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TITLE VIII--ACQUISITION POLICY, ACQUISITION MANAGEMENT, AND RELATED MATTERS

Subtitle F—Other Matters

P. L. 116-

House Conference Report   116-617

(b) Elements.--The assessment required under subsection (a) shall review the following matters as they pertain to the innovative and manufacturing capacity of the national security innovation base:

(1) A detailed description of the entities comprising the national security innovation base and how they currently interact.

(2) Competition and antitrust policy.

(3) Immigration policy, including the policies germane to the attraction and retention of skilled immigrants.

(4) Education funding and policy.

(5) Demand stabilization and social safety net policies.

(6) The structure and incentives of financial markets and the effects of such on the access of businesses to credit.

(7) Trade policy, including export control policy and trade remedies.

(8) The tax code and its effect on investment, including the Federal research and development tax credit.

(9) Regulatory policy, including with respect to land use, environmental impact, and construction and manufacturing activities.

(10) Economic and manufacturing infrastructure.

(11) Intellectual property policy.

(12) Federally funded investments in the economy, including investments in research and development and advanced manufacturing.

(13) Federally funded purchases of goods and services.

(14) Federally funded investments to expand domestic manufacturing capabilities.

(15) Coordination and collaboration with allies and partners.

(16) Measures to protect technological advantages over adversaries and to counteract hostile or destabilizing activity by adversaries.

(17) Other matters as the Secretary of Defense deems appropriate.

(c) Engagement With Certain Entities.--In conducting the assessment required under subsection (a), the Secretary of Defense shall engage through appropriate mechanisms with--

(1) the Defense Science Board;

(2) the Defense Innovation Board;

(3) the Defense Business Board;

(4) entities representing industry interests; and

(5) entities representing labor interests.

(d) Submission of Assessment.--Not later than March 1, 2022, the Secretary of Defense shall submit to the President, the Director of the Office of Management and Budget, the Assistant to the President for National Security Affairs, the Director of the National Economic Council, and the congressional defense committees the assessment required under subsection (a), together with recommendations and any additional views of the Secretary.

The Senate amendment contained a provision (sec. 802) that would require the Deputy Secretary of Defense to conduct an assessment of how economic forces and structures are shaping the capacity of the national security innovation base. The provision would require the Deputy Secretary to submit an assessment along with any policy recommendations proceeding from it to the Secretary of Defense no later than 540 days after the date of the enactment of this Act and the Secretary of Defense to submit such assessment and recommendations, no later than 30 days after receipt, to the President, the Office of Management and Budget, the National Security Council, the National Economic Council, and the congressional defense committees.

The House bill contained no similar provision.

The House recedes with an amendment that would revise the elements under assessment and would require the Secretary to submit the Department's combined assessment to the outside parties by March 1, 2022.

The conferees recognize the Department of Defense's substantial efforts to ensure that the industrial base is innovative, robust, and expansive, and remain concerned that the wider U.S. economy has a significant impact on the industrial base. The conferees believe that ensuring domestic production and supply of critical national security technologies and source materials may extend beyond the activities, industrial policies, and scope of the Department of Defense and require serious interagency and private sector cooperation. The conferees also believe that developing a strategy to address this issue should be an inclusive, whole-of-government deliberative process that involves the Department of Defense, other relevant government agencies, and relevant stakeholders. The conferees recognize that Department of Defense appropriations are downstream of economic health and Federal budgets. The conferees intend for this provision to help the Department identify critical economic features affecting the industrial base, propose policies to guarantee that its development, industrial, and budgetary needs are recognized, and ensure that broader economic policy decisions are fully informed.

Senate Committee Report 116-236 to Accompanying S. 4049

Assessment of national security innovation base (sec. 802)

The committee recommends a provision that would require the Deputy Secretary of Defense to conduct an assessment of how economic forces and structures are shaping the capacity of the national security innovation base. The provision would require the Deputy Secretary to submit an assessment along with any policy recommendations proceeding from it to the Secretary of Defense no later than 540 days after the date of the enactment of this Act and the Secretary of Defense to submit such assessment and recommendations, no later than 30 days after receipt, to the President, the Office of Management and Budget, the National Security Council, the National Economic Council, and the congressional defense committees.

The committee recognizes the Department of Defense's substantial efforts to ensure that the industrial base is innovative, robust, and expansive and remains concerned that the wider U.S. economy has a significant impact on the industrial base. The committee believes that ensuring domestic production and supply of critical national security technologies and source materials may extend beyond the activities, industrial policies, and scope of the Department of Defense and require serious interagency and private sector cooperation. Developing a strategy to address this issue should be an inclusive, whole-of-government deliberative process that involves the Department of Defense, other relevant government agencies, and relevant stakeholders. The committee also recognizes that Department of Defense appropriations are downstream of economic health and Federal budgets. This provision would therefore allow the Department to identify critical economic features, propose policies to guarantee that its development, industrial, and budgetary needs are recognized, and ensure that broader economic policy decisions are fully informed.