President Donald Trump indicated the seriousness of the current Covid-19 pandemic by announcing that he was prepared to sign an Executive Order to invoke the Defense Production Act of 1950. The Act, first written during the Korean War, allows the President to expand the manufacturing of needed equipment.

Before I begin, I have a confession to make. I was one of the people who was extremely skeptical that this China Flu was a big deal. I was ignorant. I have, since then, educated myself on the difference between seasonal flu and a novel virus. Seasonal flu begins with human to human transmission. A Novel Virus begins with animal to human transmission. Please read this article here and this article here. I still do not believe there is any reason to panic. However, we do not have any need to repeat the 2009 H1N1 virus situation. Don’t panic. Just socially distance yourself and wash your hands.

Which brings us to President Trump and the Executive Order to invoke the Defense Production Act of 1950 (DPA). Here is the presser from today. The announcement of the DPA is right at the beginning:

What does the Defense Production Act do for us, the American people? Forbes.com has some answers:

The Defense Production Act of 1950, enacted at the outset of the Korean War, allows the federal government to compel companies through loans, loan guarantees, purchases and purchase commitments to prioritize and expedite development of supplies and resources to support national defense.

In this case, the Defense Production Act will be used to accelerate the development of medical masks, ventilators and other healthcare supplies as cases of the coronavirus tick up in the country, according to a count by Johns Hopkins University.

In other words, whatever goods are needed, the DPA says that a company must fulfill that order before it produces any other order.

What do medical items do we need? According to Bloomberg.com:

Now that cases are spreading around the country, so are the shortages. Interviews with ten emergency-room doctors and hospital managers around the country tell of colleagues and peers taking extensive measures to conserve fast-dwindling protective equipment, particularly the most potent N95 protective masks, as well as eye protection, gowns and gloves.

The President has a duty to ensure the protection of the American people. This is the United States of America and, as much as the media and academia hate our market society, it is our demand economy which may save our bacon, again. American companies must be fast and flexible to respond to market demands, which means that they can easily change course to respond to national needs.

U.S. companies have always responded to national needs even before the Defense Production Act was enacted. During World War II, Franklin D. Roosevelt banned the production of consumer automobiles. Ford Motor Company rapidly switched to manufacturing Jeeps for the war effort. Cargill, 3M and Hormel all manufactured goods to aid the war effort without being federalized.

In his press conference, Trump likened the effort to stop the spread of the China or Wuhan Flu to fighting a war. Even before the press conference was finished and the press could begin to criticize the President, companies were looking for ways to help the nation. Biotech companies have moved a warp speed to study how this virus works and produce vaccines and treatments. The Financial Times is reporting that GM and Ford are in talks to manufacture respirators and ventilators.

Ford said it stood ready “to help the administration in any way we can . . . We have had preliminary talks with the US government and are looking into the feasibility”.

The move comes hours after GM and Ford, along with Fiat Chrysler, announced an unprecedented shutdown of all North American facilities in an effort to contain the spread of the disease.

The President is using a “whole of government” approach to fighting the China Flu. The American people and our companies are using the same approach. The Defense Production Act may be unneeded this time around.

Featured Image:

“masks0159b” by Gruscana is licensed under CC BY-NC-ND 2.0