Listening to the coronavirus task force news conference on Sunday, it was clear that Trump either doesn’t know or is pretending not to know what the Defense Production Act (DPA) is and what it allows. 1/13
The DPA could be used to ensure that sufficient ventilators and protective gear for health workers are being produced and distributed to where they’re most needed. Under pressure from members of Congress, Trump issued an executive order teeing up the DPA. 2/13
But he refuses to actually use it. Why? Because using it, he says, means “you’re going to nationalize an industry,” and “you’re going to take away companies.” Not surprisingly, that’s false. 3/13
The DPA has several provisions. The president can use it to require companies to prioritize federal contracts over other contracts. The companies still get paid, they still control production, they just move the federal contract to the front of the line. 4/13
This could be useful in a situation where states with less purchasing power are being outbid by other states (or other entities). The federal government could become the purchaser on the states’ behalf and ensure that every state gets the equipment it needs. 5/13
The president can also offer various financial incentives to private companies, such as loan guarantees or purchase commitments, to produce certain items. And he can greenlight voluntary agreements between competing companies that might otherwise raise antitrust issues. 6/13
Under the most extreme of the DPA’s provisions, companies the president deems capable of producing certain goods can be required to accept contracts with the federal government. The government also can control the allocation of certain “scarce and critical” goods. 7/13
That’s hardly “nationalizing an industry” or “taking over companies.” Analogizing the DPA to the Venezuelan government’s control over domestic production, as Trump did at the news conference, shows profound ignorance of the DPA, the Venezuelan economic system, or both. 8/13
Trump also said that using the DPA is “actually a big deal. I mean, when this was announced, it sent tremors through our business community and through our country.” After all, this just isn’t the kind of thing that happens in the U.S. … right? 9/13
Wrong. According to the Congressional Research Service, the Department of Defense “routinely” uses the DPA to require that its contracts get priority over others. It’s a standard clause in the Department’s contracts: 10/13 
And it’s not just the Department of Defense. Other agencies have used the DPA on multiple occasions to deal with natural disasters and other domestic emergencies: 11/13
President Trump himself invoked the DPA in 2019 to ensure that the federal government would have sufficient access to “Rare Earth Metals and Alloys.” 12/13 whitehouse.gov/presidential-a…
In short, the Defense Production Act gets used for lots of things. It just doesn’t get used, at least by this president, to ensure that hospitals have the equipment they need to provide life-saving treatment to Americans in the worst pandemic we’ve faced in modern history. 13/13
