With the United States in the grips of the coronavirus pandemic, the Defense Production Act has been a hot topic in the news. But what exactly is it? First established in 1950, the Defense Production Act was signed into law by President Harry S. Truman in response to the need for the production of supplies and equipment during the Korean War.
The act has been invoked many times by the United States federal government over the years, in times of emergencies such as war, hurricanes, and terrorism prevention. In fact, the New York Times reported that the Defense Department said it uses the act 300,000 times per year.
It was partially invoked as an executive order by President Donald Trump on March 18, to obtain “health and medical resources needed to respond to the spread of COVID-19, including personal protective equipment and ventilators.” A few days later, Trump used the Act to force GM to make ventilators.
“I view it—in a sense as a wartime president,” Trump said, after originally announcing his plans. According to an updated Congressional Research Service report on the act, it affords the president “a broad set of authorities to influence the domestic industry in the interest of national defense,” though it does not allow the government to take full control of a company.
“The authorities can be used across the federal government to shape the domestic industrial base so that, when called upon, it is capable of providing essential materials and goods needed for the national defense,” the report states.
The act is likewise defined by FEMA as “the primary source of presidential authorities to expedite and expand the supply of resources from the U.S. industrial base to support the military, energy, space, and homeland security programs.”
On April 19, Trump announced he would use the act to make sure an unnamed company would make 20 million more coronavirus testing swabs.
Trump, though, has been criticized by governors and a bipartisan group in Congress for his reluctance to use the full power of the law.
The three main sections of the Defense Production Act
To fully understand the Defense Production Act, it helps to break it down by the three major sections.
- Priorities and Allocations: It authorizes the President to require corporations to accept and prioritize contracts for services and materials deemed necessary to aid U.S. national defense. Additionally, it gives the president the power to prohibit in-demand items or materials from hoarding or price gouging.
- Expansion of Productive Capacity and Supply: The president is given the authority to establish mechanisms or create incentives for certain industries to produce critical materials and allocate those materials, services, and facilities to promote national defense.
- General Provisions: These grant the president authority to strike agreements with private industry, to halt any corporate foreign mergers that may threaten national security, and to create a faction of voluntary industry executives who could be called to government service.