President Donald Trump has proposed a dramatic increase in U.S. defence spending, calling for the 2027 military budget to reach $1.5 trillion over 50% higher than the $901 billion approved by Congress for the current year. Describing the move as essential in “these very troubled and dangerous times,” Trump said the expanded funding would enable the creation of a “Dream Military”, designed to keep the nation safe and secure against any adversary.
In a series of social media posts on Wednesday, Trump emphasized that the budget surge could be easily financed through revenue generated from tariffs. He argued that these funds would allow the U.S. to not only strengthen its military but also maintain fiscal stability while providing benefits to moderate-income Americans.
Trump also issued a stern message to major U.S. defence contractors, criticizing companies like Raytheon for slow deliveries, excessive dividends, and stock buybacks. The president argued that executives were prioritizing shareholder profits over investments in modern manufacturing plants and armament production. He warned that firms failing to improve output could lose Department of Defense contracts and proposed capping executive pay at $5 million until companies meet production targets.
Following Trump’s announcements, shares of top defence firms, including Lockheed Martin, Northrop Grumman, and Raytheon, surged in extended trading, reflecting investor optimism over potential growth from higher government spending. However, economists have cautioned that the proposed increase could significantly widen the federal budget deficit, noting that tariff revenues may not be sufficient to fully fund the ambitious plan.
The president’s call for higher defence expenditure comes amid intensifying global tensions. Recently, U.S. forces captured a Russian-flagged oil tanker accused of violating sanctions, while Venezuelan President Nicolás Maduro was seized and brought to the U.S. on drug trafficking charges. Additionally, China’s military exercises around Taiwan and Taiwan’s push to boost its own defence capabilities have heightened international concern over regional security.
Any move to implement Trump’s proposed $1.5 trillion defence budget will require congressional approval, where debates over fiscal responsibility, strategic priorities, and global security implications are expected to be highly contentious.
