How is this sensible?

Currently, it is turmpeted that the US is going to reduce its miliary budget for 2012.
If it is true, I find it difficult to reconcile such fine good news with this:
FY 2012 Defense Department Base Budget:



For FY 2012, the President requested $553 billion for the Department of Defense Base Budget. This was only $4 billion more than the $548.9 billion requested in FY 2011, and $20 billion more than the $533.7 billion requested in FY 2010.