During the campaign, Barack Obama promised to "enact a program of market incentives and sanctions for Pentagon contractors, just like any other good business client would use, to reward companies that perform well and come in under budget, while punishing firms that fail to perform as originally hired."

In May 2009, Obama signed the Weapons Systems Acquisition Reform Act, which issues general directives to the secretary of defense to "ensure competition throughout the life cycle of major defense acquisition programs." The bill does not specifically enact a program, but instead tells the secretary of defense to figure out a way to make the system more competitive.

More recently, in October 2009, the Office of Management and Budget issued a memo titled "Increasing Competition and Structuring Contracts for the Best Results." In the memo are specific guidelines on how to create incentives so defense companies finish their contracts on time without going over budget. No new program is mentioned, however.

It is too early to tell whether these two actions will lead to increased competition in defense contracting, and nothing as formal as a program has been established, but clearly the administration is placing emphasis on the idea. We'll keep an eye on it, but for now we're rating it In the Works.