White House Proposes $1.5 Trillion FY2027 Defense Budget, a Record 40% Jump
Updated
Updated · Council on Foreign Relations · Jun 2
White House Proposes $1.5 Trillion FY2027 Defense Budget, a Record 40% Jump
3 articles · Updated · Council on Foreign Relations · Jun 2
$1.5 trillion is the White House’s proposed FY2027 defense budget, which would be the largest Pentagon budget on record even after inflation and about 40% above prior budgets.
Wars in Europe and the Middle East, broader geopolitical strain and doubts about alliance resilience are driving the push, while Washington is also pressing allies to raise their own military spending.
IMF research cited in the report says roughly two-thirds of recent defense buildups were deficit-financed, with fiscal deficits rising about 2.6 percentage points and debt ratios about 7 points within three years.
Bond markets are already signaling strain: the U.S. 30-year Treasury yield has climbed above 5% as investors weigh heavier borrowing, sticky inflation and weaker expected demand for new government debt.
The proposal fits a wider global rearmament trend, with military spending above 2.5% of world GDP in 2025 and NATO members aiming for 5% of GDP on defense-related spending by 2035.