Today, the House Financial Services Subcommittee on National Security, Illicit Finance, and International Financial Institutions, led by Chairman Blaine Luetkemeyer (MO-03), is holding a hearing entitled “Mission Critical: Restoring National Security as the Focus of Defense Production Act Reauthorization, Part II."
Watch Chairman Luetkemeyer’s opening remarks here.
Read Chairman Luetkemeyer’s opening remarks as prepared for delivery:
“On March 12th of this year, this subcommittee held the first part of this hearing to learn more about the history, the current landscape, and what the future might hold for the Defense Production Act of 1950, or the DPA.
“During that hearing we heard testimony from the Congressional Research Service and other expert witnesses about the important role the DPA plays in maintaining our national defense posture as the envy of the world–as well as the dangerous state of our current defense industrial base.
“Today, we will continue that conversation as we welcome witnesses who represent the key agencies who execute the DPA–the Commerce Department, the Department of Homeland Security, and the Department of Defense.
“We don’t often see these agencies here at the Committee on Financial Services, which holds the great responsibility of having sole jurisdiction over the DPA.
“DPA is set to expire in September 2025. In light of the increased use of DPA by both the current and previous administration and the need to restore our defense industry for our great power competition with China, we have started to examine and consider this legislation in its entirety.
“DPA, which Congress passed in response to the Korean War, affords the President a broad set of authorities to ensure that American industry has the capability and capacity to meet our nation’s national security needs.
“Our hearing in March highlighted some key areas where Congress may wish to consider improvements to meet the current moment.
“Since DPA was reauthorized in 2018, the federal government has utilized the financial tools of the DPA at a pace far exceeding previous years and in more creative ways.
“In March we heard the Director of the Ronald Reagan Institute, Mr. Roger Zakheim, discuss some of the urgent needs to address military shortfalls in munitions and weapons, naval shipbuilding and maintenance, and supply chain and strategic material shortfalls.
“In the meantime, Congress acted to address the ongoing conflicts in Ukraine and Israel, which further exercise and stretch our defense production industries, and all while the People’s Republic of China’s military continues to build up its capabilities to threaten its neighbors and challenge our own military. These are all stark reminders of how critical a strong national industrial base is to the national security of the United States.
“I was encouraged to see in December of 2023, the Department of Defense, through the leadership of our witness today, Assistant Secretary Taylor Kale, release the first-ever National Defense Industrial Strategy.
“Their strategy does a great job of outlining the priority areas that are critical to a modern, defense-focused industrial ecosystem. Today I hope Dr. Taylor-Kale will tell us more about the report and how Congress can act moving forward.
“It will also benefit our members to hear how the DPA has been helpful in its past and current implementations, as well as the areas where DPA might be underutilized.
“One area of concern that I share with Mr. Zakheim and another witness, former Deputy Assistant Secretary of Defense Dr. Jeb Nadaner, is that many of these expanded authorities for which the DPA is being used seem to have little to do with what the legislation was originally intended to accomplish.
“In one of his earliest Executive Orders, President Biden invoked DPA authorities to strengthen U.S. supply chains’ resilience. He followed that up by using DPA Title I authorities to require suppliers to provide key inputs to infant formula manufacturers ahead of other customers.
“In June of 2022, the President began using DPA to accelerate domestic production of energy technologies like solar panel parts, insulation, heat pumps, biofuels, and power grid infrastructure.
“The heat pump case remains particularly controversial not least because the dependency is primarily on allied manufacturers and seems to have little to do with national security.
“Some of these actions unfortunately have reinforced the narrative that Presidents could exercise powerful DPA authorities for reasons unrelated to national security. This undermines support for a critical tool that, when used properly, is essential to building and maintaining our nation’s ability to defend itself and our allies.
“To be clear, I don’t want to throw the baby out with the bath water. The DPA is an essential mechanism that deserves reauthorization before the end of the next fiscal year. But it also needs a thorough review and careful adjustment, not just rubber stamp approval from Congress.
“Today’s hearing should give us crucial insight into the factual applications of the DPA.
“I thank our witnesses for being here today and for their ongoing engagement with Members and staff. We look forward to their testimony.”
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