What you need to know about the Defence Production Act and why Trump has resisted calls to use it to fight the coronavirus pandemic

REUTERS/Yuri GripasU.S. President Donald Trump, flanked by U.S. Vice President Mike Pence and FEMA Administrator Pete Gaynor, speaks during a news conference, amid the coronavirus disease (COVID-19) outbreak, in Washington D.C., U.S., March 22, 2020.
  • President Donald Trump is under a lot of pressure to use the Defence Production Act as states struggle to acquire enough ventilators to help stricken patients and masks to protect health care workers.
  • The law gives the federal government broad powers to pressure the private sector into producing materials necessary to aid the national defence.
  • Top political leaders like House Speaker Nancy Pelosi have urged Trump to use the law to mass produce and distribute critical items necessary to care for coronavirus patients.
  • Trump has resisted these calls, saying manufacturers are producing enough masks and that using this statute legally amounts to the drastic step of “nationalizing” a business.
  • Visit Business Insider’s homepage for more stories.

President Donald Trump is under mounting pressure from governors and congressional lawmakers in both parties to stop flirting with tapping into the powers granted to him via the Defence Production Act and fully use it to help the country with its response to the coronavirus pandemic.

Trump and his officials have sent confusing, mixed messages about the law.

“The Defence Production Act is in full force, but haven’t had to use it because no one has said NO! Millions of masks coming as back up to States,” Trump tweeted on Tuesday, March 24.

The same day, FEMA said it was using the law to obtain test kits for the virus, only to backtrack later on.

Meanwhile, Gov. Andrew Cuomo of New York has implored Trump to use the Defence Production Act to help the state gain desperately-needed ventilators, slamming the president for saying he’s a “wartime president” but not acting like it.

“President said it’s a war. It is a war. Well then act like it’s a war,” Cuomo said on Tuesday. “Only the federal government has that power and not to exercise that power is inexplicable to me… I do not for the life of me understand the reluctance to use the federal Defence Production Act.”

House Speaker Nancy Pelosi has also pleaded with Trump to use the law.

“The President must immediately use the powers of the Defence Production Act to mass produce and coordinate distribution of these critical supplies, before the need worsens and the shortages become even more dire. There is not a day to lose. We must put more testing, more protective equipment and more ventilators into the hands of our frontline workers immediately,”Pelosi said in a recent statement.

Here’s what the Defence Production Act does

The Defence Production Act (DPA) of 1950 is a Korean War-era law that gives the president the power to pressure US industries into producing supplies for the national defence.

“Through the DPA, the President can, among other activities, prioritise government contracts for goods and services over competing customers, and offer incentives within the domestic market to enhance the production and supply of critical materials and technologies when necessary for national defence,” according to the Congressional Research Agency (CRS).

The DPA was originally intended to bolster US military capabilities, but has been expanded to help the US deal with natural hazards, terrorist attacks, and other national emergencies.

The law has three primary sections that grant the president various powers, per the CRS:

  1. “Priorities and Allocations, which allows the President to require persons (including businesses and corporations) to prioritise and accept contracts for materials and services as necessary to promote the national defence.”
  2. Expansion of Productive Capacity and Supply, which allows the President to incentivise the domestic industrial base to expand the production and supply of critical materials and goods. Authorised incentives include loans, loan guarantees, direct purchases and purchase commitments, and the authority to procure and install equipment in private industrial facilities.”
  3. General Provisions, which includes key definitions for the DPA and several distinct authorities, including the authority to establish voluntary agreements with private industry; the authority to block proposed or pending foreign corporate mergers, acquisitions, or takeovers that threaten national security; and the authority to employ persons of outstanding experience and ability and to establish a volunteer pool of industry executives who could be called to government service in the interest of the national defence.”

Why Trump hasn’t used the DPA

The president invoked the DPA via an executive order last Wednesday.

“I invoked the Defence Production Act, and last night we put it into gear,” Trump said on Friday, March 20. “We are invoking it to use the power of the federal government to help the states get things they need like masks and ventilators.”

But the president has flip-flopped on this, even as governors like Cuomo have pleaded with him to help states obtain vital medical equipment, including protective gear for frontline medical workers.

“We’re a country not based on nationalizing our business,”Trump said on Sunday, March 22, at a press briefing. “The concept of nationalizing our businesses is not a good concept.” The law does not nationalize businesses.

Trump also suggested that companies would struggle to produce medical equipment like ventilators, which helps patients breathe when they’re struggling to on their own. “Nobody would know where to start,” Trump said. “If I call companies and say, ‘You build ventilators,’ they don’t even know what a ventilator is.”

“We have the threat of doing it, if we need it,” Trump said. “But we have millions of masks being done. We have respirators. We have ventilators. We have a lot of things happening right now. So just the threat of using it.”

“We are using it now. The fact that I signed it, it’s in effect,” Trump added, though the law is not actually being used.

In short, Trump is not fully leaning into the DPA because he claims the private sector is stepping up to fill the gaps in terms of necessary supplies.

“General Motors, Ford, so many companies – I had three calls yesterday directly, without having to institute like: `You will do this’ – these companies are making them right now,” Trump said Saturday. But this was false, and no automaker in the US is close to building such equipment at the moment.

But Cuomo on Tuesday said that his state, which is the epicentre of the pandemic in the US, is still in dire need of ventilators. He said New York has about 3,000 to 4,000 ventilators and has purchased about 7,000 more, but needs 30,000 to deal with the scale of the outbreak.

As of Wednesday, March 25, there were over 26,000 confirmed coronavirus cases in New York state, comprising roughly half of all cases (over 55,000) in the US.

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