To Fund U.S. Military Modernization, Congress Needs To Pass On-Time Annual Defense Budgets

On April 7, US President Donald Trump and US Defense Secretary Pete Hegseth made clear their ambitions: a one-trillion-dollar budget by fiscal year (FY) 2026 to fund a modern, agile, and globally competitive military. This is an ambitious goal, but if current funding trends hold, that future is far from guaranteed. Despite ongoing threats and bold declarations from the White House and the Pentagon, defense modernization is being squeezed by flat budgets, rising personnel costs, and a Congress that for more than a quarter century has failed to deliver predictable, on-time annual appropriations, which are essential for sustained military investment.

The biggest casualty of flat budgets is modernization. Of the $6.1 billion increase under the FY 2025 continuing resolution, more than $5.6 billion is consumed by rising personnel costs—including a 4.5 percent military pay raise and a 10 percent bump for junior enlisted. While these expenses are core to sustaining force readiness and quality of life for junior enlisted military personnel, they leave scant room for investment in next-generation weapon systems, shipbuilding, and advanced technology—all of which are needed to counter and deter future global threats.

Moreover, modernization and procurement budgets took hits in the latest continuing resolution—down $7.1 billion and $4.6 billion, respectively, compared to FY 2024. This isn’t a future-proofing strategy. It’s triage. And it reinforces a hard truth: the Pentagon is being forced to choose between readiness now and capabilities tomorrow.

As a result of this approach by Congress, a chasm has emerged between what the Pentagon says it needs and what Congress has been able to fund. Even with increased flexibilities granted under this continuing resolution, including fewer restrictions on program-level spending, the Pentagon cannot modernize on cruise control without deliberate and sustained investment. Without real growth in the defense topline, any flexibility becomes a license to reshuffle limited dollars, not expand capabilities.

Additionally, the Trump administration’s early moves—deployments to the southern border and near the Panama Canal, counter-narcotics operations, and a reorientation of posture toward homeland defense and regional security initiatives—highlight a shift in defense priorities. But these actions are being underwritten by a budget that isn’t built for strategic transformation.

This spring, the Trump administration’s FY 2026 request is expected to better reflect the new administration’s priorities, since the current budget was mostly shaped by the previous administration and major changes take time to fully appear. One key area to watch is its proposed $50 billion reallocation plan, redirecting funds from “noncritical” areas toward defense programs such as nuclear modernization, missile defense, drone technology, autonomous weapons, and cybersecurity. The Trump administration likely considers these activities necessary to bolster border security and strengthen US military capabilities in response to perceived threats to the homeland.

Regardless of the merits of using defense dollars and personnel for homeland security efforts, without a significant increase in overall funding, the administration will face tough choices between delivering on these priorities and meeting modernization and readiness goals.

None of this is sustainable without a timely and predictable appropriations process. Even after making tough trade-offs, the Department of Defense cannot sustain modernization, support military pay raises, and reinvigorate domestic policy initiatives without meaningful real-term growth in its overall budget topline. 

While continuing resolutions offer short-term stability, they erode long-term planning and procurement. They lock in outdated funding priorities, stall new projects and procurement efforts before they begin, and limit the Defense Department’s capacity to invest in multi-year efforts that benefit from future financial predictability. When the Department of Defense has to begin the fiscal year without an annual appropriations bill in place, it can lead to training disruptions due to uncertainty over available resources, as well as deferred equipment and facility maintenance, which can cause backlogs and increase long-term costs. It can also cause delays in awarding new contracts, affecting industrial base stability and workforce planning. Continuing resolutions also lead to cost inefficiencies from operating under constrained funding and require higher costs to “catch up” later. These stopgap measures also risk a gradual degradation of military readiness from the inability to execute planned operations, training, and maintenance. Even omnibus bills, often seen as a compromise, fall short of the predictability and purchasing power that full-year appropriations—enacted before the start of a fiscal year—offer. Relying on omnibus bills creates uncertainty for long-term modernization efforts and reduces the Defense Department’s ability to plan, start contracts, and invest early in the fiscal year.

The Pentagon needs more than authority and increased flexibility—it needs actual dollars. Timely appropriations passed by Congress are essential to making that possible. Yet persistent delays have become the norm rather than the exception. Without consistent, meaningful, and sustained funding, modernization will remain an ambition rather than a battlefield reality. The one-trillion-dollar vision for the defense budget may serve short-term political goals, but absent decisive and urgent action by Congress, the numbers won’t add up.

One important step Congress can take each year is to pass the annual defense appropriations bill on time, fulfilling its constitutional duty to fund essential government programs and defense functions that serve the national interest. A timely and focused appropriations bill would restore predictability to the budget process and enhance the capacity of the defense industrial base. It would also give military leaders the certainty they need to plan, build, and make more effective long-term investments across administrations.

Congress holds the keys. The question is whether it has the political will to turn them.

Jongsun A. Kim is a nonresident senior fellow in the Forward Defense initiative of the Atlantic Council’s Scowcroft Center for Strategy and Security and a former deputy comptroller for budget and appropriations affairs at the Department of Defense.

This article appeared originally at Atlantic Council.