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Secretary LAIRD. Thank you, Mr. Chairman, Senator Smith, for your comments.

Members of the committee, I am very happy to have the opportunity along with the Chairman of the Joint Chiefs of Staff, to present to you my annual defense report and the chairman's statement on military posture for fiscal year 1973. I appreciate your comments. I do want to express to this committee my appreciation for your helpful criticisms, your suggestions, and the cooperation which I have had as Secretary of Defense from all of you on this committee and from the Congress generally, during the past 3 years. When I appeared here for confirmation hearings, I indicated at that time that I thought 4 years was long enough for any person to serve as Secretary of Defense. During these 3 years, the wisdom of that statement I made appeared here in confirmation hearings, I think, has been borne out. Although I appreciate your encouragement, I still feel that the position I took when I was confirmed for this job is the position that I will stay with. But I do appreciate your encouragement.



This 1972 Defense Report is about peace: and how to maintain it.

how to achieve it

It will focus on what the Department of Defense has been doing and what more we plan to do to ensure the continued safety and security of our nation.

Our objective an objective set for us by the President is a generation of peace and a better quality of life for all Americans, The Nixon Administration has devoted three years of constant effort to moving us toward that objective while maintaining our nation's strength. These have been years of transition:

From war to peace.

From a wartime economy to a peacetime economy.

From a federal budget dominated by defense
expenditures to one dominated by human resource

From an era of confrontation to an era of

From arms competition toward arms limitation.

The business of peace is a serious and complex one. It cannot be described in simple terms. It cannot be achieved and maintained through simple solutions.

Obviously, we have not fully reached many of the goals we set for ourselves. But we have made substantial progress. This Defense Report is an accounting to the American people of that progress, of shortcomings and of the challenges and changes ahead.

It is with the hope of securing deeper understanding and broader support of our plan for peace that I submit this Defense Report. It traces the orderly progression of President Nixon's program in terms that I believe all Americans can understand.

For our focus is on the future: on a future which recognizes mistakes of the past; a future in which each man hopefully can live at peace with his neighbor and each nation can settle its disputes without resort to war.

My first Defense Report was a transition document. My second Defense Report, as its title made clear, described a Defense program designed to move us toward a Strategy of Realistic Deterrence.

This 1972 Report takes us another major step forward. It completes the transition to a fully-developed National Security Strategy of Realistic Deterrence that complements and supports the President's Strategy for Peace.

A new era in U.S. national security policy began on January 20, 1969, with President Nixon's Inaugural Address. He declared that his highest priority goals were to establish an effective Strategy for Peace and to improve the quality of life.

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Following his Inaugural Address, the President enunciated the Nixon Doctrine at Guam in July 1969. Its elements, and their relation to his Strategy for Peace and the National Security Strategy of Realistic Deterrence, are depicted on the inside cover of this Report.

Coupled with positive diplomatic initiatives, the Doctrine both seeks and permits a more creative relationship with our adversaries. The Doctrine is derived from the strength and partnership pillars of the Strategy for Peace; those pillars in turn provide the essential foundation for the third pillar a willingness to negotiate.

From the Nixon Doctrine and the Strategy for Peace, we in the Department of Defense developed and the Commander in Chief approved the National Security Strategy of Realistic Deterrence. The basic purpose of this implementing strategy is to provide, through strength and partnership, for the security of the United States and its Free World allies and friends. Its aim is to discourage and eventually to eliminate the use of military force as a means by which one nation seeks to impose its will upon another. It seeks to deter war, but insures adequate capabilities to protect our nation and its interests should deterrence fail.

Long before his Inauguration, the President and I had discussed in detail the priority objectives and goals he had set for his Administration. That was a major reason for my statement, when I

took office, that I expected to be judged as Secretary of Defense on whether I was able to contribute meaningfully to the restoration and maintenance of peace. I stand by those words.

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Based on my service in Congress, I felt that we would get nowhere in the pursuit of peace and national security if we were not willing to face the realities of the domestic and international world. This Report emphasizes, as I have many times before, those Strategic, Political, Fiscal and Manpower realities. Against the background of those realities, we initiated major policy changes changes which are most graphically demonstrated by the results achieved by our changed approach to Vietnam.

When this Administration took office:

Authorized military strength in Vietnam was

There was no accepted plan to bring American
troops home.

There was no plan to terminate U.S. involvement
in the war unless there was success at the Paris
negotiating table.

Both the President and I had long felt that a new, realistic course was essential; a course which would permit us to shift the responsibility for defending their homeland to the people most directly involved the South Vietnamese themselves. That new course was Vietnamization: a complement to and alternative for negotiation.

This Defense Report demonstrates how successful Vietnamization has been. On May 1 of this year authorized troop strength will be 69,000 a reduction of 480,500, or 87% from the situation we inherited in 1969. American combat deaths are down 95% from their 1968 peak. Our war expenditures are down by about two-thirds. American air activity in Southeast Asia has been reduced by well over 50%.

Manifestly, U.S. involvement in the war is coming to an end.

We are now planning for the period beyond Vietnam, and devoting even greater attention to America's long range security needs adequate peacetime Nixon Doctrine forces, and the urgent need to assure technological superiority.

But, Vietnamization continues, and it will not be complete so long as the enemy.prefuses to return all Americans now held in captivity and there is an accounting for all missing-in-action. We will not abandon our prisoners of war, our missing, or their families. And until our men are free, we will continue to demand that they be treated in accordance with the humanitarian provisions of he Gen Convention.

Nor should there be any doubt about our determination to take whatever steps are necessary to protect our diminishing forces as we continue to withdraw from Vietnam. If the enemy's response to President Nixon's comprehensive offers of peace should be a continued buildup which threatens the safety of our men or further offensive actions we are prepared to respond with American airpower as appropriate.

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In his State of the Union message last month, the President said:

"Strong military defenses are not the enemy of peace.

They are the Guardian of peace."

Mindful of the President's determination to maintain whatever military strength is needed, the Department of Defense makes this pledge:

We are determined to provide adequate United States
military forces so that we can, with our friends and
allies, deter war.

In my last Defense Report, I established planning goals for the Nixon Doctrine peacetime defense forces under the Strategy of Realistic Deterrence. These planning goals called for:

No more than 2.5 million volunteers in the active
military forces, backed by a strengthened National
Guard and Reserve;

An allocation of no more than 7% of the Gross National

The actual results achieved for the FY 1973 Defense Budget include:

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