A legislative history of financial incentives in the Reserve Officer Training Corps gives perspective to an analysis of present law and policy concerning breach of contract for Air Force ROTC cadets. The changed environment, criticisms of the present law and policy, and the example of three other Western nations with all volunteer militaries are given to support a need for change. Recoupment of educational subsidies is recommended as the suitable penalty for breach of contract. The legal status of recoupment under present law and contracts is summarized. (Author)