Sen. Elizabeth Warren (D-MA) gave a rare nod of approval to President Donald Trump, praising his crackdown on defense contractors that prioritize shareholder payouts over weapons production, saying the move has worked so well that she wants Congress to make it permanent.
“Since the executive order was issued, each of the four largest defense contractors that engaged in stock buybacks and dividend payouts in the first quarter of 2025 cut them dramatically in the first quarter of 2026,” Warren said. “This review reveals that the president’s executive order helped protect taxpayers and improve investments by defense contractors.”
Warren is now urging Secretary of War Pete Hegseth to support legislation codifying key portions of Trump’s executive order into law.
“Given the findings of our review, we urge your support for codifying the president’s executive order into law and ensuring that the order has lasting results,” she wrote in a letter to Hegseth.
Trump signed an executive order in January, prohibiting defense contractors involved in business with the Pentagon from using capital for stock buybacks and dividend payments if the companies have not made critical investments in increased production and other Pentagon-related needs for the country’s national interest.
“Effective immediately, they are not permitted in any way, shape, or form to pay dividends or buy back stock, until such time as they are able to produce a superior product, on time and on budget,” Trump wrote in the order.
Trump said defense companies have the right to profit from their investments and hard work, but that “America’s warfighters have the best possible equipment and weapons.” Paying out dividends is a way for companies to distribute their profits to shareholders.
Warren’s review found that combined stock buybacks and dividends among four of the largest defense contractors, Lockheed Martin, RTX, Northrop Grumman, and General Dynamics, fell from about $4.2 billion in the first quarter of 2025 to about $2.7 billion in the first quarter of 2026. The reductions were not uniform: Lockheed, Northrop, and General Dynamics all reported declines, while RTX’s payouts rose slightly year over year.
Warren’s office also identified several contractors that it said had not meaningfully changed their behavior following Trump’s executive order, arguing that the results demonstrate why Congress should codify the policy rather than leave it solely to executive action.
Warren and Sen. Josh Hawley (R-MO) introduced the Prioritizing the Warfighter in Defense Contracting Act in March, legislation intended to codify key provisions of Trump’s order. Warren, now joined by Sen. Mike Lee (R-UT), is pressing Hegseth in the new letter to support that legislation.
“These contractors who did not respond to the president’s executive order reveal the need for legislation that emboldens the department to enforce accountability. Legislation also provides certainty, and ensures that these changes are part of a strategic shift to deliver more fiscal responsibility to the department instead of temporary changes that can be quickly reversed,” she wrote.
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