Poli Alert Politics & Civics
Related Articles
President Donald Trump on Wednesday proposed boosting U.S. military spending to $1.5 trillion in 2027, a dramatic increase he said is necessary amid what he described as “troubled and dangerous times.”
The proposal comes days after Trump ordered a U.S. military operation to capture Venezuelan leader Nicolás Maduro and bring him to the United States to face drug trafficking charges. U.S. forces continue to mass in the Caribbean Sea following the operation.
The Pentagon’s budget for fiscal year 2026 is currently set at $901 billion, making Trump’s proposed figure a historic surge in defense spending.
In recent days, Trump has also floated taking control of the Danish territory of Greenland for national security reasons and has suggested he is open to military operations in Colombia. Secretary of State Marco Rubio has warned that longtime U.S. adversary Cuba “is in trouble.”
“This will allow us to build the ‘Dream Military’ that we have long been entitled to and, more importantly, that will keep us SAFE and SECURE, regardless of foe,” Trump wrote on Truth Social.
Budget Pressures and Political Resistance
The proposed increase comes on top of a roughly $175 billion boost to defense spending included in the GOP’s sweeping tax and spending bill that Trump signed into law last year.
Trump’s push for additional Pentagon funding is expected to face resistance from Democrats, who have traditionally sought parity between defense and non-defense spending. It could also encounter opposition from Republican deficit hawks who have criticized runaway federal spending.
Trump argued that the increase is affordable due to higher revenues generated by his administration’s tariff regime.
According to the Bipartisan Policy Center, the U.S. government collected $288.5 billion in gross revenues last year from tariffs and other excise taxes, up from $98.3 billion in 2024. While the increase is significant, economists note it falls far short of covering the administration’s broad promises — including taxpayer dividends, debt reduction, and major defense expansion.
Warning to Defense Contractors
Alongside the spending proposal, Trump issued a pointed warning to major defense contractors — singling out Raytheon— over stock buybacks and underinvestment in manufacturing capacity.
“Either Raytheon steps up, and starts investing in more upfront Investment like Plants and Equipment, or they will no longer be doing business with Department of War,” Trump wrote on social media. He added that contractors engaging in stock buybacks while underperforming on government contracts would face severe consequences.
Trump also signed an executive order directing the Pentagon to review defense contractors for performance failures and inadequate reinvestment, particularly those distributing dividends or buying back stock while missing delivery targets.
The order instructs the Pentagon to ensure future contracts prohibit stock buybacks during periods of underperformance and bars executive incentive compensation tied to short-term financial metrics.
Market Reaction and Industry Impact
Trump has repeatedly accused defense firms of lagging on weapons production while rewarding shareholders and executives. His comments Wednesday marked his most direct public rebuke of a specific contractor.
Raytheon manufactures several of the U.S. military’s most widely used weapons systems, including Tomahawk cruise missiles, Javelin and Stinger missiles, and the Sidewinder air-to-air missile. Its subsidiary, Pratt & Whitney, produces jet engines for aircraft across the U.S. armed forces, including the F-35 Joint Strike Fighter.
The remarks rattled Wall Street. Shares of major defense contractors fell sharply, with Northrop Grumman down 5.5%, Lockheed Martin sliding 4.8%, and RTX Corp., Raytheon’s parent company, dropping 2.5%.
