Will Trump’s ‘Big Beautiful’ Defense Spending Last?
Shipbuilding, Munitions, Air Defense, and More
The bill appropriates just over $156 billion across eleven categories, with shipbuilding, munitions and defense supply chains, and air and missile defense alone accounting for 50 percent of the total enhancements. Funds for readiness and a range of modernization activities, low-cost weapons production, nuclear forces, and U.S. Indo-Pacific Command requests all exceed $12 billion each, with the remainder allocated to air superiority (mostly aircraft procurement), quality of life for military personnel, cybersecurity, and border and counter-drug support.
Innovative Emerging Capabilities
The bill invests tens of billions of dollars to accelerate research and development, acquisition, and fielding of emerging capabilities. Just a few of the items that will see additional funding are:
- Artificial intelligence (AI) and autonomy (at least $250 million for the broader Department of Defense AI ecosystem)
- Directed energy (another $250 million)
- Counter-unmanned aerial systems programs ($1.3 billion altogether for kinetic and non-kinetic, land-based and ship-based systems)
- Next-generation 5G/ 6G technologies ($500 million)
- Quantum ($250 million to the Defense Advanced Research Projects Agency (DARPA) for research into the feasibility of developing practical quantum computers)
- High-altitude balloons for surveillance ($500 million).
The bill also provides support for innovation accelerators, testing and evaluation infrastructure (especially for AI), early-stage research, supply chain resilience, and the broader defense industrial base. This includes $600 million to the Strategic Capabilities Office (which invests in dual-use technologies), $25 million to the Office of Strategic Capital (which scales private investments in critical supply chain technologies), and a $2 billion “wedge”— Pentagon parlance for flexible funds that the military can determine how best to direct toward outcomes—to support the Defense Innovation Unit’s mission to rapidly integrate off-of-the-shelf commercial technologies.
At least $7.7 billion of these innovative investments directly support the development and short-term scaling of precise mass systems. These are low-cost and autonomous platforms, sensors, and weapons that have become more prominent as their utility has been proven in Ukraine, Israel, and Iran. The bill aims to accelerate procurement and integration of Naval expeditionary loitering munitions, one-way attack systems (with AI investments to support them), mass-producible autonomous underwater systems, and more. The Air Force and Navy will also gain $1.5 billion in funding for low-cost cruise missiles, filling a pressing need to ensure U.S. forces have inexpensive munitions that can be launched from existing cargo aircraft and vertical launch tubes. The funding will likely support the procurement of the most viable candidates for the Navy’s Multi-mission Affordable Capacity Effector initiative and the Air Force’s Affordable Mass Missile Program.
Another $2.1 billion is allocated for medium-sized unmanned surface vessels. The funds might go to buying vessels based on DARPA’s No Manning Required Ship program, which currently has an autonomous test boat at sea. It is built to carry either missiles or surveillance equipment and to travel in packs around ships such as Aegis cruisers—which are equipped with specialized anti-air and missile systems—or other larger naval ships. These have the potential to become the naval version of the Air Force’s Collaborative Combat Aircraft, which also received an increase of $678 million.
Nuclear Modernization
With the end of arms control and China’s expansion of its own nuclear arsenal, Congress is increasing funds for U.S. nuclear weapons even as nuclear force modernization deadlines pass and costs increase. This bill funds planned and new efforts to modernize the U.S. nuclear forces, in part because the New Strategic Arms Reduction Treaty (New START), which limits U.S. and Russian strategic nuclear deployments, expires in February 2026.
Among the investments are $62 million to reopen closed missile tubes on Ohio-class nuclear submarines, allowing them to launch additional nuclear-tipped missiles (currently capped under New START). The Sentinel intercontinental ballistic missile program (ICBM), plagued by delays and cost overruns, receives $2.5 billion for “risk reduction activities.” Extending the life of the Minuteman III ICBM program, given Sentinel’s delays, receives an additional $500 million.
The bill also allocates $4.5 billion to buy an unspecified number of additional B-21 next-generation bombers that are slated to eventually replace the B-2, recently in the news for dropping the Massive Ordnance Penetrator bomb on Iranian nuclear sites. The National Nuclear Security Administration also receives $3.89 billion to accelerate domestic uranium production, spent fuel reprocessing, and the modernization of both the primary and secondary stages of nuclear weapons, as well as facility updates (many were built during World War II and require refurbishment to remain safe).
Space Capabilities
The bill includes extensive investments in space systems to support the Trump Administration’s Golden Dome initiative and other space investments aimed at countering China and Russia. The investments can support missile warning and tracking for conflicts in the Indo-Pacific region or for homeland defense, and America’s ability to fight in space if necessary.
To build up these capabilities, the appropriation includes $3.65 billion to support procurement and protection of military satellites, $2 billion for air-moving target indicator military satellites, $1 billion for the X-37B uncrewed space plane, and $850 million for space command and control and to support space launch infrastructure.
A Temporary Fix
The bill’s infusion of funds for innovation capabilities, nuclear forces, space systems, and other key homeland and Indo-Pacific priorities, along with the costs of supporting infrastructure, supply chains, and service members, can help remedy current capability gaps. Whether the money is actually spent in ways that fully support these priorities remains to be seen and will require further back and forth between the Trump administration and Congress.
The defense spending in the reconciliation bill is unusual. It means funding for defense spending in FY26 will be appropriated across two separate processes: this reconciliation bill and the standard defense budget process. While this injection of funds will certainly aid in the development and deployment of key capabilities for the Pentagon, it is a temporary fix. The bill’s funds cannot overcome persistent innovation or program management challenges.
There’s a risk that, without sustained follow-on funding, the bill’s investments will stall—wasting both resources and momentum. The extended availability of these funds (through 2029) hedges against this slightly, and underscores the value of multi-year appropriations, which help shield promising programs from annual budget volatility during the review process. It also encourages new entrants or innovative companies and programs to take a chance on the defense sector with the assurance that the payoff will be worth the upfront costs.
Sustainably accelerating innovation adoption, and funding the Pentagon’s disparate priorities, will require not just one-off bills, but funding through the base budget or defense budget process reforms.
Erin D. Dumbacher is the Stanton nuclear security senior fellow at the Council on Foreign Relations, Michael C. Horowitz is a senior fellow for technology and innovation at the Council, and Lauren Kahn is a senior research analyst at Georgetown’s Center for Security and Emerging Technology. This article is published courtesy of the Council on Foreign Relations (CFR).This work represents the views and opinions solely of the authors. The Council on Foreign Relations is an independent, nonpartisan membership organization, think tank, and publisher, and takes no institutional positions on matters of policy.
