White House unveils reconciliation-augmented fiscal 2026 budget

President Donald Trump is suggesting significant reductions in both domestic and foreign aid spending for the fiscal year starting October 1, alongside substantial increases for defense and border security. Republican lawmakers are involved in drafting separate legislation outside of the regular appropriations process to support this proposal.

The trimmed-down version of the White House’s budget plan, revealed on Friday, includes a more than 13 percent hike in defense and related expenditures, exceeding $1 trillion in that category for the first time. This increase of $119 billion, covering $6 billion for the Energy Department’s nuclear programs, would be made possible through the budget reconciliation package that Republicans are working on.

This approach would allow appropriators to maintain discretionary funding for defense and other national security accounts at the same level as provided in the fiscal 2025 full-year stopgap package. However, some lawmakers, particularly defense hawks, have expressed concerns about this strategy.

President Trump’s proposed budget would see a boost of $119 billion in defense spending, offset by equivalent cuts to nondefense programs, resulting in an overall agency budget of slightly over $1.6 trillion for next year. Various nondefense agencies would face substantial reductions under the plan, with notable cuts to departments like State, Housing and Urban Development, and Health and Human Services.

While the Pentagon and Department of Homeland Security would be the main beneficiaries of the budget, other agencies would face significant cuts if Congress follows the Trump administration’s blueprint. The proposal aims to streamline government operations by drastically reducing the size of various departments and agencies.

The budget plan also includes cuts to programs identified as promoting certain ideologies, as well as initiatives related to border enforcement, deportation efforts, and climate programs. The administration believes that using the reconciliation process will allow for increased defense and border funding without being hindered by Democrats seeking nondefense spending increases.

In conclusion, the proposed budget includes a mix of increases and cuts across different government agencies, with a focus on boosting defense and border security while reducing spending in other areas.