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4 July 2025

The winners and losers in a trillion-dollar US defence budget

Richard Thomas

An aerial view of the Pentagon in Washington, D.C. Credit: Air Force Staff Sgt. John Wright/US DoD.

The US Department of Defense (DoD) has outlined the proposed FY26 national defence budget from US President Donald Trump, a more-than $1tn package intended to provide investment into key capabilities across the country’s military services.

According to a 26 June release from the DoD, the request, which represents a 13.4% increase from FY25, includes $848.3bn for the discretionary budget and $113.3bn in mandatory funding through congressional reconciliation.

Additional elements take the FY26 budget request to $1.01tn, by some margin the largest defence budget on the planet.

In comparison, the next largest defence budget is China’s, which although not publicly available is thought to be in excess of $300bn, according to analysis conducted by the Stockholm International Peace Research Institute.

“This historic defence budget prioritises strengthening homeland security, deterring Chinese aggression in the Indo-Pacific [region], revitalising the defence industrial base and maintaining our commitment to being good stewards of taxpayer dollars,” a senior defence official told reporters, according to the US DoD news service.

The official added the $113bn in mandatory reconciliation funding would address President Trump’s priorities, including shipbuilding, missile defence, munitions production and quality-of-life initiatives for service personnel.

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