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President Donald Trump on Wednesday called for increasing next year’s defense budget to $1.5 trillion, up from his prior proposal of $1 trillion, which a budget watchdog is warning would add trillions to the national debt.
Trump said in a post on his Truth Social platform that, after discussions with lawmakers and administration officials, he determined that “in these very troubled and dangerous times, our Military Budget for the year 2027 should not be $1 Trillion Dollars, but rather $1.5 Trillion Dollars.”
The president said that revenue from tariffs would be used to cover the increased defense spending as well as to fund other priorities he has touted, such as a tariff dividend. He explained that the increase would allow the U.S. 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.”
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The nonpartisan Committee for a Responsible Federal Budget (CRFB) analyzed the proposal and found that the $500 billion annual increase in defense spending would be nearly twice as much as the expected tariff revenue, and the spending increase would push the national debt $5.8 trillion higher over the next decade.
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President Donald Trump called for a $1.5 trillion defense budget in FY2027, up from his initial $1 trillion proposal. (Reuters/Kent Nishimura/File Photo / Reuters Photos)
CRFB noted that the Congressional Budget Office estimated that tariffs would bring in $2.5 trillion in additional revenue through 2035, or $3 trillion with interest, while on a dynamic basis that revenue is likely to be somewhat smaller after accounting for economic shifts caused by tariffs.
Additionally, a significant portion of the president’s tariffs were implemented under the International Emergency Economic Powers Act (IEEPA) and the Supreme Court is expected to rule on the legality of those import taxes in the near future.
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Trump said his proposed $500 billion increase to the defense budget would allow the U.S. to build a “dream military.” (U.S. Navy/Mass Communication Specialist 2nd Class Jacob Mattingly / DVIDS / Fox News)
If the IEEPA tariffs are struck down, CRFB said tariff revenues would be $700 billion lower through 2035 and, based on prior estimates, would cover only 15% of the cost of the president’s proposal for $500 billion in additional defense spending per year.
“Given the $175 billion appropriated to the defense budget under the One Big Beautiful Bill Act (OBBBA), there is little case for a near-term increase in military spending. Any future increases that may be necessary should be fully paid for, ideally twice-over given our high and rising national debt, with new revenue or spending cuts,” CRFB wrote.
“Policymakers should not rely on existing tariff revenue – without which deficits would be much higher – and even if they did it would fall far short of covering the costs of such a large defense spending increase,” the budget watchdog added.
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Congress will be considering FY2027 defense spending levels this year before the new fiscal year begins on Oct. 1. (Photo by Anna Moneymaker/Getty Images / Getty Images)
The appropriations process for fiscal year 2027 will play out over the course of the year before FY2027 begins on October 1 – although Congress and the White House often have to resort to the use of continuing resolutions to extend funding at current levels to avoid a lapse in funding that causes a government shutdown.
Most recently, Congress enacted a short-term CR in November following a 43-day government shutdown, the longest on record, that extends funding in FY2026 for most agencies until January 30, 2026.
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Lawmakers have already enacted full-year FY2026 appropriations under three of the 12 annual discretionary spending bills, though the defense portions of the package are funded under the CR and only run until Jan. 30.
