House Select Committee on the CCP• Dec 5, 2024• 1:41:43

House Select Committee On The CCP Holds Hearing About America's Defense Industrial Complex

From House Select Committee on the CCP

Executive Summary

defense industrial base (DIB) is on a peacetime footing and lacks the capacity, speed, and innovation required to deter or win a potential conflict with the People's Republic of China.
War game simulations reveal the U.S.
would exhaust critical munitions like long-range missiles in less than a week of a Taiwan conflict, suffering catastrophic losses to key assets like aircraft carriers.
is critically dependent on China for essential materials like gallium and germanium, a vulnerability the CCP is actively exploiting through export bans, which could cripple defense production.
A strategic shift is imperative, moving away from small numbers of exquisite, expensive platforms towards mass production of lower-cost, autonomous, and attritable systems, championed by new defense tech companies like Anduril.

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Concerns Raised

The U.S. defense industrial base lacks the capacity for a peer conflict with China.
Critical supply chain dependence on China for essential minerals like gallium and germanium.
Slow and bureaucratic DoD acquisition processes stifle innovation and speed.
The U.S. would exhaust key munitions in less than one week in a Taiwan conflict.

Opportunities Identified

Leveraging private capital and innovative defense tech companies to build autonomous systems at scale.
Shifting procurement from 'lowest price' to 'best value' to incentivize resilient supply chains.
Strengthening alliances for co-production and maintenance with partners in the Indo-Pacific.
Investing in domestic production of critical materials using the Defense Production Act.

Key Themes

The Atrophy of the U.S. Defense Industrial Base

Post-Cold War consolidation has created a slow, uncompetitive industrial base that stifles innovation and prioritizes financial returns over production capacity. This 'monopsony' structure, coupled with a bureaucratic acquisition system, is the root cause of the U.S.'s inability to produce weapons at the scale and speed needed for a peer conflict.

This structural weakness directly undermines U.S. military readiness and deterrence, leaving the nation unprepared for the production demands of a major war and ceding a significant advantage to adversaries.

China's Pacing Threat and Industrial Dominance

China has executed a massive military buildup, creating the world's largest navy and dominating global supply chains for critical minerals and industrial manufacturing. Through its 'military-civil fusion' strategy, the CCP rapidly converts its economic and technological power into military capability, directly challenging U.S. strategic interests.

China's industrial might represents a direct and formidable challenge that the current U.S. DIB is ill-equipped to counter, shifting the balance of power and increasing the risk of conflict in the Indo-Pacific.

Strategic Supply Chain Vulnerabilities

The U.S. defense sector is dangerously dependent on China for essential components and processed minerals, including 100% of its gallium. The CCP's recent export bans on these materials demonstrate a willingness to weaponize this dependency, which could halt U.S. production of advanced military systems.

This dependency is a critical national security risk, creating a single point of failure that could be exploited to cripple the U.S. military's technological edge at the outset of a crisis.

The Imperative for a New Production and Procurement Model

The current DoD acquisition system is a slow, risk-averse relic of central planning that is failing to keep pace with technological change. The hearing advocates for a paradigm shift towards agile development, embracing private capital, and creating a strong demand signal for innovative, lower-cost, and autonomous systems from a new generation of defense companies.

Modernizing the procurement process is essential to rapidly field the technologies needed to offset China's advantages in mass, enabling the U.S. to build a more resilient and affordable deterrent force.

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Topics

Defense Industrial Base (DIB)US-China Competition Geopolitics Taiwan Military Readiness Defense Acquisition Reform Supply Chain Vulnerability Critical Minerals Gallium Germanium Autonomous Systems Anduril War Games CSIS National Security

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