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SECRETARY OF DEFENSE LEON PANETTA: Good afternoon, everybody.
As all of you know, this department has undertaken a very fundamental review of its defense strategy and of our spending priorities.
The reasons for the review are clear. First of all, we are at a strategic turning point after a decade of war and after a very substantial growth in the defense budget. And second, the Congress of the United States, through the passage of the Budget Control Act, has required that the defense budget be reduced by $487 billion over 10 years.

To accomplish this effort, we decided that it was important to make this an opportunity to develop a new defense strategy for the United States and for the U.S. military force that we wanted for the future.

That strategy has guided us in making a series of tough budget choices and establishing a new set of defense priorities.

The ongoing process reached an important milestone earlier this month with the release of the new strategic guidance and the priorities for a 21st century defense. And it will be reflected in the decisions that have been made and will be presented in the President’s budget.

When I announced the new guidance, I highlighted five key elements of the strategy and five key elements of the vision that we have for a military force of the future. And let me just summarize each of those.

First, the military will be smaller and leaner, but it will be agile, flexible, rapidly deployable and technologically advanced. It will be a cutting-edge force.

Second, we will rebalance our global posture and presence to emphasize where we think the potential problems will be in the world. And that means emphasizing Asia-Pacific and the Middle East.

Third, we will maintain our presence elsewhere in the world and will do that by building innovative partnerships and strengthening our key alliances and develop new partnerships elsewhere in the world: in Europe, in Africa and Latin America and elsewhere.

Fourth, we will ensure that we can quickly confront and defeat aggression from any adversary anytime, anyplace.

And fifth, we will protect and prioritize some very important and key investments in technology and new capabilities as well as our capacity to grow, adapt, to mobilize, to surge as needed.

Given the significant fiscal constraints that have been imposed on the department, our approach was to develop this force for the future with some pretty important guidelines. We wanted to maintain the strongest military in the world. We committed ourselves not to hollow out the force, as has been done in the past in these kinds of drawdowns, to take a balanced approach to our budget by putting everything on the table and to not break faith with the troops and their families.

I want to thank the entire leadership of this department, military and civilian alike, for their participation and support in this effort. This has truly been a team effort, and I am deeply appreciative for their cooperation.

And we are united in the belief that this strategy and the resulting budget decisions followed the right approach to meet the country’s most pressing security challenges and to preserve the strongest military in the world and at the same time meet our fiscal responsibilities.

Today I’d like to offer a preview of the decisions that we made to help build the department’s budget request for fiscal year 2013 and the future years’ defense plan.

Consistent with the Budget Control Act, this plan reduces spending over the 10 years, obviously, by $487 billion. But in the five-year budget that will be presented by the President, we reduce the defense budget by 259 billion [dollars] over the next five years.

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