This paper reviews the initiatives of the Reagan Administration to control cost overruns during the last 2 and a half years and the actions taken by the Congress to strengthen its oversight role. Particular attention is directed at the critical need to enhance management incentive and accountability at all level of the acquisition process. If recently instituted reform in the Department of Defense fail to control cost overruns, pressure may grow for a more sweeping and radical approach. Serious consideration in such an event might even be given to removing responsibility for weapons acquisition management for the military service and assigning it to a civilian-operated supply agency.
This report discusses the Iran-Iraq conflict at its present state, which has become a war of attrition with neither side capable of achieving a decisive military victory over the other in the short term. U.S. policy concerns currently are threefold: first, that Iraq, despite moves to sustain its economic and military capacities, ultimately might suffer a destabilizing defeat to the detriment of U.S. interests in the Persian Gulf region; second, that future instability in Iran could open opportunities for Soviet exploitation; and third, that the conflict might expand beyond its present confines to threaten friendly regional states and the availability of their vast petroleum resources.
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