sequence, we have proposed a budget which is based on that continuation of the drawdown of our Armed Forces.

But further than that, it is based upon the realization of what has happened in our discussions on strategic weapons. And it is based upon the fact that we are no longer chasing the Soviet Union for new technology and new technology weapons. Hence, we will continue at a much slower pace.

I might stop at this point and ask Sean O'Keefe if he would give a few charts on some of the details of the budget itself.

Mr. O'KEEFE. Thank you, Mr. Secretary. Over the course of the last several years, obviously, there have been many many modifications of the President's program. This chart is referred to lovingly by the Secretary as the pitchfork chart, in an attempt to define, I think, where we began in April 1989, as the first modification of the Bush administration's program. Looking at a 1.2-percent real increase per year over the span of the 5-year plan, subsequently modified a year later after the Berlin Wall came down to a negative 2 percent each year, which was the first time historically, that the administration had forecast an ever-declining defense budget profile throughout the Future Year Defense Program.

The third line down is the summit agreement. The yellow line that is represented there was the assumption after the summit agreement was forged in October 1990. The annual real decrease from that point forward beyond the average of 3 percent per year. And then the bottom line is the latest reduction and adjustment the President has proposed and appended to this February's particular submission.

Overall, over the span of time, we are looking at a real decrease from the high watermark of the Reagan years through the span of about 37 percent in real terms.

Represented another way, as a share of Federal outlays, total spending throughout the Federal Government, during the peak years of the Vietnam war we were looking at about 43 percent of Federal spending. Today we are looking at about 18 percent, which is where we were projecting to conclude this particular program, a year ago. At this point, now, we are looking at it as a factor for fiscal year 1993. By the time the future year defense program is complete, we are looking at about a 16.3-percent assumption of the overall Federal spending program, year to year.

As a share of gross national product, again during the Vietnam period, it peaked out at about 9.1 percent. Even during the Reagan buildup, it never exceeded more than about 6.3, which was the largest peacetime increase at that time. But we are now declining to historically low levels that approximate that of about 1939, before World War II, of 3.4 percent of GNP.

NATIONAL DEFENSE & PAYMENTS TO INDIVIDUALS
(as a Percent of Total Federal Spending)

An interesting parallel that has occurred over the same span of time in which the overall Federal spending profiles have changed,

as well as adjustments in the dedication of the overall Federal budget toward defense, is in the mid-1950's we were looking at about 60 percent of overall Federal spending toward defense costs. And the balance of about 16 percent that was not tied up in other specific domestic discretionary, was for entitlements or payments to individuals, specifically Social Security and Medicare.

Those percentages have now reversed completely. We are looking at about 16 percent for defense and 61 percent that is entitlement or mandatory spending or payment to individuals.

DOMESTIC DISCRETIONARY, DEFENSE AND MANDATORY OUTLAYS
Cumulative Real Changes FY 1985 - FY 1997

As an examination of change that has occurred, again since the peak years of the Reagan buildup and as a byproduct of what was negotiated as part of the summit agreement in October 1990, just as a relative context, the overall increases that have occurred since that time. Mandatory spending is up in real terms by 33 percent. Domestic discretionary income has increased over the span by a real term increase of 8 percent.

And yet defense has dropped in terms of outlays, comparable expenditures, by 26 percent. Budget authority has been reduced at a much faster pace than that, and the balance of that difference of 11 percent will be subsumed, of course, throughout the balance of the Future Year Defense Program.

Represented in terms of the raw numbers themselves, the overall budget resolution totals for 050 that will be debated now, between now and March 20. Representative will be $280.9 billion as the overall request. The 051 piece, or the Defense Department's portion when you recuse the Department of Energy and the other national security-related elements throughout all the domestic appropriations bills, totals $267.6 billion, of which this Defense Subcommittee has jurisdiction over $257.4 billion.

Of that amount, the balance, of course, is military construction and family housing outlays in this span, projected to remain roughly constant at about $272 billion over this course. All of these numbers, of course, exclude the consequences of Desert Shield.