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Tax Legislation Generates Concern Over Potential Defense Spending Squeeze

But Kate Blakeley, an analyst at the Center for Strategic and Budgetary Assessments, said the tax bill has the potential to constrain defense spending in the mid-2020s -- when DOD expects to face massive bills for several major acquisition programs.

"Defense spending would be particularly squeezed when the 'dynamic' effects of the tax changes fail to achieve enough revenue or if the deficit balloons more than expected," she wrote in an email.

"Pressure to extend the individual tax cuts that currently expire in 2025 will also set up a classic guns vs. butter conflict," she continued. "Unfortunately for the Pentagon, the mid-2020s are exactly when the bow wave of acquisition costs will hit, even without the expected growth in procurement spending the Trump administration is expected to request for FY-19 and beyond."

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