{"id":8904,"date":"2026-04-04T05:10:46","date_gmt":"2026-04-04T05:10:46","guid":{"rendered":"https:\/\/sawahsolutions.com\/range\/budget-would-cut-pentagon-research-by-one-third-can-industry-compensate\/"},"modified":"2026-04-04T05:10:47","modified_gmt":"2026-04-04T05:10:47","slug":"budget-would-cut-pentagon-research-by-one-third-can-industry-compensate","status":"publish","type":"post","link":"https:\/\/sawahsolutions.com\/range\/budget-would-cut-pentagon-research-by-one-third-can-industry-compensate\/","title":{"rendered":"Budget would cut Pentagon research by one-third. Can industry compensate?"},"content":{"rendered":"
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Pentagon R&D spending would drop by about one-third under the White House\u2019s 2027 defense-spending proposal\u2014but the impact of that $4.5 billion reduction might be cushioned by the tech industry\u2019s willingness to fund its own research.<\/p>\n

The proposed drop, which echoes a similar cut in the first Trump administration\u2019s 2020 proposal, was outlined in Friday\u2019s record-breaking $1.5 trillion defense-spending request.\u00a0<\/p>\n

Basic research spending would fall $3.7 billion from this year\u2019s appropriated amount. Most of that\u2014$2.6 billion\u2014would be borne by the Space Force, but reductions would also hit the Army ($173 million), Navy ($529 million), Air Force ($150 million), and the Defense Department-wide account ($202 million).<\/p>\n

Applied research funding would drop by about $1.3 billion. The Army\u2019s pool would drop by $1.312 billion while the Navy and Air Force would each lose $150 million. But the DOD-wide account would gain nearly $600 million and Space Force would edge up $56 million, both buoyed by Golden Dome missile-defense work.<\/p>\n

The documents released on Friday don\u2019t provide any real explanation for decreasing research spending, although one alludes cryptically to \u201cunnecessary spending and excessive bureaucracy\u201d and \u201cwoke frivolities.\u201dThe new proposal comes as the White House has already worked to reduce non-defense spending on science and technology research \u2014for example, by 22 percent in the fiscal year 2026 budget.<\/p>\n

\u201cWhile the United States is dismantling the very foundations that have sustained our STEM and innovation leadership for generations, Beijing has announced its plans to continue accelerating its investments in science, technology, and innovation,\u201d says a Nov. 5 letter from Rep. Raja Krishnamoorthi, D-Ill., ranking member of the House Select Committee on the CCP.<\/p>\n

China is increasing its spending on basic and applied research in a wide number of areas in what could be called dual-use technology. Its government says it allocated $569 billion for research and engineering last year. The number is in line with a broader trend of year-over-year increases that have boosted government-funded science spending to 23 times its 2000 level.\u00a0<\/p>\n

Decreases in U.S. government funding for military research and development don\u2019t necessarily mean less basic and applied research funding overall\u2014not when you factor in private-sector spending. Venture capital funding for new defense startups\u2013which largely goes to R&D\u2013is steadily rising.<\/p>\n

New and established technology companies that specialize in dual-use products spend more of their own money on R&D than do traditional defense contractors, KPMG reported in January.\u00a0<\/p>\n

Ukraine provides an excellent example of what a newly re-wired industrial base can look like. By some estimates, the country boasts more than a thousand defense startups that are finding customers across continents\u2014and all with very limited government help. The Ukrainian government has allocated about $20 billion for military R&D this year. Ukrainian companies have leaned into information technology, rapid innovation, and continuous experimentation to produce new weapons on short timelines.<\/p>\n

Kurt Freshley, a former Marine who leads growth for technology company Valinor, says his company is \u201cencouraged by signals that the Department wants to open the industrial base to new entrants.\u201d\u00a0<\/p>\n

But Freshley said a larger topline for DOD doesn\u2019t necessarily mean more money for new competitors.<\/p>\n

\u201cThe rewiring question will be answered not by the overall number, but by whether new entrants can compete and deliver,\u201d he said. \u201cIf the procurement architecture actually creates room for new companies to compete, if this budget delivers on that, it’s genuinely significant.\u201d\n\n<\/svg><\/p>\n<\/div>\n