President Donald Trump has called for a sharp increase in US defence spending, proposing a budget of $1.5 trillion (£1.1 trillion) in 2027, citing what he described as “very troubled and dangerous times” globally.
If approved, the figure would represent an increase of more than 50 per cent from the $901 billion defence budget passed by Congress in December. In a post on social media on Wednesday, Trump said the expanded budget would allow the United States to build what he termed a “Dream Military” capable of keeping the country “safe and secure, regardless of foe.”
Trump argued that the United States could “easily hit” the proposed spending level, claiming revenues generated from tariffs would help offset the cost, despite longstanding warnings from economists that the gap between US government spending and income has become unsustainable.
Alongside his call for higher military funding, the president issued a warning to major US defence contractors, criticising what he described as excessive payouts to executives and shareholders. Trump said defence firms must accelerate weapons production and invest in new manufacturing facilities or risk losing government business.
“Military equipment is not being made quickly enough,” he said, urging companies to build “new and modern plants” rather than prioritising shareholder dividends and stock buybacks. He also took aim at executive compensation, calling pay packages at arms manufacturers “exorbitant” and proposing a cap of $5 million for top executives.
In a separate post, Trump singled out Raytheon, describing it as the “least responsive” to America’s defence needs and the slowest to ramp up production. He warned that unless the company invested more heavily in plants and equipment, it could face exclusion from future contracts with what he referred to as the “Department of War.”
Despite Trump’s criticism, markets reacted positively to his defence spending push. Shares in major defence firms, including Lockheed Martin, Northrop Grumman and Raytheon, rose by more than 5 per cent in extended New York trading following his remarks.
Trump’s renewed emphasis on defence comes amid rising global tensions. On Wednesday, US forces captured a Russian-flagged oil tanker suspected of breaching American sanctions. The move followed the weekend seizure of Venezuelan leader Nicolás Maduro, who was taken to the United States to face drug trafficking charges.
Elsewhere, geopolitical pressures have intensified in Asia, with China conducting military drills around Taiwan in December that simulated a blockade of the self-governed island. Taiwan’s own efforts to increase defence spending have angered Beijing, which considers the island part of its territory.
Trump has consistently pushed for higher defence spending by both the United States and its allies since his first term, arguing that military strength is essential in an increasingly unstable world.
Melissa Enoch
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