Record Defense Budget Requires Greater Oversight
Members of Congress are about to approve a record budget for the Department of Defense (DOD), which requires a concomitant increase in oversight and accountability given the Pentagon’s track record of inefficient spending and poor financial stewardship.
The House of Representatives passed the fiscal year (FY) 2027 National Defense Authorization Act (NDAA) on July 22, 2026, authorizing $1.15 trillion. This funding level is a near match to the $1.2 trillion the Senate Armed Services Committee approved on June 16, 2026. Congress seems set to authorize a substantial increase of up to 43 percent over the DOD’s FY 2026 budget of $839 billion.
While it is certainly within Congress’s prerogative to increase the defense budget in light of global threats and the need to enhance national security, there are red flags waving in the precipitous growth of specific areas of the budget. The Defense Autonomous Warfare Group (DAWG), responsible for much of DOD’s drone research and development, received a $54.6 billion budget request, or a 24,166 percent increase compared to the DAWG’s $225 million FY 2026 budget. While the use of drones is expanding rapidly, the massive increase in one year requires a corresponding increase in oversight to prevent wasteful spending and ensure that the funds are allocated in a targeted, efficient manner.
This concern stems from the Pentagon’s poor track record with procurement and financial management. The DOD takes on average more than 12 years to provide even initial capability on new weapons systems. This lumbering pace is well behind the speed of technological advancements in modern warfare.
Emblematic of the problem is the F-35 Joint Strike Fighter (JSF), the most expensive weapons system ever built. Under continuous development since the contract was awarded in 2001, total JSF acquisition costs exceed $442 billion, 89.7 percent greater than the initial estimate of $233 billion, and total lifetime costs will exceed $2 trillion. Despite this substantial investment, the JSF continues to underperform, as evidenced by its mission capable rate, or the percent of time aircraft could perform one of its tasked missions. According to a June 11, 2026, Government Accountability Office (GAO) report, between FYs 2021 and 2025, the JSF fleet’s mission capable rate declined from 67 percent to 44 percent. The JSF fleet’s full mission capable rate, the percent of time aircraft could perform all missions, dropped from 38 percent to 25 percent.
A second procurement disaster, the M10 Booker, demonstrated the DOD’s lack of critical thinking. In 2013, the Army envisioned a light tank to replace the retired M551 Sheridan, capable of supporting infantry by being airdropped from a C-130 or C-17, with two M10s fitting in each type of cargo plane. However, the Booker bulked up during development, to the extent that it could not fit in the C-130, and the C-17 could only transport one tank. After having spent $1 billion, the Army announced the end of the M10 Booker on June 11, 2025. All existing tanks will be sent to storage, or the scrap heap.
The Pentagon’s financial management is also a mess. The DOD remains the sole federal agency that has yet to pass an audit under the Chief Financial Officers Act of 1990. The FY 2024 NDAA required the DOD to attain a clean audit, by December 31, 2028, and it seems highly unlikely the Pentagon will meet this deadline. The Marine Corps remains the sole service to pass an audit.
The Pentagon’s inability to adequately track its spending is a perennial problem. Its financial irregularities have been on GAO’s list of programs at high risk for waste, fraud, abuse, and mismanagement since 1990. The February 25, 2025, GAO High-Risk report contained five areas within the DOD, including weapon systems acquisition (which has also been on the list since 1990), and business systems modernization, first added in 1995. GAO expanded its concerns over DOD financial management in an April 29, 2025, report that added fraud risk management to the High-Risk List. The report noted that between FYs 2017 and 2024, the DOD reported $10.8 billion in fraud and tracked $6.6 billion in fraudulent payments between FYs 2013 and 2017.
A $1.2 trillion DOD authorization would represent a 43 percent increase from its FY 2026 level. But there is no evidence that the new cash is being tied to a corresponding efficiency drive. Given the DOD’s track record in procurement and financial management, Congress needs to provide at least a 43 percent increase in oversight, accountability, and transparency to ensure that the money is spent to enhance national security rather than going to waste.
