Defense Production Act, the Constitution, and the Voluntary Way

President Trump initially seemed uncertain whether he would use the Defense Production Act (“DPA”) in the coronavirus situation. Then the head of FEMA announced on March 24 that the DPA would be used to speed up the production of coronavirus testing kits. Shortly after the FEMA announcement, a FEMA press secretary informed the public: “At the last minute we were able to procure the test kits from the private market without evoking the DPA.”

At base, this Korean-War-era statute, among other things, authorizes the president to order private companies to prioritize government contracts inasmuch as the items under production are deemed necessary for the national defense or some national emergency.

The Congressional Research Service describes the constitutional authority for the DPA as follows:

Though initially passed in response to the Korean War, the DPA is historically based on the War Powers Acts of World War II. Gradually, Congress has expanded the term national defense, as defined in the DPA, so that it now includes activities related to homeland security and domestic emergency management. The scope of DPA authorities extends beyond shaping U.S. military preparedness and capabilities, as the authorities may also be used to enhance and support domestic preparedness, response, and recovery from natural hazards, terrorist attacks, and other national emergencies.

While most of us believe that private industry should, as good corporate citizens, take Herculean efforts to ensure that enough testing kits are produced and reach the epicenters of the crisis, it is another thing to acquiesce in the use of a statute at odds with the Constitution.

Congress certainly has the power to declare war and to raise armies and navies. But does it follow that Congress can delegate to the executive the authority to direct private industry to prioritize one contract over another? Is this “necessary and proper” to carry out the powers related to war-making? Especially when there is no declared war and this is instead a matter of public health, a field that is left to the reserved powers of the states. “The powers of the federal government,” James Madison explained in the Virginia ratifying convention, “are enumerated; it can only operate in certain cases; it has legislative powers on defined and limited objects, beyond which it cannot extend its jurisdiction.”

Of course, almost every president in recent memory has invoked the DPA. Clinton and Bush II did so to ensure supplies of electricity and natural gas for California. In the Iraq War, DPA was used to prioritize the supply of military equipment. President Trump also invoked it to help Puerto Rico after a hurricane ravaged the island. But frequent use does not translate into constitutional grounding.

President Trump was correct to be hesitant in invoking the DPA in the coronavirus panic. Even if DPA could be constitutional in a wartime situation under Congress’ war powers, a public health crisis is another matter. The Constitution does not permit the national government to direct private companies in their prioritization of contracts.

Besides, private companies are voluntarily stepping up and helping in the crisis. Anheuser-Busch is making hand sanitizer. Hanes is retrofitting plants to produce medical masks. Los Angeles Apparel is also making masks. Mass market clothier H&M is gearing up to supply more surgical garments. Tesla is working with Medtronic on ventilator production.

In a free society, the voluntary way is better for individual liberty and can meet the exigencies of a crisis. The private sector is working diligently to provide needed medical equipment. We don’t need the national government exceeding its enumerated powers and mucking up this process.

William J. Watkins, Jr. is a Research Fellow at the Independent Institute and author of the Independent books, Crossroads for Liberty, Reclaiming the American Revolution, and Patent Trolls.
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