The National Security Act of 1947 is signed into law, thus creating the CIA, the Air Force, the National Security Council, and the Joint Chiefs. The Department of Defense will be created two years later in an amendment to this Act.
The Act merged the Department of War and the Department of the Navy into the National Military Establishment, headed by the Secretary of Defense. It was also responsible for the creation of a Department of the Air Force separate from the existing Army Air Forces. Initially, each of the three service secretaries maintained quasi-cabinet status, but the act was amended on August 10, 1949, to assure their subordination to the Secretary of Defense. At the same time, the NME was renamed as the Department of Defense. The purpose was to unify the Army, Navy, and what was soon to become the Air Force into a federated structure.
Aside from the military reorganization, the act established the National Security Council, a central place of coordination for national security policy in the executive branch, and the Central Intelligence Agency, the U.S.'s first peacetime intelligence agency. The function of the council was to advise the president on domestic, foreign, and military policies so that they may cooperate more tightly and efficiently. Departments in the government were encouraged to voice their opinions to the council in order to make a more sound decision