The biggest untold story out of Washington these days is the tremendous growth in federal tax revenues, which increased 12 percent in the fiscal year ended in September and 15 percent in 2005. David E. Baker, a defense analyst with Stanford Washington Research, thinks that a fast withdrawal from Iraq is unlikely, and that military and homeland-security spending will grow at least as much under a Democratic Congress as they did under the Republicans. Baker, a retired Air Force brigadier general, says Democrats understand that any effort to slow the growth of defense spending now would just become campaign fodder for Republicans seeking to portray them as soft on terrorism. "That's a label they want to avoid at all costs," he says.

Here's another reason to play defense: "Solid economic growth and the surge in global commodity prices have provided the liquidity necessary for a number of countries to fund arms buildups," Merrill Lynch chief investment strategist Richard Bernstein wrote in a recent report. Over the past several months the Pentagon has announced plans to sell $450 million in Northrop Grumman communications equipment to Jordan, $2.9 billion in General Dynamics Abrams tanks to Saudi Arabia, and $144 million in Lockheed Martin-made Patriot missiles to Japan.

The quick and easy way to play defense stocks is with the PowerShares Aerospace & Defense Portfolio (PPA), an exchange-traded sector fund. Our favorite individual stock: General Dynamics, which trades at 16 times 2007 earnings. Analysts expect those earnings to come in 13 percent ahead of this year's, and previous estimates have tended to be low.

Baker says the case for General Dynamics is straightforward: Democrats' defense budgets are likely to tilt toward spending "that directly supports the troops" - as opposed to futuristic projects like missile defense. Nicholas Chabraja, General Dynamics' CEO, agrees, to an extent, though he believes the issue transcends politics. "When troops get deployed in significant numbers it's not very surprising that the balance shifts toward supplying the current forces," Chabraja told Fortune in a rare interview. And as the leading manufacturer of tanks and armored vehicles, General Dynamics excels at supplying current forces.

Another reason to favor General Dynamics is its fast-growing corporate-jet business, Gulfstream, which is in itself a backdoor homeland-security play. With more and more corporations seeking to shield their executives from the hassles of flying commercial, Gulfstream now boasts an order backlog of $6.5 billion, up from $5.2 billion a year ago.