The federal government is undergoing its tightest economic pinch since the Great Depression in the 1930s. Despite $2 trillion in emergency spending signed into law by President Trump, Federal Reserve Chairman Jerome Powell believes a full economic recovery is likely to stretch well into 2021. The budget deficit this year is already projected to reach $3.7 trillion, a number likely to rise as Congress debates another coronavirus-related spending bill.
As deficits increase and the mountain of national debt gets steeper, Pentagon officials and defense analysts in Washington are increasingly nervous about what the fiscal environment could mean for the U.S. defense budget. Defense Secretary Mark Esper has warned of a “reckoning” for his department, with many fearing a reversal of the Pentagon’s modernization projects.
