Congressional Research Service

The Defense Production Act (DPA) of 1950 (P. L. 81-774, 50 U. S. C. Appx 2061 et seq.), as amended, confers upon the President a broad set of authorities to influence domestic industry in the interest of national defense. The authorities can be used across the federal government to shape the domestic industrial base so that, when called upon, it is capable of providing essential materials and goods needed for the national defense. Though initially passed in response to the Korean War, the DPA is historically based on the War Powers Acts of World War II. Gradually, Congress has expanded the term national defense, as defined in the DPA, so that it now includes activities related to homeland security and domestic emergency management. The scope of DPA authorities extends beyond shaping U. S. military preparedness and capabilities, as the authorities may also be used to enhance and support domestic preparedness, response, and recovery from natural hazards, terrorist attacks, and other national emergencies. The authorities of the DPA are generally afforded to the President in statute. The President, in turn, has delegated these authorities to department and agency heads in Executive Order 13603, National Defense Resource Preparedness, issued in 2012. While the authorities are most frequently used by, and commonly associated with, the Department of Defense, they can be, and have been, used by numerous other executive departments and agencies. Since 1950, the DPA has been reauthorized over 50 times, though significant authorities were terminated from the original law in 1953. Congress last reauthorized the DPA in 2014 (P. L. 113- 172). This reauthorization amended some of the current DPA authorities and extended the termination of the act by five years, until September 30, 2019, when nearly all DPA authorities will terminate. A few authorities of the DPA, such as the Exon-Florio Amendment (which established government review of the acquisition of U. S. companies by foreigners) and anti-trust protections for certain voluntary industry agreements, have been made permanent by Congress. The DPA lies within the legislative jurisdiction of the House Committee on Financial Services and the Senate Committee on Banking, Housing, and Urban Affairs. Congress may consider enhancing its oversight of executive branch activities related to the DPA in a number of ways. To enhance oversight, Congress could expand executive branch reporting requirements, track and enforce rulemaking requirements, review the activities of the Defense Production Act Committee, and broaden the committee oversight jurisdiction of the DPA in Congress. Congress may also consider amending the DPA, either by creating new authorities or repealing existing ones. In addition, Congress may consider amending the definitions of the DPA to expand or restrict the DPA's scope, amending the statute to supersede the President's delegation of DPA authorities made in E. O. 13603, or consider adjusting future appropriations to the DPA Fund in order to manage the scope of Title III projects initiated by the President.

Strict sanctions on Iran's key energy and financial sectors harmed Iran's economy and arguably contributed to Iran's acceptance of at least temporary restrictions on expanding its nuclear program in exchange for modest sanctions relief. The interim nuclear "standstill" agreement (Joint Plan of Action, JPA) has been extended until November 24, 2014 to allow time to translate it into a comprehensive agreement on Iran's nuclear program. The economic pressure of sanctions included the following: Oil exports fund nearly half of Iran's government expenditures and sanctions reduced Iran's oil exports in 2013 to about 1 million barrels per day-far below the 2.5 million barrels per day Iran exported during 2011. During 2012-2013, the loss of revenues from oil, coupled with the cut-off of Iran from the international banking system, caused a sharp drop in the value of Iran's currency, the rial; raised inflation to over 50%; and cut off Iran's access to most of its hard currency held outside the country. Iran's economy shrank by about 5%in 2013 as many Iranian firms reduced operations and loans became delinquent. Sanctions have also slowed somewhat Iran's nuclear and missile programs and reduced its military power by hampering its acquisition of foreign technology and weaponry. However, the sanctions have not halted Iran's provision of arms to the Assad government in Syria, the Iraqi government, or to other pro-Iranian factions in the Middle East. Nor have sanctions altered Iran's repression of dissent or monitoring of the Internet. The JPA has provided Iran about $14 billion in sanctions relief, including about $7 billion ($700 million per month during January-November 2014) in access to hard currency from oil sales since implementation began on January 20. The relief has been made possible by waivers and suspensions of provisions of several U. S. sanctions laws and executive orders. This relief has halted further economic deterioration but not stimulated any dramatic economic rebound, to date. Some assess that Iranian leaders need a comprehensive nuclear deal to achieve the sanctions relief and economic improvement demanded by the populations. By all accounts, a comprehensive nuclear agreement, if reached, will entail significant easing of U. S. and third country sanctions on Iran-particularly those sanctions imposed since 2010 that reduce Iran's oil exports and limit its access to the international financial system. The Administration has said that substantial sanctions relief under a comprehensive deal would be provided, but that comprehensive sanctions relief would be stepwise as Iran fulfills the terms of an agreement. Although it might be able to act on its own authority to suspend most sanctions on Iran, the Administration has said it would work with Congress on long term sanctions relief in the event of a final nuclear deal. Most observers assess that additional U. S, sanctions are likely to be proposed, and perhaps enacted, if negotiations on a comprehensive settlement break down and Iran expands its nuclear work. See also CRS Report RL32048, Iran: U. S. Concerns and Policy Responses, by Kenneth Katzman; CRS Report R43311, Iran: U. S. Economic Sanctions and the Authority to Lift Restrictions, by Dianne E. Rennack; and CRS Report R43492, Achievements of and Outlook for Sanctions on Iran, by Kenneth Katzman.