23 August 2025

Why the Defense Industrial Base Is So Hard to Fix

Daniel Bob

Supply chain and raw material uncertainty as well as a declining workforce are at the root of America’s defense industrial base woes.

America’s ability to defend itself and deter conflict rests not only on the sophistication of its weapons systems, but on the capacity to produce and sustain them. For decades, the United States held a commanding lead in both military technology and the industrial might behind it. That edge is now eroding—not because of technological stagnation, but because of brittle supply chains, aging infrastructure, and growing dependence on foreign—sometimes adversarial—sources for critical materials and components.

The US defense industrial base—the layered network of manufacturers, foundries, suppliers, and skilled workers that builds our military—needs major improvements. Raw material costs are rising. Many contractors rely on sole-source suppliers. And nearly all are constrained by labor shortages and limited surge capacity. These weaknesses are emerging at a time of rising global tension, particularly amid intensifying strategic competition with China.

From a foreign policy and trade perspective, this trend is troubling. For too long, national security planning has underestimated the impact of economic leverage, production capacity, and supply chain control on shaping geopolitical power. As the boundaries between commerce and conflict continue to blur, industrial resilience must be understood as a core element of US strategy.

Successive US administrations prioritized efficiency in supply chains over redundancy, partly based on the assumption that global economic interdependence would outlast the political rivalry. However, China has methodically positioned itself to exploit strategic chokepoints, controlling over 70 percent of global rare earth processing and leading in the production of gallium, tungsten, and neodymium.

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