• The ongoing COVID-19 pandemic has revealed weaknesses in the medical industrial base, including a dependency on China, indicates Ellen Lord, undersecretary of defense for acquisition and sustainment. Credit: Tumisu/Pixabay
     The ongoing COVID-19 pandemic has revealed weaknesses in the medical industrial base, including a dependency on China, indicates Ellen Lord, undersecretary of defense for acquisition and sustainment. Credit: Tumisu/Pixabay

Ellen Lord: The United States Is Too Reliant on China for Medical Gear

April 30, 2020
By George I. Seffers
E-mail About the Author

The military cranks out protective gear for COVID-19 and future pandemics.

The United States is overly dependent on foreign sources, especially China, for personal protective equipment such as the gear required during pandemics, including the ongoing COVID-19 outbreak, according to Ellen Lord, the undersecretary of defense for acquisition and sustainment.

Lord made the comments during an press April 30 press briefing that was streamed online.

“What I would like to see is the U.S. have the capacity and throughput to take care of ourselves in times of need. We, at this point, have some national security issues with China. We have found that our dependency on China is more than we need it to be,” she said. “We still have the air bridge working to bring all kinds of medical resources back to the United States, so we need to make sure we have security and resiliency in our medical industrial base and we can help HHS [Department of Health and Human Services] to make sure we have both the capacity and throughput that we need not only now but in the future.”

The Department of Defense (DOD) is helping. Lord outlined a wide array of projects and statistics to illustrate the role the department is playing in helping the country cope with the crisis.

For example, the department has signed an interagency agreement with the HHS that “establishes a framework by which DOD will provide acquisition assistance on behalf of HHS and their CARES Act authorities,” she said, noting that the two departments already are working on their first joint project and adding that she look forward to expanding our partnership to deliver medical resources in support of our national mission.”

Furthermore, to date the department has taken 8,000 contracting actions in response to COVID-19 totaling over $1.7 billion, and anticipates reaching $2 billion by the end of this week. “This includes $200 million in medical construction for the mobile military medical hospitals. Medical equipment, lab equipment and testing remain high priorities,” she said. “We are there to support and provide our acquisition expertise but we will stand down once we do have the capacity, the capability and the volume coming out of that industrial base for medical resources …”

Moreover, since February 1, the Defense Logistics Agency has executed 5,026 contract actions valued at $837 million, including $688 million directly supporting requirements from the Federal Emergency Management Agency (FEMA) and the HHS.

Lord also updated reporters on the 60 Critical Care Decontamination Systems being provided by the Battelle Memorial Institute. The systems allow medical professionals to reuse masks up to 20 times, reducing the nation’s need for new inventory. Eight units are operational in various cities, including New York, Boston and Chicago. Fourteen other units are setting up and should be operational soon in cities from coast to coast, including Miami, Denver and Burbank, California. The remaining units are being prioritized for delivery.

The department also has provided 20 million N-95 masks to HHS and FEMA.

Asked whether the Defense Department will be combating COVID-19 for six months or a year, Lord emphasized it’s not just the military. “The nation is going to be battling COVID for six months or a year. I look to DOD as the support in times of national emergency to FEMA and HHS.  They have the infrastructure, they have the overall mission, yet we have a capability to surge 140,000 acquisition professionals to provide the contracting and the program management support to really energize the medical industrial base. We’ve learned we’ve had fragility in it on a number of fronts,” she said.

Lord has been working with industry to minimize the impact of the pandemic.

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To borrow a thought from the US service war colleges, this topic is rife with second and third order effects; however, this comment just focuses on a narrow aspect of economics and trade.

Ever since President Nixon's game-changing visit to China, both countries have enjoyed the tangible benefits of free trade -- briefly, widespread availability of low cost goods in the US and growth of industry, technology, and wealth in China. Of course, there have been issues: Chinese theft of intellectual property and restrictions on US companies' access to its domestic markets, to name a few. For the most part, trade has grown explosively and without a prudent eye to the consequences of potential disasters, whether flood, fire, famine, or others of that ilk, like pestilence.

Self-sufficiency occurs on tension with free-trade. A thriving domestic, self-sufficient industry usually entails higher costs than foreign imports -- and the immediate second order effects of restricting imports to build a domestic base are (1) the diversion of resources to build that base as well as (2) lower growth in the US gross domestic product (GDP). A significant third order effect, now apparent to all of course, is the brittleness of that free-trade and rapid growth -- especially supply chains -- in the presence of disaster.

No easy solutions. We need a comprehensive discussion of how the government and regulatory bodies can encourage the free people and industries of the US to better anticipate the costs of rare, but catastrophic events even when those measures require investment, savings, and deferred consumption in the short term.

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