Wednesday, April 1, 2020

Don't make me invoke Liberty Ships again

Picking up (in a slightly less pissed-off mood) from Monday's rant.

Everyone by now knows that, we need to both flatten the curve and raise the line, to slow the spread while increasing the capacity of our healthcare system. We've gotten better about discussing the first, but it's more difficult to find sober, realistic discussions of the second.

Fortunately, we can count on Talking Points Memo.:

[Jeffrey Bialos is a partner at Eversheds-Sutherland, a global law firm. He previously served as Deputy Under Secretary of Defense for Industrial Affairs and as a member of Secure Virginia, the state’s homeland security advisory board.]

The simple fact is that the DPA, together with U.S. contracting capabilities and funding, can be utilized to methodically plan short, medium and long term solutions to health supply needs that can more quickly enable the country to return to some semblance of normalcy.

First, the President invoked some DPA powers – to prioritize and allocate production but said he only planned to use it in a “worst case” scenario. Yesterday, he authorized additional DPA powers – to incentivize businesses to expand capacity through loans and other measures and voluntary industrial agreements as needed. 

But, other than with respect to a single company, the President has steadfastly declined to use the authorities he’s invoked in any type of holistic way. All signs point to the refusal being driven perhaps in part by an ideological desire to rely on our private sector’s historic ability to step up and meet market needs without the government’s heavy hand. The President himself has raised the spectre that the DPA could result in the nationalization of industry – which has no basis in fact.

Indeed, the business community has lobbied against the use of the DPA, with the Chamber of Commerce raising the red herring that the United States would be in violation of its World Trade Organization requirements. This ignores the fact that the WTO has an “essential security” exception that surely can be invoked in this crisis situation. The Chamber’s assertion that the use of the DPA would somehow break up global supply chains also seems specious. The point here is to use the DPA to increase global volume and take the pressure off supply chains, and not disrupt them.

Volunteerism by industry is admirable and perhaps can help address the underlying health shortfalls at the margin. But, let’s be frank about it. The ad hoc reach-outs by White House advisors like Peter Navarro to underwear companies and other willing volunteers is no substitute for a serious industrial mobilization under the DPA. This type of ad hoc approach is at best likely to be only partially effective and at worst create false expectations and foster belief that the problem is being addressed when it’s not. And, worst of all, we run the risk of not knowing that the voluntary approach didn’t work until it’s too late.

In short, the answer here is clear. The administration needs to rapidly assemble an interagency team outside of the White House with the right experience, drawing on Health and Human Services for its health expertise, FEMA and the Department of Defense for their contracting expertise in exigencies (FEMA in natural disasters, DOD in setting up rapid equipping programs during the wars in Afghanistan and Iraq), and other relevant departments and agencies.

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