Testifying before the House Armed Services Committee, Panetta said deciding which military programs to cut or delay was "not an easy task" but that Pentagon leaders were united in their priorities.
"I believe that all of us -- the service chiefs, and the combatant commanders -- have developed a complete package here aligned to achieve our strategic aims and at the same time to meet our responsibilities to fiscal discipline," Panetta said.
Panetta also said the United States "faces a complex array of security challenges across the globe," including terrorism, nuclear proliferation, belligerence from Iran and North Korea, and turmoil in the Middle East.
Obama has proposed a 2013 defense budget of $614 billion, nearly $32 billion less than this year's.
The reduction reflects the end of the Iraq war, the approaching end of the Afghanistan war, and the need to reduce the U.S. budget deficit.