The Trump Administration has requested $1.5 trillion for the FY2027 Defense Budget, a 44% jump from the previous year's funding, according to a new analysis from the National Taxpayers Union Foundation published in 2025. If Congress approves the request, it would mark one of the biggest expansions in military spending in decades—exceeding even the World War II peak when adjusted for inflation. The report warns that lawmakers are being asked to greenlight this historic increase for a department that has never passed an audit, remains exposed to waste and fraud, and has been slow to adopt reforms recommended by federal watchdogs.

The proposed funding combines roughly $1.15 trillion in discretionary spending that goes through the normal appropriations process—requiring 60 Senate votes—with another $350 billion in mandatory spending through budget reconciliation, which needs only 51 votes. The $350 billion in reconciliation funds would go overwhelmingly toward modernization: purchasing new weapons and funding the research to develop them, from ships and drones to the Golden Dome missile shield. When combined with discretionary dollars, procurement and Research, Development, Test, and Evaluation claim the largest share at $756.8 billion—roughly half the entire budget. Operation and Maintenance, covering the cost of running the military day to day, takes another $430.7 billion, while the remainder would support military personnel, construction, and family housing. The request comes as federal debt held by the public has crept past 100% of GDP, and the Congressional Budget Office projects a total deficit of $1.9 trillion for FY2027.

The Department of Defense has consistently failed audits of its finances and is the only major federal agency never to pass one, the report finds. The Pentagon's most recent audit identified 26 material weaknesses—areas where a significant accounting mistake could occur and wouldn't be caught. The Government Accountability Office has had DoD financial management on its high risk list since 1995, and in February 2025 GAO added fraud risk to its concerns, warning that the department's systems are vulnerable. Between 2017 and 2024, DoD reported nearly $11 billion in confirmed fraud, and GAO says that's only a fraction of the potential fraud exposure. The report also highlights how "use-it-or-lose-it" incentives drive wasteful year-end spending: in September 2025, the last month of the fiscal year, the Pentagon spent $93.4 billion, including $9 million on king crab and lobster.

The size of the increase is especially hard to justify because the budget appears to have been developed around a predetermined spending target rather than a carefully constructed defense strategy, according to Todd Harrison of the American Enterprise Institute, quoted in the report. Harrison observed during a Brookings Institution panel that President Trump set an arbitrary level based on 5% of last year's GDP, then "at relatively the last minute in the budget development process, the department was told, come up with a request that gets you to this number." That approach raises questions about whether the proposal reflects genuine defense priorities or simply fills in projects to reach a political goal. The report notes that DoD is also facing a time crunch to obligate approximately $260 billion in contract awards before the October 1 sequestration deadline, pressure intensified by a 43-day government shutdown. Awarding that volume in such a short span raises concerns that acquisition offices will skip competitive bidding and make rushed purchasing decisions.

Congress has clear options to cut unnecessary spending and improve oversight, the report concludes. The Congressional Budget Office has identified reforms that could reduce the defense budget by about $1.1 trillion over ten years by shrinking active-duty personnel roughly 17% and relying more on U.S. allies to provide for their own defense. Other savings include stopping construction of Ford-class aircraft carriers after the four already authorized (saving $15 billion over ten years), retiring the F-22 fighter fleet (saving $29 billion), and capping annual military pay raises at 0.5 percentage points below private sector wage growth through 2030 (saving $22 billion). The Government Accountability Office has flagged 79 priority recommendations for the Pentagon, including one that would save $1 billion or more by requiring procurement offices to track whether they deliver on time, at cost, and at quality—first recommended in 2021 but still not implemented. The report argues that support for a strong national defense shouldn't mean giving the Pentagon a blank check, and that lawmakers should require DoD to demonstrate how the funding advances genuine national security priorities and establish a credible path toward a clean audit before approving the historic increase.