In brief: The Defense Department, which manages an $850 billion annual budget and employs two million people, is the largest federal agency – and it has long faced scrutiny over wasteful spending and dark budgets. A new reallocation plan seeks to reduce dependence on outside contractors and shift resources toward in-house operations.

United States Defense Secretary Pete Hegseth has cut $5.1 billion in defense contracts for consulting and nonessential services. The move targets redundant agreements, with plans to shift much of the work to in-house personnel.