From the Mirror Files :

RAND and The City: Part Two 

In the Beginning 

   America was still celebrating the end of World War II, when aeronautical engineers Arthur E. Raymond and Franklin R. Collbohm suggested to Air Force Commanding General H.H. "Hap" Arnold that the Air Force underwrite long-term weapons research to keep the U.S. a step ahead of its once and future enemies.
   Arnold approved the proposal, authorized an initial expenditure of $10 million and asked Donald Douglas to house Project RAND (Research and Development) at Douglas Aircraft in Santa Monica.    Two years later, RAND moved into a onetime printing plant in downtown Santa Monica with the approval of Arnold.
   Its original contract with the Air Force called for "study and research on the broad subject of intercontinental warfare, other than surface, with the objective of recommending to the Air Force preferred techniques and instrumentalities for this purpose." But RAND soon extended its reach - to nuclear strategies, Cold War scenarios, international security and ultimately, to a wide range of domestic issues.
   For more than forty years, these quintessential cold warriors devised weapons and strategies for deploying them. They were ready for any eventuality - except the collapse of the Soviet Union and the simultaneous meltdown of their primary reason for being. Michael Rich, executive vice president of RAND, said, "In no way can you say that any piece of work predicted what would happen in 1989."
   The abrupt end of the Cold War in 1989 devastated the Southern California defense industry and sent the region into a deep recession. Almost immediately, RAND proposed a massive commercial development on its Main Street acreage, positing that the end of the Cold War would trigger a severe financial decline and therefore it had to find new sources of revenue.

RAND Wrong About Its Prospects 
   As it turned out, RAND was no better at predicting its own future than it had been at predicting the end of the Cold War. As a spokesman said in the mid-1990s, "We've never had a period of such sustained success."
   At the end of the Cold War, RAND's annual income was $85 million. In the next three years, it topped $100 million and in 1995 it hit an all-time high of $110 million and was still rising. As one former RAND man said, "These boys've always been nimble." As if to prove its flexibility, soon after the collapse of the so-called evil empire, RAND signed an agreement with its longtime nemesis, the Russian government, to do analysis and research on population, migration, health insurance, school reform and worker training.
   But RAND's primary employer has always been the federal government. Though both federal spending and defense contracts were in decline, 83% of its income still derived from federal contracts and two-thirds from defense contracts and, for the first time, it was also working for foreign governments and businesses. In addition to its deal with Russia, RAND undertook studies for the Dutch, and its Center for Asia-Pacific Studies was jointly financed by major American and Japanese corporations.

RAND Spreads Itself Out 
   Though nearly two-thirds of RAND's income continued to come from the Defense Department, it also had contracts with the Departments of Energy, Health and Human Services, Justice and Labor, as well as the Agency for International Development, Environmental Protection Agency, NASA, the National Science Foundation and the Administrative Office of the U.S. Courts. In addition to reshaping their agenda and expanding their client lists, The old cold warriors also seemed to be attempting to plug themselves into the hot tickets of the '90s, as when Michael Rich wondered, "Is drug policy a domestic or a security issue?" 

Systems Analysis Praised, Panned 
   In a book published and privately distributed in 1973 to commemorate its first 25 years, then-RAND president Donald Rice and Chair J. Paul Austin wrote, "RAND has no stock or stockholders, no laboratories, no development or production facilities, no sales force, no product or services to sell in commercial markets. Our work is supported entirely by government agencies and private institutions concerned with public problems... (and) our sponsors must have vision and patience... RAND exists because it does one thing well. Not invariably well, because it is the nature of research to run the risk of being wrong...Much of the work of the past quarter-century was successful, some singularly so, because it clarified policy issues, changed the attitudes and perspectives of public leaders and influenced events in important ways. Or because it resulted in new ways of dealing analytically with them..."
   Sam Cohen, a physicist, longtime RAND hand and inventor of the neutron bomb, recently said, "Those first years were golden years...We had some very sweet ideas." In addition to Cohen's bomb, RAND scientists developed weather and reconnaissance satellites and the ICBM. "My ilk," he said, "was basically technical and we dealt in what I regard as truth." But, soon, the technicians were outnumbered by systems analysts, according to Cohen. They dealt, he said, in "ideologically based fantasy...(systems analysis) is grossly intellectually dishonest. Garbage in, garbage out...That was the beginning of the end of RAND's veracity and usefulness."

RAND Cranks Up the Volume 
   In August, 1953, after the Soviets tested a hydrogen bomb that was far larger than its analyses had anticipated, RAND recommended that America match or surpass the Soviets -- weapon for weapon -- in order to achieve what Albert Wohlstetter called "a delicate balance of terror" and went on to develop an entire litany of strategic concepts, such as "ready alert," "airborne alert," "second strike capability," "fail-safe" and "limited war."
   Cohen said of his former colleagues, "They believed, I think honestly at the beginning and fraudulently at the end, that they could create a better world and have control over the process of re-creating the world through their science and their mathematics because it all sounded so damn rational and so damn reasonable as to be unassailable."
   RAND's trademark systems analysis became the model as technocrats replaced politicians and its methodology replaced knowledge, experience and beliefs. The new age of reason was as cold as the Cold War it spawned and conducted for 40 years.    In this way, as James A. Smith said, politics was reduced to a quantitative science.

To Be Continued