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Just the Facts…. The Defense Production Act and COVID19: What is it and how can it help?

It is becoming increasingly evident that 2019-nCoV, commonly known as the Coronavirus or COVID19, will continue to impose unprecedented global challenges that many predict will remain for months to come. In response, governments around the world are struggling to figure out how they can contain and ultimately alter the trajectory of the virus and simultaneously mitigate the impact of perhaps a more prolonged crisis-- their economy. In the United States, the federal government has already passed one major response bill and is set to pass a two trillion dollar stimulus package by the weekend. These combined bills attempt to address not only the needs of our overwhelmed health systems but also the fiscal impacts of the epidemic for both individuals and businesses alike. And yet, many contend that our federal government could still do more. These differing views on the federal government's response to the crisis are based on fundamental philosophical beliefs regarding the extent of the role of the federal government. Unfortunately, this current crisis serves as an excellent illustration of the primary divide among our policymakers and how that divide can hamper the government's ability to serve its citizens. Let's use a current debate you may have heard about regarding a policy called "The Defense Production Act."

The "Defense Production Act" is a power that resides in the Executive branch of our government- the President and the Administration. It was initially invoked during the Korean War as President Truman, and his advisors urged American businesses and industries to support US war efforts in an attempt to avoid the lack of preparedness experienced during World War II. The "Act" allows the national government to use "national defense" as a justification for issuing government contracts to private industries for the production of necessary goods in times of need. Essentially, another way in which the federal government can spend its money to stimulate the production of critical products while also stimulating the economy through increased employment. All that said, you might be wondering what any of this has to do with COVID19 and philosophical differences among our Nation's leaders?

Well, it began a few days ago when the Federal Emergency Management Agency (FEMA) urged the President to use the "Defense Production Act" to accelerate the production of testing kits, masks, gloves, respirators, and other essential equipment required to address the growing needs linked to the spread of COVID19. Governors and mayors from New York to California echoed this request imploring the President to take action. Yet, as of this writing, the President has been reluctant to use this power, stating that the private sector is already making significant contributions to the Nation's efforts and that more government intervention is unnecessary.

For their part, many private sector industries have already offered their manufacturing support to address the various consequences of this crisis. However, corporate entities have also acknowledged that they would require additional funds to enable the production of products outside of their typical manufacturing scope. For example, car manufacturers lack the type of equipment needed to build respirators- a critical component to addressing the immediate health needs of thousands of citizens. Other manufacturers have stated that they would need to train their existing workforce as well as acquire additional skilled labor to bring these products to scale.

Those who support the President's reluctance to utilize the "Act" also point to the Department of Defense as an existing governmental entity capable of filling this need. They argue that the DOD has the requisite appropriated funds to expand their scope of work without compromising other essential priorities. Therefore, between existing appropriations to government agencies, as well as the responsibility of the private sector to contribute to the overall crisis effort, additional federal funds for increased manufacturing is unnecessary.

So, which side of this debate if correct? Neither. Unfortunately, or fortunately, there is no right or wrong side of this divide. The US government, founded on the principles of federalism, operates under the construct of shared responsibility between the government and the private sector. Each individual has the opportunity to decide for themselves what role- broad or limited- our federal and state governments should play and how reliant on the private sector we should be. This freedom of choice and the ability to act upon it by voting for elected officials is arguably the essence of our liberty as US citizens. However, this same freedom also creates complexities that, at times, our government cannot overcome, even when it is in the best interest of their citizens to do so. The world looks nothing like it did only weeks ago, and many of us find ourselves living in ways we would never have imagined. Federalism will be challenged in new and unique ways over the coming months. Stay tuned as the world watches what happens.

Contributing Author: Lauren O’Neil


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