President Trump has promised to end the Russia-Ukraine war, facilitate peace in the Middle East and start arms-reduction talks with Russia and China, leaving open the possibility for the U.S. to reduce its military spending.
The U.S. has the largest military budget in the world, with an estimated $916 billion spent on defense in 2023, a 2.3% increase from the previous year, according to the Stockholm International Peace Research Institute. The institute noted that military spending went up in every region of the world that it examines.
Still, the U.S. spends roughly twice as much on military as China and Russia combined. Defense spending in the U.S. also makes up nearly half of total discretionary spending.
The Trump administration is laying off federal workers and trying to cut spending in federal agencies, with the government running an annual budget deficit of nearly $2 trillion and the national debt topping $37 trillion. Elon Musk and the Department of Government Efficiency is looking at the Pentagon as one of its targets for some of those cuts.
The state of proposed defense cuts is far from clear. An internal Pentagon memo last month suggested the agency could achieve at least $50 billion in spending cuts this year, but a proposed stopgap spending bill this week in Congress would boost defense spending by $6 billion through Sept. 30.
Mr. Trump has said he wants significant defense spending cuts annually for the next four years, an agenda that is likely to meet resistance from Republican lawmakers.
Analysts said the geopolitical tensions that have spurred higher U.S. defense spending aren’t likely to change significantly.
“The unprecedented rise in military spending is a direct response to the global deterioration in peace and security,” said Nan Tian, a senior researcher at SIPRI’s Military Expenditure and Arms Production Programme.
A 2023 report from the Congressional Budget Office, which conducts 10-year projections of the cost of the U.S.’s nuclear forces, estimated that from 2023-2032 the U.S. will have spent $756 billion on nuclear arms and related programs, or roughly $75 billion a year.
The total comprises the cost for operation and sustainment of old and new nuclear forces, modernization of nuclear delivery systems and weapons, facilities and equipment for the weapons laboratory complex, and modernization of command, control, communications and early-warning systems. There is also money estimated in the total for potential cost growth.
The increase in defense spending was driven primarily by the war between Ukraine and Russia that began three years ago, tensions in the Middle East and the pushback against organized crime in the Caribbean and Central America.
But a decrease in U.S. military spending still may not be on the horizon even if Mr. Trump’s peace plans succeed for the Middle East and Ukraine, analysts say.
“Yes, there is potential for planned reductions in U.S. military spending to be growth-promoting, in the sense that resources that were being invested in the military, which does not directly produce revenue, can be invested in more productive activities,” Cullen Hendrix, senior fellow at the Peterson Institute for International Economics, said in an email. “This was the case in the 1990s, not just in the United States but more widely. But that isn’t an inevitable or even particularly likely outcome this time.”
He said the so-called “peace dividend” that was achieved in the 1990s after the Soviet Union collapsed was a response to a “diminished threat environment,” and that investing more in the country by way of infrastructure, education and other social programs made sense, but the case is not the same this go-around.
“Those are far different than the circumstances we face now, where Russia’s invasion of Ukraine is being recast with Ukraine as the aggressor, U.S. allies are deeply concerned about U.S. treaty commitments, and China remains ascendant and geopolitically aspirational,” he said. “And we can add to that the massive security threat that would come with any attempt by the United States to expel millions of Palestinians and develop Gaza into a beachfront luxury destination under U.S. occupation. It would be an obvious target for terrorism.”
Andrea Stricker, deputy director of the Foundation for the Defense of Democracies’ Nonproliferation and Biodefense Program, said a decrease in military spending would not put the U.S. in a good position once Mr. Trump leaves office.
“Even if Trump is more friendly with [China and Russia], Trump will leave office in four years, and tensions will resume, potentially. We don’t even know if they’re going away altogether, so we need to be prepared,” Ms. Stricker said.
Still, the government seems hopeful that the “waste and fraud” can be eliminated, or at the very least lessened, freeing up funds for other purposes. Mr. Musk and the Department of Government Efficiency — a new office that Mr. Trump created — has been tasked with finding waste in government spending.
The actions DOGE has taken, laying off thousands from federal agencies and shuttering some agencies altogether, has caused controversy, with people questioning whether these mass firings will actually equate to money saved.
Mr. Musk said on Joe Rogan’s podcast in February that the Defense Department is “a target-rich environment for saving money” and he “did not think it would be as bad as this” when he began examining the government’s spending.
“If it was a very well-run ship, if it was very efficient, it would be hard to improve, but it’s not efficient, so therefore it is actually relatively easy to improve,” he said.
