Defense Spending Is out of Control

“Defense spending is out of control … a bottomless pit of need with no design and little assessment between competing platforms and above serious oversight.”  That recent assessment by  noted defense expert Joseph Collins is, or should be, a clarion call. The growth of federal spending and an exploding national debt have been cause for concern for decades. This year, Pentagon spending will exceed $1trillion, a 17% increase in a single year, with an astounding $1.5 trillion projected for FY2027 – far higher than during the Korean or Vietnam wars or the Cold War. America’s enemies are not, as we usually hear, our greatest national security threat. As former Chairman of the Joint Chiefs of Staff Admiral Mike Mullen aptly observed as far back as 2008, “the single biggest threat to national security is our debt.” 

U.S. economic strength is unquestionably the wellspring of our prosperity, stability, and national security. We remain the world’s largest economy with 26% of global GDP. The dollar serves as the world’s reserve currency, dominating all others due to its strength and stability. In recent years we have become largely energy independent, and we continue to be the largest consumer market in the world, with strong consumption spending and relatively low unemployment. We are the world’s leader in capital investment. These strengths enable a high standard of living for our population, global economic influence, and a military that is by a wide margin the strongest and most capable on the planet.

All of this is now at risk due to soaring levels of federal government debt (approaching 133% of GDP, the largest since 1945), persistently expanding entitlement spending (which puts strong upward pressure on annual deficits and accumulated debt), high trade deficits, massive defense spending and relatively slow economic growth.  Current projections show that debt service – already larger than the entire defense budget – will double by 2036, a terrifying prospect. Addressing these challenges to boost economic growth, raise wages and ensure a higher standard of living for the American people should be at the heart of our national security strategy. But clearly it isn’t.

Advocates of ever-higher defense spending like to argue that, as a percentage of GDP, defense budgets were far higher in the past. That metric is highly misleading, both because overall GDP was far lower and because entitlement programs didn’t consume nearly as much of the federal budget. In matching defense requirements to defense budgets, Pentagon budgeteers also typically discount the contributions of treaty allies, which are enormous. Today the U.S. spends more than twice as much on defense as Russia, China, Iran, and North Korea combined. Our 31 NATO allies, plus Japan, Australia, and South Korea, spent $670B on defense in 2025 and will spend more this year. By any measure, aggregate defense spending that more than triples that of our four largest adversaries combined is divorced from reality.

Why does this matter? It matters because defense spending represents the largest discretionary portion of the budget. Historically, most of the Federal budget goes towards debt service and providing entitlements established by law – some two-thirds of the Federal budget. To be sure, any meaningful policy solutions to Federal budget challenges must constrain entitlement spending. But sustainable defense spending must go hand-in-hand with entitlement reform. Otherwise ballooning debt and debt service will crush us within a generation.

Reform of the defense budget must therefore play a significant part in solving the Federal budget challenges. Even with defense budgets that exceed Cold War levels, we have far fewer deployable forces and units than formerly. Principal cost drivers include rising personnel costs (primarily due to high officer and civilian overhead and health care costs), the proliferation of staffs and headquarters, the continuation of military installations we no longer need, and increasingly hyper-expensive, and in many cases unneeded, acquisition programs.  Congress and the Pentagon will have to address all four, both to restore discipline and tight financial controls to defense budgets, and to free resources we need to strengthen our fighting forces. If it doesn’t, implacable economic factors will.

Given these fiscal realities, we can take specific steps. We can reduce personnel costs by reforming healthcare and cutting inflated officer inventories across the force. We can downsize or eliminate agencies and headquarters that sap the fighting strength of our military formations, and we can reduce leader-to-led ratios and our inventory of general and flag officers to pre-9/11 levels. We can close unneeded military installations. We can look hard at redundant and overlapping military capabilities that exist all around us. We can downsize the DoD civilian workforce by 20% over the next five years. We can review all major program acquisitions to ensure that we fund none that are not cost-effective and  clearly essential for national defense. Hard choices about force structure, basing and program acquisitions will be required. Just as importantly, we must restrain entitlement spending which, if unchecked, will eventually prevent rational defense budgeting altogether as federal discretionary spending dries up. We can face these realities now, soberly, and realistically, or we can face the remorseless arithmetic that is coming. Now, more than ever, kicking the can down the road won’t do.

R.D. Hooker, Jr. is a Senior Fellow with The Atlantic Council. A carer Army officer, he served three tours on the National Security Council and commanded a parachute brigade in Iraq.