Was Soviet threat exaggerated during the Cold War?

A question from Yahoo! Answers:

Do you think the evil and threat of the Soviet Union, etc. was exaggerated during the Cold War?

Repeatedly and systematically.

The Cold War was a very peculiar symbiotic situation. The Soviets wanted their achievements blown out of proportion for propaganda purposes (to instill pride in their own people and to have something to show to the world), while the U.S. government and its defense contractors wanted those achievements blown out of proportion to justify throwing more and more taxpayer money at (guess whom?) the defense contractors. Truth was of no interest to anyone. Organizations that could shed some light on the situation, at least from the economic standpoint (the IMF and the World Bank), were deliberately kept out of the loop, as their opinions were of no interest to either the Soviets with their unfounded superiority complex or the U.S. government with its spending agenda.

In the resulting frenzy, money flowed like water. Anything that had “strategic defense” written on it got funded and then funded again, no matter the cost overruns. Take the B-1 bomber for example. At the inception of the program, it was estimated that a SUPERsonic bomber will cost $12 million. By the time B-1s were rolling off production lines, direct cost of building a SUBsonic bomber (somewhere along the way it was decided that supersonic speed was not required) was $85 million; if you count the cost of research and development, a B-1 cost about $100 million.

By the time the IMF and the World Bank established presence in the countries or former USSR, the degree of hyping the Soviet threat gradually became known. While the Soviet propaganda and the Western Sovietologists used to agree that Soviet GDP was about $8,000 per capita, the IMF and the World Bank independently arrived at much lower figures in the $1,500-$2,000 range for Russia with its substantial oil and gas exports, $700-$900 for the Ukraine, and $400-600 for Uzbekistan, the most populous of the former Soviet republics in Central Asia.

One mistake that Western military observers systematically made was assuming that the entire Soviet armed forced are equipped and trained as well as the units they saw deployed close to their borders (mostly the so-called Group of Soviet Troops in Germany, also known by its Russian acronym, GSVG). In reality, GSVG was an exception, since it always received the newest equipment, the most attention from equipment manufacturers, and the best personnel. Much of the rest of Soviet armed forces was plagued with pervasive problems, from language barrier (conscripts from Central Asia, whose share in the conscript pool was gradually increasing over time due to higher birth rates in Central Asia, often spoke poor Russian) to food shortages (by late 1980s, almost every sizable standalone unit had a pig farm attached to it and tended to by conscripts). Alas, as Mark Twain once said, “it is very difficult to get a man to understand something, especially if his income depends on not understanding it”…

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