Senator Graham Pushes Forward with Defense and Homeland Security Funding Bill

Senate Budget Committee Chairman Lindsey Graham announced on March 25, 2026, that Republicans will push forward with a second budget reconciliation bill this year, aiming to boost funding for defense and homeland security while bypassing the Senate's 60-vote filibuster threshold [1]. The move comes as the Department of Homeland Security enters its sixth week without funding, TSA callout rates have surged past 40% at major airports, and U.S. military operations against Iran have generated new spending demands that exceed existing Pentagon budgets [2][3].

"The purpose of the second reconciliation bill is to make sure there is adequate funding to secure our homeland and to support our men and women in the military who are fighting so bravely," Graham said [1]. The bill would also incorporate White House priorities including border enforcement and voter identification legislation—a combination that has already drawn skepticism from members of Graham's own caucus [4].

The Money: From $150 Billion to Potentially $450 Billion

The scale of what Graham is proposing requires context. Congress already approved roughly $150 billion in supplemental Pentagon funding through the first reconciliation bill in 2025, signed into law as H.R. 1 [5]. That money funded an array of weapons programs: $24.7 billion for the Golden Dome missile shield, $29 billion for shipbuilding including Virginia-class submarines and guided-missile destroyers, roughly $25 billion for munitions and supply chain investments, and billions more for the F-47 sixth-generation fighter and B-21 bomber [6].

The Pentagon's base FY2026 budget request totaled $961.6 billion—$848.3 billion in discretionary funding plus $113.3 billion in mandatory spending [7]. The Defense Department structured its request assuming Congress would pass that reconciliation money, planning to spend all $152 billion in a single fiscal year rather than spreading it over the originally planned five-year window [6].

Now Graham and allies want to go further. Senate Armed Services Chairman Roger Wicker and House Armed Services Chairman Mike Rogers have advocated for approximately $450 billion in a second reconciliation package for national security [8]. Pentagon officials have separately requested about $200 billion for operations related to the Iran conflict [3]. President Trump has stated his intention to fund a $1.5 trillion defense budget for fiscal year 2027, though it remains unclear whether reconciliation figures into that calculation [1].

Source: FRED / Bureau of Economic Analysis (FDEFX)

Data as of Mar 25, 2026CSV

The DHS Shutdown: Forcing the Issue

Graham's reconciliation push is inseparable from the ongoing DHS funding crisis. The department's funding lapsed in mid-February 2026 amid a dispute over Immigration and Customs Enforcement's handling of immigration enforcement [2]. The consequences have been severe and visible: more than 450 TSA officers have quit since the shutdown began, callout rates have reached 40% to 50% at multiple major airports compared with a pre-shutdown average of 4%, and a top TSA official has called the situation "dire" [2].

The shutdown has created political pressure on both parties. A bipartisan deal to fund most of DHS—excluding a portion of the ICE budget—appeared close after White House talks on March 23, but neither Trump nor Senate Democrats have formally endorsed the framework [9][10]. By folding DHS funding into reconciliation, Graham can potentially bypass Democratic opposition entirely, needing only 50 Republican votes plus the vice president's tiebreaker.

This linkage is strategic. As newly confirmed Homeland Security Secretary Markwayne Mullin noted, Graham is "committed to making sure we get reconciliation through," with the plan involving ICE funding and potentially backfilling provisions from last year's tax bill [4].

Where the First $152 Billion Went

The Pentagon's spending plan for the first reconciliation allocation reveals the scale of programs now dependent on this funding mechanism [6]:

Shipbuilding (~$29 billion): $4.6 billion for a second Virginia-class submarine, $5.4 billion for two guided-missile destroyers, $2.7 billion for three fleet replenishment oilers, $1.5 billion for amphibious warships, and $4.9 billion for unmanned surface and underwater vessels [6].

Golden Dome Missile Defense (~$24.4 billion): Trump touted this as a "down payment" on the system's projected $175 billion total cost. It includes $7.2 billion for space-based sensors, $2.2 billion for hypersonic weapon countermeasures, and $2 billion for ground-based radar improvements [6].

Munitions (~$25 billion): $490 million for 245 JASSM-ER missiles, $400 million for approximately 90 Long Range Anti-Ship Missiles, $250 million to boost Tomahawk production to 800 per year, and $1 billion for one-way attack drones through the Defense Autonomous Warfare Group [6].

Nuclear Modernization (~$11 billion): $2.5 billion for the Sentinel ICBM program, including $1.3 billion for risk reduction on the Northrop Grumman contract and $689 million for launch silo prototypes [6].

The Procedural Question: Can This Actually Work?

Budget reconciliation was designed as a tool for aligning tax and spending policies with budget resolution targets. The Congressional Budget Act of 1974 created the process, and the Byrd Rule—named for the late Senator Robert Byrd—constrains what can be included by prohibiting "extraneous" provisions that do not change spending or revenue [11][12].

Here is the central tension: discretionary spending subject to the regular appropriations process—including annual defense funding—has traditionally been excluded from reconciliation [12]. The Appropriations Committee last received reconciliation instructions in fiscal year 1982, more than four decades ago [11]. The Congressional Research Service has stated plainly that discretionary spending for departments like Defense "cannot be included in the reconciliation process" [12].

Yet the first reconciliation bill did include $150 billion for the Pentagon, framed not as annual appropriations but as one-time mandatory spending—a legal distinction that allowed it to survive procedural challenges [5]. The Senate Parliamentarian, who advises on Byrd Rule compliance, did flag several provisions in the first reconciliation bill as impermissible, though the defense spending provisions were ultimately structured to pass muster [13].

The question for a second bill is whether this approach can be repeated at even larger scale. Senator Mitch McConnell, who chairs the Defense Appropriations Subcommittee, has been among the most pointed critics: "Much of the Defense Subcommittee's most arduous work in recent months has been helping the armed services address real, urgent operational shortfalls that were created when much of Washington decided to pretend that one-time infusions of cash could take the place of consistent annual appropriations" [8].

McConnell's objection is substantive, not merely procedural. Reconciliation money arrives as a one-time lump sum. Annual defense programs—personnel, training, maintenance, operations—require predictable year-over-year funding. A $450 billion reconciliation package in 2026 does not guarantee a single dollar in 2027.

The Republican Fault Lines

Graham needs all 50 Republican senators to pass reconciliation (assuming Vice President JD Vance breaks a tie). The opposition within his own caucus falls into distinct categories.

Appropriations process defenders: Senate Appropriations Chair Susan Collins has stated flatly that reconciliation is "not a good approach," arguing defense spending "would be best" handled through traditional appropriations [8][14]. Senator Shelley Moore Capito, a defense appropriator, called the effort "a heavy lift" and expressed uncertainty about its feasibility [8].

Byrd Rule skeptics: Senator Mike Lee of Utah questioned whether non-fiscal provisions like the SAVE America Act voter ID legislation could survive reconciliation: "It's hard to imagine how the SAVE America Act could be passed through reconciliation. And by 'hard' I mean 'essentially impossible'" [4]. Senator Rick Scott of Florida expressed similar doubts [4].

Fiscal hawks: Some Republicans are wary of adding hundreds of billions to the deficit without identified offsets. The federal debt stood at $38.5 trillion as of October 2025, up from $34 trillion just two years earlier [15]. A $450 billion reconciliation package without pay-fors would add directly to that total.

The Freedom Caucus: House Freedom Caucus members have called the reconciliation strategy "gaslighting," suggesting it papers over deeper disagreements about spending priorities [4].

Even supporters hedge their enthusiasm. Wicker, while backing the $450 billion figure, acknowledged that "a good bit of it" should come through "the traditional means" of appropriations [8].

Source: CNBC / Heritage Foundation / Breaking Defense

Data as of Mar 25, 2026CSV

The Spending-vs.-Allocation Debate

The push for more defense dollars operates against a backdrop of already substantial increases. Federal defense expenditures have risen from $906 billion (annualized) in early 2021 to over $1.16 trillion by late 2025, according to Bureau of Economic Analysis data [16]. The FY2026 defense appropriations bill passed the Senate 71-29 through the normal bipartisan process, providing base funding that both parties agreed was necessary [17].

China, frequently cited as the justification for increased U.S. military spending, proposed a 7% increase in its 2026 military budget to approximately $277 billion [18]. Even accounting for estimates that China's actual military spending may be $304 billion to $377 billion when off-budget items are included, the United States spends roughly three to four times as much [18][19].

Critics of the reconciliation approach argue the issue is allocation, not total dollars. The Quincy Institute for Responsible Statecraft found that between 2020 and 2024, the top five defense contractors received a disproportionate share of Pentagon spending, raising questions about whether additional funds address readiness gaps or primarily flow to established prime contractors [20]. Economist Heidi Peltier has calculated that for every $1 million invested by the government, the defense industry creates only seven jobs—making military spending one of the least efficient forms of job creation compared with education, healthcare, or infrastructure [21].

Proponents counter that specific capability gaps—particularly in shipbuilding, munitions stockpiles, and missile defense—require urgent investment that the regular appropriations process has failed to deliver. The Navy's shipbuilding backlog, submarine production delays at Electric Boat and Newport News, and depleted munitions inventories from Ukraine support transfers all represent concrete shortfalls [6]. Electric Boat alone plans to hire 8,000 workers in 2026 as it ramps up submarine production [22].

The Precedent Question

Democrats used reconciliation to pass the $1.9 trillion American Rescue Plan in 2021 without a single Republican vote [23]. They used it again for the Inflation Reduction Act in 2022, which included approximately $370 billion in climate and energy spending [24]. Republicans used reconciliation for the 2017 Tax Cuts and Jobs Act and attempted to use it to repeal the Affordable Care Act [11].

Graham's argument is straightforward: if Democrats can use reconciliation for COVID relief checks and solar panel subsidies, Republicans can use it for aircraft carriers and border security. This is, on its face, a claim about procedural symmetry.

The counterargument is about institutional norms rather than legal rules. Reconciliation has historically been used for tax and entitlement changes—mandatory spending that operates on autopilot—not for discretionary programs that require annual reauthorization. Using it for defense appropriations converts what has been a bipartisan, annual negotiation into a party-line exercise. If defense can be funded through reconciliation, so can education, transportation, or any other discretionary program, potentially making the 60-vote threshold for appropriations bills a dead letter.

Senator McConnell's critique captures this concern: one-time reconciliation infusions create dependency without sustainability [8]. The Pentagon is already planning to spend five years' worth of reconciliation money in a single year [6], suggesting the funds will create ongoing program commitments that future Congresses must then fund through regular order—or through yet another reconciliation bill.

What Happens Next

Graham faces a narrow path. He must convince skeptics within his own caucus that reconciliation is appropriate for defense spending, that the Byrd Rule will not strip critical provisions, and that the political benefits of funding DHS and the military outweigh the institutional costs of further eroding the filibuster's reach.

The DHS shutdown provides urgency. Every day that TSA officers go unpaid and airport lines lengthen increases pressure on both parties to act. Graham is betting that linking defense, homeland security, and border enforcement into a single reconciliation vehicle creates a package that no Republican can afford to oppose—even those who object in principle.

House Budget Chair Jodey Arrington is in informal talks with Graham about the bill's structure [1]. Speaker Mike Johnson has indicated supplemental Iran funding would "probably" be included [25]. But the gap between a $200 billion Iran supplement, a $450 billion defense wish list, and whatever DHS and border enforcement provisions make the cut remains wide.

The Senate parliamentarian's review—the "Byrd bath" that scrubs reconciliation bills for impermissible provisions—will be the critical gatekeeper [11]. The first reconciliation bill's defense provisions survived by being structured as mandatory one-time spending. Whether a second, larger package can thread the same needle remains an open question that will likely define the legislative trajectory of the remainder of the 119th Congress.