Here's How New York Governor Andrew Cuomo Could Use the Federal Defense Production Act to Get More Coronavirus Supplies

Andrew Cuomo
New York Governor Andrew Cuomo hold a press briefing about the coronavirus crisis on April 17, 2020, in Albany, New York. “The federal government has something called the Defense Production Act, DPA they call it, which I've been saying from day one is a very powerful tool for the federal government to use when they need to secure a product in the defense of this nation,” Cuomo said at an earlier press conference. Matthew Cavanaugh/Getty

The Defense Production Act (DPA)—a powerful Korean War-era law that allows the federal government to establish dominion over private industry—has been a focal point of the Trump administration's response to the COVID-19 outbreak.

Critics have seized on the White House's early reluctance to invoke the full measure of the law's authorities, which range from providing financial incentives to overriding and directing operations at private businesses.

In response to a question about more aggressively employing the DPA to compel production of personal protective equipment (such as face masks, gowns and gloves) in short supply, President Donald Trump initially objected, saying in late March that "we're a country not based on nationalizing our business."

"Call a person over in Venezuela. Ask them, 'How did nationalization of their businesses work out?' Not too well," the president said at a press briefing. "The concept of nationalizing our business is not a good concept."

His administration has indicated that it sees the DPA as a more valuable tool in the fight against COVID-19 when used to exert leverage in negotiations with private industry. But Trump has begun to invoke the law in gradual fashion, using one of the lesser provisions known as the priorities authority to require that government PPE orders jump to the front of the line.

"Priority ratings are the part of the DPA that is used regularly within the government," David J. Kaufman, who led the Office of Policy and Program Analysis at the Federal Emergency Management Agency (FEMA), told Newsweek.

Though quarrels over using the law have sprung to the surface during COVID-19, the federal government—including the Trump administration—has routinely enjoyed the priorities benefit in a multitude of other projects.

The New York Times has reported that the Trump administration has placed hundreds of thousands of priority-rated orders under the DPA for materials such as body armor and military missile components.

"Notwithstanding how this government has talked about the DPA, it has used it regularly in a wide range of areas," Kaufman said.

When COVID-19 hit, partisan tensions flared over using the law to compel private industry production of PPE and ventilators, demand for which had skyrocketed overnight. State and local officials began to plead with the federal government to use the law to meet their quotas, presenting the public with a stark portrait of governors made helpless by a crisis that had exceeded their individual capacities to respond.

On April 8, the Department of Health and Human Services announced that it had secured its first priority-rated order for ventilators—a contract that was delivered to General Motors, with whom Trump had earlier sparred over production capacity.

"The federal government has something called the Defense Production Act, DPA they call it, which I've been saying from day one is a very powerful tool for the federal government to use when they need to secure a product in the defense of this nation," New York Governor Andrew Cuomo said at a press conference on April 10.

"I can't do it as a state. If I had a Defense Production Act in the state, I would use it. I would use it. I don't have that tool, the federal government does," Cuomo added.

But Kaufman pointed out that there is a little-utilized power enabled by the DPA allowing states to make use of the law to issue their own priority-rated contracts. With FEMA's permission, states can use DPA muscle to prioritize contracts related to "emergency preparedness, mitigation, response and recovery programs," according to a 2016 delegation of authority.

A spokesperson for the Cuomo administration did not respond to a request for comment about whether it has or intends to use this process to expedite delivery of PPE.

In early March, the New York State legislature moved to temporarily expand the governor's emergency powers, allowing him to issue any directive "necessary to cope with" a public disaster. However, such orders must be "reasonably necessary" to manage the crisis and should not exceed a "minimum deviation" from the state's current laws and regulations.

Donald Trump
U.S. President Donald Trump speaks during the daily briefing of the coronavirus task force at the White House on April 22, 2020, in Washington, DC. Trump has compared using the full measure of the Defense Production Act, a powerful Korean War-era law, to the economic devastation in Venezuela. Drew Angerer/Getty

The more powerful part of the DPA—enabling the federal government to essentially take over production at private facilities—is not as readily available to states. This provision known as the allocations authority has been likened to 'nationalizing' industry, an imperfect-but-not-unhelpful comparison.

One barrier that could prevent New York from enacting its own analogue to the law, and especially to the allocations authority, is a part of the Constitution known as the Dormant Commerce Clause. A "phantom" provision, this clause prevents states from introducing laws or regulations that discriminate in commerce among the states, which is a power uniquely reserved to Congress.

"A state is not allowed to discriminate against out-of-state business interests," Martin Redish, a professor of law and public policy at Northwestern University's Pritzker School of Law, told Newsweek. "Even if they're not passing discriminatory laws, even if they're neutral, they will be invalidated if they cause an undue burden on the free flow of interstate commerce."

But that burden can be subject to a balancing test, and Redish noted that "if there's a compelling interest," a state-level DPA "might be upheld." In matters of statewide emergency, public health is "the strongest argument" you can make in favor of these proposals, he said.

One landmark 1986 Supreme Court case found that a Maine statute was constitutional even though it "discriminates on its face against interstate trade," an otherwise prohibitive barrier, for the reason that such a law was needed to "protect the health and safety of its citizens." That case concerned the spread of parasitic disease, resembling the kind of public health prerogative that could be advanced by a state seeking to develop its own DPA.

But Redish surmised that the novelty of the current coronavirus might be a more reasonable explanation for why states haven't marshaled their own executive powers in the same way the U.S. president has.

"The reason states don't have these laws is probably more practical than legal," he said. "Any kind of crisis that would rise to the level of the need to basically take over industry is going to be so overwhelming a matter that the federal government should be handling it. This is an unprecedented approach by the president."

"This is what's so amazing," Redish added. "Just as a general structural matter, that the federal government is making these states engage in their equivalent of The Hunger Games."

Here's How New York Governor Andrew Cuomo Could Use the Federal Defense Production Act to Get More Coronavirus Supplies | U.S.