One of the most meme-able lines in all of film comes from “Jurassic Park,” when the brilliant theoretical mathematician Dr. Ian Malcolm tells the titular park’s creator that “Life, uh, finds a way.”
The same thing is true of the free market economy, despite the best efforts of central planners of all stripes to obscure, inveigle or obfuscate it.
For example, President Joe Biden’s efforts to supplant the free-market economy by forcing Americans into electric vehicles in place of those with traditional gas-powered internal combustion engines have encountered yet another speed bump.
This time, the roadblock was thrown up by the Biden administration’s primary target itself: the free-market economy.
According to The Wall Street Journal, prices for many of the minerals needed for electric vehicle batteries have increased so much that producers are pulling back on expanding production.
“The disruptions are threatening to deepen shortages of those materials in coming years and hit the brakes on the Biden administration’s timeline for weaning the country off gas-powered cars,” the Journal reported.
Anthony Milewski, CEO of battery metals investment company Nickel 28, called the situation “dangerous” to Biden’s scheme.
“This situation is a bit dangerous because the mines aren’t going to get built,” he told the Journal. “We should be building those mines now and we’re not.”
The Biden administration had set a goal of 2030 for having half of all new vehicle sales in the U.S. to be of EVs, according to the Journal.
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In the 3rd quarter of this year, only about 8 percent of newly purchased cars were electric.
New mining projects already faced uphill battles against what the Journal called “local opposition, environmental concerns, red tape and other obstacles.”
“We continue to see production-expansion delays globally,” Paul Graves, CEO of Philadelphia-based lithium producer Livent, said on a recent call with investors.
Demand for lithium, cobalt and nickel is expected to grow much faster than supply over the next seven years, but with prices of the minerals so low currently, producers have little incentive to invest in expanding their capacity.
The fact that it can take years between a mineral discovery and gearing up to exploit it only complicates the timeline, the Journal said.
Meanwhile, falling mineral prices should lower the cost of EV batteries, which should in turn pull down prices of electric vehicles, making them more affordable to a broader range of consumers.
That, in turn, should increase EV demand, leading to higher prices for the vehicles, their batteries — and the minerals needed to produce them, which would provide an incentive for producers to expand their operations.
As it always does, the free market will find a way.
