Your point about the widespread nature of rare earth oxides is true to a point, but the fact is that discovered minable concentrations are less common than for most other ores. US and world resources are contained primarily in bastnäsite and monazite. Bastnäsite deposits in China and the United States constitute the largest percentage of the world's rare-earth economic resources, while monazite deposits in Australia, Brazil, China, India, Malaysia, South Africa, Sri Lanka, Thailand, and the US constitute the second largest segment. The remaining resources (apatite, cheralite, eudialyte, loparite, phosphorites, rare-earth-bearing (ion adsorption) clays, secondary monazite, spent uranium solutions, and xenotime) are still not felt to be profitable.
Add the fact that the profit-driven US industry drops out of any business as soon as it can be acquired more cheaply from China, and it's no wonder that China is now responsible for over 95% of the world rare earth production.
Your canard about interference from meddling environmental groups is simply disingenuous. When California's Mountain Pass mine closed down, they cited competition from China as the primary reason. Their only run-in with environmental issues stemmed from repeated spills of radioactive waste water; and all that cost them was a cleanup order and a tiny $1.4m fine. They're now back in business under Molycorp, and aren't being picketed by the Sierra Club.