Executive Order 13806: Manufacturing base

What the Executive Order Says

Executive Order 13806 is entitled "Assessing and Strengthening the Manufacturing and Defense Industrial Base and Supply Chain Resiliency of the United States".  It has 3 sections.

Section 1

This section defines policy.  It posits that the manufacturing capacity and defense industrial base has been weakened by the loss of factories and jobs.  This has consequences for national security.  Therefore policies should be crafted to enhance manufacturing capacity and the defense industrial base.

Section 2

This section mandates that a report is created.  It does have a number of subsections which define the aspects of the report.  These include identification of stuff that is essential to national security, what domestic manufacturing capability exists, what internal and external shocks might precipitate a crisis and what we should do to prevent that.  This report is due in 270 days.

Section 3

This section contains the necessary legal fine print to assure that the Executive order is constitutional.

My Commentary

This is tricky.  There is a real national security weakness when the USA relies on weapons manufactured outside of the country.  Further, it is true that some weapons which are assembled in the USA rely on components and raw materials that come from outside the country.  Any of these components or raw materials could be made into point of leverage, be it batteries, memory chips or high strength magnets.  All of these three mentioned parts rely on metals which are often rare and not necessarily found in the USA.  Batteries require lithium.  Chips are made with gallium and arsenide.  Magnets are made with neodymium.  What are the options to obtain these minerals when faces with some kind of external shock.
The problem is that these Executive Orders have been, under this President, often tools of simple political posturing, full of sound and fury signifying nothing.  Also, anyone that knows anything about this topic knows that there are no simple solutions.  Partly this is because the pace of industrial innovation and technological development is such that in order to aim to catch up with someone, you end up trying to come up with the next round of evolution (or revolution) in a technology before them.  If you just try to match where they currently are, by the time you get there, you are behind again.
The last point I want to make is that short of the government procuring goods and services from private industry, there are few if any direct tools to create manufacturing jobs or build factories.  As such, the probability is that the suggestions will amount to re-invigorating the military-industrial complex of the 1970's and 1980's.  The government has much more power to influence conditions that are conducive to job growth and expansion of the manufacturing base.  These would include: low interest rates, low tax rates, less regulation, the availability of highly skilled workers who will work at low rates of pay. All of these disadvantage or harm workers.  Fundamentally, manufacturing is not coming back and we will have to deal with the national security implications of that.