June 29, 2022

The Defense Production Act helps rebuild America’s industrial base. Let’s keep it that way.

Recently, the Biden administration has come under fire for its use of a law that, until its enforcement during the COVID-19 pandemic, was relatively unknown. The Defense Production Act has been on the books since 1950, but only in recent years has its potential value been so widely recognized, with both sides championing its use from the White House and Congress. However, recent allegations that the president is abusing the power of the DPA in pursuit of partisan objectives threaten the viability of this unique tool for rebuilding a robust, resilient and globally competitive American industrial base.

Sen. Patrick Toomey, R-Pa., Recently noted that Congress might need to restrict the act in light of perceived misuse by the White House. Other non-public sources have cited more specific restrictions being considered by Congress that would broadly apply to the DPA, even in cases where its application is not in question.

It would not be the first time that a perceived overreach resulted in blanket restrictions that went beyond the action complained of. And it wouldn’t be the first time this had happened to the DPA. In 2014, Congress amended the DPA with several restrictions, following a change in congressional control and in response to congress frustration with the Obama administration’s use of the law to support a clean energy initiative focused on biofuels.

Instead of limiting how the DPA could be applied, they mainly made it more difficult to use, for example by eliminating the possibility of delegating signing authority below the president. The result has been an increase in bureaucracy and a corresponding decrease in efficiency.

Going forward, we encourage all parties to avoid any changes that impede the effective use of the DPA. To that end, we also strongly recommend an open dialogue between Congress and the Pentagon to understand and address the current restrictions that impede the effective application of the DPA, and to ensure that any future changes will not compromise the ability of the Department of Defense to respond effectively and quickly to self-defense. terms.

Legitimate debate may arise over the use of DPA beyond traditional defense needs. As this debate unfolds, Congress may find that DPA authorities need to be extended to DoD while applying additional oversight and restrictions to civilian agencies that are not as experienced in using this authority.

Over the past 70 years that the DPA has been in effect, it has been reauthorized 53 times through bipartisan efforts. But at no time has it been more important than today, as we seek to give American industry an opportunity to rebuild and compete with China on a global scale. This importance has been affirmed by the White House and Congress – through bipartisan calls to increase its strategic use in rebuilding national supply chains, combined with substantial funding increases.

The Trump administration, through Executive Order 13806, and the Biden administration, through Executive Order 14017, have taken a whole-of-government approach to assessing vulnerabilities and building resilience in critical supply chains. The reports resulting from these decrees recognize the extent and dangerousness dependence on China it is a fundamental characteristic in several industries essential to national defense, including microelectronics, batteries, castings and forgings, among others.

This reliance on our dynamic competitor is due to a combination of US inaction and aggressive, unfair and even illegal Chinese economic practices. The Ministry of Defense February 2022 report on critical supply chains specifically highlights the need to leverage the full reach of the US economy to support national defense, such as aggregating demand across industries and limiting the use of military requirements to take better advantage of innovations in the commercial market.

The DPA is an unparalleled tool to address these trends, standing at the intersection of private industry and federal investment, with unique authorities that enable the government to strengthen American industry to better ensure our security. economic and national in the broad sense. Several DPA authorities can help counter Chinese government intervention in international markets, which has created an unfair advantage for Chinese companies.

Enforcing the DPA can also establish a fairer environment for American industry to demonstrate and deliver the proven power of the free market. In this era of great power competition, the DPA is a unique and essential tool for ensuring the competitiveness of American industry in the global marketplace and for strengthening American economic security while restoring military security.

The DPA has always been seen as common ground for Democrats and Republicans, and it aligns with bipartisan initiatives such as the House Armed Services Committee’s critical supply chain task force and bipartisan legislation. on infrastructure. By working together, we can effectively and appropriately use the DPA as a strategic asset for shared American values ​​and national interests.

For those who wish to understand the DPA, Click here for a report by the Congressional Research Service, which provides a useful summary of the history of the law and current authorities.

Bill Greenwalt is a nonresident senior fellow at the American Enterprise Institute, former senior staffer of the Senate Armed Services Committee, and former Deputy Assistant Secretary of Defense for Industrial Policy. Jerry McGinn is executive director of the Center for Government Contracting at George Mason University’s School of Business. He is a former senior Pentagon acquisitions official whose responsibilities involved the DPA. Christopher Zember has served as both a government and business executive, and was previously director of the Center for Technology and National Security Policy at the National Defense University. This commentary does not necessarily reflect the views of current or former employers of the authors.