ABSTRACT
The end of the Cold War has seen national defense budgets plummet, and resulted in a reduced demand for defense products, demobilization of millions of soldiers and the generation of thousands of pieces of surplus military hardware. A comprehensive econometric analysis by economists at the World Bank and International Monetary Fund has found that military expenditure is economically unproductive. The 1997 Quadrennial Defense Review was completed under the guidance of Secretary of Defense William S. Cohen. In a seminal speech at the United Nations on December 7, 1988, Mikhail Gorbachev announced that the Soviet Union was going to make unilateral reductions in its armed forces. The White Paper calls for implementing a military strategy of active defense that seeks to ‘gain mastery only after the enemy has struck. The reunification of West and East Germany has resulted in a significant draw down of the military establishment in the new state.
