December 18, 1984

The President has made his decision regarding the defense budget. The decision is based on his determination that all agencies and departments, including the Department of Defense, will be involved in the plan to reduce the deficit. Consistent with this directive, the budget originally submitted by Secretary Weinberger for fiscal year 1986 will be reduced by 11 [11.1] billion in budget authority and by 8.7 billion in outlays. These reductions will bring the President's fiscal year '86 request for defense to levels below the amounts previously approved in October in the congressional budget resolution for both budget authority and outlays.

These outlay reductions are larger than those originally recommended by the Office of Management and Budget and the budget core group. They are, therefore, consistent with the President's objective of achieving a freeze on total government spending for fiscal year '86. The President also emphasized his continued commitment to a strong national defense at adequate spending levels.

The President is also committed to a deficit reduction plan with the objective of shrinking the deficit at a percentage of gross national product from 4 percent in fiscal year '86 to 3 percent in fiscal '87 and 2 percent in fiscal '88.

Note: Larry M. Speakes read the statement to reporters assembled in the Briefing Room at the White House for his daily press briefing, which began at 9:32 a.m.