera.com/news/2025/10/17/can-australia-provide-us-with-rare-earth-metals-which-china-has-restricted

10. Baskaran, Gracelin. “China’s New Rare Earth and Magnet Restrictions Threaten U.S. Defense Supply Chains.” Center for Strategic and International Studies, October 9, 2025 https://www.csis.org/analysis/chinas-new-rare-earth-and-magnet-restrictions-threaten-us-defense-supply-chains

11. Cameron, Hugh. “China’s Rare Earth Restrictions Could Backfire on Xi. Here’s How.” Newsweek, October 16, 2025 https://www.newsweek.com/chinas-rare-earth-restrictions-could-backfire-on-xi-heres-how-10886552

12. Foroohar, Rana. “America’s Rare Earth Delusion.” Financial Times, October 19, 2025 https://www.ft.com/content/583abbd2-ffa8-4232-931f-66f55949b5d5?syn-25a6b1a6=1

Featured image: An open-pit mine in Kokpatas, Uzbekistan, operated by Navoi Mining and Metallurgical. (Photo by U.S. Army Acquisition Support Center)

Fostering the Discussion on Securing the Seas.