50 Years of Federal Times

The End of the Cold War: Military reshaped, redefined

Steve Watkins, president of Watkins Communications and former editor of Federal Times, reflects on how the end of the impasse between the U.S. and Soviet Union led to Pentagon downsizing that reshaped the military in ways that still reverberate.

This is part of a larger Federal Times 50-year anniversary project, showcasing the historic events from the last five decades that most shaped how government operates. Go to our special report to see more of our coverage as it rolls out in December and the first part of 2016.

The fall of the Berlin Wall was more than the crumbling of divided Germany; it was the destruction of the most visible symbol of the Cold War and the fall of the Soviet Union. In the U.S., it ushered in a new era of how the entire military and defense and intelligence communities operated.

The Cold War may not have been a direct war between powers in the same sense as the two World Wars, but its end brought a familiar retrenchment in defense spending and military structure. The early 1990s saw cuts to the Pentagon budget and launched the closures of hundreds of military facilities under the Base Realignment and Closure Act.

The Cold War's end also heralded a sea change in geopolitics, military strategy and intelligence operations. It was, by many accounts, the end of an age where enemies were singular, well-defined and limited to a particular region. When the wall came down, the world opened up – for many it meant freedom, but for others, it was Pandora's Box.

"We're still dealing with the end of the Cold War. Most of us at a leadership level were hired at a time when it was us versus them, U.S. versus Soviet Union, our proxies versus their proxies," said Keith Masback, who was the Army duty officer in Berlin the night the wall fell, now CEO of the U.S. Geospatial Intelligence Foundation. "When the Cold War was over and we had the Balkanization of the Balkans, removing Yugoslavia, the world began to change in a way that just became much more complicated. That forced a new way of thinking in every aspect. People, process and technology – all of that had to change in the intelligence community as the result of the end of the Cold War."

It all changed in the defense industrial base too, with a hallmark of that shift being the so-called "last supper" in July 1993 when then-Deputy Defense Secretary William Perry advised industry leaders to start tightening their belts. That night's impact is still felt today, as it brought on industrial mergers that significantly affected competition in Defense Department acquisition.

"My messaging was pretty simple: We will not pay the increased overhead for your overcapacity, you have to get rid of it. And that was sort of a fair warning, because we did not plan to pay for unused capacity. We figured we'd give them advanced notice for that because it takes time to reduce capacity if you want to do it properly," Perry said in an interview with Federal Times. "The response to the Last Supper was partly that, but perhaps more dramatically the number of services decided to consolidate. Some consolidation was alright, and probably an inevitable consequence to reducing the size of the defense budget, but I think the consolidation part was overdone. And it had one deleterious consequence, which was in some programs it reduced the competition we needed."

The pendulum swung too far, Perry said, with lack of competition becoming a big, expensive problem; he pointed to programs like the F-35, where it's only becoming more costly as the defense marketplace narrows. DoD officials, now faced with new post-war budget cuts, are trying to fix that.

“What the last supper led to was thinking about what should be the desired structure of the industrial base,” said Jacques Gansler, who at the time was under secretary of defense for acquisition, technology and logistics. “Better Buying Power 3 tries to eliminate barriers to buying commercial, and that’s an acknowledgement by [current AT&L Under Secretary] Frank Kendall that there are barriers. And that’s one of the industrial structure questions we have to figure out.”

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