retaries are going to require the capacity to deploy forces to defend against ballistic missiles.

The place where we do that in our budget, the program designed specifically to give us the capacity to field that capability, is the Strategic Defense Initiative. So we are recommending a robust SDI program.

The other programs, I think, speak for themselves. We continue with the Trident missile program. Peacekeeper rail garrison, we take through an initial test stage this year. We are not asking for money to deploy that. Small ICBM continues in the R&D stage. We are not asking for deployment funds at this point. Both programs are alive.

Advanced cruise missile-another key strategic capability. [The following information was received for the record:]

CHART 12.-FISCAL YEAR 1992-FISCAL YEAR 1993 LAND FORCES

These are initial systems we are investing in: the Black Hawk helicopter for Active and Guard and Reserve forces, a combat communications system for the Army-the SINCGARS, and the light helicopter we think are important to go forward with.

The Apache Longbow is a fire system for the Apache helicopter that has great promise. Medium tactical vehicles-you need trucks. We are going to buy a lot of trucks for our ground forces. [The following information was received for the record:]

CHART 13.-FISCAL YEAR 1992-FISCAL YEAR 1993 NAVAL FORCES

These are major naval forces. New aircraft carrier comes in 1993 in terms of long lead items. That is consistent with the 12 carrier structure. We are recommending that. We recommend building one Seawolf submarine a year.

The Burke class AEGIS is destroyer DDG-51. We will keep this important capability.

[The following information was received for the record:]

CHART 14.-FISCAL YEAR 1992-FISCAL YEAR 1993 TACTICAL AIR FORCES

Finally, with respect to tactical air forces, we may want to come back to this. We continue with the F/A-18. The Advanced Tactical Fighter is the next generation fighter for the Air Force. That program is going well. We have four prototypes now, two from each of the contracting teams, and we hope to down-select to one contractor this year. We think it is vital to have this program.

The F16-D, we basically continue to buy and close it out because we are not going to have as big a force structure and won't need as many F-16s.

The C-17 is vital. We are flying the wings off the C-141s and C5s. We need a replacement transport aircraft. The C-17 is scheduled to fly for the first time later this year. We think that has to continue to be a high priority item.

The EA-6B, the AMRAAM, and MILSTAR, we also think are important. These programs are restructured in line with the wishes of the Congress. But these are vital priorities for the chiefs.

Mr. Chairman, members of the committee, you have been very patient for that quick run-through across the surface of what is a $300 billion budget.

[The following information was received for the record:]

CHART 15.-DEFENSE MANAGEMENT REPORT INITIATIVES

Data Processing and Corporate Information Management; Consolidate Finance and Accounting Services; Coordinate Maintenance Depot Services; Consolidate Supply Depots; Reorganize Contract Management; Improve Technical/Engineering Research and Development and Consolidate Commissary Operations.

I would like at this point to call on my distinguished colleague,

PREPARED STATEMENT OF HON. DICK CHENEY, SECRETARY OF DEFENSE

Mr. Chairman, members of the Committee, thank you for this opportunity to discuss the Administration's fiscal year (FY) 1992-93 defense budget request.

During the past two years, the global security environment has changed dramatically. Many of these changes have made America safer. The West's post-war strategy of containment, deterrence, and support for democracy around the world has made these positive developments possible.

But it is also true that I appear before you today with America at war for the first time in over 15 years. Half a million U.S. servicemen and women--all volunteers--now stand with armed forces from a broad coalition of countries to enforce the United Nation's mandate.

I am pleased to report that our military is performing magnificently. From the remarkably rapid deployment of force, to the skill of our pilots, to the technical wonders of Patriots, Stealth fighters, and Tomahawk missiles, America's past investment in defense is on display. We can be even prouder of what has been accomplished, because no one among us wanted war. America invests in defense not primarily to go to war, but to preserve the peace. Even in the much heralded postCold War world, peace too has its price.

NEW DEFENSE STRATEGY AND THE BUDGET

Last August, President Bush announced a new strategy for America's defense. This strategy, announced on the very day Iraq invaded Kuwait, takes into account the uncertainties before us today. The most significant new feature of U.S. defense strategy is that it is no longer focused primarily on the threat of Soviet-led aggression that would engulf Europe and probably much of the world. On the other hand, our strategy does take account of the uncertainty regarding the eventual outcome of the upheaval in the Soviet Union, and the massive Soviet military capabilities that we expect to remain for the foreseeable future.

While keeping a watchful eye on Soviet military power, the new U.S. defense strategy sizes our active and reserve forces principally against major regional contingencies that threaten American interests. These threats have not diminished, as recent events in the Middle East have proven. And they have become ever more dangerous by the disturbing number of Third World countries with formidable conventional forces, and by the

proliferation of ballistic missiles, and weapons of mass destruction--with chemical, biological, and even nuclear potential. Also continuing is the threat posed by drug trafficking and terrorism.

Last year we presented to America and the Congress the first phases of a program of dramatic reductions in our defense budget to begin implementing this new strategy. The budget I am presenting to you today continues to chart a path to virtually the smallest U.S. force level since World War II. I am comfortable with the capabilities that these forces will possess and believe that they will provide needed forward presence and be prudently matched to the threat we have been projecting. However, these forces represent the irreducible minimum to which our forces should be reduced; cutting below these levels would not leave us with needed capabilities, even under quite positive future trends.

Recent times have made us all keenly aware of how unpredictable the world can be. Should the security environment look less promising than we are now projecting, we may need to reassess our current plans for reductions through the mid-1990s. Therefore, as I have formulated this road map for reductions, I have noted those points where we may need to slow the projected decline in our force levels.

As an additional hedge, we also are building into our forces enhanced capabilities to reconstitute, if necessary. There may someday be more distant threats--for example, the reemergence of a global threat of the type that the Soviets posed to us during the height of the Cold War--that cannot be met at the lower force levels we currently envision. Such reconstitution may never be needed, but given recent events, some hedging against this risk is prudent.

KEEPING AN EYE ON RECENT TRENDS

When I testified before this committee a year ago I noted three key conditions that allowed us to reduce and reshape U.S. forces. These conditions were:

• A continuation of the positive developments in Eastern Europe and the USSR;

• Completion of satisfactory Strategic Arms Reduction Talks (START) and Conventional Armed Forces in Europe (CFE) agreements; and

• No unforeseen, extended commitments for U.S. forces.

There have been some promising developments since last year. Democratic regimes have been elected in most of Eastern Europe, and Soviet actions have contributed in several ways to a more secure international environment. Moscow deserves great credit

for agreeing to German unification in NATO. The Soviet Union has agreed to withdraw its troops from Czechoslovakia, Hungary, and Germany, and unilaterally reduced general purpose forces at home. The Soviets have joined with the overwhelming majority of the international community in supporting 12 UN Security Council resolutions condemning Iraq's wanton aggression in the Persian Gulf.

Nevertheless, these conditions today look somewhat different from a year ago. We have a war in the Gulf; there are problems on the horizon for both CFE and START; and there are some troubling events in the Soviet Union.

In October 1990 I visited the Soviet Union. It happened to be at the very time the Soviet central government rejected the most serious economic reform program proposed to date. The Soviet government has since taken other steps away from economic reform.

Political reform has also suffered a number of blows, including military pressure on the freely elected governments in the Baltic states, a broad campaign attacking press freedoms, and a decree establishing joint MVD-Army patrols. There is now

a widespread consensus among Soviet observers that the influence of the military, the security services, and the Communist party bureaucracy is increasing. So long as the Soviets pursue this path, they will face further economic decline and continued political unrest.

As Secretary Baker noted yesterday, the potential for longterm cooperation between our countries depends ultimately on the course of the Soviet Union's domestic reform. Experience shows that ultimately U.S.-Soviet relations are driven by how the Soviet Union governs itself. Let me be clear, the failure of reform would not necessarily mean a return to the worst days of the Cold War, but it would prevent movement to thorough-going, across-the-board cooperation with the Soviet Union.

What does this mean for our long-term defense needs?

First, let me reiterate that the President has said many times that we want the process of reform in the Soviet Union to succeed. We still hope that it will be successful, and we believe the central government may still be able to take steps to return to the path of reform.

Absent a return to the course of reform, the Soviet military will not be able to extricate itself completely from the broader economic illness that grips the country. As a consequence, some of its capabilities will be degraded. At the same time, the military will continue to play an important role; and some elements of Soviet power, such as Soviet strategic force modernization, is likely to continue unabated. We have serious