The Defense Production Act Was Designed for Emergencies Like Coronavirus

nurses protesting — Alameda Health System nurses, doctors and workers hold signs during a protest in front of Highland Hospital on March 26, 2020 in Oakland, California to demand better working conditions and that proper personal protective equipment be provided. Justin Sullivan/Getty Images

When President Harry Truman signed the Defense Production Act (DPA) in 1950, the threat was clear. The Korean War was just beginning. And the United States needed to gear up to help the Republic of Korea (we know it now as South Korea) ward off the Soviet-backed North to stop the creep of communism worldwide.

Congress came up with a plan to mobilize the private sector, Truman inked his "Harry S.," and the Defense Production Act became law, awarding sweeping powers to the federal government to compel private industry to produce materials and goods to help in the war. The Act has been authorized and reauthorized, amended and fiddled with, more than 50 times since.

The threat to the United States is clear, today, too, if a little less conventional. The national emergency in the spring of 2020 is the deadly coronavirus. The concern is that the United States won't have enough personal protective equipment (PPE) like face shields, gloves, gowns and masks for health care workers, or ventilators and other medical equipment for those who are sick.

"It absolutely could be an effective tool. I don't think it's necessarily the only tool," says Peter Shulman, a history professor at Case Western Reserve University in Cleveland. "But it's the law that's on the books. It already exists. The authority already exists to do a good chunk of what we need. That's why it's there."

How the Defense Production Act Was Born

At the end of World War II, post-1945, the American government went through a massive downsizing. The world was at peace. The Americans won the war. They didn't need this expansive (and expensive) fighting force and the guns, tanks and infrastructure to support it.

"The number of men and women in uniform goes down well over 90 percent. Military spending is cut sharply," says John McGreevy, a history professor at the University of Notre Dame. "And all the industrial controls over production are abandoned."

Years before that, though, before the demobilization, many people throughout government realized the need to have a tool at hand that would allow the country to quickly ready itself in time of national emergency. That time came much more quickly than anyone anticipated.

America became involved in the conflict in Korea in late June 1950, just five years after the end of WWII. But because of the forward thinking by some, the framework for what would become the DPA already was in place. The Act was drawn up, Congress passed it and Truman signed it less than three months later, in early September of '50. The long title:

An Act to establish a system of priorities and allocations for materials and facilities, authorize the requisitioning thereof, provide financial assistance for expansion of productive capacity and supply, provide for price and wage stabilization, provide for the settlement of labor disputes, strengthen controls over credit, and by these measures facilitate the production of goods and services necessary for the national security, and for other purposes.

The original Act — again, it's been tinkered with a lot — granted broad powers to the president. According to the Congressional Research Service, "the DPA allowed the President, among other powers, to demand that manufacturers give priority to defense production, to requisition materials and property, to expand government and private defense production capacity, ration consumer goods, fix wage and price ceilings, force settlement of some labor disputes, control consumer credit and regulate real estate construction credit and loans, provide certain antitrust protections to industry, and establish a voluntary reserve of private sector executives who would be available for emergency federal employment."

People line up outside Elmhurst Hospital in Queens to get tested for coronavirus. New York City has about a third of the confirmed COVID-19 cases in the U.S. making it the country's epicenter of the outbreak.
Eduardo Munoz Alvarez/Getty Images

The DPA Over the Years

The powers granted to the president through the DPA are meant to secure the national defense, aimed especially at the country being ready in times of emergency.

The definition of "national defense" has broadened over the years. It's defined now in the law as this, according to the CRS:

[P]rograms for military and energy production or construction, military or critical infrastructure assistance to any foreign nation, homeland security, stockpiling, space, and any directly related activity. Such term includes emergency preparedness activities conducted pursuant to title VI of The Robert T. Stafford Disaster Relief and Emergency Assistance Act [42 U.S.C. §§5195 et seq.] and critical infrastructure protection and restoration.

Likewise, the definition of what might threaten the national defense has been fluid and now goes well beyond the scope of war.

Again, from the CRS: "[T]he authorities [of the Act] may also be used to enhance and support domestic preparedness, response, and recovery from hazards, terrorist attacks, and other national emergencies, among other purposes."

The DPA was used to mobilize the country's war machine again for the war in Vietnam, and during the energy crisis of 1973, when president Richard Nixon authorized the Department of Defense to order 22 oil companies to deliver 826 million gallons (3.1 million liters) of fuel to the military. That was the first time the DPA was invoked in a non-war context, according to Shulman.

It was employed again to ensure that California companies received electricity and natural gas during an energy crisis in that state in 2001; it was used to develop new technologies (mainly for military use) for the wars in Afghanistan and Iraq; and yet again it was used to aid Puerto Rico in the aftermath of Hurricane Maria in 2017.

"It was put there 70 years ago for the inevitable crisis," Shulman says. "At the time, it was for military crises, but it's been expanded. FEMA itself, the Federal Emergency Management Agency, was a product of the original version. It gives an administration the power and the flexibility to meet the kind of mobilization needed for a crisis."

The DPA Today

On March 18, 2020, President Donald Trump signed an executive order invoking the DPA in response to the growing threat of the coronavirus pandemic. But his unwillingness to enact it earlier, and the fact that he balked at actually using any of the Act's provisions to spur on the private sector, were criticized on many fronts.

"The fact that I signed it, it's in effect," Trump said four days later during a news conference. "But, you know, we'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. The concept of nationalizing our business is not a good concept."

Said the U.S. Chamber of Commerce's Neil Bradley, in the Wall Street Journal: "The law is no panacea. The Defense Production Act isn't a magic wand to immediately solving medical supply shortages. It can't produce highly specialized manufacturing equipment overnight."

Still, many others are arguing for the DPA, including several lawmakers and a list of national security professionals who signed a statement March 25 urging Trump to utilize the Act to its fullest extent. Just four days before, on March 21, the American Hospital Association, the American Medical Association and the American Nurses Association sent Trump a joint letter urging him to "immediately use the DPA to increase the domestic production of medical supplies and equipment that hospitals, health systems, physicians, nurses and all front line providers so desperately need." It has worked in the past, through wars and other crises. It can help now, they say.

"The real value is allowing the government to become the allocator of supplies. They can say, 'We're going to buy up all the ventilators, we're going to stop having states — as they are right now — competing with each other, and hospitals competing with each other for masks and ventilators and gowns and gloves," Shulman says. "And [they can] say the federal government is going to buy all this. And the federal government will consult with states and hospitals to figure out where the greatest needs lie, and allocate them according to those needs to make sure that supplies in fact are meeting demands. And we can make guarantees to make it financially worthwhile to the companies.

"It's a huge power for the government were they to invoke it to the fullest degree. It's not about nationalization. It's about allocation in an emergency."

Just as this story was going live on March 27, President Trump issued a statement that he signed a presidential memorandum directing the Secretary of Health and Human Services to "use any and all authority available under the Defense Production Act to require General Motors to accept, perform, and prioritize federal contracts for ventilators."