[Congressional Record Volume 141, Number 179 (Monday, November 13, 1995)]
[House]
[Pages H12142-H12144]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




               DEFENSE PRODUCTION ACT AMENDMENTS OF 1995

  Mr. CASTLE. Mr. Speaker, I move to suspend the rules and pass the 
bill (H.R. 2204) to extend and reauthorize the Defense Production Act 
of 1950, and for other purposes, as amended.
  The Clerk read as follows:

                               H.R. 2204

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Defense Production Act 
     Amendments of 1995''.

     SEC. 2. EXTENSION OF PROGRAMS.

       Section 717(a) of the Defense Production Act of 1950 (50 
     U.S.C. App. 2166(a)) is amended in the first sentence by 
     striking ``Title I (except section 104), title III, and title 
     VII (except sections 708, 714, 719, and 721) of this Act, and 
     all authority conferred thereunder shall terminate at the 
     close of September 30, 1995'' and inserting ``Title I (except 
     section 104), title III, and title VII (except sections 708 
     and 721), and all authority conferred thereunder, shall 
     terminate at the close of September 30, 1998''.

     SEC. 3. AUTHORIZING APPROPRIATIONS FOR TITLE III PROJECTS.

       Section 711 of the Defense Production Act of 1950 (50 
     U.S.C. App. 2161) is amended--
       (1) in subsection (a), by striking ``(a) Authorization.--'' 
     and all that follows through ``subsection (c),,'' and 
     inserting ``(a) Authorization.--Except as provided in 
     subsection (b),''; and
       (2) by striking subsections (b), (c), and (d) and inserting 
     after subsection (a) the following new subsection:

[[Page H 12143]]

       ``(b) Title II Authorization.--There are authorized to be 
     appropriated for each of the fiscal years 1996, 1997, and 
     1998, such sums as may be necessary to carry out title 
     III.''.

     SEC. 4. REPORTS TO THE CONGRESS.

       (a) In General.--The President shall prepare and transmit 
     to the Committee on Banking and Financial Services of the 
     House of Representatives and the Committee on Banking, 
     Housing, and Urban Affairs of the Senate an interim report 
     and a final report on proposed legislative modernization of 
     the authorities contained in the Defense Production Act of 
     1950.
       (b) Timing.--The President shall so transmit--
       (1) the interim report required by subsection (a), not 
     later than January 31, 1997; and
       (2) the final report required by subsection (a), not later 
     than September 30, 1997.

  The SPEAKER pro tempore. Pursuant to the rule, the gentleman from 
Delaware [Mr. Castle] will be recognized for 20 minutes, and the 
gentleman from New York [Mr. Flake] will be recognized for 20 minutes.
  The Chair recognizes the gentleman from Delaware [Mr. Castle].
  Mr. CASTLE. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, I rise in support of the bill before us today, H.R. 
2204, a basically noncontroversial measure to extend and reauthorize 
the Defense Production Act of 1950. In this, I am grateful to enjoy the 
support of Representative James A. Leach, chairman of the Committee on 
Banking and Financial Services. In true bipartisan spirit, our 
distinguished former chairman, Representative Gonzalez and 
Representative Flake, the ranking member of the subcommittee have also 
provided their strong support for this legislation and I am very 
appreciative of their efforts. I would be remiss if I did not also 
acknowledge the valued input provided by Representative Metcalf, 
Representative Barr, Representative Chrysler, and Representative Watt 
of the subcommittee. Their counsel has served to improve the future 
exercise of Defense Production Act authorities.
  Mr. Speaker, the Subcommittee on Domestic and International Monetary 
Policy of the House Banking and Financial Services Committee has 
primary jurisdiction over the Defense Production Act, which is the 
primary statute used for the mobilization of civilian efforts during 
national disasters in peacetime and in support of the national defense 
during periods of national emergency. The authorization for the DPA 
expired on September 30, 1995. This legislation would extend and 
reauthorize the DPA until September 30, 1998.
  Title I of the DPA is designed to ensure that the Armed Forces of the 
United States can obtain the critical goods and services required to 
carry out their duties during wartime national emergencies and 
peacetime national disasters. It provides the President with the 
authority to establish an order of precedence among contracts and to 
require that those contracts or orders for essential goods, necessary 
to the national defense, take precedence over other contracts or 
orders. In addition, title I authorizes the President to manage the 
allocation of materials, equipment, and services necessary to promote 
the national defense.
  The fiscal year 1995 Defense Authorization Act redefined ``national 
defense'' and amended the DPA to extend the application of the 
authorities under title I to be used in the event of a national 
disaster. This is a sensible adaptation to permit these capabilities 
and authorities to be employed to help victims of natural disasters--
floods, fires, hurricanes, and earthquakes.
  These authorities have been employed to support the U.S. military in 
every conflict since 1950. Operation Desert Storm was a recent example 
of a conflict situation that arose with special needs that could not be 
completely anticipated and supplied through the ordinary operations of 
the market. Currently the Bosnian situation places actual and potential 
emergency equipment and logistical demands for the support of our 
forces.
  Title III authorizes the President to use incentives to establish, 
expand, and maintain domestic production capacity for critical 
components, critical items of technology, and essential industrial 
resources required for the execution of the national security strategy 
of the United States.
  No appropriations for DPA have been requested by this administration 
for fiscal year 1996 and none are forecast for fiscal year 1997. The 
Congressional Budget Office estimates that H.R. 2204 would result in 
additional outlays of $80 to $85 million over the 5-year period between 
1996-2000. All of these costs would be subject to discretionary 
appropriations. The bill is not subject to pay as you go procedures 
because it would not affect direct spending or receipts. Enactment of 
this bill will have no effect on the budgets of State and local 
governments.
  Mr. Speaker, the administration and the minority support this 
extension of the DPA through September 30, 1998. The other body has 
already passed substantially identical legislation by unanimous 
consent. This bill is a provident and careful provision for the 
unpredictable conflict or national emergency. I urge its immediate 
adoption.
  Mr. Speaker, I reserve the balance of my time.
  Mr. FLAKE. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, I commend the chairman of the Subcommittee on Domestic 
and International Monetary Policy, as well as the many members on both 
sides of the committee and in the House who realize the importance of 
the Defense Production Act to our national security.
  Mr. Speaker, preparedness has long been a staple of our Nation's 
military strength. It is an unrefuted fact that our Nation's defense is 
grounded upon a policy of a strong industrial and technology base 
capable of meeting national defense requirements, and is further 
predicated upon our maintaining technological superiority on the 
battlefield. The synergy of these two themes is affirmed in the Defense 
Production Act.
  More importantly, however, the authorities contained in the act make 
our policy a reality. The DPA's authorities are unique in that they 
provide the Defense Department the ability to maintain a strong 
domestic base which will be responsive to threats to the national 
security of the United States. Moreover, I am pleased to say these same 
authorities may apply in times of natural disasters here at home.
  Mr. Speaker, a brief history of the DPA is in order, so that the 
American public can understand the efficacy of its provisions. 
Established in 1950, the original intent was to mobilize the Nation's 
production capacity in response to material shortages experienced 
during World War II and the outbreak of the Korean war. Only three out 
of seven titles remain in operation today, and these authorities 
expired on September 30, 1995.

  Title I is a powerful tool that ensures that our Armed Forces and 
those of our allies can obtain the materials they need to meet any 
contingency that threatens the national security. These priorities and 
allocations authorities have been used extensively and have proven 
invaluable. During Desert Storm, title I ensured that industry provided 
priority production and shipment of essential items urgently needed by 
the coalition forces. Close to 600 cases were handled during the 
conflict which included delivery of: Global positioning system 
receivers; activated charcoal for gas masks; and search/rescue radios.
  Mr. Speaker, title III provisions also contain vital authorities. 
This ``expansion of productive capacity and supply'' authority allows 
the President to use incentives to establish, expand, or maintain 
domestic productive capacity for critical components, critical 
technology items, and industrial resources essential for the execution 
of the national security policy of the United States.
  Title III provides a unique vehicle by which the Defense Department 
can provide financial incentives to industry to support defense needs. 
These incentives allow domestic industries to support and supply key 
advanced materials and technology items, and facilities the use of 
these materials in our Nation's defense systems. Most often these 
systems involve high technology systems including lasers, radar, and 
communication systems.
  Mr. Speaker, the last operative authority, title VII, contains some 
general measures. I will close, however, by extending my support to the 
new language inserted requiring a report for possible changes to the 
active sections of the DPA. Members from both parties expressed 
concerns about the age of this law, and whether these authorities 

[[Page H 12144]]
are obsolete. Some also felt that the President has too much power 
under the DPA. I believe the changes will assuage these concerns, and I 
look forward to working with Mr. Castle and the Defense Department on 
those changes.
  Therefore, as the ranking member of the Subcommittee on Domestic and 
International Monetary Policy, I support the bill.
  Mr. GONZALEZ. Mr. Speaker, for 45 years the Defense Production Act 
has provided the executive branch with essential authorities to ensure 
that our Armed Forces will have the materials and supportive services 
necessary to promote the national defense.
  Ever since the Defense Production Act was enacted in 1950, the 
Banking Committee has carefully reviewed and amended the act so that it 
is as necessary today as the day it was enacted.
  The bill before us today continues, until September 30, 1998, the 
President's authority to set procurement priorities on contracts for 
goods and services that are absolutely necessary for strategic military 
purposes. Additionally, the bill extends the President's authority to 
establish financial incentives to permit the domestic defense industry 
to produce goods and services which are critical elements of weapon 
systems.
  While we recognize that we live in a global industrial environment, 
it simply makes no sense to depend on foreign sources of critical parts 
for U.S. weapon systems; no matter how strongly we believe another 
country shares our national interests. This legislation takes important 
steps to prevent an unreasonable reliance on the defense industries of 
other countries. The Defense Production Act produces jobs in American 
industries and promotes the development of new technologies for our 
firms.
  I commend the chairman of the Banking Committee, Chairman Leach, the 
subcommittee chairman and ranking member, Chairman Castle and 
Congressman Floyd Flake respectively, for their work in bringing the 
bill to the floor.
  I strongly recommend bipartisan support of the Defense Production Act 
Amendments of 1995.

                              {time}  1500

  Mr. FLAKE. Mr. Speaker, I yield back the balance of my time.
  Mr. CASTLE. Mr. Speaker, I yield back the balance of my time.
  The SPEAKER pro tempore. The question is on the motion offered by the 
gentleman from Delaware [Mr. Castle] that the House suspend the rules 
and pass the bill, H.R. 2204, as amended.
  The question was taken; and (two-thirds having voted in favor 
thereof) the rules were suspended and the bill, as amended, was passed.
  A motion to reconsider was laid on the table.

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