J.B. Sivanich

The name “Blackwater” has joined the likes of Abu Ghraib, Niger Yellowcake, the Duelfer Report, “Slam Dunk,” Valerie Plame, and the Downing Street Memo on a lengthy list of scandals and mistakes that have come to symbolize the American invasion and occupation of Iraq.The September 16 killings of 17 unarmed Iraqis by Blackwater employees is just the tip of the iceberg when it comes to the untold story of contractors and reconstruction in Iraq.

Many commentators say that the Bush administration is “outsourcing the war” by hiring private security contractors like Blackwater and DynCorp International. From 2001 to 2006, Blackwater has received close to $1 billion dollars in federal contracts. It costs the government $445,000 for each Blackwater security guard in Iraq per year — individual security guards can make $12,000 to $33,000 a month. The real story is that two-thirds of Blackwater-government contracts are “no-bid” contracts, an example of the absence of capitalism in the defense industry. No-bid contracts are illegal under European Union law.

On a side note, many of these no-bid contracts that the Bush administration issued have “cost-plus” provisions, which guarantee contractors that they will receive full compensation for any errors or cost overruns plus their expected profit. This reverses the normal capitalist incentive to care about costs, deadlines, and quality. A more ridiculous example of the “cost-plus” system is the Basra Children’s Hospital, one of Laura Bush’s pet projects. It was a planned state-of-the-art medical facility in a town without safe drinking water. The Bechtel Corporation, which was originally given a $50 million contract, dropped the project a year into it, citing security reasons — however, when they dropped it, the hospital was not even remotely close to being operational and the price tag had risen to $169 million.

Blackwater founder Erik Prince claims that the title “mercenary” is “slanderous” because Blackwater consists of “Americans working for the American government.” According to the U.N.-defined Geneva Conventions, however, a mercenary is any person who is “motivated to take part in hostilities essentially by the desire for private gain and, in fact, is promised, by or on behalf of a Party to the conflict, material compensation substantially in excess of that promised or paid to combatants of similar ranks and functions in the armed forces of that Party”– which is exactly what Blackwater does. Prince also failed to mention that of his 987 employed contractors, only 744 are American citizens. There are 100,000 American contractors in Iraq — 20,000 to 30,000 of whom are armed private security contractors — but in the past three years, there has not been a single prosecution for an incident of violence. Compared to an American city of equal size, that is implausible — and Iraq is a war zone. Former Director of Iraqi Reconstruction Paul Bremer granted immunity for contractors from Iraqi law, saying, “The immunity is not absolute. The order requires contractors to respect all Iraqi laws.” American armed forces also have immunity from Iraqi laws but are held responsible in military court. There is an article in the law that states immunity can be withheld, but the protocols for handling cases like the Blackwater shootings are untested, unclear and easy to fight in court.

If the Bush administration is going to hire private security contractors such as Blackwater in order to make up for poor recruitment of soldiers, then they need to create a workable legal format in which the contractors can be held accountable. And if the Bush administration maintains “no-bid” contracts, then they need to be more scrupulous in holding wrongdoers liable. There is too much personal profiteering in a land where others are selflessly serving their country and more still are simply trying to survive. The least the government can do is set up a workable framework to hold gross violators accountable and be meticulous in their application.