Why did the U.S. government take the unusual step of subsidizing the “restructuring costs” of the largest defense firms’ mergers and acquisitions during the 1990s, when federal military spending was in decline more broadly? While there have been various explanations offered by academics and federal officials, many ignore or discount how the military-industrial complex (MIC) shapes official policy in the context of elite politics. This thesis identifies an explanation for federal subsidization of defense market consolidation by reviewing existing literature and analyzing arguments disseminated within the MIC. I look at the feasibility of economic preservation and national defense reliability as rationales by considering them in the historical context of the MIC and the work of other researchers. Based on this analysis, I conclude that a preexisting system of institutional relationships between defense firms and the state, especially between the leadership of the Pentagon and defense industry executives, combined with shifting American transatlantic foreign policy goals demonstrates the strength of the MIC in influencing official policy during the 1990s and its continuity following the collapse of the Soviet Union.