Updated Mar 21, 2020 - Health

Defense Production Act: What you need to know

President Trump.
President Trump invoked a Korean War-era act "if we need it" as part of a plan to combat the coronavirus. Photo: Chip Somodevilla/Getty Images

President Trump says he has invoked the Defense Production Act but has provided few details about what he's ordered to address the coronavirus outbreak in the U.S.

Why it matters: Hospitals around the country are coping with a lack of medical supplies and respirators as the number of Americans in need of treatment for COVID-19 rises. The act would authorize Trump to use his presidential powers to direct the private sector to ramp up the production of critically needed materials, like masks and ventilators, in the interest of national defense.

  • At a news briefing on Friday, Trump said he had invoked the act "yesterday," but at Thursday's briefing confirmed he had proceeded with no authorizations under the act.
  • Trump said Thursday the states are responsible for adequate supplies to hospitals, and that he would make orders under the act "if we were desperately in need of something -- and we, frankly, will know about that very shortly."

What it does: President Harry Truman signed the Defense Production Act of 1950 to address the lack of war-time equipment during the Korean War, but Congress has expanded the act to generally cover all national emergencies. Presidents have invoked it more than 50 times during crises like hurricanes and to prevent terrorism.

  • It lets the president provide the private sector with incentives to "expand the production and supply of critical materials and goods," through loans, loan guarantees, direct purchases, and purchase commitments.
  • The president could also require companies to prioritize government contracts and orders that are for national defense interests.
  • The president could establish voluntary agreements with private industries and block proposed foreign corporate mergers, acquisitions, or takeovers that threaten national security.

The act was most recently invoked in 2017 after the Hurricane Maria devastated Puerto Rico, as the Federal Emergency Management Agency looked to prioritize contracts for food, bottled water, manufactured housing units.

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