FIRST LOOK – A new report out today by the Center for Strategic and Budgetary Assessments explores three ways DOD can meet spending restrictions imposed by the Budget Control Act, saying the recommended cuts “can reduce costs without reducing military capabilities, although they may require politically difficult decisions.”

THE REPORT BY TODD HARRISON AND EVAN BRADEN MONTGOMERY touches the third rail of the budget debate – military pay and benefits – recommending that “rather than focusing exclusively on how to reduce costs, DOD should instead focus on how to get better value from its compensation and benefits programs. … Preference-based benefits optimization could be applied across the full range of compensation and benefits, to include special pays, bonuses, healthcare, retirement, and in-kind benefits such as commissaries, on-base facilities, and K-12 schools. Where misalignments are identified between DOD’s offerings and the value perceptions of service members, DOD can maintain or even increase perceived value while reducing costs.”

SAVINGS WOULD ALSO COME from increased use of unmanned systems where technology and missions allow, and relying more on cooperation with allies. You can see the report here: http://bit.ly/oNRCpm

MILITARY PAY AND BENEFITS ARE ON THE TABLE – sort of – and political opposition to any changes will be fierce. Not only have Panetta and Dempsey ruled out any changes that affect existing service members, but lobbies which look out for troops and veterans have already lined up to oppose them.

Charles Hoskinson Go to POLITICO Morning Defense Now >> http://www.politico.com/morningdefense