By Julia Cartwright |

The United States is facing an urgent strategic issue that is moving much faster than most of Washington’s current energy debates.

Right now, China is rapidly moving ahead in next-generation nuclear, specifically thorium-fueled molten salt reactors, building directly on technologies the United States originally pioneered at Oak Ridge. Their TMSR-LF1 molten salt reactor has already demonstrated key milestones in the thorium fuel cycle under real operating conditions. China has developed a pathway to abundant, high-density, domestically controlled energy capable of supporting industry, AI and data centers, maritime applications, and defense for decades.

At the same time, China is positioning itself as the future exporter of this technology and associated fuel services, which would give them enduring leverage over global nuclear deployment, standards, and supply chains. If they secure cheaper and more secure sovereign baseload power while we dismantle our own strategic advantages, no tariff regime or short-term subsidy program will offset that structural gap.

By contrast, the U.S. is allowing its position to erode. We are downblending our limited U-233 inventory, treating it as a cleanup problem instead of what it is: a uniquely valuable strategic asset for advanced fuel cycles and life-saving medical isotope production. This is exactly the quiet, procedural decision-making that risks foreclosing options while our competitors scale up.

Congress can still change course, but it must act now:

Immediately Pause U-233 Downblending
Place a hold on further downblending and require a comprehensive strategic review of remaining U-233, including its potential for thorium/molten salt reactors, medical isotopes, and national security.

Recognize U-233 and Thorium R&D as Strategic Assets
Direct DOE to treat these materials and programs as strategic infrastructure, not mere liabilities, with clear interagency coordination and regular reporting to Congress.

Launch a Serious Thorium / Molten Salt Demonstration Program
Provide dedicated, multi-year funding for U.S.-based demonstrations in partnership with private innovators, with milestones focused on deployed hardware and licensing, not just reports.

Modernize Advanced Reactor Licensing
Instruct NRC and DOE to create fit-for-purpose licensing pathways for non-light-water designs so U.S. companies can build and iterate here at home instead of ceding deployment experience to China.

Require Transparency & Briefings
Request immediate briefings on U-233 inventories, current and planned downblending, and DOE’s thorium/MSR activities so Congress can make informed decisions before irreversible steps are taken.

Beyond the federal urgency, there is a major upside here for forward-looking states.

A state that chooses to lead on thorium and molten salt reactor development through hosting secure U-233/thorium R&D infrastructure, aligning its regulatory environment, and partnering with private innovators can position itself as a long-term anchor for:

• World-class industrial power costs: Stable, high-density baseload power can underwrite advanced manufacturing, refining, AI and data centers, and port and logistics facilities, drawing in the very projects now shopping globally for clean, reliable energy.
• High-wage technical and research jobs: National labs, engineering programs, medical isotope production, and nuclear supply-chain firms cluster around serious demonstration efforts, creating durable, specialized employment rather than transient construction booms.
• Cutting-edge medical and technology ecosystems: Leveraging U-233 for medical isotopes supports a globally relevant health sciences hub, while advanced nuclear capability underpins secure digital infrastructure for finance, AI, and defense applications.
• Energy, economic, and strategic credibility: A state that proves this out, prudently and safely, will not only strengthen U.S. security, it will become a model other states and allies look to for standards, supply-chain partnerships, and deployment know-how.

Put simply, this is the kind of targeted leadership that can make a state’s energy and industrial base the benchmark others quietly measure against. 

One concrete path would be to build on the framework, as an example, of S.4242 – the Thorium Energy Security Act of 2022, which sought to preserve U-233 inventories to foster development of thorium molten-salt reactors and required DOE to secure and manage those inventories strategically. The government could:

• Explore state-level resolutions or companion legislation urging preservation of U-233 and support for thorium/MSR R&D.
• Signal interest in hosting secure storage, processing, and demonstration facilities consistent with an updated Thorium Energy Security framework.
• Pair that with state incentives and regulatory clarity that welcome advanced nuclear innovators while maintaining rigorous safety and environmental standards.

China is not waiting. If we continue down this path, we are not simply “falling behind,” we are choosing to surrender long-term energy, technological, and geopolitical leverage, along with an opportunity for American states to anchor the next generation of strategic industry at home rather than abroad.

Julia Cartwright, PhD, is a Senior Research Fellow in Law and Economics at the American Institute for Economic Research (AIER).