The differences between the Picard as shown in the rest of the season and how he reacts in this episode shows the extent to which the Federation has changed its tactics. The Enterprise is referred to not as a vessel of exploration but as a battleship, and that instead of housing families, it holds troops only. The very idea of placing families aboard a warship seems ridiculous to Picard. In fact, when facing ultimate destruction at the hands of the Klingon vessels and offered a chance to surrender, Picard quips, "That'll be the day."Captain Picard to Captain Captain Garrett wrote:"The war is going very badly for the Federation, far worse than is generally known. Starfleet Command believes that defeat is inevitable. Within six months, we may have no choice but to surrender."
"Are you saying all this may be a result of our arrival here?"
"One more ship will make no difference in the here and now, but twenty-two years ago, one ship could have stopped this war before it started."
The war has obviously affected everyone in Starfleet. Research is on the back burner as the Federation fights for its very life against the Empire, with vessels regardless of age being pressed into service. No doubt many ships, including obsolete Constitution class vessels, were being pushed into service as fast as possible. Forty billion lives were reported lost, no doubt by invading Klingon forces and a few orbital bombardments. Whether that number is merely Federation casualties or a combined estimate, it's still a significant loss.
The ultimate point of this discussion is to discuss the war's beginning, tactics used by both sides, the reason for perpetuating the war, and the ultimate conclusion of the war. The assumption for the war's conclusion is that the Federation, out of desperation, proposes a surrender to the Klingon Empire. What would the Klingon terms for surrender be, if they don't use the standard 'surrender without terms'? Would the Federation become a puppet state or have all its worlds find Klingon military governors installed to 'maintain order'? What would become of Starfleet and its ships?