Follow the “M” word: More on the “National Defense Resources Preparedness” Executive Order
posted at 1:41 pm on March 19, 2012 by J.E. Dyer
Not “martial law,” folks. Not that “M” word. The other one: “money.”
Ed did an excellent job breaking down the few actual differences between Obama’s new defense-resources EO and the previous version from 1994. Here are the two main differences:
1. The Obama EO elaborates vague-sounding functions for federal agencies in maintaining defense-resources preparedness (Section 103). Ed summarizes them as follows:
Note what this EO specifically orders: identify, assess, be prepared, improve, foster cooperation.
2. The Obama EO delegates authorities under Section 308 to agency heads. The Section 308 authorities include putting additional equipment in public and private defense industrial facilities, and modifying or expanding private facilities, including modifying or “improving” industrial processes.
Any time I see the Obama administration and “modifying private industry” in the same zip code, I get curious about who’s cooking up ways to spend taxpayer money on uneconomic ventures. We’ve had that whole thing with the green-tech companies making out like bandits from Obama administration crony projects – while failing, destroying unused parts, and charging the military four times the cost of regular fuel – so it’s not like there’s no precedent for the concept.
And it turns out that Obama’s new EO did not emerge from out of nowhere in this regard. The Department of Energy has become notorious for its funding awards to Obama cronies, but there has been much less of that unpleasant publicity about the Department of Defense. Where Obama has proposed increasing defense expenditures, however, is in public-private partnerships to develop “advanced manufacturing” technologies for the defense industry. A whole infrastructure of initiatives and organizations has been set up to bring the idea to fruition. And a key due-out in each case will be DOD money going to businesses.
As Ed and others pointed out this weekend, there is nothing new about federal provisions to manage and ensure “defense resources.” The Obama administration has set up some new organizations, but it has relied on the authority from previous legislation (principally the Defense Production Act of 1950, or DPA) to scope its overarching concept. Readers should also keep in mind that the idea of government stepping in and modifying defense businesses has been enshrined in US law for decades. (The previous understanding has been that these measures would be reserved almost entirely for war or national emergency.) The Obama administration is merely putting its unique stamp on the concept.
There’s a big cast of characters. Besides reorganizing the President’s Council of Advisors on Science and Technology (PCAST), an entity that has existed under different names for most of the last 80 years, the Obama administration launched its Advanced Manufacturing Partnership (AMP) in June 2011. The AMP will hand out money, but will also identify projects for the federal departments to hand out money to.
In 2011, the administration created a new Deputy Assistant Secretary of Defense for Manufacturing and Industrial Base Policy (MIBP). ASD/MIBP is not a Senate-confirmed official, but he manages the DPA Fund; i.e., money. (A GAO report in 2008 summarized the somewhat chaotic approach to funding DPA projects under Title III; the Obama administration’s approach has emphasized wrestling some of that chaos down, to put a more Obamist face on the priorities.)
Obama also established an interagency Defense Production Act Committee, which, although derived from the authorities conferred by the DPA of 1950, had not been constituted prior to 2009. DPAC’s charter:
[DPAC] serves as a multi-departmental forum to identify risks and shortfalls in the industrial base and make recommendation on actions to rectify them, including the use of DPA Title III authorities.
(Title III authorities are summarized here as a “set of unique economic authorities to incentivize the creation, expansion or preservation of domestic manufacturing capabilities for technologies, components and materials needed to meet national defense requirements.” Read, in large part: money.)
The Obama administration also published very quickly – in March 2009 – a new strategic plan for the DOD Manufacturing Technology Program, another federal program dating to the 1950s, and one that – you guessed it – disburses money. But note: the specific requirement for the strategic plan came from the Defense Authorization Act in the final year of the Bush administration. As is often the case, the Obama administration doesn’t have to think up new programs, requirements, or authorities; it simply leverages the existing, cumulative infrastructure.
That appears to be what is going on with a concatenation of programmatic efforts that we may call the “defense advanced manufacturing nexus,” or DAMN. The central document in the nexus is the National Strategic Plan for Advanced Manufacturing, published – pay attention here – in February 2012. This is another in that ever-lengthening list of things you probably didn’t know we had. This strategic plan was developed by the Interagency Working Group on Advanced Manufacturing (IAM, and how’s that for an acronym), in response to Section 102 of the America COMPETES Reauthorization Act of 2010.
The strategic plan is about federal investment (“greater public co-investment”) – that is, in plain speak, “giving money” to folks. The priority for expenditures is explained as follows:
[P]rivate investment in advanced manufacturing capabilities may not occur domestically unless the public sector makes strategic investments to address market failures in stages of the innovation process downstream from basic research.
So the strategic plan is to invest taxpayer money in market failures. And it all comes together on pages 30-31 of this document, where we see the Defense Production Act Committee and the DOD Manufacturing Technology Program called out specifically as vehicles for implementing the strategic plan. DARPA is explicitly invoked as well.
Acronym overload is an issue here, so let’s just state the proposition one more time. The Obama strategic plan for advanced manufacturing is to invest public money in technologies that are vulnerable to (or are already) market failures, with a focus on defense manufacturing. The vague-sounding functions assigned to federal agencies in Obama’s new defense-resources EO – identify, assess, be prepared, improve, foster cooperation – mirror quite exactly the National Strategic Plan for Advanced Manufacturing and the DOD Manufacturing Technology Strategic Plan.
In light of this comprehensive, money-intensive plan, the delegation of authority to agency heads – for adding to, modifying, and improving the industrial base – takes on an interesting hue. The first thing that occurs to me is the Obama administration’s well-known reliance on “stealth” implementation of controversial or unpopular measures, through the unheralded actions of federal agencies. Charles Krauthammer outlined several such actions in December 2010; readers can no doubt think of numerous others.
How would this matter to the defense industrial infrastructure? One obvious way is the potential for agencies to quietly circumvent the intentions of Congress, which are a longstanding source of friction for presidential defense priorities. The Senate, in particular, is the center of excellence for political horse-trading over national priorities for the defense industry. If it’s manufactured for defense, or if it’s a defense service, there’s a senator for that: the Senate’s slugfests over which states get the biggest or next or “fair share” piece of the defense-industry pie are as unseemly and ridiculous and necessary as anything in consensual republican government.
But there is a subtler issue as well. The defense industry and its advocates have been complaining in the last couple of years about irreparable losses in the defense industrial infrastructure due to spending cuts. (See here and here as well.) There need be no “conspiracy theories” for us to recognize that as spending is cut further and further, some elements of the base will die on the vine, and what the federal government does spend defense money on is what will determine the shape of the future defense industrial base.
I am profoundly uneasy about the priorities of the Obama Defense Department in general – and I am made more so by the achievements in innovation touted by defense-funded enterprises like the $16-a-gallon marine biofuel, the contract to apply grid efficiency technology to DOD energy use, and DARPA’s partnership with start-up Local Motors to develop the first Experimental Crowd-Derived Combat-Support Vehicle (XC2V). The last sounds like one heck of a lot of fun, but forcing money into this kind of idea while declining to fund basic weapon systems will transform the defense industrial base in a way no one would buy into up front.
The new Obama EO on defense resources comes out of an accelerating, months-long effort to harness the defense budget for favored kinds of spending. This will no doubt be depicted as, precisely, “national defense resources preparedness.” And it’s already underway. In addition to the various direct-purchase or sponsorship projects with defense funding, the Army and Navy are just (literally, just) opening new research laboratories, which the US is apparently able to fund in spite of needing to cut funds for the high-performing RQ-4 Global Hawk UAV, the F-35 multi-service strike-fighter, US bases in Europe, and 80,000 Army soldiers.
For perspective, it is important to recognize that all presidential administrations seek to put their stamp on defense policies. There is nothing nefarious about doing that. What’s worth noting about the Obama administration is that its clearest public posture on defense is that defense spending has to be cut, no matter how painful the losses in military capability. In the esoteric realm of “national investment in infrastructure,” however – where money goes, as with the “Stimulus” package, to cronies – the administration has lifted out a segment of defense-related spending for special funding. It defines this segment in the terms of its “investment” plan for “advanced manufacturing,” in a manner similar to its enthusiasm for defense “investment” in “green technologies.”
And now it has modified the EO on National Defense Resources Preparedness along lines that are clearly relevant to implementing the plan for advanced manufacturing. A whole slew of websites went to high warble over the revised EO on the theory that it was intended to facilitate martial law, and I agree with Ed that that looks like a silly overreaction. But the important point is that it’s misdirected. I don’t think the EO or its timing is meaningless, or merely routine.