White House Releases Report on Building Resilient Supply Chains and Revitalizing American Manufacturing

The White House has released a new report titled, “Building Resilient Supply Chains, Revitalizing American Manufacturing, and Fostering Broad-Based Growth.” The report was developed in accordance with Executive Order (EO) 14017 of February 24, 2021 titled “America's Supply Chains,” which orders the Administration to conduct a supply chain review within 100 days. The EO directs the Departments of Commerce, Energy, Defense, and Health and Human Services to identify risks in the supply chain for critical technologies such as high-capacity batteries, advanced packaging, and pharmaceuticals, and asks the Secretaries of each Department to offer policy recommendations to address these risks.
 
The report identifies five key supply chain vulnerabilities:

1. Insufficient U.S. manufacturing capacity
2. Misaligned Incentives and short-termism in private markets
3. Industrial Policies Adopted by Allied, Partner, and Competitor Nations
4. Geographic concentration in global sourcing
5. Limited International Coordination 

To address these vulnerabilities, the report outlines policy recommendations and provides detailed instructions to achieve those recommendations (for specifics, please reference the report):

1. Rebuild our production and innovation capabilities by enacting new federal legislation that will strengthen critical supply chains and rebuild our industrial base, by increasing public investments in R&D and commercialization of key products, and by supporting an ecosystem of producers and innovators including SMEs and skilled workers.
2. Support the development of markets that invest in workers, value sustainability, and drive quality by creating 21st century standards for the extraction and processing of critical minerals, identifying potential U.S. production and processing locations for critical minerals, and improving transparency throughout the pharmaceuticals supply chain.
3. Leverage the government’s role as a purchaser of and investor in critical goods by using federal procurement to strengthen U.S. supply chains, strengthening domestic production requirements in federal grants for science and climate R&D, reforming and strengthen U.S. stockpiles, and ensuring that new automotive battery production in the United States adheres to high labor standards.
4. Strengthen international trade rules, including trade enforcement mechanisms by establishing a trade strike force and evaluating whether to initiate a Section 232 investigation on imports of neodymium magnets.
5. Work with allies and partners to decrease vulnerabilities in the global supply chains by expanding multilateral diplomatic engagement, including hosting a new Presidential Forum and leveraging Leverage the U.S. Development Finance Corporation (DFC) and other financing tools to support supply chain resilience.
6. Monitor near term supply chain disruptions as the economy reopens from the COVID-19 pandemic by establishing a Supply Chain Disruptions Task Force and creating a data hub to monitor near term supply chain vulnerabilities. 

Many of the policy recommendations listed above and in the report are in line with those recommended by the ASME Manufacturing Public Policy Task Force in its white paper, “The Hazards of Global Supply Chains.” The paper discusses the supply chain disruptions that occurred following the onset of the COVID-19 pandemic and how factors such as outsourcing contributed to global shortages of key supplies in the months immediately following the outbreak. The paper also explains the role a strong manufacturing sector can play in bolstering economies against future disruptions of similar scale and lays out recommendations for strengthening manufacturing and foreign relations policies to provide the U.S. with the tools to overcome similar challenges in the future.
 
Two recommendations made by the ASME Manufacturing Public Policy Task Force that are closely echoed in the White House’s new report are:
 

• ASME White Paper: The Federal Government should create globally competitive incentives for U.S. manufacturers to maintain or establish domestic capabilities and rapidly scalable manufacturing capacities in industry sectors critical to the health and well-being of the U.S. economy.
• White House Report: Sectors where we seek to advance our technological competitiveness—like high-capacity batteries—will require an ecosystem-building approach that includes supporting domestic demand, investing in domestic production, recycling and R&D, and targeting support of the U.S. automotive workforce.

 

• ASME White Paper: The Federal Government should invest in research and development aimed at creation of transformative advanced manufacturing technologies that will enable rapid scale-up of manufacturing capacities of critical goods to meet domestic needs in times of a national emergency.
• White House Report: The United States maintains an unparalleled innovation ecosystem with world-class universities, research centers, start-ups and incubators, attracting top talent from around the world. The Administration must double-down on our innovation infrastructure, reinvesting in research and development (R&D) and accelerating our ability to move innovations from the lab to the marketplace.

 
ASME White Paper: Hazards of Global Supply Chains
White House Report: Building Resilient Supply Chains, Revitalizing American Manufacturing, and Fostering Broad-Based Growth