DOD Wants $1.5 Trillion Defense Budget as US Borrowed $1.8T the Past 10 Months

Defense Secretary Pete Hegseth has previously said that not properly funding the Pentagon is "greatest threat" the U.S. faces.

As U.S. Defense Secretary Pete Hegseth has warned Congress that not appropriating roughly $1.5 trillion towards the Pentagon's next fiscal year budget is the "greatest threat" the country faces, a new budget report shows that the nation's rampant spending exceeds the Defense Department's own budgetary aspirations.

The United States borrowed $1.8 trillion in the first ten months of Fiscal Year 2026, according to the latest Monthly Budget Review from the Congressional Budget Office (CBO). That amount, which includes $431 billion borrowed in July alone, is roughly $169 billion more than the deficit recorded during the same period last fiscal year.

Revenues rose by $139 billion (3%) and outlays increased by $308 billion (5%), per the CBO. That comparison is affected by a shift in the timing of certain payments. For example, payments that otherwise would have been due on Aug. 1—which fell on a weekend—were shifted into July.

If not for such shifts, the deficit at this juncture would have been $1.7 trillion, or $71 billion more than the shortfall for the same period in FY25. The federal fiscal year annually runs from Oct. 1 through Sept. 30.

"We’re on track to surpass $2 trillion in borrowing this fiscal year despite not being in a recession," Maya MacGuineas, president of the Committee for a Responsible Federal Budget, said in a statement. "That is not normal. Incredibly, such an enormous level of borrowing barely scratches the surface of our fiscal deterioration.

"We are about to hit the sobering milestone of $40 trillion in gross national debt, and things are only likely to get worse. If lawmakers want to correct our fiscal course, they should start by targeting a reasonable fiscal goal—like 3% of GDP deficits—and then create a bipartisan commission to figure out how we should get there. We can no longer afford to put off difficult decisions. The time to act is now."

US Defense Spending Higher Than FY25

The CBO, in its latest report issued Aug. 10, highlighted certain agencies and their correlation to the $1.8 trillion borrowed over the past 10 months.

It pointed to increased spending by DOD for military activities, roughly totaling a $39 billion year-over-year difference. That is an approximate 5% increase compared to the same period of FY2025, with the largest increases being attributed to military personnel and research and development.

DOD spending increased while the CBO notes how some other federal agencies massively cut spending.

Outlays of the Department of Education, for example, decreased by $79 billion (60%). It is largely attributed to the department recording a net reduction of $53 billion in the estimated costs of outstanding student loans in June 2026.

Total government spending in July was $765 billion, per CBO estimates—or $135 billion (21%) more than in July 2025. DOD spending increased by $8 billion, or 11%, in that span.

The $431 billion borrowed in July is an estimated increase of $140 billion over the deficit recorded in the same month last year. Revenues were $5 billion less this July than they were the year before, while outlays increased by $135 billion.

Defense Budgets Working Through Congress in Midst of War

In May 2026, the national debt hit $39 trillion while daily increases of between $5 and $7 billion have been reported.

The rising debt has been connected to different factors, including Americans' interest payments, spending on entitlements like Social Security and Medicare, and budget deficits throughout the federal government.

In July, Hegseth—joined by Chairman of the Joint Chiefs of Staff Dan Caine and Agriculture Secretary Brooke Rollins—testified in front of the Senate Appropriations Committee, requesting an additional $87.6 billion for "urgent needs" regarding the United States' ongoing military operations in Iran.

At that juncture, the defense secretary publicly stated that the Iran War had cost U.S. taxpayers roughly $37.5 billion. It was the first concrete financial figure correlated with the ongoing operation in the Middle East, where the Strait of Hormuz remains a major hurdle that U.S. officials continue to attempt to navigate.

GOP Appetite on Capitol Hill

If the DOD and White House get their wants in the FY2027 budget, which must pass the GOP-controlled House and Senate, it would amount to the largest single-year increase in U.S. military spending dating back to World War II or the Korean War.

But Hegseth and company face an uphill battle, according to reports. As senators have been on break and the November midterm elections loom, the question is whether an appetite presently exists in Washington to pass a huge financial request like this.

Adopting legislation via reconciliation, as a method to avoid Democrats' voting power, has reportedly been frowned upon by Republican Sens. Susan Collins and Mitch McConnell, according to Politico.

Losing GOP senators politically could put a dent into what not just Hegseth wants, but what President Donald Trump and the White House have openly pined for.

“So much of that additional defense funding is banking on not only a third, but potentially a fourth reconciliation [bill],” Sen. Lisa Murkowski (R-Alaska) said, per Politico. “So what if that doesn’t come? I’ve asked [Pentagon officials]: you have your F-35s, your Patriot missiles baked into that — what’s your plan B? And it’s been tough to get an answer.”