Mnuchin: Trump will ‘demand’ increase in military spending

President Trump will “demand” an increase in military spending when he and Congress negotiate an end-of-year budget deal, Treasury Secretary Steven Mnuchin said Tuesday.

Mnuchin said at a conference that Trump agreed to a three-month deal on the budget and debt limit last week because the alternative was a one-year deal, which would have hindered military spending.

“We could have done a one-year deal on the debt ceiling,” Mnuchin said at the Delivering Alpha Conference presented by CNBC and Institutional Investor.

“Had we done that, it would have been linked to one year of additional funding for the government. But the president wants to raise military spending,” Mnuchin continued. “The president wants to increase military spending, and that’s something he’s going to demand for December.”

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Last week, Congress passed and Trump signed a package that provides aid for Hurricane Harvey relief, raises the debt ceiling and funds the government through December with a continuing resolution.

Trump agreed to the deal with Democratic leaders, shocking Republicans.

Defense hawks revolted against the bargain, with lawmakers including Senate Armed Services Committee Chairmen John McCain (R-Ariz.) and his House counterpart, Mac Thornberry (R-Texas), voting against it despite the Harvey aid.

They argued a continuing resolution is detrimental to the military at a time when North Korea has claimed it has successfully tested a hydrogen bomb and ship collisions in peaceful areas have killed more troops than the war in Afghanistan this year.

During the presidential campaign, Trump repeatedly promised to bulk up military spending.

His proposed budget, though, fell short of defense hawks’ hopes. The Trump administration requested $603 billion for the base defense budget and $65 billion for a war fund known as the Overseas Contingency Operations (OCO) account.

By contrast, the House-passed defense policy bill would authorize $621.5 billion in the base defense budget and $75 billion in OCO. The defense policy bill currently being considered by the Senate, meanwhile, would authorize $640 billion for the base defense budget and $60 billion for OCO.

Both the bills and the administration’s request are above budget caps, which would need to be changed by a budget deal.