Fears About Obama's "National Emergency" Executive Order are Overblown
Most of the executive order issued by President Obama last week is not a dire as it seems on first reading. The order, called for by the Defense Production Act of 1950, plans for the event of a war or national emergency. The act was passed in September 1950 -- that date is important and explains why Congress vested such broad economic powers in the executive branch. In the first war after the start of the Cold War and the end of World War II, Congress established economic powers that are similar to wartime mobilization, but which would usually be part of the acts passed right after a declaration of war. The Defense Production Act essentially established the nation's ability to mobilize in a limited fashion for wars that would themselves be limited and undeclared (it allows the executive branch to order the production of goods and services needed by the government, rations critical materials, and so on).
Conservatives should resist the urge to magnify everything the Obama administration does into a conspiracy. Most of the order amounts to responsible planning in anticipation of some kind of emergency -- the order doesn't declare any emergency or trigger the powers under the Act. There are still a few things here and there, but they still require some kind of announcement of an action or decision. This order just delegates the authority to undertake actions under the DPA already granted to the President, but it still requires the President or the cabinet officer to first make the decision. This order itself is not such a decision.
So, there is a provision that anticipates more government intervention in the energy markets. That power is already in the statute. But the power is not being exercised here, only being delegated from the President to the Commerce and Energy Secretaries -- and they cannot use the power until there is a finding made about shortages in critical materials vital for national security.
There also seems to be some movement to allow the federal government to make loan guarantees. This could turn into more Solyndra-type failures. But it applies, as far as I can tell, only in areas where critical national defense materials are involved. I expect that there should be some fund created somewhere by Congress to provide funding for this pool -- it isn't in this order or in the DPA. Congress should be able to restrict what the administration can do under the order by changing the funding for these programs.