Page 2 of 2 DISPATCHES FROM AMERICA The Pentagon's cubicle mercenaries
By Frida Berrigan
approve the payments and threatened to levy fines against the company if it did
not get a better handle on its spending. Later, he told James Risen of the New
York Times that KBR had "a gigantic amount of costs they couldn't justify.
Ultimately, the money that was going to KBR was money being taken away from the
troops."
Despite his 31 years with the army, and without notice, Smith was transferred
from his post, while the requested payments were subsequently sent to KBR.
According to the New York Times, the Army argued that "blocking the payments to
KBR would have eroded basic services to the troops. They said that KBR had
warned that if it was not paid, it would reduce payments to subcontractors,
which in turn would cut back on services."
In other words, the Pentagon - in charge of hundreds of billions of dollars and
more than a million personnel in and out of uniform - was essentially held
hostage by a company which threatened to withhold services that (just to be
clear) had been pretty shoddy to begin with.
Senator Robert Byrd saw the problem: "We have found ourselves dependent on
profit-oriented companies for even the day-to-day basics of feeding and housing
our troops, [and] for carrying out a myriad of other functions of the mission,
including security. These kinds of contracts opened the door for every manager
to game the system in order to maximize profits."
And game the system they do. For example, the sort of corruption that seems
endemic to KBR has created a profitable new market for another kind of private
military corporation - one specializing in oversight and accountability.
After the army replaced Smith, it hired RCI Holding Corporation to review KBR's
records. Smith says the private company "came up with estimates, using very
weak data from KBR", while ignoring audit information gathered within the
Pentagon. While KBR was subsequently awarded high performance bonuses and a
portion of that new 10-year contract with the Army, Serco (RCI Holding's parent
company) also received a new contract - to continue to oversee KBR's contracts.
And so dependency begets deeper dependency, while corruption, incompetence, and
callous indifference become ever more ingrained in the military way of life.
During his first presidential campaign, George W Bush identified Christ as his
favorite political philosopher. But as the first American president with a
Masters of Business Administration (and from Harvard, no less), he has done a
much better job of applying the profit-first principles of Donald Trump and
Jack Welch than exemplifying the man from Galilee who promised the rich young
man "treasure in heaven" once he sold all he owned and gave it to the poor. As
president, Bush has brought a corporations-can-do-no-wrong perspective to the
Oval Office and quickly sought to give the private sector an ever freer rein
over a smorgasbord of public works and services. Today, the military sector
leans remarkably heavily on private corporations to perform what used to be
their basic functions, from war to disaster relief to washing the dishes. KBR
is just one multi-billion dollar example of the MBA presidency's legacy.
Beyond Blackwater: The Pentagon's cubicle mercenaries
The new Complex 2.0 regularly employs companies whose job it is to send armed
mercenaries into action beside US soldiers or to guard US diplomats and
high-ranking military officers. Fighting wars for hire has become an essential
part of the Pentagon's modus operendi since 2001, and the Blackwater employee
gunning through Baghdad in a Kevlar vest, a kafiyah, and wrap-around shades is
the ultimate symbol of the new moment.
But there's another dimension of the Bush era's privatization surge at the
Pentagon that has gotten far less coverage: private military firms are also
doing the paperwork of war. According to a March 2008 GAO report, Additional
Personal Conflict of Interest Safeguards Needed for Certain DoD Contractor
Employees, in offices throughout the Department of Defense, cubicle mercenaries
in startling numbers are working shoulder-to-shoulder with uniformed military
staff and federal employees.
The Government Accountability Office (GAO) looked at 21 different Pentagon
offices and found that private contractors outnumbered Department of Defense
employees in more than half of them. In the engineering department of the
Missile Defense Agency, for example, employees from private contractors made up
more than 80% of the work force. The GAO found that contractors were
responsible for carrying out a wide range of tasks and were not subject to
federal laws and regulations designed to prevent conflicts of interest -
including the rules that concern personnel who want to take positions with
companies they had awarded contracts to as federal employees.
Another March 2008 GAO report assessed the Army's Contracting Center of
Excellence where private contractors made up less than 20% of the workforce.
The average hourly cost of an employee from a private contractor, however, was
more than 26% higher than that of a government employee. Similar disparities in
pay can be seen even more starkly in Iraq, where a soldier is paid little more
than minimum wage, while a private military contractor can earn well above
$100,000 a year tax-free.
For perhaps the ultimate contrast in military privatization, consider this:
testifying at a Congressional hearing in July, Blackwater CEO Erik Prince
offered a ballpark estimate for his annual salary - "more than a million". He
assured Representative Peter Welch that he would "get back" to him with a more
exact figure. Welch noted at the time that General David Petraeus - then
responsible for more than 160,000 US military personnel in Iraq - earned
$180,000 a year.
Privatization at the bottom
Once private companies take on military and war-making tasks, where does the
buck stop? It is not uncommon, for example, for a company hired to perform a
service for the Pentagon to subcontract part of the job to another company,
which may then subcontract part of its task to a third. Who, then, is in
charge? When something goes wrong, who is culpable?
A recent investigation by Craig and Marc Kielburger, Canadian co-founders of
the NGO Free the Children, and Toronto-based journalist Chris Mallinos found
that KBR has subcontracted to more than 200 different firms - many based in
Kuwait - to transport materials into Iraq.
One result of this: the United States has ended up paying companies that are
essentially enslaving Filipinos, Sri Lankans, and other "third country
nationals" who drive supplies into Iraq. In a recent article in Epoch Times,
the trio recount a series of fact-finding trips to Kuwait to meet with dozens
of South Asian and Filipino men "recruited to the Middle East with the promise
of good jobs, only to be hired by Kuwaiti transport companies driving into
Iraq".
A Filipino described how Jassin Transport and Stevedoring Company - one of
KBR's sub-subcontractors - took his passport, nullified the contract he had
signed in the Philippines, and issued him a new contract written in Arabic.
Employees were "given an ultimatum: sign or be abandoned". Then they were
handed the keys to unarmored tractor-trailer trucks and told to drive fast
along roads known to be dangerous. The authors concluded that these companies
"openly flout US labor laws by using cheap imported labor, withholding employee
passports and housing workers in decrepit conditions".
Officially, nothing like this is supposed to happen. The Philippines, Nepal,
and other countries bar their citizens from taking work in Iraq. In 2006, the
Defense Department actually issued stricter regulations forbidding such labor
trafficking, and KBR and other companies pledged that they and their
subcontractors would follow local labor laws. But regulations or no, the truth
is that the Pentagon is no longer really in control of the process, and
sub-sub-subcontracting is how you make the big money in places like Iraq.
Oh ... and despite hearings, investigations, and legislation, Congress isn't in
control either. In an attempt to address the privatization of the military, for
example, the Senate's Democratic Policy Committee has held a total of seventeen
hearings on waste, fraud, and corruption in Iraq. Representative Waxman's
Oversight and Government Reform Committee has made the role of congressional
gadfly respectable. Hearings in both the House and Senate have offered
riveting, sometimes shocking, inside-the-Beltway theater, but subsequent
legislation created to make decent Pentagon reporting and oversight a reality,
close gaping loopholes in accountability, criminalize fraud, and curb some of
the worst abuses of private contractors has proven well-meaning but hopelessly
weak and ineffective in practice.
Is MIC 3.0 in our Future?
President Bush will leave office boasting that the US has the most powerful and
professional military machine in the world. We have paid dearly for this
machine in the past seven-plus years. The bill for all that might and muscle
comes to more than $3.8 trillion since 2001 - plus another $900 billion or more
for actually flexing it in Iraq, Afghanistan, and elsewhere.
And if the US military machine is now both oversized and staggeringly
expensive, it is also more prone to breakdown in a more dangerous and unstable
world. So think of Bush's legacy to us as a Pentagon bloated almost beyond
recognition and crippled by its dependence on private military corporations.
As for Bush's legacy to the Lockheed Martins, the KBRs and the Pentagon's whole
"Top 100" crew, it's been money beyond measure, enough to leave them all hard
at work on Military Industrial Complex 3.0. They naturally want to make sure
that the money continues to pour into their ever-upgrading war machine, no
matter who takes over the White House in 2009.
Frida Berrigan is a senior program associate at the New America
Foundation's Arms and Security Initiative. She is a columnist for Foreign
Policy in Focus and a contributing editor at In These Times. She is the author
of reports on the arms trade and human rights, US nuclear weapons policy, and
the domestic politics of US missile defense and space weapons. Part one of her
series on Bush's Pentagon Legacy at Tomdispatch.com, "Entrenched, Embedded, and
Here to Stay," can be read by clicking
here. She can be reached at berrigan@newamerica.net.
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