Donald Trump’s argument that the government is rigged and the deep state is out of control resonates with a significant part of his base.
For example, President-elect Trump launched a harsh critique of the state of the defense industry at a September 2024 campaign stop in Wisconsin, where he said the following:
“I will expel warmongers. We have these people, they want to go to war all the time. You know why? Missiles are $2 million apiece. That’s why. They love to drop missiles all over the place.” And then he added, referring to his previous presidency, “I had no wars.”
It is an open question as to whether the president-elect will follow through on this hard-hitting rhetoric. In his 2016 campaign for president he criticized defense contractors for overcharging the government but built an alliance with the industry once he took office.
The partnership began during preparations for Trump’s first foreign trip, to Saudi Arabia. One of the president’s goals for the trip was to conclude a massive arms deal with the Saudi regime, in part to burnish his image as a deal maker, and in part to create jobs in America.
The administration consulted some industry leaders in assembling the arms package. Most notably, Trump son-in-law Jared Kushner called the CEO to give Saudi Arabia a discount on an $18 billion THAAD missile defense system.
Arms sales to Saudi Arabia during Trump’s first term were far less than advertised -$22 billion versus a promised level of $110 billion. But that didn’t prevent Trump from claiming that sales to Saudi Arabia supported 500,000 jobs in America. A survey of experts by Washington Post fact checking columnist Glenn Kessler suggested that the real figure was likely about one-tenth of what the president was claiming. But most Americans never saw the Post’s correction, so President Trump’s image as a job creator was enhanced by sales to the Kingdom.
The ultimate test of Trump’s loyalty to arms makers came in the wake of the Saudi government’s brutal murder of U.S.-resident dissident Saudi journalist Jamal Khashoggi, when there was widespread pressure to suspend U.S. arms transfers to the regime. Trump put out a statement saying that he didn’t want to suspend sales because it would reduce business for “Boeing, Lockheed Martin, Raytheon and many other great U.S. defense contractors.” Can President Trump change course and police the behavior of firms that he defended so doggedly last time he was in power?
The other issue that could impact the Trump administration’s approach to the defense sector involves the close ties of key officials to Silicon Valley military tech firms. It is now known that Peter Thiel, the founder of up and coming emerging military tech firm Palantir, has been a mentor and financial supporter of vice-president J.D. Vance, employing him at one of his firms and donating millions to support his successful run for the Senate from Ohio. And then there’s Elon Musk, who spent $119 million on activities designed to get Donald Trump elected and
is now slated to co-chair Trump’s proposed Department of Government Efficiency (DoGE). Musk’s firm, Space-X, launches all of the U.S. military’s satellites, as well as ensuring internet access to Ukrainian soldiers attempting to fend off Russian invaders, using his company’s Starlink system. Space-X recently received a contract to develop a version of Starlink adapted to the needs of the U.S. military.
Whether or not the new administration launches a campaign to reduce the influence of defense contractors, there is another equally consequential issue at hand — whether it takes sides in the impending battle for funds between legacy firms like Lockheed Martin, that make large weapons platforms like ships and combat aircraft, and firms like Palantir and Anduril, that make smaller, more nimble systems that use complex software and often incorporate AI. Anduril, founded by Palmer Luckey, a protege of Peter Thiel, has published a manifesto entitled “Rebooting the Arsenal of Democracy” that basically argues that the current crop of military mega-firms are ill-suited to develop the weapons of the future and should therefore step aside and make room for a new generation of innovative, tech savvy firms that can get the job done.
Pentagon officials have spoken enthusiastically about emerging tech, but it has yet to match its rhetoric with significant funding. The bulk of the Pentagon’s investment funds still go to large platforms like aircraft carriers, bombers, fighter planes, and armored vehicles, and the members of Congress from states and districts where these systems are built want to keep it that way. If the Trump administration weighs in heavily on one of the two sides — legacy systems versus emerging tech — it could help determine the shape of the defense sector for decades to come.
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