Making a Killing: America's Private Army and the Business of War

These private companies are part of a huge surge in the outsourcing of war, which is extremely evident in Iraq, as well as Afghanistan, Colombia, Haiti, and numerous other countries. Private contractors are the second-largest con- tingent of the “Coalition of the Willing” with a ratio of about one armed con- tractor for every two American soldiers. This is up from a ratio of one to sixty during the first Gulf War. The Pentagon estimates the number of contractors at around 100,000—but this is only an estimate because after four years in Iraq the military is only now beginning a survey to find the size of its contractor force.

According to the Government Accountability Office, approximately 48,000 of these contractors are working in Iraq as private soldiers, about six times the number of British troops in the country. Their roles include everything from operators of US military aircraft to security guards to bodyguards for high-level officials to interrogators (such as the CACI employees involved in the Abu Ghraib torture scandal).

For political purposes it is in the interests of the US government to build a large army of private soldiers. Even though 770 contractors have been killed in Iraq and 7,761 have been injured, they are not included in the official US death toll. Perhaps even more have been killed but the Pentagon doesn’t track contractor deaths, citing military regulations as the reason for this lack of oversight. Figures have to be deduced from insurance claims filed through the Depart- ment of Labor. Plus, if contractors are used for missions that are not quite legal or want to be distanced from official policy, their actions are completely deniable as they are not employees of the US government. This is the case along the Afghanistan-Pakistan border, where American forces are not allowed to venture into Pakistani territory.

With the job being so risky, what would attract so many to private companies? Well, Blackwater has been known to pay its employees $365,000 per year, compared to the $36,000 an average US soldier makes. No wonder so many former military personnel are signing up with a private employer instead of re-enlisting.

Blackwater is able to pay its soldiers so much because they have received $505 million in contracts from the US government since 2000. Three hundred twenty million of this has been since June 2004 alone, when they received a no-bid contract to guard diplomats and staff in Iraq. With this amount of money the company has been able to build the largest base for a private military in the world, acquire a fleet of 20 aircrafts (including helicopter gunships, a Boeing 767, and even a zeppelin), develop its own armored vehicle called the Grizzly, and build up a force of 20,000 soldiers.

The scariest thing about Blackwater and other such companies is that they currently lie in a legal no-man’s land, under no authoritative jurisdiction from any US or international law, nor the Geneva Conventions. In fact, when L. Paul Bremer—whose personal bodyguards were a specialized Blackwater team—was placed in charge of the Coalition Provisional Authority (CPA), one of his first mandates was to make contractors immune from Iraqi law.

In October, Republican Sen. Lindsey Graham inserted a clause into the 2007 Defense Bill attempting to place contractors under the Uniform Code of Military Justice, the code of laws for the US military. Proponents of expanded controls on contractors initially saw this as a small victory. In response Peter Singer, an expert on private military companies at the Brookings Institution, said “contractors’ ‘get-out-of-jail-free’ cards may have been torn to shreds.”

However, Doug Brooks, president of the International Peace Operations Association, a lobbying group represent- ing military contractors, disagrees and insists that the clause would not cover all military firms. “It might be doable for Defense Department contractors, but it’s not a panacea,” Brooks says. “It’s a square peg in a round hole.” And he’s most likely right. As many of the contracts are not through the Defense Department—especially those of most companies in a “security” role, the ones most likely to engage in combat and therefore needing a means of accountability the most—military law would not apply. Blackwater’s operations, for instance, are conducted under a variety of agencies, including the Department of State and the CIA, among others.

"The lack of a legal framework for battlefield contracting has allowed certain rogue contractor employees to perpetrate heinous criminal acts without the threat of prosecution,” said Democratic Congressman David Price. One such incident occurred this past Christmas Eve when an off-duty Blackwater contractor shot and killed an Iraqi contractor. The Blackwater employee was quickly sent back to the US and fired, although there is no indication he will be extradited to Iraq to face trial. The history of armed contractors in Iraq is filled with similar stories.

Price has recently introduced legislation that he hopes will apply more generally anyone “employed under a contract (or subcontract at any tier) awarded by any department or agency of the United States Government, where the work under such contract is carried out in a region outside the United States in which the Armed Forces are conducting a contingency operation.” However, it is not clear that such legislation will pass a vote on the House floor.

Many Americans first heard of Blackwater back in March of 2004. Four Blackwater guards were ambushed as they were driving through Fallujah. After being shot and burned, two of their mutilated bodies were hung from a nearby bridge. This episode—captured on video and broadcast around the world—became the excuse for a three-week attack on Fallujah that April, and subsequently another operation that completely destroyed the city in November, killing around 5,000 Iraqi fighters, hundreds of civilians, and 95 US Marines.

The families of the four men killed in Fallujah have sued Blackwater for wrongful death by cutting corners on the mission, saying the company violated contract by sending out the private soldiers without the weapons and manpower they were promised. In response, Blackwater has countersued for $10 million, targeting the family’s lawyer, Richard Nordan. They argue that by suing for wrongful death, the family is in turn breaching the dead soldiers’ contracts.

The most interesting fact about the families’ lawsuit, however, is that Blackwater has been unable to get the lawsuit dismissed or stayed. They have been arguing that their work is an extension of the military and therefore is not subject to the jurisdiction of civilian courts. As their strategy seems to be failing, Blackwater has asked a federal court to move the case to arbitration. It is necessary “in order to safeguard both [Blackwater’s] own confidential information,” their attorneys say, “as well as sensitive information implicating the interest of the United States at war.”

This is very dangerous for Blackwater and other companies providing similar services, as this case could become a precedent, making every death of an employee a potential lawsuit. As of fall 2006, Blackwater had nine pending lawsuits from dead employees’ families. But it seems that the most damaging part of the case to Blackwater—and what they are most afraid of—might not be the bad PR or the price of losing the lawsuit, but instead the fact that sensitive information that they have so far been able to keep private might be made public.

Private companies, unlike government agencies, are not subject to the Freedom of Information Act, and for the past two years this has prevented members of Congress from getting the government to explain the details of Blackwater’s contracts in regards to billing and payment. But this case might be a chance for a rare peak into the secretive company.

One part of the contract under scrutiny in the lawsuit, for instance, has revealed that Blackwater was paying its soldiers $600 per day but charged its client, Regency Hotel and Hospital Co., whom the deceased men were escorting, $945 per day. Regency was in turn a subcontractor of ESS, a division of Compass, who was subcontracted by Halliburton’s subsidiary KBR. There have been no documents showing how much each of the other companies added on to these charges by the time it reached the top contractor, Halliburton, who then billed the US government. Under Halliburton’s $16 billion contract they are only allowed to rely on the US military for armed protection and not private firms. If too many documents of this nature are released, there’s a possibility it could ultimately threaten Blackwater’s ability to win contracts.

This shouldn’t be too big of a problem, however, as Blackwater has so far won only no-bid contracts. And with a global market opening as quickly as it is now, plenty of new opportunities have arisen. For example, the head of the mission in Washington for Southern Sudan’s regional government, Ezekiel Lol Gatkuoth, recently announced that he expects Blackwater to start working with security forces in the next few weeks, although this has not officially been confirmed by Blackwater.

Sudan was placed under sanctions in 1997 after the US accused the government of supporting terrorism. Bush lifted the embargo this past October, giving Blackwater the ability to operate in the country legally. The company was apparently hired because no state was willing to send troops to aid the southern Christian militias, which have allied themselves with the Muslim government following a peace accord in order to fight off the other rebel groups. The conflict in Southern Sudan was separate from that of Darfur, in the west, but the government whose support has aided the Janjaweed in its extermination of as many as 450,000 non-Arabs in that region is the same.

Blackwater has big plans for Sudan, and wants to use the situation in Darfur to prove its ability to operate in a “peacekeeping” capacity. It has been pushing the idea for sometime to members of Congress and high-ups in the military, saying it can send in a large ground force aided by gunships for air support in a moment’s notice. Gary Jackson, Blackwater’s CEO, seems pretty confident about their future in Darfur. “We are going to field a brigade-sized peacekeeping force,” he says. “You can quote me on that.”

While Blackwater soldiers begin to operate in Sudan, their deployment will likely increase in the Middle East as well. Their 2004 “diplomatic security” contract with the State Department was part of much larger plan called the Worldwide Personal Protective Service (WPPS) program, characterized as designed to protect US officials as well as "certain foreign government high level officials whenever the need arises,” according to official documents. Other than Blackwater, several other high profile private military firms are included in the WPPS, such as DynCorp and Triple Canopy.

Blackwater’s contract under the WPPS is for five years and the payment is supposed to be a total of $229.5 million. However, after only two years in the program it had received a total of $321,715,794. The State Department has not been able to provide an answer as to why the firm has received almost $100 million more than required for only half the work that is due. And the contract still has two and a half years left.

During Bush’s State of the Union address he asked Congress to approve two immense military buildups. First, he requested “an increase in the size of our active Army and Marine Corps by 92,000 in the next five years. A second task we can take on together is to design and establish a volunteer civilian reserve corps. Such a corps would function much like our military reserve.” Bush, however, was not the first to mention this idea. Blackwater CEO and co-founder Erik Prince, a huge campaign contributor to Bush and the GOP, presented his plan for a “contractor brigade” of private military firms at a military conference two years ago.

KBR’s CEO Bill Utt said they plan on increasing the size of their force in Iraq in response to Bush’s announcement of sending more troops. The company now has over 500,000 resumes on file for people seeking employment in Iraq, Kuwait, or Afghanistan. With every troop “surge” the private military business gets an extra boost as well.

Former Secretary of Defense Phillip Coyle sees this privatization of war as directly related to the occupation of Iraq, where contractors now perform jobs previously done by US soldiers. “Obviously the military could do it,” Coyle says, “but indeed the Administration is looking for places to get more troops for Iraq.”

The 21,500 combat troops Bush is sending into Iraq will have to be supported by 28,000 additional US military men and women, a government assessment recently concluded. This makes the actual number of US soldiers being deployed around 50,000 at a cost of $27 billion according to the Congressional Budget Office. Exactly how many more contractors will arrive in Iraq as a result has yet to be determined, but with the current ratio of nearly one contractor for every soldier, we can expect it to be a significant number.

From Fault Lines #20