Biden Announces Plan to Fix Bottlenecks in Critical Supply Chains

The Biden administration will act to strengthen U.S. supply chains on critical goods, remedying disruptions resulting from the Covid-19 pandemic and making supply chains more secure.

In February, Biden issued an executive order for a 100-day review, directing cabinet members to have their departments identify vulnerabilities in key sectors: semiconductor manufacturing, large capacity batteries like those used in electric vehicles, critical minerals and pharmaceutical manufacturing and ingredients.

Multiple agencies are involved in the effort. The Department of Energy will offer loans to companies building advanced battery technology manufacturing facilities to establish a domestic supply chain for the kinds of lithium batteries used in electric cars. And a Department of Interior task force will look to identify potential locations “where critical minerals could be sustainably and responsibly produced and processed” in the U.S.

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Under the Defense Production Act, Biden will order the Department of Health and Human Services to “establish a public-private consortium for advanced manufacturing and onshoring of domestic essential medicines production.” The Defense Production Act gives the president the authority to direct private companies to prioritize manufacturing for the government related to national defense. Former president Donald Trump was reluctant to use his DPA authorities in the early days of the Covid-19 pandemic, leading to criticism that he was not moving quickly enough.

National Security Advisor Jake Sullivan and National Economic Council Director Brian Deese wrote a statement accompanying a report, released Tuesday, summarizing the results of the review. “More secure and resilient supply chains are essential to our national security, our economic security, and our technological leadership,” Sullivan and Deese wrote. “The work of strengthening America’s critical supply chains will require sustained focus and investment.”

The White House also announced Tuesday the creation created a Supply Chain Disruptions Task Force to “tackle near-term” supply line disruptions in construction, transportation, semiconductor production and agriculture industries. The task force will help provide a “whole-of-government response” to ensure that supply can meet demand. The prices of many construction materials, including wood, have increased dramatically in recent months as homebuyers flood the market to take advantage of low interest rates. One poll conducted in March found that more than half of nearly 1,500 contractors surveyed said they had experienced delays because they were short on construction materials, parts or equipment.

Another task force in the office of the U.S. Trade Representative will identify “unfair foreign trade practices” and make recommendations to address them. The group will also look at existing trade agreements and find ways to strengthen the country’s supply chain resilience.

Also on Tuesday, the Senate was on track to pass a bipartisan $50 billion emergency allotment to the Commerce Department to help the domestic semiconductor manufacturing industry compete with China, which supporters told the AP would be the biggest scientific research investment the U.S. has seen in decades.

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