WASHINGTON — The executive order President Trump signed Friday ordering a government-wide review of America’s defense industry aims to help fulfill Trump’s promise to “rebuild” the military, a top U.S. trade official says.
White House Director of Trade and Industrial Policy Peter Navarro called the defense-industrial base “a major priority,” for Trump. The order, he said, “recognizes that the United States cannot be a global power without a preeminent military.”
“It also recognized that we cannot retain a preeminent military without a healthy, growing economy and a resilient industrial base,” Navarro said in a Fox News op-ed published Saturday.
Navarro is also the director of the White House National Trade Council, a new body created to advise the president on trade policy, U.S. manufacturing and the defense-industrial base. Navarro, a former professor at the University of California-Irvine, is known as a staunch China critic whose faced criticism himself from fellow economists.
Within 270 days of the order, the heads of various federal agencies, including the Defense Department, must issue an unclassified report on the health of the defense-industrial base.
The Aerospace Industries Association, in a statement Monday, hailed the study for recognizing gaps are emerging in the nation’s industrial capability and acknowledging “manufacturing capacity, balanced international and defense trade and a robust and healthy workforce and a resilient supply chain play in our national security – issues that have been at the forefront of AIA’s advocacy.”
“Our industry’s contributions are vital components of U.S. national security and economic well-being and can’t be taken for granted,” said AIA CEO David Melcher.
Byron Callan, of Capital Alpha Partners, said in a note to investors on Monday that the study is likely to focus on the health of smaller private U.S. firms that provide key parts for major weapons systems, among other areas.
Callan anticipated the biggest issue the study will address related to the large prime contractors is their ability to attract and retain software, robotics, data analytics and artificial intelligence talent in 2018 and beyond.
Navarro said the U.S. has lost more than 60,000 factories and almost 5 million manufacturing jobs over the last two decades, which opens national security gaps. He pointed to thin domestic capabilities for submarine propeller repairs, flat-panel aircraft displays, semiconductors, rare earth element processing, printed circuit boards.
Navarro also pointed to the need to retained skilled labor in the defense workforce.
“Throughout our defense industrial base, talented workers in these critically important trades are retiring and not being replaced in sufficient numbers to support our defense needs,” Navarro said. “Shipyards, vehicle manufacturing and aircraft facilities are particularly hard-hit. Training the next generation of skilled trade workers will be essential to our military’s future success.”