I have been helping my son with his homework lately as he studies the robber barons of the late 19th and early 20th century. What China is doing is right out of their playbook. They are not looking to be one of a small group of dominant players in industry, they are looking to be the only player, crippling the rest. In another rapidly growing industry, lighting, they are limiting access to the rare earth minerals that are vital to the manufacture of the phosphors that are critical in LED lighting and compact fluorescent lighting. Since they control these materials they set prices, blocking access to international competition. They know where the pressure points are and they are using them.
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