Sharpening Signals and Reducing Noise for Better Defense Budgets

America's military power is inextricably linked to its economic strength, making the defense budget a crucial instrument of national strategy and economic statecraft. The current budgeting process, however, often fails to translate strategic goals into clear signals for industry because stated priorities far exceed realistic funding levels. To better compete with adversaries, the Pentagon must leverage the nation's free-market dynamism by providing stable, coherent guidance that aligns private innovation with national security challenges. By influencing even small shifts in massive commercial markets like AI, the United States can effectively multiply its defense capabilities and harness its foundational economic advantages.