Dodd-Frank Undermines the Fight Against Covid

As U.S. manufacturers race to produce new vaccines, therapeutics and medical equipment to combat the pandemic, their efforts are impeded by a misguided decade-old government mandate enacted, ironically, for humanitarian purposes. This rule—targeting “conflict minerals”—has shrunk the medical supply chain for components of everything from ventilators to vaccine needles and syringes.

The troublesome mandate is in a last-minute provision inserted into the Dodd-Frank financial overhaul in 2010. That law’s Section 1502 forces manufacturers to disclose if any of their products contain “conflict minerals” mined in the Democratic Republic of the Congo and nine adjoining countries in Africa. Under the law, companies listed on U.S. stock exchanges must audit their supply chains and disclose if their products contain even traces of the designated minerals—gold, tantalum, tin and tungsten—that might have been mined in areas controlled by warlords.

The provision was sold as protecting Congolese citizens from warlords who profited from the mining and sale of these minerals. Proponents claimed that restricting their use would save lives, and the only costs to Americans would be possibly slight increases in the prices of laptops, cellphones and other “luxury” items that contain these minerals.

They were wrong on two counts. First, the effects of the conflict-minerals mandate proved to be devastating for those it aimed to help. As the Journal reported, manufacturers spent about $709 million and more than six million man-hours attempting to trace their supply chains for conflict minerals in 2014. And 90% of those companies still couldn’t confirm their products were conflict-free. Many decided to avoid the Congo region altogether and source materials from other countries and continents.

Read the full article on the Wall Street Journal.