President Joe Biden has applied the Defense Powers Act (DPA) to two components used in the manufacture of virtually all electronic devices, protecting the country’s ability to control its supply of electronic materials and equipment.
Biden signed a presidential directive that includes printed circuit boards and advanced packaging under Executive Order 14017, “America’s Supply Chains,” the Department of Defense announced on March 27.
The original executive order, signed in February 2021, addresses vulnerabilities in U.S. military readiness and economic competitiveness.
“The United States needs resilient, diverse, and secure supply chains to ensure our economic prosperity and national security,” Biden wrote in 2021.
The DPA authorizes the president to control the production of items necessary for the national defense by allocating materials, services, and facilities for their production.
The president may also prohibit the hoarding of supplies, offer loans or loan guarantees, and install equipment in government or privately owned factories.
In recent years, Presidents Obama, Trump, and Biden have used the law primarily to prioritize the fulfillment of orders placed by the federal government for medical and military equipment.
Biden’s directive delegates these powers to the DoD regarding printed circuit boards and advanced packaging.
Printed circuit boards are electrical circuits etched into a material like copper, to which other electronic components may be attached. Advanced packaging is the aggregation of several electronic components into a single device.
By including printed circuit boards and advanced packaging under the DPA umbrella, the administration builds on the CHIPS and Science Act of 2022 in reducing U.S. dependence on China, the world’s largest producer of electronic components and devices.
The CHIPS Act provides $280 billion for the research and manufacturing of semiconductors in the United States. The law was passed with bipartisan support amid a global shortage of computer chips.
In 2020, China controlled 54 percent of computer chip sales. More than two-thirds of the world’s supply of circuit boards are made in China, including Hong Kong.
The DoD now has the authority to strengthen U.S. production of these items.
While that move benefits military readiness, it is part of the president’s broader agenda to strengthen U.S. manufacturing.
“Resilient American supply chains will revitalize and rebuild domestic manufacturing capacity, maintain America’s competitive edge in research and development, and create well-paying jobs.” Biden wrote in the 2021 executive order.
Congress enacted the DPA in September 1950 at the outset of the Korean War and has renewed it several times since then. The current version of the law expires in 2025.
