The Defense Production Act Has Become a License for Central Planning

President Donald Trump was never one with high regard for the limits of his executive authority. Yet when people first floated the idea of using the 1950 Defense Production Act (DPA) to force private sector businesses to prioritize orders from the federal government for masks, ventilators, and other gear, the idea gave Trump a moment’s pause.

“We’re a country not based on nationalizing our business,” Trump said at a March 2020 press conference. “Call a person over in Venezuela; ask them how did nationalization of their businesses work out. Not too well.”

It didn’t last, and Trump did eventually sign a declaration invoking the DPA. But if you think it was a stretch to respond to a pandemic with a law designed to ensure the military can access supplies during wartime, wait ’til you find out the ways Trump’s successor has been using it.

The production of vaccines? Check.

Rare minerals needed for electric car batteries? Check.

Baby formula? Check—despite the role that his own government played in creating that shortage in the first place.

Solar panels, heat pumps, and…home insulation? Check, check, and check.

How, exactly, is insulation related at all to national security? According to the White House, it’s because “insulation is an industrial resource, material, or critical technology item essential to the national defense.” By that standard, what product isn’t essential to national defense?

The Defense Production Act has become President Joe Biden’s go-to “solution” to any market that isn’t operating quite how he’d like. It’s the back door to central planning: just declare any product to be of a vital national security interest. Who’s going to stop you? Certainly not Congress, and so far not the courts either.

The justifications for invoking the DPA are “just getting thinner and thinner the more it gets used,” argues Philip Rossetti, a senior fellow at the R Street Institute. Rossetti tells Reason that the DPA isn’t being used to increase production overall, but rather to reorganize the market under the White House’s direction.

“And that’s going to come at a cost to wherever you’re taking those resources from,” he says, because “government doesn’t produce; government simply takes from one area and puts it towards another.”

Trump was not the first president to call up on the DPA for something other than a wartime emergency. President Bill Clinton invoked the law in 2000 to force providers to keep selling natural gas to California’s largest electricity provider despite the utility’s bankruptcy. In 2011, President Barack Obama used the law to compel telecommunications companies to disclose fo