America Should Rebuild the National Defense Stockpile

Mountains are reflected in a brine evaporation pond at Albemarle Corp.'s Silver Peak lithium facility, Thursday, Oct. 6, 2022, in Silver Peak, Nev. The ponds use evaporation to help separate lithium from brine pumped from underground. The Biden administration on Wednesday, Oct. 19, awarded $2.8 billion in grants to build and expand domestic manufacturing of batteries for electric vehicles in 12 states. A total of 20 companies, including Albemarle Corp., will receive grants for projects to extract and process lithium, graphite and other battery materials, manufacture components and strengthen U.S. supply of critical minerals, officials said. (AP Photo/John Locher)

To reform the NDS, it is essential to first understand its structure. As part of the Department of Defense, NDS operations are overseen by the Director of the Defense Logistics Agency (DLA), who simultaneously serves as the National Defense Stockpile Manager. The NDS is also overseen by the Strategic Critical Minerals Board of Directors, chaired by the Assistant Secretary of Defense for Industrial Base Policy. With twelve other board members, the board of directors provides oversight and outlines strategy. Further down in the chain of command, the day-to-day logistics are overseen by an NDS administrator and deputy, who manage the agency’s strategic stockpiles.

State, Interior, Commerce, and Energy Depts.

During the Cold War, the agency oversaw about 102 different stockpile locations – today, it oversees six. This decrease has followed a larger sale of stockpiled material since the end of World War II. Today’s $912.3 million in stockpile assets is a 98% reduction of its value since 1952. While our supply chains have become more complicated and increasingly rely on our competitors, America has drawn down on its reserves of the materials that power essential technologies. When the NDS is diminished, so is America’s ability to adequately respond to national security threats.

If Congress is seriously concerned with meeting the demands of strategic grand power competition, its actions should reflect its rhetoric. Between 2002 and 2022, Congress transferred more than $6 billion in proceeds from the periodic sale of NDS material out of the NDS Transaction Fund and applied them towards the federal General Fund. Congress does not appropriate funds to NDS on an annual basis – the agency  is reliant on proceeds from the sale of stockpiled material to pay for operating and maintenance costs. For the last two decades, Congress slowly drained the NDS of its value and utility. This shortsighted removal of funds is not without consequences. American national security is threatened by a decrease in our stockpile levels. And NDS itself is projected to reach a fiscally dangerous level by next year.

As a result of our increasingly vulnerable critical mineral supply chain, as well as Congressional mismanagement, today’s NDS is unable to meet its mission: supply critical materials for essential civilian and military usage. According to the FY23 stockpile assessment, the NDS has  shortfalls of $14 billion in more than 80 different materials, meeting only 37.9 percent of military needs and less than 10 percent of essential civilian needs in the event of a national emergency.

As China’s recent antimony restrictions show, America’s ability to build critical technologies is subject to the whims of our competitors. Without antimony, our military cannot build certain automobile batteries, night vision goggles, or more than 300 different types of munitions. With only a fraction of the critical materials essential to military and civilian technologies, America will not be able to sustain its defense industrial base.

If we do not want to let China and Russia dictate our access to the minerals that power frontier innovations, policymakers must take steps to rebuild the National Defense Stockpile into what it once was: a bulwark against material shortfalls that provided America security against supply chain disruptions.

First, Congress must ensure that the NDS has the funds it needs by making annual appropriations to close the $14 billion shortfall gap by 2027 and prohibit the extraction of material sale proceeds from the National Defense Stockpile Trust Fund. Congress should also revisit NDS’s shortfall planning scenario. Currently, the NDS aims to stockpile enough material to last one year of active combat and three years of recovery. By increasing these parameters to three years each, lawmakers may furnish the NDS with more materials than it needs – but it is better to be oversupplied than experience shortfalls in the middle of war.

On the part of NDS, its board of directors ought to take advantage of their limited oversight and strategic planning capabilities. While they stockpile materials with the intention of using them, the NDS board should increase spending on Defense Logistic Agency’s Strategic Material grants to research and development projects that seek to find alternatives to reliance on certain critical minerals. It is good to stockpile critical materials, but even better to eliminate that reliance entirely. The NDS board should also increase information sharing with relevant agencies and private sector partners to facilitate collaboration in securing critical minerals and build out domestic capacity for refineries.

Antimony is just one part of a larger dynamic that threatens America’s ability to engage in great power competition. By rebuilding the National Defense Stockpile through normalized appropriations, updated planning scenarios, increased grant spending, and interagency collaboration, America can secure its access to everyday and next-generation technologies.

Farrell Gregory is a junior at Dickinson College studying international relations and Chinese. He is also a research assistant at the Yorktown Institute.