Home Civilian based defense Opinion: What is the Defense Production Act and why did Biden invoke it to end the baby formula shortage?

Opinion: What is the Defense Production Act and why did Biden invoke it to end the baby formula shortage?

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It said it would ask suppliers of infant formula ingredients to prioritize delivery to infant formula manufacturers and control their distribution if necessary.

You might well wonder what babies going without formula have to do with defense production, reminiscent of large warships and weapon systems. While using the Defense Production Act to force companies to make infant formula would certainly be a new use of the law, it wouldn’t be the first time the post-war law has been used in the US. beyond its original purpose of supporting national defence.

And in fact, the law is used much more frequently than you might think. But as a business professor who studies strategies for maximizing the efficient allocation of resources, I think when presidents invoke the law, it’s often more about political theater – showing the public that you’re doing something – than to solve the problem in the most effective way.

Scan Authority

The Defense Production Act was passed in 1950 and is modeled after the War Powers Acts of 1941 and 1942.

The War Powers Acts gave the President the power to control domestic manufacturing. For example, it helped the United States increase warplane production from 2,500 a year to over 300,000 by the end of the war.

In 1950, America faced the Korean War, and Congress feared that the growing postwar demand for consumer goods would crowd out the defense production needed to deal with China and the Union. Soviet Union, both of which supported North Korea in the conflict. There were also concerns about inflation during this post-war period.

The Defense Production Act gave the President – ​​who then delegated that authority to Cabinet members like the Secretary of Defense – sweeping powers to force manufacturers to manufacture goods and provide services to support national defence, as well as to fix wages and prices and even rationing. consumer goods.

“We cannot get all the military supplies we need now from increased production alone,” President Harry Truman told Americans in a radio address after the law was signed. “This expansion cannot happen fast enough. Therefore, to the extent necessary, workers and factories will have to stop manufacturing certain civilian goods and start producing military equipment.

The original law focused on “developing American military readiness and capability,” which limited the scope of the president’s authority.

Summoned regularly

Although the Defense Production Act only makes the news when the President dramatically invokes it, the government is using the law – or simply threatening to use it – to force private companies to prioritize government orders. The Ministry of Defense, for example, uses it to close around 300,000 contracts with private companies a year.

Congress must reauthorize the law every several years and has frequently amended it to expand or limit its scope. Over time, this greatly expanded the definition of national defense to include support “for national preparedness, response and recovery in the face of dangers, terrorist attacks and other national emergencies”.

The Department of Homeland Security invoked it about 400 times in 2019, primarily to help prepare for and respond to hurricanes and other natural disasters, such as providing resources to house and feed survivors. And Presidents Bill Clinton and George W. Bush, for example, both used it to divert electricity and natural gas to California during the energy crisis of 2000-2001.

The law has also been used extensively during the COVID-19 pandemic. President Donald Trump has used it to prioritize the allocation of medical resources, prevent hoarding of personal protective equipment and force General Motors to build ventilators. He also ordered beef, pork and poultry processing facilities to remain open during shutdowns to ensure protein supplies for the American population.

Biden, for his part, has also used the act many times before, mostly to fight the pandemic. For example, in March 2021, he invoked it to speed up vaccine production by ensuring additional facilities were up to snuff, as well as to speed up the production of critical materials, equipment, machinery and supplies. . In March 2022, it issued a directive aimed at increasing the supply of materials for large capacity batteries that are mainly used in civilian electric vehicles.

Biden’s use of the Defense Production Act to address the infant formula problem illustrates one limitation. It can be used to prioritize ingredients and crafting ability, but it’s not a magic wand. A president cannot by decree instantly bring to light a power that does not exist. And it’s unclear just how quickly that will end the formula shortage — given that the main issue is manufacturing issues that shut down production at a key factory, not just an ingredient shortage.

The law is widely used and has been very helpful, but it does not replace advance planning and preparation.

Erik Gordon is a professor of business at the University of Michigan.

This article is republished from The Conversation. Read the original article.