Reed says securing defense supply chain will be 'major effort' following Biden's executive order

By Tony Bertuca  / February 24, 2021

Senate Armed Services Committee Chairman Jack Reed (D-RI) said today a new executive order from President Biden to review the U.S. defense industrial base is the start of a "major effort" to secure national supply chains, despite challenges posed by China's key role in the global marketplace.

"It's a bipartisan effort at this point," Reed said during a call with reporters. "I think the pandemic gave us a wake-up call in terms of where things are coming from and we have to marry that – here's the tension -- with a global trading system that's not going to go away."

Biden's new executive order calls for, among other things, an in-depth, one-year review of the defense industrial base. Other sectors, like energy, transportation, and information technology, will also be reviewed.

"The executive order launches a comprehensive review of U.S. supply chains and directs federal departments and agencies to identify ways to secure U.S. supply chains against a wide range of risks and vulnerabilities," according to a White House fact sheet. "Building resilient supply chains will protect the United States from facing shortages of critical products. It will also facilitate needed investments to maintain America's competitive edge, and strengthen U.S. national security."

Defense Secretary Lloyd Austin has called China the "pacing challenge" for the United States.

Biden's executive order also calls for a 100-day review across all federal agencies to address vulnerabilities in pharmaceuticals and active pharmaceutical agreements, critical minerals, including rare earths, semiconductors and advanced packaging, and large-capacity batteries, such as those used in electric vehicles.

Pentagon officials for many years have worried about potential disruptions in the U.S. defense industrial base, but the COVID-19 pandemic has highlighted weaknesses in the global supply chains feeding that base.

Vice Chairman of the Joint Chiefs of Staff Gen. John Hyten, the Pentagon's No. 2 military official, recently said the COVID-19 pandemic exposed critical points of failure.

"My concern is the health of our industrial base," he said during a virtual event hosted by the Center for Strategic and International Studies. "Because right now our industrial base is not healthy and COVID has not helped it."

Reed, who today said the issue has been partially addressed in previous defense authorization bills and would likely return this year, noted the challenges associated with on-shoring critical capabilities like potentially isolating allies who wish to sell products to the United States and pushing them toward China.

"I do think there is a tension there," he said. "I don't think we can ever in this global economy sort of say everything has to be produced in America. But I think we can try to identify reliable allies who could be our sources of supply and who would be willing and able to provide us supplies in the case of tensions or conflict."

During a panel discussion last month, former Deputy Defense Secretary Bob Work said he was concerned about a "bipartisan overemphasis" on economic protectionism, which, he argued, might

protect single points of failure in the industrial base, but does little to strengthen U.S. allies and could cede the global marketplace to China. He said the current approach seems to be "astrategic" and "based on domestic U.S. politics that allows the Chinese to compete against all democratic nations individually rather than as a united front."

Reed said he believed the United States would be able to proceed "judiciously" with supply chain security, selecting "those critical elements that we must have and then, either through the United States production or a close ally, have them available to us in all circumstances."