Congress expects to receive the Trump administration’s official budget request for fiscal year 2027 sometime next week. If it is consistent with President Trump’s “announcement” on Truth Social on January 8 that his administration would request a defense budget of $1.5 trillion—$600 billion more than this year—that would be a whopping 66% increase in military spending.
If passed and sustained, analysis shows the plan will add almost $6 trillion to the national debt in the next decade. In an era of illegal wars and dangerous domestic military operations, Trump’s plan would hand trillions of additional dollars to defense contractors and militarize our country in ways not seen since World War II—what we might call a “Bloody New Deal.”
A level of spending with almost no precedent
The original New Deal took place over six years in the 1930s and infused the US economy with government spending to end the Great Depression. It cost $41.7 billion at the time, translating to around $1 trillion in today’s dollars. Given the comparatively small size of the US economy in the 1930s, the New Deal remains one of the largest economic stimulus packages in US history (if not the largest).
Among modern spending packages, the Bloody New Deal would stand alone in scope. If enacted and sustained over the next 10 years, it will cost roughly six times as much as President Biden’s Inflation Reduction Act (although many of its provisions have been rolled back by the Trump administration since this cost estimate), four times as much as President Obama’s Affordable Care Act, and twice as much as President Trump’s One Big Beautiful Bill Act. Even though Trump has claimed he will use tariff revenue to pay for his spending increase—now in question due to the recent Supreme Court decision striking down most of his tariffs—the Bloody New Deal will add at least $5.8 trillion dollars to the national debt over the next decade, which will harm our financial security and long-term warfighting ability. And that figure is based on a rosy outlook for tariff revenue and a conservative outlook of defense spending growth.
By comparing this massive spending plan to other options, the potential scope of President Trump’s announcement becomes even clearer. For $6 trillion over 10 years, the US government could simultaneously fund all the following:
- More than 750,000 new registered nurses
- 11.5 million new public housing units
- 1 million new elementary school teachers
- 29 million children receiving Medicaid
- 6 million people receiving paid parental leave
- 5.9 million new Head Start slots for children
What would the Bloody New Deal’s billions get us?
While the president was, as usual, frustratingly vague when announcing the largest single increase in US defense spending, congressional Republicans have recently provided more clues about what they would fund and how long this increase would last. The chair of the House Armed Services Committee has indicated the funding will be used to grow the “defense industrial base” and Trump’s pet projects, the missile defense scheme “Golden Dome” and the Navy modernization project “Golden Fleet.”
Growing the industrial base for our military has been a long-term bipartisan priority in Congress. Almost all new military acquisition projects this century have struggled with brittle supply chains and out-of-date procurement practices that could be helped by a stronger industrial base. But this goal either means a one-time increase would be a fool’s errand, unable to solve the problem, or an admission that the spending increase would be made permanent, as some House Republicans have already called for. On a very basic and intuitive level, long-term capacity cannot be created without long-term funding commitments to the defense industry.
Setting aside all the wasted money on infeasible fantasy projects like Golden Dome and Golden Fleet, the Bloody New Deal, even if sustained, won’t fix the problems it sets out to solve. A host of structural issues, not a lack of funding, have caused a failure in output from our defense industrial base.
One of these issues, monopolization, provides an example of something that cannot be fixed with more funds. Both former President Biden’s and President Trump’s defense appointees have pointed out that the shrinking number of contractors has kneecapped our ability to produce military equipment due to a lack of competition, anti-competitive behavior, and contractor influence in Congress. In the 1990s, there were 51 major defense contractors. Today, there are only five.
The Bloody New Deal would likely cause a temporary feeding frenzy for new entrants into the defense sector in its first year like that seen in the massive Golden Dome bidding process currently underway. But history has shown the market will likely reward existing firms when all is said and done. After 9/11, rapid-procurement authorities and emergency funding briefly pulled hundreds of non-traditional firms into defense contracting before mergers and closures quickly narrowed the field again.
In the end, it is likely the Bloody New Deal will only grow the power of incumbent contractors. Even the Pentagon has signaled it wouldn’t know how to deal with this amount of money if it was passed. In 10 years, the largest increase in discretionary spending in modern US history could very well be regarded as the largest corporate welfare plan for defense contractors and arms salesmen, not remembered for making anyone more secure.
Now is the time for opposition
For a spending plan of potentially unparalleled scope, the lack of attention it has received is shocking. If this Bloody New Deal actually passes, it could give unparalleled increases in financial power to defense contractors and support for the political work they already do to influence Congress. The Trump administration may also try to get a rumored $200 billion supplemental defense spending package through Congress to support its ongoing war against Iran. Although this is a different way of increasing the defense budget, the outcome would be much the same.
Sane voices need to act now, building opposition to this unprecedented plan. Especially in the context of attacks decrying President Biden’s Inflation Reduction Act as too expensive or unrealistic, and all of the work the current administration has done to undermine that bill, this infeasible proposal becomes all the more ludicrous. Progressives should be unflinching in defining this proposal as a blank check for the same contractors who cannot deliver ships on time, munitions at scale, or clean audits. Pouring funds into a defense sector that has repeatedly failed basic tests of accountability will not miraculously produce innovation.
As the Trump administration makes clear its unchecked willingness to attack other countries regardless of legality, the stakes of dumping unprecedented funds into the US military-industrial complex have never been higher.