“Last year’s National Defense Strategy concluded that although U.S. predominance in conventional warfare is not unchallenged, it is sustainable for the medium term given current trends. This year’s budget deliberations focused on what programs are necessary to deter aggression, project power when necessary, and protect our interests and allies around the globe," Robert Gates said.

The one underlying word that was heard throughout the hearing was reform. Gates said the budget would profoundly reform the way the Pentagon buys weapons and does business in general.

Gates spoke of increasing funding in certain areas, such as army and marines personnel.

Robert Gates (AFP Photo / Chip Somodevilla / Getty Images)

But the world financial crisis, of course, affected the budget and resulted in deep cuts to some big weapons programs.

He plans to halt programs like a new helicopter for the president, and the production of the $140 billion F-22 fighter jet. The Army's modernization program would also be scaled back, while a new satellite system, and a search-and-rescue helicopter would be cut.

But Gates’ plans may be opposed by the Congress, as defense contractors are already warning that if certain programs are cut, job layoffs will be inevitable.

Another subject on the agenda was missile defense, as uncertainty about the U.S. anti-missile shield in Europe remains.

“In the area of missile defense, we will restructure the program to focus on rogue states and missile threats. We will not increase the number of current ground-based interceptors in Alaska, as had been planned, but we will continue to robustly fund continued research and development to improve the capability we already have to defend against long-range rogue missile threats, a threat North Korea's missile launch this past weekend reminds us is real,” Robert Gates said.

Gates said the Missile Defense program would be reduced by $1.4 billion, from about $9 billion.

A group of senators has already sent a letter to president Barack Obama opposing the proposed cuts in missile defense spending. They are citing the incident with North Korea, saying that if you cut spending here, it would make the US more vulnerable to these kinds of threats.

In light of this, implementing the reform may become a real challenge for Gates and Obama.