President Donald Trump’s proposed “Golden Dome” missile defense shield would resurrect and update the incomplete Reagan era project known as “Star Wars.” The new plan would deploy satellites — perhaps hundreds of them — to monitor, intercept and destroy Chinese or Russian rockets hurtling toward targets in the American homeland.

Trump announced last week he had chosen a Golden Dome configuration expected to cost $175 billion over three years, and he tapped U.S. Space Force Gen. Michael Guetlein to manage it. The project came to light in January when the president signed an executive order to create it.

“Once fully constructed, the Golden Dome will be capable of intercepting missiles even if they are launched from other sides of the world and even if they are launched from space,” Trump said last week in an oval office press conference. “And we will have the best system ever built.”

Planning already underway

The administration gave the Pentagon 60 days to provide details for the dome, which Trump said could be completed by the end of his term in 2029. But military leaders were already at work on ideas for the shield, according to a Department of Defense communique released by Secretary of Defense Pete Hegseth.

“Within the last four decades, our adversaries have developed more advanced and lethal long-range weapons than ever before, including ballistic, hypersonic and cruise missiles capable of striking the homeland with either conventional or nuclear warheads,” the DoD statement said.

The department plans to use new technology in the dome but will also draw upon the work performed but not completed for the Strategic Defense Initiative. Work on the SDI began in 1983, but by 1987, a non-profit group of scientists declared the project — known derisively among critics as “Star Wars” — was still decades from being finished. Funding was soon cut.

The current project, originally called the “Iron Dome for America,” was reportedly renamed by the Pentagon to honor the president’s fondness for the yellow metal. It also happens that an Israeli defense contractor had trade-marked the term “Iron Dome” for that country’s missile defense system.

Names aside, the Golden Dome appears to be joining the American arsenal. Senior Defense Department officials met with the Senate Armed Services Committee strategic forces subcommittee on May 13 to discuss the initiative. Military officers told legislators defenses already in place — such as interceptor missiles, radar satellites and command-and-control networks — would become part of the dome.

Sen. Deb Fischer (R-Neb.), who leads the Senate Armed Services Committee’s subcommittee overseeing strategic forces, called the Golden Dome a much-needed ”generational leap” and warned that today’s defenses, primarily ground-based interceptors based in Alaska and California, can’t address some emerging threats, such as hypersonic glide vehicles and space-launched weapons.

But Democratic members of Congress have taken a less-rosy view of the project. Forty-two of them signed a letter asking the acting inspector general at the Department of Defense to conduct a probe into Trump associate Elon Musk’s lobbying for the dome.

Musk’s privately owned SpaceX is considered the “front runner” for dome contracts, and other companies that stand to benefit from constructing the project include Palantir Technologies (PLTR), L3Harris Technologies (LHX), Lockheed Martin (LMT) and RTX Corp. (RTX)

Whoever lands the contracts, building the dome won’t be cheap. Trump has suggested an initial investment of $25 billion to get things started, but the Congressional Budget Office estimates the project would cost as much as $831 billion and would take more than two decades to complete.

No matter what the cost, the money has to come from someplace in the defense budget. Let’s see if we can find out where

Paying for the dome

The White House is requesting $1.01 trillion for defense in fiscal 2026, up 13% from this year’s budget of about $850 million. The figure for next year doesn’t include the administration’s call for $175 billon for Homeland Security, a staggering increase from $65 billion this year.

But despite the increased spending, the DoD has been cutting staff and reducing or cancelling contracts and grants, which would free some funds to help pay for the 12-figure cost of the dome.

In March, Hegseth announced he was seeking to reduce the Pentagon’s civilian workforce by as many 60,000 employees, or 8%, through firings, resignations and a hiring freeze.

Even though the Space Force is taking on the task of establishing the golden dome, its $26.3 billion budget for the next fiscal year would be down 13% from this year, ending four consecutive years of growth.

A number of defense-related agencies are facing cuts that could help defray the cost of the dome. One such organization would be the Cybersecurity and Infrastructure Security Agency. Its staff of 3,292 is expected to lose nearly 1,000 full-time employees, and the budget would shrink by more than $420 million, falling from $2.38 billion to $1.96 billion.

The Pentagon is also gutting another agency, the Office of the Director of Operational Test and Evaluation, which is losing almost 80% of its funding. Congress established the office in 1983 to test weapons and evaluate the effectiveness of other defense-related programs.

Examples of projects that are shrinking or ceasing altogether include grants of $6 million to decarbonize emissions from Navy ships, $5.2 million to diversify the Navy and a $9 million to a university for developing “equitable AI and machine learning models,” Hegseth said in a DoD report.

Other cuts include $1.8 billion in consulting contracts the Defense Health Agency awarded to private firms, a $1.4 billion enterprise cloud IT services and a $500 million Navy contract for business process consulting.

But it’s not all about austerity. Despite the cut to the Space Force, Trump’s 2026 defense budget proposal includes $260.8 billion to fund the combined Air Force and Space Force next year, an increase of $3.7 billion, or 1.4%. That’s about half the rate of inflation for 2024, which was 2.9%.

Ed McKinley is Luckbox editor-in-chief.

Click here to read Three Ways to Play the Defense Industry’s Latest Supercycle.