For days, as disturbing reports mounted from hospitals in urban covid-19 hotspots, both Trump’s opponents and some of his supporters have been urging the president to use this authority. The president repeatedly said it wasn’t needed, then abruptly changed course as negotiations between GM and the government broke down.
Trump had it right the first time. This is undoubtedly good political theater, but it doesn’t actually get us ventilators any faster.
Our ventilator supply is inadequate for three reasons. First, with the advent of vaccines and antibiotics, health-care systems are no longer so beset with the severe periodic epidemics that used to be a fact of urban life, so as we’ve built up modern hospital systems, we’ve been able to run them very close to capacity. This saves money, but it necessarily means that when we get hit by a major epidemic, we don’t have as much staff or equipment as we’d like.
Second, this time we aren’t just having a local epidemic, but a pandemic that is striking everywhere in the world — and all at once. So we are competing for ventilators with dozens of other countries that want them just as badly.
Third, the United States spent the past two decades outsourcing manufacturing capacity, which makes it more difficult for us to boost production to meet this crisis.
Nonetheless, Trump probably has one thing right: The best solution is for the manufacturers of other goods still being made here to start making ventilators and other medical equipment instead. But we hardly need the Defense Production Act to make that happen. We could just offer to buy the ventilators at a fair price — one that covers not just the materials and labor needed to make the ventilators, but the cost of retooling factories to produce them. With factories idled and demand crashing, a lot of manufacturing companies should be happy to take that deal.
As, indeed, GM was. The Federal Emergency Management Agency reportedly balked at the $1 billion price tag — and, apparently, at the slow timetable for delivery.
The Defense Production Act does not enable General Motors to retool its plant, design a machine or school its workforce on making an unfamiliar product, any faster than a big check from the government would. Nor did command-and-control efforts during World War II, by the way; it took considerable time to ramp up that war production, and it will take a bit of time to get ready for this battle, too.
We can’t even necessarily force GM to make the things any cheaper. The government can require GM to make ventilators, but not at a huge loss — because that would be a “taking,” barred under the Fifth Amendment. If $1 billion is close to what it would cost GM to make those ventilators, then it’s probably close to what the government is ultimately going to have to pay.
In the meantime, forcing the company to take the contract erodes the spirit of cooperative enthusiasm with which one normally likes to enter into a business relationship — if only because a sullen, unwilling partner isn’t one who is looks hard for every opportunity to serve you even better, or to find quick solutions to your joint problems.
So if we want GM to make our breathing machines, it would probably have been better to just agree to pay GM, then stand back while the company leapt into action. The only problems the DPA really solves are political: They make Trump look powerful and decisive at a time when the nation is desperate for those qualities, and they bolster the image he is trying to cultivate as a wartime president.
It wouldn’t be a bad idea to rally Americans towards some kind of WWII-like solidarity, even if our main sacrifice is sitting at home, and our main enemy is a bug one-billionth our size. But command and control isn’t particularly unifying — nor is it particularly effective.