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Today, the Subcommittee on National Security, Illicit Finance, and International Financial Institutions, led by Subcommittee Chair Warren Davidson (OH-08), held a field hearing at the National Museum of the United States Air Force in Dayton, OH, to examine the Defense Production Act (DPA) and how U.S. supply chains can be better suited to face growing global challenges.
On the need to modernize the DPA
“Enacted in 1950 during the Korean War, the DPA was designed to secure America’s industrial base for national emergencies, prioritizing domestic production over foreign reliance. Today, as our dependence on foreign critical materials—semiconductors, rare earth minerals, pharmaceuticals—grows, the DPA’s importance is undeniable. However, from 2018 to 2024, only one direct loan and zero guarantees were issued – not for lack of need but due to cumbersome processes. The COVID-19 pandemic exposed this reactive posture, proving that waiting for crises risks delayed responses. Modernizing the DPA demands a proactive approach to bolster domestic capabilities before emergencies strike,” said Subcommittee Chair Davidson.
"America's navigating one of the most dangerous and complex global threat environments in recent history. Our adversaries are accelerating innovation, scaling production, and heavily investing in their national defense capabilities. It's critical that America keeps pace and expands our dominance as the leader of the free world. That requires not just military might but economic resilience, financial agility, and industrial strength,” added Chairman French Hill (AR-02).
On the critical role of a strong domestic industrial base
“With the continued consolidation of our domestic industrial base, it seems to me more important than ever to recognize and support the critical role of our existing industry. Back home in North Carolina, for example, we have a lot of companies that contribute greatly to the supply chain when it comes to national defense,” said Rep. Tim Moore (NC-14).
On ensuring Congress remains focused on the DPA’s core objective
In his questioning, Vice Chairman of the Full Committee Bill Huizenga (MI-04) asked witnesses, “I think that's a lot of the question, concern, and feedback that I think not just from colleagues but from taxpayers that we hear, which is why are we making these investments into an industry that isn't needed? …Are we focused enough with the DPA, or have we wandered away from that core objective?”
Witnesses echoed their support for the work of the Committee on the two panels.
Jeffrey W. Frankston, Acting Deputy Assistant Secretary of Defense for Industrial Base Resilience, Office of Assistant Secretary of Defense for Industrial Base Policy, Department of Defense (DoD) said: “The DPA is not a Cold War relic. It is a vital statutory tool, one that enables the Department to (1) identify and respond to industrial shortfalls, (2) reinforce supply chain integrity and resilience, and (3) accelerate production in support of urgent operational needs. … In an era where geopolitical competition is intensifying, particularly from China, industrial capacity remains a determinant of deterrence. We continue to see challenges that test our industrial resilience. We have seen renewed cyberattacks targeting U.S. aerospace and shipbuilding firms, expanded Chinese restrictions on exports of critical minerals, and mounting cost pressures across defense manufacturing. Our shipyards are overburdened. Our munitions suppliers are operating at maximum throughput but still falling short of surge demands. These disruptions are cumulative and compounding, and they demand more than reactive procurement. They require flexibility and coordination between government and industry. The DPA provides that and more. Revitalizing the defense industrial base (DIB) is foundational to restoring deterrence and rebuilding our military.”
Dr. Charles D. Ormsby, Acting Director, Materials and Manufacturing Directorate, Air Force Research Laboratory, Wright-Patterson Air Force Base said: “The Executive Agent Program Office is central to the practical execution of Defense Production Act Title III investments for the Department of Defense. … The Executive Agent Program Office executes from six funds including core Title III dollars, CARES Act Supplemental funds, Ukraine Supplemental funds, Inflation Reduction Act funds, Indo-Pacific Security Supplemental fund and Israel Security Supplemental funds. These funds have varying structures; for some funds, obligation and expenditure have no expiration dates, but for other funds, expiration dates are stated. The Executive Agent Program Office’s diverse staff of engineers and scientists are proud to provide critical technical depth for assessing industrial base capabilities and ensuring investments achieve a resilient Defense Industrial Base.”
Robert Faxon, Chairman of the Board, Consolidated Boring Inc. said: “The DPA's effectiveness can be enhanced through improvements to the funding and implementation processes. … Funding for critical projects must be provided for the entire duration of the project, not on a year-to-year basis. A multi-year DPA authorization for the AFM factory would provide the necessary stability to invest in long-lead-time equipment and infrastructure, allowing for faster and more efficient capacity expansion. … Exploring ways to streamline DPA application and approval processes while maintaining necessary oversight is recommended. This could include clear guidelines, readily accessible resources for industry partners, and potentially a more consolidated point of contact for DPA-related inquiries. … By investing strategically in critical manufacturing capabilities and improving the mechanisms of the Defense Production Act, the industrial base can be empowered to meet the evolving demands of a complex global landscape.”
Gordon Follin, Chief Product Officer, Beehive Industries said: “The Defense Production Act, particularly Title III, has been essential to supporting the expansion of U.S. defense innovation. Without its authorities, including loan guarantees, purchase commitments, and advance funding, the risks of scaling complex, capital intensive manufacturing would be prohibitive for most small and nontraditional businesses. … The Defense Production Act is the government’s most important statutory tool for shaping and scaling the defense industrial base in times of crisis. Letting it lapse would delay investments in munitions, critical materials, and propulsion systems already under strain. Timely reauthorization that strikes a balance between modernizing the law and providing necessary flexibility to implementing agencies to address their specific requirements is vital to support emerging technologies and processes while reaffirming the U.S. commitment to supply chain resilience and allied readiness.”
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