Trump Administration Proposes $1.5 Trillion Defense Budget for 2027 Amid Cuts to Health and Non-Defense Spending

By Eduardo Porter

*Published: 2026-04-12*

The United States records higher rates of deaths from treatable conditions compared to many peer nations in the industrialized world. According to data from the Institute of Health Metrics and Evaluation, mortality rates from amenable causes—those preventable through timely and effective healthcare—stand at nearly twice the levels seen in countries such as Spain, France, Japan, and Australia. Factors contributing to these disparities include cost-related barriers to care: U.S. residents are more likely to forgo doctor's visits, medical tests, or prescription medications due to expense, per surveys from the Commonwealth Fund. The U.S. also has lower rates of public health insurance coverage and higher out-of-pocket medical costs than most OECD peers.

The White House's fiscal year 2027 budget proposal, released last week, includes a 12% reduction—or about $15 billion—for the Department of Health and Human Services (HHS) compared to current levels. This follows changes enacted last year through the president's "big, beautiful bill" (BBB, or H.R. 1), which imposed work requirements on Medicaid and modified Affordable Care Act marketplaces. Some analysts estimate these provisions could lead to more than $1 trillion in reduced federal spending on Medicaid and ACA programs over 10 years, potentially resulting in 15 million people losing coverage, though the Congressional Budget Office (CBO) has not confirmed these exact figures. The BBB also included Medicaid expansions alongside restrictions.

Beyond healthcare, the proposal addresses other domestic programs. U.S. public spending on early childhood education and care ranks low among affluent nations, according to OECD data, even as women's labor force participation rate—around 57% for prime-age women—remains relatively high compared to many peers like Italy (52%) and France (55%). Affordable childcare has been cited as a challenge for working families.

The budget proposal prioritizes tax relief and defense spending. The BBB provided $4.5 trillion in tax cuts over 10 years, with the CBO estimating a 2.7% increase in after-tax income for the top 10% of households, or about $13,622 annually per household in that group.

Defense receives significant increases, linked to ongoing national security needs. Last year, the BBB allocated $165 billion to the Department of Homeland Security for immigration enforcement, including arrests and deportations. The 2027 proposal requests $1.5 trillion for defense—about 42% more than the 2026 budget and roughly three times Iran's GDP. This follows substantial expenditures on the ongoing U.S.-Iran war, which began in early 2026. Pentagon reports indicate $12.7 billion spent in the first six days and $28 billion over the first five weeks, with daily costs averaging around $1 billion. The department has requested a $200 billion supplemental appropriation to sustain operations. At an Easter reception last week, President Trump stated, "We have to take care of one thing: military protection. We have to guard the country."

The proposed cuts to non-defense discretionary spending total 10%, but they do not fully offset the defense increase. White House officials have indicated that further adjustments to mandatory spending programs may be pursued, given Republican opposition to tax increases. In comments at the Easter event, Trump said, "It’s not possible for us to take care of daycare, Medicaid, Medicare, all these individual things, they can do it on a state basis," adding that such programs are "little scams you have to let states take care of them." The White House later deleted a video of the remarks from its YouTube channel, though copies circulated online.

The administration justifies non-defense cuts by citing waste and fraud. For instance, it proposes trimming $4 billion from the Low Income Home Energy Assistance Program (LIHEAP), which aids poor households with electricity costs, due to instances of benefits paid to deceased individuals and other irregularities. Similarly, $5 billion is cut from the National Institutes of Health (NIH) budget, with the White House pointing to "wasteful spending, misleading information, risky research, and the promotion of dangerous ideologies that undermine public health."

This budget proposal marks the starting point for congressional negotiations, where topline figures are often revised. Congress must approve the final version, and historical precedents show adjustments to both defense and non-defense allocations.

President Trump campaigned successfully in 2024 and previously in 2016 on support for working-class Americans, criticizing elites, trade deals, and immigration policies. The 2027 proposal has drawn criticism from Democrats, who plan to highlight Trump's Easter remarks in midterm election ads. Poll numbers for the president have softened recently, amid debates over domestic priorities.

The budget reflects trade-offs in federal spending amid fiscal constraints. Defense outlays have surged due to the U.S.-Iran conflict, which escalated after Iranian attacks on U.S. assets in the Middle East. Non-defense programs face reductions justified by efficiency goals, while tax cuts from the prior year continue to shape revenue projections. Outcomes will depend on bipartisan talks in Congress.

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