General George C. Marshall, appointed U.S. Army chief of staff in 1939, noted Smith's abilities and in October 1939 summoned him to Washington to assist in swiftly building up the military from its existing weakness to full wartime strength and capability. In September 1942 Smith was assigned to Dwight D. Eisenhower, commander of the European theater of war, as chief of staff, where he remained until the end of 1945, winning a stellar reputation as one of the finest army chiefs of staff.
Smith returned to Washington in January 1946 as chief of the Operations and Planning Division of the Joint Chiefs of Staff (JCS), but two months later President Harry S. Truman appointed him ambassador to the Soviet Union, where he remained until 1949. Smith's experiences in this post, as the Cold War steadily and rapidly intensified, convinced him that the United States must take a firm line to contain Soviet expansion but also that the Soviets did not deliberately seek war and would back down when confronted by American strength.
In late June 1950 Truman named Smith, then commanding the First Army, director of the CIA. He was advanced to full general in July 1951. The president hoped that Smith would improve leadership and organization within the agency, then attracting heavy criticism for its failure to predict the Democratic People's Republic of Korea (DPRK, North Korea) invasion of the Republic of Korea (ROK, South Korea). Smith's reputation as an outstanding bureaucrat and a staunch anticommunist helped to deflect further criticism from the CIA, which he centralized and coordinated, persuading Douglas MacArthur not only to allow the agency to operate in Korea but to utilize its intelligence. Under Smith, the CIA nonetheless wrongly predicted that China would not intervene in the Korean conflict and also failed to anticipate assorted coups in Latin America. Smith tightened the flow of intelligence, restricting the overall picture to a few high-ranking officers, and instituted a training program to develop a group of career intelligence officers.
As undersecretary of state during 1953–1954 in the Eisenhower administration, Smith provided a degree of continuity. After his retirement in 1954 an embittered Smith, who never received either the fifth star or appointment as chief of staff of the army that he believed he deserved, turned to business, amassing an estate valued at almost $2.5 million. In 1958 John Foster Dulles appointed Smith, a staunch and vocal supporter of nuclear expansion, as his special advisor on disarmament. Smith died in Washington, D.C., on 9 August 1961.
Mayers, David. The Ambassadors and America's Soviet Policy. New York: Oxford University Press, 1995.; Montague, Ludwell Lee. General Walter Bedell Smith As Director of Central Intelligence, October 1950–February 1953. University Park: Pennsylvania State University Press, 1992.; Smith, Walter Bedell. My Three Years in Moscow. Philadelphia: Lippincott, 1949.