President Donald Trump proposed setting U.S. military spending at $1.5 trillion for 2027, saying the increase was needed amid “troubled and dangerous times.” In remarks tied to his proposal, Trump said it would help create a “Dream Military” designed to keep the United States “SAFE and SECURE, regardless of foe,” according to a posting on Truth Social.
Trump’s proposal arrives after his administration ordered a U.S. military operation to capture Venezuelan leader Nicolás Maduro and spirit him out of the country to face drug trafficking charges in the United States, with U.S. forces continuing to mass in the Caribbean Sea. In recent days, Trump also has called for taking over the Danish territory of Greenland for national security reasons, and he has suggested he is open to carrying out military operations in Colombia. Secretary of State Marco Rubio, the Associated Press reported, has warned that longtime adversary Cuba “is in trouble.”
The White House framed the defense-spending increase as something the government could fund with revenue Trump says his administration generated through tariffs imposed on “friends and foes around the globe since his return to office.” The Associated Press reported the U.S. collected gross revenues of $288.5 billion last year from tariffs and other excise taxes, up from $98.3 billion in 2024, citing the Bipartisan Policy Center.
Even with that increase, Trump faces political resistance as lawmakers weigh the higher topline. Insisting on more funding for the Pentagon, the Associated Press said, is likely to meet resistance from Democrats who seek to maintain parity between changes in defense and non-defense spending. It also could draw objections from GOP deficit hawks who have pushed back against larger military spending.
Trump also tied the 2027 spending pitch to efforts to reshape defense contracting incentives. The Associated Press reported that Trump threatened to cut off Pentagon purchases from Raytheon, one of the biggest U.S. defense contractors, if the company did not stop stock buybacks and instead invest more profits into building up weapons manufacturing capacity.
On social media, Trump said Raytheon would either “steps up” and begins investing in more “Plants and Equipment” or would no longer be doing business with the Department of War, according to the Associated Press account. He added that if Raytheon wanted further U.S. government business, it would not be allowed to conduct “additional Stock Buybacks” where it has spent “Tens of Billions of Dollars,” until it “gets their act together,” the Associated Press reported.
The threat came as Trump issued an executive order calling on the Pentagon to begin a review to identify defense contractors that, in the administration’s view, are underperforming on fulfilling contracts and insufficiently investing in building manufacturing while still engaging in stock buybacks or distributing dividends. The executive order also called on the Pentagon to include contract provisions that prohibit stock buybacks during periods of underperformance, and to stipulate in future contracts that executive incentive compensation is not tied to short-term financial metrics.
The Associated Press noted that Trump has repeatedly complained in recent months that defense firms were “woefully behind” on deliveries of critical weaponry while continuing dividends, stock buybacks, and high executive pay. The report said the criticism of Raytheon was the most pointed to date.
Raytheon makes missiles used by the U.S. military, including the Tomahawk cruise missile, the Javelin and Stinger missiles, and the Sidewinder air-to-air missile, according to the Associated Press. The company also owns Pratt and Whitney, which the report said manufactures jet engines that power aircraft across the military branches, including the newest F-35 Joint Strike Fighter.
After Trump’s comments and the executive order, shares of defense contractors fell on Wall Street, the Associated Press reported: Northrop Grumman dropped 5.5%, Lockheed Martin declined 4.8%, and RTX Corp., the parent company of Raytheon, slipped 2.5%. Raytheon did not immediately respond to a request for comment, the report said.