Hypersonics, AI, Space Weapons, & Directed Energy: Lawmakers Release Defense Bill As Expiring Obamacare Subsidies Marinate On Back-Burner

With Congress in its second-to-last week in session for this year, lawmakers on the House Armed Services Committee released the final bill text of the 2026 National Defense Authorization Act (NDAA) Sunday night, which allocates a topline of roughly $8 billion over the $892.6 billion the Department of Defense had requested, and what the House version of the NDAA provided which stuck to the Pentagon’s request. 

The NDAA is the annual law passed by Congress that sets the budget, policies, and legal authorities for the U.S. military and national defense programs. It shapes everything from troop pay to weapons development and foreign military aid.

“This year’s National Defense Authorization Act helps advance President Trump and Republicans’ Peace Through Strength Agenda by codifying 15 of President Trump’s executive orders, ending woke ideology at the Pentagon, securing the border, revitalizing the defense industrial base, and restoring the warrior ethos,” House Speaker Mike Johnson (R-LA) said in a Sunday statement. 

The $8B increase is a ‘compromise’ – as the Senate tried to jack the budget up by $32 billion over the department’s request. According to Breaking Defense, Rep. Adam Smith, the ranking member of the House Armed Services Committee, noted that appropriators would have the last word on the final budget, but was optimistic that the $8 bullion figure was in the ballpark.

 “We’re going to put a marker out there that’s like $8 billion above the president’s budget, but we’ll see. It’ll depend on what the appropriators work out,” the DC Democrat told the outlet. 

According to a House Armed Services Committee fact sheet, the NDAA procurement plan includes: 

• $26 billion for shipbuilding
• $38 billion for aircraft, including “full funding” for the Navy’s F/A-XX sixth-generation fighter
• $4 billion for ground vehicles
• $25 billion for munitions
• $145.7 billion for hypersonics, AI, quantum, directed energy and autonomy
• An estimated $685 million for Israel-specific missile defense (Iron Dome, Arrow, David’s Sling) which is separate of ~$3.3 billion in non-NDAA aid
• $400 million for the Ukraine Security Assistance Initiative for both FY26 and FY27. Congrats to all involved.

Also included are: 

Servicemember Pay and Quality of Life: Provides a **3.8% pay raise**, expands bonuses and special pays, increases family separation allowances, and invests heavily in barracks/housing ($1.5B), childcare ($491M), dining facilities, healthcare improvements, and schools/Impact Aid.

Elimination of DEI and “Woke” Policies: Permanently repeals all DoD DEI offices, programs, training, and activities; prohibits new ones; ensures merit-based promotions, accessions, and command selections (no consideration of race/ethnicity/gender); bans men from women’s sports at military academies; cuts funding for related initiatives.

Border Security Support: Fully funds DoD assistance to border security, including National Guard/active-duty deployments, establishment of National Defense Areas, contractor support to CBP, and over $1B for counter-drug/trafficking efforts.

Acquisition and Bureaucracy Reforms (SPEED Act): Implements major reforms to accelerate procurement, prioritize commercial solutions, reduce regulatory burdens, centralize management, empower the acquisition workforce, and streamline processes for faster delivery of innovative technologies.

Defense Industrial Base Revitalization: Establishes funds and programs for capacity investments (including critical minerals), multi-year munitions contracts, supply chain transparency (especially vs. China risks), advanced manufacturing (e.g., 3D printing, robotics), and small business/unmanned systems support.

Missile Defense and “Golden Dome”: Updates policy and funds development of the Golden Dome integrated missile defense system; additional funding for THAAD, SM-3, Patriot; codifies related executive orders.

Nuclear Modernization and Deterrence: Fully funds nuclear triad (Sentinel ICBM, Columbia-class, SLCM-N); accelerates programs; codifies advanced nuclear reactor deployment and energy independence initiatives.

Deterring China/Indo-Pacific Focus: Extends and increases funding for Pacific Deterrence Initiative; prohibits acquisitions from China-linked entities (biotech, minerals, drones, solar, etc.); $2.7B+ for regional MILCON/logistics; full funding for Taiwan cooperation, Philippines assistance, and exercises.

Innovation and Technology: Advances AI, biotechnology, quantum, cyber, and software acquisition; establishes new offices/programs for rapid adoption; protects against foreign threats to infrastructure/cloud.

According to the DoD, they found nearly $20B in savings through cuts to climate programs ($1.6B), DEI ($40M+), obsolete assets, bureaucracy, consulting, and inefficient programs, while aligning civilian workforce reforms with broader civil service changes. The NDAA’s stated goals are “peace through strength,” restoring lethality and meritocracy, revitalizing industry, countering China, and implementing conservative policy priorities while delivering significant troop support and procurement investments.

As Breaking Defense notes further; 

• Section 1249 attempts to places a brake on the withdrawal of US forces from Europe by requiring specific certifications be handed into Congress for 60 days before forces drop below 76,000 in European Command’s area of responsibility. That same prohibition covers any attempts to “divest, consolidate or otherwise return to a host country any parcel of land or facility” currently under control of EUCOM, or to attempt to relinquish the role of NATO’s Supreme Allied Commander. 
• The NDAA extends the Ukraine Security Assistance Initiative by $400 million for both FY26 and FY27.
• It also repeals the 2002 Authorization for Use of Military Force (AUMF) for Iraq.
• Not included: any language renaming the Department of Defense as the “Department of War.” While President Donald Trump has authorized the use of Department of War as a nickname and it has been taken up by Defense Secretary Pete Hegseth, that title cannot be made official without congressional action.

Obama-What?

As Punchbowl News observes, lawmakers are not that motivated to deal with the expiring Obamacare subsidies – though apparently “GOP senators who represent dueling ideological factions in the Republican Conference are teaming up on a plan to extend the Obamacare subsidies for two years with income caps and other reforms.”

The new proposal from Republican Sens. Bernie Moreno (Ohio) and Susan Collins (Maine), outlined in this one-pager, would cap income eligibility and eliminate zero-premium plans by requiring a $25 minimum monthly payment.

Under the Moreno-led plan, the full tax credit would be available for households with income of up to 400% of the poverty level, and then gradually phase out so that households making over $200,000 would no longer benefit.

It comes as the Senate is set to vote this week — likely Thursday — on Democratic legislation that extends the tax credits for three years, a promise Senate Majority Leader John Thune made to end the recent government shutdown. This won’t get anywhere close to 60 votes.

But Senate Republicans aren’t expected to hold a separate vote on a unified proposal of their own, a dynamic that’s fueling some GOP frustration with Thune, as we reported Friday. -Punchbowl

That said, the reality is that there isn’t yet an alternative to the Democrats’ legislation that unites Republicans, while Senate GOP leaders wouldn’t want to promote Democrat messaging on a bill with a vote that splinters the GOP. So, expect more wheel spinning.