A reaction to perceived Western aggression by the creation of NATO, the Warsaw Pact was a Russian-dominated military alliance that included all of the states of Eastern Europe except Yugoslavia. It integrated both tactics and equipment throughout the alliance along Soviet models. Albania withdrew from the Pact in 1968.
Time: Early War
Removed after event: Yes
Being able to remove all US influence in Eastern Europe is vastly superior to adding 5 influence. It is essentially Truman Doctrine at any time (regardless of control) and in four (Eastern European) countries at once.
Accordingly, I always play Warsaw Pact Formed for Ops in the Early War / Mid War so that I can keep it in the deck. Its mere presence in the draw deck is a threat to the US, in much the same way that Truman Doctrine deters the USSR from engaging in European Ops wars. Warsaw Pact is your best (and sometimes only) defense against the Late War US onslaught of Chernobyl, Tear Down This Wall, East European Unrest, John Paul II Elected Pope, and Solidarity.
Once you get to Turn 7 and draw Warsaw Pact, it is then a common USSR hold card in case of European emergency. Since any card played or discarded on Turn 7 or later is likely not going to return to the game, you must try to keep it in the game for as long as possible. As long the US player is convinced that the Warsaw Pact may yet be formed, he will be very hesitant about investing into Europe, thereby nullifying one of the great US advantages in the game.
In the unfortunate event that the US triggers Warsaw Pact Formed in the Early War or Mid War and there is no meaningful US influence to remove, I ordinarily bump East Germany and Poland by 2 each and stick the other influence in Yugoslavia or Czechoslovakia. (Yugoslavia because I usually start with 1 there, and Czechoslovakia because it could theoretically provide a -1 against a Tear Down This Wall realignment of East Germany or Poland.)
If you draw this in the Early War / Mid War, count your blessings. As US, Warsaw Pact Formed is actually a better draw than most US events (like, say Five Year Plan). Being able to get rid of a critical USSR Late War card is a huge bonus, and by playing it when you have no influence to be removed, you can save yourself a lot of worry and headaches in the Late War.
As an added bonus, an early play of Warsaw Pact Formed means the USSR can no longer dump NATO or Independent Reds with impunity.