Pentagon Is Backing $8 Billion Smelter Plant, Sparking Questions After US Seizes Venezuela's Metal Wealth

First it was oil. Then lithium. Now it is smelting. With an $8 billion defence-backed metal plant, the United States is no longer content with merely regulating global trade — it seeks control over the critical choke points that underpin the modern economy.

The US Department of Defense has acquired a 40 per cent stake in a JPMorgan-backed smelter project in Tennessee. Officials describe it as a strategic move designed to protect American interests. They argue it will reduce reliance on China and create middle-class jobs. On the surface, this rationale seems reasonable. But a closer look reveals a deeper shift in US policy.

This is not solely about zinc, silver, or gallium. It is about who controls the industrial infrastructure connecting raw materials to economic power.

When Markets Become Military Assets

The Clarksville smelter exemplifies a significant departure from traditional US manufacturing policy, which has historically been driven by market forces and supply-demand dynamics. Now, with the technical expertise of Korea Zinc and the financial backing of Wall Street, the project signals a move away from pure market reliance. The US government is directly involved in ownership, financing, and scheduling through the Department of Defence.

Projected to process more than a million tonnes of raw material annually by 2029, the facility will produce metals vital for missiles, semiconductors, batteries, and infrastructure supporting artificial intelligence. According to the US government, 11 of these metals are classified as 'critical'. Currently, the United States relies entirely on imports for many of these materials, highlighting concerns over supply chain vulnerabilities.

However, the response to these concerns—state-sponsored industrial control—is less about fostering resilient free markets and more about hoarding strategic resources.

The Venezuela Shadow

Understanding these developments requires context. The recent US actions against Venezuela—sanctions, asset seizures, and freezing of assets—have provoked widespread criticism from outlets like Vanity Fair and Gawker. The implications for Latin America and the broader international community are significant.

Venezuela, now economically isolated, finds itself deprived of the ability to process its mineral wealth domestically. Meanwhile, a US-supported project backed by defence contractors is filling the void. This effectively sends a message: Washington is dictating the rules to secure supply chains and control critical resources.

Many observers interpret these moves as evidence of the US employing military and economic power to advance a form of nationalist economic policy.

Wall Street, the Pentagon, and a New Industrial Paradigm

The involvement of JPMorgan is particularly revealing. This isn't merely an infrastructure project; it's a strategic hedge against geopolitical risks and a means of ensuring steady returns on infrastructure investments. The Pentagon's backing provides a layer of security that reassures investors.

While the Department of Defence (DOD) is a customer of JPMorgan, it also acts as an investor, financier, and strategic planner. This multiplicity of roles blurs the lines that traditionally separated market risk from sovereign power and competition from national security interests. Once these boundaries become indistinct, they are rarely restored to their prior clarity.

Security or Control?

Supporters argue that US leadership in metals production is necessary due to China's overwhelming dominance of processing industries, coupled with Europe's inaction, which creates ongoing supply shocks. While there is some truth to these claims, the speed and scale of this recent initiative suggest motives beyond mere self-preservation.

In essence, the move reflects a broader strategic shift—one that uses economic muscle as a form of geopolitical leverage. As Washington asserts greater control over critical resources, questions remain about the implications for global markets and the future of international trade.