Trump says he will not permit dividends and stock buybacks for defense companies

[IsailedawayfromFR]

Trump says he will not permit dividends and stock buybacks for defense companies
Jan 7 2026

Trump: I will not permit dividends or stock buybacks for defense companies
President Donald Trump on Wednesday said he “will not permit” defense companies to issue dividends or stock buybacks until those firms speed up their production of military equipment and address his other complaints about the industry.

Trump, in a lengthy Truth Social post, also took aim at defense contractors’ executive pay packages, calling them “exorbitant and unjustifiable.”

“Defense Companies are not producing our Great Military Equipment rapidly enough and, once produced, not maintaining it properly or quickly,” he wrote.

Until those companies build new production plants, “no Executive should be allowed to make in excess of $5 Million Dollars,” Trump declared.

Shares of General Dynamics
, Lockheed Martin
 and Northrop Grumman
 each fell about 3% following Trump’s comments.

Trump later singled out Raytheon
 as “the least responsive to the needs of the Department of War, the slowest in increasing their volume, and the most aggressive spending on their Shareholders rather than the needs and demands of the United States Military.”

He said that the Pentagon will cut its business ties with Raytheon unless it “steps up” on investment in plants and equipment, adding that “under no circumstances” can the company do any more stock buybacks in the meantime.
https://www.cnbc.com/2026/01/07/trump-dividends-stock-buybacks-defense-companies.html
______________________________________________________________________________
Trump has jumped way outside his lane and is antagonizing his backers within the defense industry as well as defense stock holders such as me.

There is no way this can stick.

[Kamaji]

How does he plan to do that?

[Drago]

How does he plan to do that?

Cancel the offending contractors' existing contracts and no new ones issued I guess?? Maybe?

#DOWINDUSTRIALCOMPLEX
(#DODINDUSTRIALCOMPLEX)

[Kamaji]

Cancel the offending contractors' existing contracts and no new ones issued I guess?? Maybe?

#DOWINDUSTRIALCOMPLEX
(#DODINDUSTRIALCOMPLEX)

Really?  That’ll be fun; who wants sidewinders designed and manufactured by MizzilesBeUs Inc.?

[bigheadfred]

Really?  That’ll be fun; who wants sidewinders designed and manufactured by MizzilesBeUs Inc.?

BuddyOne is betterest

[Drago]

Really?  That’ll be fun; who wants sidewinders designed and manufactured by MizzilesBeUs Inc.?

PDJT is pissed at Raytheon (and other defense contractors that do stock buybacks and increase their dividends with taxpayer $$$):

https://www.reuters.com/world/us/trump-threatens-cut-raytheons-government-contracts-over-stock-buybacks-2026-01-07/

Just get Elon to start a new Space X defense division for missiles! 🚀 🧨

[Kamaji]

PDJT is pissed at Raytheon (and other defense contractors that do stock buybacks and increase their dividends with taxpayer $$$):

https://www.reuters.com/world/us/trump-threatens-cut-raytheons-government-contracts-over-stock-buybacks-2026-01-07/

Just get Elon to start a new Space X defense division for missiles! 🚀 🧨

Ahh.  So you mean these companies are stealing taxpayer funds to illicitly kick back to their shareholders?

[Drago]

No, not "stealing"...just not "best value for the $$"...less stock buy backs and stable dividends equals more Hellfires for the money in the next purchase contract. 💰 "More bang for the buck!" 💥

The prez says:

https://www.whitehouse.gov/fact-sheets/2026/01/fact-sheet-president-donald-j-trump-prioritizes-the-warfighter-in-defense-contracting/

[Kamaji]

No, not "stealing"...just not "best value for the $$"...less stock buy backs and stable dividends equals more Hellfires for the money in the next purchase contract. 💰 "More bang for the buck!" 💥

The prez says:

https://www.whitehouse.gov/fact-sheets/2026/01/fact-sheet-president-donald-j-trump-prioritizes-the-warfighter-in-defense-contracting/

So then why did the government agree to the pricing in the first place if it wasn’t “best value”?  Would it be better value if the profits were instead wasted on paying for excessive management perks, like filet mignon dinners served on premises?

These are private companies that bargained with the government at arms length for the pricing on the equipment they’re making and selling to the government.  As private for-profit businesses they are expected to have a net profit left over after they’ve fulfilled their contracts, and what they do with that profit is nobody’s business but that of the management and the shareholders.  It is certainly none of the governments business. 

This is the sort of interference in private business that actually does smack of fascism - ie, corporativism. 

[Drago]

Ahhhh that is the sticky part...the government "agreeing to pricing"...is that how we get to $10,000.00 toilet seat COVERS?

Gotta go all DOGE on the whole process I guess!  The $38 Trillion isn't going to pay itself down!

https://www.grassley.senate.gov/news/news-releases/grassley-defense-dept-there-no-way-justify-10000-toilet-seat-lid

[Kamaji]

Ahhhh that is the sticky part...the government "agreeing to pricing"...is that how we get to $10,000.00 toilet seat COVERS?

Gotta go all DOGE on the whole process I guess!  The $38 Trillion isn't going to pay itself down!

https://www.grassley.senate.gov/news/news-releases/grassley-defense-dept-there-no-way-justify-10000-toilet-seat-lid

So now you’re claiming to have proof that this private company was actually forcing the poor widdle federal government to accept a bad bargain?   Really?

If that’s the case, then where are all the whistleblowers?  They’d be getting a big cut of any recoveries for fraud. 

[Drago]

No whistleblowers in the happy “MIC”.

Two sides to the story:

https://www.postkeynesian.net/downloads/working-papers/PKWP2409.pdf

or

https://breakingdefense.com/2021/01/ike-was-wrong-the-military-industrial-congressional-complex-turns-60/

Take your pick.

[Kamaji]

It’s a private company, so unless there’s proof of fraud, in which case damages can be sued for, what it does with the profits it is expected to make under basic economic theory is its own business and not the business of the government.

Also, stock buybacks are sometimes used because it gives a better tax result for the shareholder selling the stock than does a cash dividend.   Otherwise, there’s nothing particularly nefarious about them.

[The_Reader_David]

This is the sort of interference in private business that actually does smack of fascism - ie, corporativism.

Indeed. One of the worst things about Trump is he actually provides a legitimate basis for the usually idiotic practice of calling Republicans "fascists."