FederalTrump Faces Pressure to Utilize the Defense Production Act: What Exactly Is That?

The Trump administration is facing pressure to utilize the Defense Production Act, a Cold War-era policy giving the president authority to direct private industry. Here's a look at its history and the current debate.
March 25, 2020
https://thetexan.news/wp-content/uploads/2020/03/49100685987_4c0a68f3b6_o-1-1280x853.jpg

As communism spread like an infection across the post-WWII world, President Harry Truman pursued a policy of containment to try and stop the spread of a radical ideology that would kill millions.

“It must be the policy of the United States to support free peoples who are resisting attempted subjugation by armed minorities or by outside pressures,” said the 33rd president, establishing the Truman Doctrine, which would define American foreign policy for years to come.

For Truman to follow through on that commitment to freedom, he would need the support of American military — and American manufacturers.

On June 25, 1950, communist forces in the north launched an insurgency against the Republic of Korea.

At the news, the public panicked at circulating rumors and some began hoarding food supplies, causing local shortages at markets.

The Texan Mug

But at the prospect of war, basic food resources were still in ample supply — it was military resources that the United States needed.

“We have a tremendously rich and productive economy, and it is expanding every year,” said Truman. “Our job now is to divert to defense purposes more of that tremendous productive capacity—more steel, more aluminum, more of a good many things.”

To achieve that goal, Truman sent a message to Congress asking the legislature to “give the Government power to guide the flow of materials into essential uses, to restrict their use for nonessential purposes, and to prevent the accumulation of unnecessary inventories.”

Out of his request, the Defense Production Act (DPA) was created.

Among other things, it gave the president an “array of authorities to shape national defense preparedness programs and to take appropriate steps to maintain and enhance the domestic industrial base.”

Under the act, there are three broad sections, summarized as follows:

  1. Title I: Priorities and Allocations — authorizes the president to require certain persons or businesses to accept contracts for the production of materials or other services.
  2. Title III: Expansion of Productive Capacity and Supply — authorizes the president to incentivize manufacturers by loans, purchases, or other financial commitments.
  3. Title VII: General Provisions — various authorizations to support the overall goal of the law, including the basis for voluntary agreements with private industry.

According to the Congressional Research Service (CRS), the DPA has been reauthorized over 50 times since it was first signed into law in 1950.

While the reauthorization in 1953 allowed some of the executive’s power under the 1950 version to expire — namely Titles II, IV, V, and VI, which the CRS says “related to requisitioning, rationing, wage and price fixing, labor disputes, and credit controls and regulation” — the other reauthorizations throughout the past 70 years have generally expanded powers under the act.

The act’s definition of “national defense” originally applied more strictly to military capabilities, but the term has been broadened throughout the DPA’s numerous reauthorizations to allow more uses for the act.

In 1994, the definition was expanded to include “emergency preparedness activities.”

For that purpose, the law can be applied to the production of “health resources” such as “drugs, biological products, medical devices, materials, facilities, health supplies, services, and equipment.”

The DPA was most recently reauthorized in 2018 and will remain in effect until 2025 unless Congress takes action to alter or extend it.

Making use of the law to anywhere near the full extent of its powers under the three titles has seldom been done, which is probably why the times it is invoked usually goes fairly unnoticed.

Last summer, for instance, President Trump used a section of the DPA to determine that “the domestic production capability for Rare Earth Metals and Alloys is essential to the national defense.”

But if you search for articles relating to the DPA now, the overwhelming majority of the content will be focused on the current COVID-19 outbreak.

The Trump administration has received enormous pressure to make use of the act to facilitate the production of much needed medical supplies, such as ventilators and personal protective equipment (PPE).

On March 18, the president signed an executive order to essentially activate the DPA and grant the secretary of Health and Human Services (HHS) the ability to determine “the proper nationwide priorities and allocation of all health and medical resources…for responding to the spread of COVID-19 within the United States”

But since then, there has been confusion around whether or not Trump is making use of the act.

During a press conference, Trump said that the DPA is “in effect” because he signed the order, but emphasized that he did not want to “nationalize” businesses through the use of the law.

“[W]e’re a country not based on nationalizing our business. Call a person over in Venezuela; ask them how did nationalization of their businesses work out. Not too well,” said Trump.

Peter Navarro, a White House trade advisor and member of the president’s coronavirus task force, said that the executive order has given him “quiet leverage” in mobilizing the private industry to produce the supplies needed in the crisis.

Without making use of the law to require manufacturers to produce certain materials or products, several companies have begun shifting their operations to supply the demand for needed items.

Distilleries have begun making hand sanitizer; Ford Motor, GE Healthcare, and 3M are coordinating to produce certain supplies like respirators and face shields; Hanesbrands will be producing face masks; and many other companies are stepping up to help provide vital materials.

Nevertheless, political leaders from both parties have placed pressure on the Trump administration to make stronger use of the DPA’s powers to orchestrate an increased manufacturing effort in the face of the unique challenge.

On Monday, Rep. Van Taylor (R-TX-03) joined Rep. Andy Levin (D-MI) in introducing a resolution calling on the president “to make urgent use of all relevant authorities” of the DPA to “direct the domestic production of supplies” needed to address the pandemic.

Likewise, Sen. Ted Cruz (R-TX) sent a letter to HHS Secretary Alex Azar, urging him to “use the significant powers” of the DPA to “ensure that healthcare facilities across the country have the ventilators they need to treat all patients who become critically ill with this virus.”

In a draft obtained by The Texan, the CARES Act — the $2 trillion coronavirus relief package currently stalled in the Senate by Democrats — contains a $1 billion dollar allocation for “Defense Production Act Purchases.”

Presumably, these funds would be used by the federal government to purchase the needed medical supplies from manufacturers.

If the bill passes with such funding still in place, it’s foreseeable that the Trump administration would make full use of that money, possibly exercising greater use of the DPA’s powers by requiring manufacturers across the country to begin producing things they might not normally make.

Disclosure: Unlike almost every other media outlet, The Texan is not beholden to any special interests, does not apply for any type of state or federal funding, and relies exclusively on its readers for financial support. If you’d like to become one of the people we’re financially accountable to, click here to subscribe.

Get “KB's Hot Take”

A free bi-weekly commentary on current events by Konni Burton.

Daniel Friend

Daniel Friend

Daniel Friend is a reporter for The Texan. While recently finishing his degree in Political Science from Azusa Pacific University, he also interned in the U.S. Senate and co-authored a book on C. S. Lewis’s science fiction trilogy. In his spare time, he might be reading up on Dostoevsky or attempting to write a novel.