Illustration: Sarah Grillo/Axios

"Don't say we didn't warn you." With these words, China has signaled that its next step in the trade war might be to cut off America's access to rare earth minerals — a key component in everything from cellphones to missile systems.

The impact: China exports about 80% of the rare earths imported by the U.S., and a boycott could cripple much of American high-tech manufacturing.

  • China doesn't dominate this industry because it has unusually large deposits of rare earths; it doesn't. (As every story about rare earths has to mention, they're actually very common.)
  • Rather, China simply has a greater willingness than most other countries to do the filthy job of mining these minerals — a job that generally involves hundreds of nasty acid baths, a lot of pollution and even quite a bit of radioactive waste.

Flashback: In 1991, Lawrence Summers, then the World Bank's chief economist, signed his name to a notorious "pollution memo" that was leaked to the environmental community. The memo made perfect economic sense, even if it was politically rash.

  • "Health impairing pollution should be done in the country with the lowest cost, which will be the country with the lowest wages," Summers wrote. "The demand for a clean environment for aesthetic and health reasons is likely to have very high income elasticity."
  • Summers wasn't entirely serious. But the memo does a good job of explaining how China ended up mining most of the world's rare earths.

By the numbers: The Rare Earths Monthly Metals Index, a price gauge created in 2012 at a level of 100, stood at just 19 in May — surprisingly low after almost a year of worries that China could cut off supplies. If American businesses have been warned, they haven't shown any signs of stockpiling the precious supplies they need.

Go deeper: Why rare earth minerals matter in the U.S.-China trade war

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Mike Allen, author of AM
4 mins ago - Politics & Policy

Democrats' Armageddon option

A makeshift memorial outside the Supreme Court yesterday. Photo: Jose Luis Magana/AFP via Getty Images

Furious Democrats are considering total war — profound changes to two branches of government, and even adding stars to the flag — if Republicans jam through a Supreme Court nominee, then lose control of the Senate.

On the table: Adding Supreme Court justices ... eliminating the Senate's 60-vote threshold to end filibusters ... and statehood for D.C. and Puerto Rico. "If he holds a vote in 2020, we pack the court in 2021," Rep. Joe Kennedy III (D-Mass.) tweeted.

Updated 5 mins ago - Politics & Policy

Coronavirus dashboard

Illustration: Sarah Grillo/Axios

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  6. World: Guatemalan president tests positive for COVID-19 — The countries painting their pandemic recoveries green.
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Trump's health secretary asserts control over all new rules, including for vaccines

HHS Secretary Alex Azar and President Donald Trump. Photo by MANDEL NGAN/AFP via Getty Images

Heath and Human Services Secretary Alex Azar wrote a memo this week giving him authority over all new rules and banning any of the health agencies, including the FDA, from signing any "regarding the nation’s foods, medicines, medical devices and other products, including vaccines," the New York Times reports.

Why it matters: The story further underscores reporting that health and scientific agencies are undergoing a deep politicization as the Trump administration races to develop a coronavirus vaccine, as Axios' Caitlin Owens has reported. Dr. Peter Lurie, a former associate commissioner of the FDA, told the Times the Azar memo amounted to a "power grab."