It Would Be So Funny If Trump Nationalized Elon Musk’s Companies
A similar idea was floated online yesterday by Steve Bannon, the odious former film producer and Trump confidant, who suggested using the Defense Production Act to “seize” SpaceX. The wide-ranging Korean War–era policy outlines several steps by which the White House can bypass Congress to intervene in the demand and supply sides of particular industries. Those powers can include directing private companies to prioritize orders from the federal government, issuing loans and loan guarantees, and allocating “materials, services, and facilities” from corporations.
Just this week, Trump invoked the Defense Production Act to boost production of so-called critical minerals and weapons. A waiver published to the Federal Register on Wednesday claims that shortfalls of either would “severely impair national defense capability.” The Biden administration similarly leveraged the Defense Production Act to spur on the domestic production of graphite, a key component of the lithium-ion batteries used in military energy systems and electric vehicles. Both presidents turned to the law during the Covid-19 pandemic to address medical supply chain shortages and accelerate vaccine production. As the Roosevelt Institute’s Todd Tucker has pointed out, the Defense Production Act has been continually updated to give the White House broader authority over energy, in particular. Its 2009 reauthorization specifically excised language in previous versions that restricted the government’s ability to directly engage in energy production. After 9/11, the Defense Production Act’s definition of “national defense” was updated to include the protection and restoration of “critical infrastructure,” a legal designation of 16 sectors deemed essential to the functioning of the economy, including telecoms, information technology, and transportation.
In theory, that is, the Defense Production Act offers Donald Trump a massive toolbox with which to intervene in Musk’s business. He could stick it to the richest man on earth by ordering Tesla to stop making Cybertrucks and start making electric buses, or forcing Starlink to provide free internet service to everyone in the country.
