WASHINGTON—
No
one
could
predict
the
twists
and
turns
of
the
first
Trump
administration,
even
for
an
area
as
obscure
and
mundane
as
the
defense
industrial
base,
and
it
would
be
a
fool’s
errand
to
try
to
do
that
for
a
second
one.
[This
article
is
one
of many
in
a
series
in
which
Breaking
Defense
reporters
look
back
on
the
most
significant
(and
entertaining)
news
stories
of
2024
and
look
forward
to
what
2025
may
hold.]
Instead,
let’s
break
down
the
current
state
of
play
in
the
political
environment,
look
back
at
the
first
Trump
term,
and
think
about
some
of
the
major
questions
facing
the
defense
industry
during
a
second
Trump
administration:
Will
Trump
personally
involve
himself
in
defense
acquisition,
again?
For
defense
acquisition
nerds,
Trump’s
first
term
was
marked
by
his
highly
unusual
personal
involvement
in
weapons
contracting.
Whether
it
was
his
stated
desire
to
return
to
“goddamn
steam”
catapults
on
the
Ford-class
carrier,
interrogating
Boeing
executives
on
the
possibility
of
buying
a
“Super
Duper
Hornet”
F/A-18
variant,
or
having
personal
meetings
with
defense
CEOs
on
Air
Force
One
and
F-35
contracts,
Trump
delved
into
the
minutia
of
defense
acquisition
in
a
way
that
no
US
president
had
done
in
the
modern
era.
With
the
Wall
Street
Journal
reporting
that
Trump
has
already
spoken
with
Boeing
CEO
Kelly
Ortberg
about
the
Air
Force
One
replacement
program
—
as
well
as
the
return
of
the
F-35
and
drone
warfare
to
the
mainstream
news
cycle
—
it’s
highly
probable
that
we
could
see
Trump
once
again
try
to
make
his
mark
on
a
program,
putting
pressure
on
defense
contractors
to
highlight
his
deal-making
skills
to
the
American
taxpayer.
If
I
were
a
gambler,
my
money
would
be
on
Trump
interference
on
big-name
aerospace
projects
—
most
likely
F-35
or
Air
Force
One,
again
—
but
potentially
also
other
fighter
jets,
including
the
Navy
and
Air
Force’s
sixth-generation
fighter
programs.
What
happens
with
defense
spending?
The
fiscal
24
defense
budget
was
constrained
by
the
spending
limits
imposed
by
last
year’s
Fiscal
Responsibility
Act,
and
while
final
appropriations
for
FY25
won’t
be
passed
until
spring
(at
earliest),
signs
point
to
a
budget
that
conforms
to
those
limits.
Those
restrictions
will
be
gone
in
time
for
FY26
—
the
first
chance
the
Trump
administration
has
to
shape
the
defense
budget,
albeit
not
from
the
bottom
up.
While
the
groundwork
for
the
FY26
was
performed
by
the
Biden-era
Pentagon,
whether
the
incoming
administration
doubles
down
on
that
stagnant
Pentagon
spending
or
bumps
it
up
could
be
a
bellwether
for
its
approach
in
future
years.
Analysts
who
spoke
to
Breaking
Defense
immediately
after
the
presidential
election
were
split
on
whether
Trump
would
be
good
for
defense
spending.
Roman
Schweizer,
a
defense
analyst
with
TD
Cowen,
pointed
to
boosts
in
defense
spending
under
the
first
Trump
administration
and
cited
support
for
higher
toplines
among
Republican
leaders
on
the
defense
committees.
However,
whether
defense
budgets
ultimately
see
a
boost
could
be
down
to
the
interplay
of
House
Republicans,
as
the
razor-thin
GOP
majority
in
the
House
has
given
hardline
fiscal
conservatives
enormous
bargaining
power.
The
Department
of
Government
Efficiency,
spearheaded
by
Elon
Musk
and
Vivek
Ramaswamy,
could
be
another
fly
in
the
ointment
for
defense
spending
hawks.
Musk
has
declared
his
intent
to
use
DOGE
to
slash
$2
trillion
from
the
federal
budget.
And
although
lawmakers,
defense
executives
and
military
leaders
have
suggested
they’re
on
board
to
cut
wasteful
spending
(who
doesn’t
love
government
efficiency?),
I
don’t
see
defense
companies
lining
up
to
suggest
programs
where
they
should
receive
less
money.
RELATED:
Such
efficiency,
very
defense:
Congress,
industry
waiting
for
Elon’s
DOGE
to
wow
Is
Trump
a
friend
or
foe
to
the
defense
industry,
and
who
benefits?
During
his
last
term,
Trump
got
cozy
with
the
defense
primes,
celebrating
the
business
acumen
of
defense
executives
such
as
then-Lockheed
Martin
CEO
Marillyn
Hewson
and
—
before
the
Boeing
737
MAX
crisis
—
Boeing
chief
executive
Dennis
Muilenburg.
It
remains
to
be
seen
whether
any
CEOs
from
legacy
defense
primes
win
Trump’s
favor,
but
so
far
his
regard
seems
to
be
centered
on
business
leaders
from
the
defense
startup
and
venture
capital
world.
The
incoming
president
recently
tapped
Stephen
Feinberg,
who
leads
private
equity
firm
Cerberus
Capital
Management,
as
deputy
secretary
of
defense.
Other
executives
from
firms
like
Anduril
and
Palantir
are
also
reportedly
being
considered
for
major
roles
inside
the
Pentagon,
and
Musk
could
be
helping
to
cut
Pentagon
spending
despite
leading
a
major
defense
company
in
SpaceX.
One
way
this
dynamic
could
play
out
is
greater
preference
for
inexpensive
uncrewed
systems
—
an
area
where
defense
startups
have
firm
footing
—
instead
of
the
exquisite,
expensive
weapons
platforms
traditionally
made
by
defense
primes.
Pentagon
leaders
could
potentially
opt
to
sacrifice
a
discrete
quantity
of
a
major
weapons
system
such
as
a
single
Virginia-class
submarine
or
several
dozen
F-35s
in
order
to
buy
hundreds
of
autonomous
weapons
and
improved
networks,
Byron
Callan,
a
defense
analyst
with
Capital
Alpha
Partners,
wrote
in
a
Dec.
18
note
to
investors.
“The
tension
between
GOP
fiscal
hawks
and
defense
hawks
will
likely
push
the
administration
to
look
for
lower-cost
options
for
defense
in
the
form
of
autonomous
air
and
naval
systems.
The
role
of
persons
with
defense
tech/venture/start-up
backgrounds
in
senior
administration
positions
adds
firepower
to
this
battle,”
he
wrote.
Down
further
into
the
weeds
are
questions
about
the
regulatory
environment,
changes
to
defense
contracting,
and
how
Trump’s
overall
trade
policy
influences
defense
contractors.
The
previous
Trump
administration
took
a
more
hands-off
approach
to
antitrust
enforcement,
resulting
in
increased
mergers
and
acquisitions,
most
controversially
seen
in
Northrop
Grumman’s
purchase
of
Orbital
ATK.
(The
Biden
administration
would
later
block
a
similar
proposal
for
Lockheed
to
acquire
Aerojet
Rocketdyne.)
Analysts
speculate
that
the
second
Trump
administration
will
revert
back
to
a
more
permissive
environment
for
M&A.