Pentagon’s budget troubles reverberate across the Atlantic

Pentagon’s budget troubles reverberate across the Atlantic With Mason Boycott-Owen and Chris Lunday WELCOME TO GLOBAL SECURITY. We’re examining the transatlantic ripple effects of the Pentagon’s budget debate, Germany’s efforts to stay in the Trump administration’s good graces, and the push to speed up consideration of Lindsey Graham’s Russia sanctions bill. Read more about our mission. We’ll publish daily for free during major industry events but our otherwise weekly newsletter is behind the paywall for U.S. and EU Pro subscribers. Which country’s defense industry will come away the biggest winner at Farnborough? Email [email protected] with tips, pitches and feedback, and follow along on X at @JackDetsch. GLOBAL SPENDING Stop if you’ve heard this one before: eleven senators gathered around a table, decked out in big-soled shoes for a day of walking around tented chalets and large aircraft, pitching bipartisanship and “Buy American.” But there’s no getting around that this year — even with the Americans boasting a bipartisan presence at the air show, the U.S. sales offer doesn’t carry the weight it used to. That’s because the Trump administration is going to have a hard time delivering on its hopes of a blockbuster Pentagon budget. Just ask the people who are trying to get it over the finish line. “We’ve got the midterm elections coming, and I don’t know what’s going to happen on any of this stuff right now,” said Sen. John Kennedy (R-La.). “Both the House and the Senate, they’re disorganized. A less charitable perspective would be that both chambers kind of look like the happy hour at an airport Chili’s.” “There’s just a lot of confusion,” he added. “I think we’ll get the NDAA done. I hope we’ll have a [continuing resolution] to continue the budget, but after that, I really don’t know.” Low-profile. All of that has made for a lower-key Farnborough than usual. The Pentagon’s top weapons buyer Michael Duffey is here, and so is the agency’s industrial base chief, but they’re operating behind the scenes. The congressional delegation is only on the ground for a little more than 24 hours, with many of the senators here heading back to Washington to prepare to do battle with Defense Secretary Pete Hegseth at an appropriations hearing on Tuesday afternoon. But it’s dawning on everyone that despite the Trump administration’s highfalutin’ rhetoric about a $1.5 trillion topline, getting more money through a party-line vote is dead on arrival, and Congress is almost certain to just extend the current budget into next year. And the midterms are looming over everything, even at an airshow where sonic booms from fighter jet flyovers are more likely to kill polite conversation than social awkwardness. “The appropriations process isn’t working at its smoothest right now, the one-for-one parity that existed for a long time, defense versus non-defense, kind of broke apart,” said a U.S. industry official, granted anonymity to talk about behind the scenes budget negotiations. “But this budget breaks it apart even more, so the Democrats are saying not so fast on this defense number until we settle what’s on the other side, and it’s a midterm election year.” And Democrats are insistent that the $95 billion “Reconciliation 3.0” being pushed by House Republicans to pay for costs related to the war in Iran is likewise a non-starter. “There isn’t going to be a third reconciliation package,” said Sen. Jeanne Shaheen (D-NH). “So anything that’s in there is not going anywhere.” Nasty habits. The Trump administration is already cannibalizing money from the Sentinel program to pay for the refurbishment of the president’s Qatar-made Air Force One jet, which is out of service for the foreseeable future. And in this situation, Kennedy, who said that Trump recently called him “excited as I’ve heard him in a while” to push for a Senate bill making daylight savings time permanent across the U.S., believes that reconciliation is the best possible option. “There’s a concern that if you start doing defense and reconciliation; it can create a bad habit, and I get all that,” he added. “But the military needs money, and the only way to get it to them in this environment is through reconciliation.” “We’re not going to get an NDAA bill done anytime soon. No offense to anybody, but anybody who thinks we’re going to do an NDAA before the midterm needs to back off the crank because it’s not going to happen.” TRANSATLANTIC TENSIONS German Defense Minister Boris Pistorius, who abandoned a U.S. trip in the spring after the Pentagon couldn’t make a Hegseth meeting happen, is again making plans for a stateside visit, Chris Lunday writes in from Berlin. What’s on tap: According to internal planning notes obtained by Chris, Pistorius hopes to travel to the U.S. in mid-September to visit the Pentagon for a bilateral meeting with Hegseth, and is looking at setting up conversations with members of Congress, the National Security Council, and defense industry CEOs. Pistorius’ five-day jaunt would culminate in Dallas at a rollout for the U.S.-made F-35 fighter jets that will be delivered to Germany. Setting the agenda: Pistorius’ visit would come as the Pentagon will be knee deep in — or perhaps on the tail end of — a monthslong review to determine the scale of U.S. troop and equipment withdrawals from Europe, as Trump’s anger over the continent’s lack of interest in joining the Iran war has continued to flare. But American executives see European interest in the U.S. defense industry as a bright spot. Germany, the Netherlands, Poland, and Sweden are working with the U.S. to establish a missile maintenance facility for Patriot interceptors in a country yet to be named in Europe. And Lockheed Martin, the maker of the missile, is touting a lower-cost interceptor at Farnborough that is priced at less than half the cost of the highest-end Patriots. “The demand is still very, very high,” Jay Pitman, the head of Lockheed Martin International, said in an interview on the sidelines of the conference. Supply Chain Watch Republicans here at Farnborough want Senate Majority Leader John Thune to move on the late Sen. Lindsey Graham’s revived Russia sanctions bill, which the Trump administration agreed to back last week. That’s according to Kennedy, the Louisiana senator, who said that he’s told Thune to “saddle up and ride” to get the bill to on President Trump’s desk. “The votes are there. When you got the votes, you go,” said Kennedy, eliciting cheers from his colleagues, including Sen. Katie Britt (R-Ala.). “There’s an old expression that works in the Senate: The sight of the gallows concentrates the mind. If it were up to me, I’d put that sumbitch on the floor next week.” Fragile consensus. Kennedy says the urgency stems, in part, from the fragile deal lawmakers and the administration have struck over which countries would be subject to secondary sanctions for providing Russia with military and economic support in its war on Ukraine. “The longer you wait, the more people are going to have suggestions of countries to add to the list, which makes it harder to pass,” he said. “I don’t know why we’re waiting.” Logistics. Thune, who is co-sponsoring the bill along with 61 other senators, previously put the legislation on hold last year as Trump and Putin met. But the senator said that Democrats and Republicans “need a time agreement to be able to expedite” the legislation on the floor. That reflects what the leader has told counterparts behind the scenes. Sen.Jeanne Shaheen (D-N.H.), who is co-leading the congressional delegation, said Thune has told her he’s keen to move the legislation, but is worried about the measure getting jammed up on the floor. “If you can’t get a unanimous consent agreement to move it, then you have to go through motion to proceed and cloture on the motion to proceed, and that takes time,” Shaheen said. The word on high. “We’ve been working on this thing for a year and a half, waiting on the president,” Kennedy said. “The president is there. I called him myself and said, ‘Are you there or not?’ And he said: ‘I am there.’” “Lindsey deserves a lot of credit for turning him around,” Kennedy added. THE KICKER Anduril has got a new offering just for Farnborough: It’s an uncrewed rotorcraft named Thunder, which takes off vertically and sports tilt rotors and can carry Hellfire missiles, air-launched munitions, and counter-drone weapons. With attack helicopters more and more vulnerable to cheap weapons and persistent battlefield surveillance, taking the human pilot out of a helicopter was a no-brainer, company executives said. “It was obvious to put robots there instead of people,” said Shane Arnott, Anduril’s senior vice president of engineering for maritime and maneuver dominance.