Privatizing The Army

by hilzoy

From the NYT:

"The Army official who managed the Pentagon’s largest contract in Iraq says he was ousted from his job when he refused to approve paying more than $1 billion in questionable charges to KBR, the Houston-based company that has provided food, housing and other services to American troops.

The official, Charles M. Smith, was the senior civilian overseeing the multibillion-dollar contract with KBR during the first two years of the war. Speaking out for the first time, Mr. Smith said that he was forced from his job in 2004 after informing KBR officials that the Army would impose escalating financial penalties if they failed to improve their chaotic Iraqi operations.

Army auditors had determined that KBR lacked credible data or records for more than $1 billion in spending, so Mr. Smith refused to sign off on the payments to the company. “They had a gigantic amount of costs they couldn’t justify,” he said in an interview. “Ultimately, the money that was going to KBR was money being taken away from the troops, and I wasn’t going to do that.”

But he was suddenly replaced, he said, and his successors — after taking the unusual step of hiring an outside contractor to consider KBR’s claims — approved most of the payments he had tried to block."

The obvious way to read this is as indicating that Halliburton had the connections to block any investigation of its recordkeeping. And while that's true, I'm not sure that's what's going on here. The next paragraph of the NYT story:

"Army officials denied that Mr. Smith had been removed because of the dispute, but confirmed that they had reversed his decision, arguing that blocking the payments to KBR would have eroded basic services to 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 fact, KBR did at one point threaten to stop providing basic supplies -- little things like food -- to our troops in Iraq. (I've put the account of this episode below the fold.) What that means is, to my mind, even more scandalous than simple corruption by a company with good connections. It means that we have outsourced absolutely critical functions to private companies, companies which, unlike military personnel, can threaten to stop doing their jobs without facing courts-martial. In wartime, when a company is doing something as important as providing food to our troops, the military has no choice but to cave to their demands. (That's one reason I said it was more scandalous than simple corruption: it virtually ensures that that corruption will occur, while simultanously leaving our troops at risk.)

To my mind, we should not allow any company to assume any critical function in wartime without putting in place some guarantee that it will go on performing that function whether it wants to or not. If it's impossible to do that legally, then that function should not be outsourced. Period. We cannot allow any private company to threaten to stop supplying our troops during wartime. But we have.

Here's a description of the episode I referred to. It's from Betraying Our Troops: The Destructive Results of Privatizing War, by Dina Rasor and Robert Bauman.

"The Army's logistics contract manager at the camp could not believe what he was hearing. A KBR manager reponsible for supplying the troops in this camp with food, water, and all other services and supplies had just threatened to stop KBR's work at Camp Speicher -- to stop cooking and feeding the troops, to stop supplying the troops outside the base -- unless the Army paid KBR's submitted invoices.
Granted, his company, KBR, a subsidiary of Halliburton, was operating "at risk" by overrunning its budgeted spending and had been late in sending its invoices to the Army. And the Army was slow in paying becasue of its concerns over the accuracy of the company's invoices. Even so, the KBR manager had just threatened the Army brass that his employees were going to stay in their housing containers and do nothing until the money was paid. Essentially, this would amount to a work stoppage, or labor strike, on the battlefield -- perhaps the Army's biggest fear regarding the Pentagon's new experiment of having private contractors supply the basic needs of its troops on the battlefield.

The Army manager and his assistant wondered if KBR could really do this. If soldiers or officers tried to pull this same stunt in the old Army, the general would court-martial them, and they could be sent to prison. However, according to federal contracting rules, a company has the right to stop work if that company is risking a large amount of its own money and the government is unable to pay due to funding problems. Clearly, wartime conditions should be an exception when soldiers' lives are on the line, but there is no legal basis for a general to force a company's employees to work beyond the contracting rules. The company or its employees can stop work or go home, and there is nothing that military commanders can do about it, except seek drawn-out legal-contract remedies in the courts back in the United States.

The Army logistics contract manager and the camp's general officer faced the disaster of having to explain to their men, their superior officers, and the public that there might not be any food, water, or other vital supplies the next day because the Army didn't have a backup plan. Since the Army had outsources these traditionally Army-provided services to one company, they did not have any choice. The Army was short of troops, so there were no back-up soldiers to take on these tasks.

KBR ended up working the next day because the Army ultimately relented and agreed to come up with new money to pay its invoices. But this was not the first or last time the company would threaten the Army with work stoppages. It was like negotiating with the only plumber within a thousand miles when your basement is filling with water. KBR was in the driver's seat, and the company knew it."

Comments

[now_what]

Who decides when it is wartime?

And isn't it always, in America?

Just wonderin'.

[Pooh]

Sad to say, this barely wiggles the outrage meter anymore.

[Jesurgislac]

You know, it's more than slightly ironic that this was happening in 2004, while the Republicans were running a campaign against Kerry claiming he wouldn't support the troops - motivated, so it was explained to me, because, after the Vietnam war, John Kerry had supported veterans who spoke openly about the atrocities committed by US soldiers in Vietnam.

Apparently, it's more important to "support the troops" in committing atrocities and not having these atrocities exposed to the public, than it is to "support the troops" by ensuring they have little things like food and water on the battlefield.

And with Blackwater mercenaries on the streets, the US army can outsource the atrocities, too.

[Hartmut]

In the officer-on-the-spot's place I would have seriously considered to react: "If you don't bring in food and water, you will be also without it (we'll make sure of that). We also withdraw our protection from you and announce that publicly while preventing you from leaving the area by all means. Additionally we will relieve you of all means to communicate with the outside world except through OUR system. Anyone of you guys caught with a cellphone will have an unfortunately fatal accident!"

[Brett Bellmore]

It's actually pretty reasonable, and has been standard practice, to outsource critical functions to private contractors. The Army doesn't manufacture it's own ammo, you may be aware. Having ammo is pretty critical...

Pretty reasonable for a contractor that doesn't get paid to stop doing the job, too, though I suspect that in prior wars any that tried that met with a pretty nasty reaction from the government.

Outsourcing them without any competition, though, THAT'S nuts. Unambiguously.

[Jesurgislac]

It's actually pretty reasonable, and has been standard practice, to outsource critical functions to private contractors. The Army doesn't manufacture it's own ammo, you may be aware. Having ammo is pretty critical...

The army does not grow its own crops or breed its own beefstock or weave the cloth for its own uniforms, either. I don't think Hilzoy was suggesting that the US army should take over those industries in the US.

I think you're slightly missing the point: the difference between having suppliers at source be private contractors, and the supply line itself be under the control of private contractors.

An army of occupation in a foreign country is utterly dependent on supplies of ammo, food, and - in Iraq - potable water, reaching the troops from a trusted source.

The source may well be a civilian contractor who supplies the army buyers with the produce or ammo they need.

To allow the supply line to be run by contractors for a profit is mortal folly.

[AllenS]

"A KBR manager reponsible for supplying the troops in this camp with food, water, and all other services and supplies had just threatened to stop KBR's work at Camp Speicher -- to stop cooking and feeding the troops, to stop supplying the troops outside the base..."

This is easy to resolve. Tell KBR that if they refuse to work, they will be escorted off of the base. Let the KBR employees fend for themselves without the protection of the Army.

[russell]

Sad to say, this barely wiggles the outrage meter anymore.

Nah, it wiggles mine.

It's actually pretty reasonable, and has been standard practice, to outsource critical functions to private contractors.

What Jes said.

The Bush administration theory of government is to use the institutions of the state to enrich themselves and their buddies.

These guys aren't Republicans. Eisenhower was a Republican. These are banana republicans.

These guys are criminals. Someone needs to go to jail.

Thanks -

[Brett Bellmore]

Jes, at some point the supply line IS going to be in civilian hands, unless the army is going to send trucks out to the farms. We're arguing over differences of degree, not kind.

Extending civilian workers further into the logistic chain was a natural consequence of Bush's decision to go to war without asking for an increase in troop caps. Because we didn't enlarge the military from peacetime levels, every last person holding a non-civilian job has to be devoted to actual fighting, leaving too few military employees to handle logistics.

If it helps any, I agree that not asking to increase the size of the military was a bone headed move. The very first sign that Bush wasn't really serious about his "war on terror".

[russell]

Extending civilian workers further into the logistic chain was a natural consequence of Bush's decision to go to war without asking for an increase in troop caps.

No argument on that.

The point I argue with is calling that either "reasonable" or "standard practice". It's neither.

The cherry on top, of course, is sending all the private work to their buddies.

It's not a bug, it's a feature!

Thanks -

[expat63]

The problem folks, is that you are NOT at WAR.

Countries that are at war invoke emergency measures that restrict individual rights so that people can be shot if they refuse to provide essential services to the military (of course one should only threaten to kill the cook for not feeding the troops. Actually killing him makes little sense). Governments know that the voting public will only stand for those restrictions when faced with a real and immediate threat to their own livelihood. The "terrorist threat" just doesn't make the grade. Being at war would also mean having to call Gitmo a POW camp, with all kinds of messy consequences.

[russell]

From a paper at the Heritage Foundation:

Civilian contractors accounted for 1 in 60 of deployed personnel in Iraq during 2001. In Bosnia the ratio had become 1 to 10; then in Kosovo it was 1 to 2. Statistics for the current Iraq deployment indicate a ratio of approximately 1.5 contractors to each member of the military.

It's not a war, it's a growth opportunity.

Thanks -

[femdem]

You can't put the civilian contract employees in danger because the guys at the Cheney level are avaricious, amoral cretans who learned everything they needed to know from repeated viewings of a truncated Grinch Christmas Special. The contract employees are there to perform a job and if their bosses cut off the supplies, there's not a darned thing the sneakers on the ground can do to change it. If KBR had actually sent out the order not to work, I'll bet the real workers would have been out the next day doing what they could anyway.

KBR, on the other hand, needs to be brought up on treason charges. At the very least they should never get another govt contract again.

[Brett Bellmore]

It's standard practice to have civilians in the logistic chain. It's not standard to have them this far down the chain. It's standard practice to have civilians doing things which are absolutely critical to the war effort. Usually they're not doing it on the battlefield.

As I said, it's a difference of degree, not kind. And it was necessitated by a rather stupid decision not to seek an expanded military after 9-11.

[aimai]

Wow! I had no idea Iraq was not a "right to work" war. Those KBR union bastards wouldn't dare show their faces in Texas...uh...what? YOu mean that the Bush/cheney administration outsourced critical military support functions to a non-unionized, civilian work force and then allowed mere capitalist greed to shut down those functions? Ya don't say.

And brett, of course, is almost comically ignorant of the difference between traditional procurement of military materiel (which did, until recently, take into account problems with the future interruption of supply in a number of complex ways) and the provision of necessary support systems in the field. The cost of certain services may be lowered when they are bid out to the lowest bidder (or the most connected republican) in peacetime but the skyrocketing cost of extortion on the battlefield was utterly predictable. As someone above said, its not a bug, its a feature, except for the, you know, war effort and the troops. But hey, they aren't that big a deal since they never refuse to fight even when they are electrocuted in their showers by poor wiring, or given non potable water to drink, or any of the other well documented failings of the bush romance with crony capitalism.

aimai

[Bernard Yomtov]

it's a difference of degree, not kind.

I disagree. When you buy food or ammo, or pay to have them trucked to airports, you have alternatives if your supplier doesn't perform.

But in Iraq you have no alternative and no time to find one. You're at the mercy of the supplier. That's the situation that should be avoided. When the supply line gets to that point, it needs to be controlled by military personnel, not private companies.

[ral]

Yes, extortion. It's only a small step to...

"That's a very nice tank you have there. Wouldn't want anything to 'appen to it."

[hairshirthedonist]

Whether it's a matter of degree or kind, it is what it is, and it's bad. I can't wait 'till January, even if it's McCain. He can't be this bad. (Of course, I still really really hope it's not McCain.)

[Jesurgislac]

As I said, it's a difference of degree, not kind.

In exactly the same way as it's just a difference in degree, not kind, whether you jump down 13 feet or 1362 feet.

[lou]

A friend of mine corresponds with several soldiers in Afghanistan and Iraq and there's another issue they've raised: when the Army supplies its own cooks and truck drivers, the cooks and truck drivers are also soldiers. So if an Army base is attacked, the cooks and truck drivers are trained soldiers and can participate in battle. When they're private contractors, and civilians, the soldiers have to protect them.

[lou]

A friend of mine corresponds with several soldiers in Afghanistan and Iraq and there's another issue they've raised: when the Army supplies its own cooks and truck drivers, the cooks and truck drivers are also soldiers. So if an Army base is attacked, the cooks and truck drivers are trained soldiers and can participate in battle. When they're private contractors, and civilians, the soldiers have to protect them.

[aimai]

Is this what you are thinking of, ral:

http://video.aol.com/video-detail/monty-python-army-protection-racket/619001376

[...now I try to be amused]

The Army's caving in to KBR stands in stark contrast to Reagan firing the air traffic controllers when they went on strike. Shameful.

All the military history I've read considers the militarization of the rear echelon to be a good thing. The US armed forces (and the US government in general) are backsliding.

[spaghetti happens]

Just a little OT, but one small bright spot in all this is that obvious fact that, given what happened to Charles Smith--and to Bunnatine Greenhouse and probably many others who didn't toe the Halliburton line--it is at least true that civil servants can be removed "for cause," whatever that "cause" may be. This goes against the common wisdom that civil service employees, in contrast to political appointees, have an effective lifetime tenure in their jobs.

One of Barack Obama's biggest jobs is going to be (I hope) rooting out of government those moles whose concept of service to their country is to do the bidding of "Dick" Cheney and Karl Rove.

[Mowgli]

Yes, privatize by all means. Any private could do better.

[ral]

aimai, I can't watch it right now but I think you've got it.

Life imitates art.

[John Thullen]

All that is needed here are slight adjustments in the incentives and disincentives for the contractors who feed the troops.

Don't you people understand human nature?

If only the government would get out the way and let the troops practice true privatization --- plundering sheep and goats from the local villages and maybe a dancing girl or two.

Such practices would put the troops in fine fettle for returning home and fending for themselves from the homeless shelters. And then gathering on the White House lawn and pulling Dick Cheney off of his horse and administering a group rifle-butt massage to his nether regions, not unlike the scene early in Dr. Zhivago when the troops pull the monocled, greatcoated officer down from his steed for a pep talk, before running into town and punishing the Tsar.

When the Middle East learns our mysterious ways and lets market forces work, we'll win this thing. The day Osama Bin Laden is interrupted in his recruitment of volunteers to fly airplanes into tall buildings by a John Clesse type who raises his hand at the back of the cave and asks "Do I receive health insurance and a parking space with this job?" will be the day we've got 'em licked.

Until the recruits start asking to organize unions. Then Bin Laden and Dick Cheney will find common ground and work together to achieve peace in the world and a new paradigm.

I hope we find the correct pricing level for the new paradigm. Otherwise we'll have to withhold the new paradigm from the market until profit margins expand.

The lamb shall lie down with lion. For $50 each half hour. The lamb shall then seek a pencillin shot and a reality show, while the lion shall seek counseling for mutton addiction.

Then all will be right with and in the world. If it's not, we'll add a bonus clause and incentive benchmarks to the contract.

[Jesurgislac]

It's not funny because it's true.

[southpaw]

As I said, it's a difference of degree, not kind.

How is it not a difference in kind? Suppliers of food and ammunition in the past were engaged in domestic agriculture and manufacturing. KBR is engaged in international supply-line management and battlefield logistics, among other things. It's not like we could ask any agriculture company or metalworking plant to scale up and do this; it's a fundamentally different enterprise.

[trilobite]

As Brett and Bernard say, it's the lack of competition that really matters here. The Army not only couldn't replace KBR then and there, it couldn't plausibly threaten next year's contract either. This mess is of a piece with our government's ongoing willful misunderstanding that capitalism is based on competition.

Unfortunately, this is not just a Republican problem. Bush/McCain are certainly a trifle cozier with would-be monopolists like Enron and Halliburton, but Bill Clinton also showed an unnerving permissiveness towards media consolidation and mergers.

Obama built his campaign so much on small, individual contributions, that he may be slightly less beholden to the giant oligopolies. His party is still in their pocket, so he can only change so much, but let's hope!

[hairshirthedonist]

A bit tangential, but I'm reminded of a discussion I recently saw on Bill Moyers (here's the transcript) regarding our new Gilded Age of crony capitalism, evidenced in the subject of Hilzoy's post.

[Dustoff]

trilobite
Obama built his campaign so much on small, individual contributions, that he may be slightly less beholden to the giant oligopolies. His party is still in their pocket, so he can only change so much, but let's hope!
________________________________________

Say what? SOROS.. look him up.

[Nombrilisme Vide]

Outsourcing them without any competition, though, THAT'S nuts. Unambiguously.

As Aimai, and Bernard, and Trib and possibly others said, there's little practical comparison to be made between privatized procurement on the homefront where alternatives can be sought should a supplier refuse to provide goods or services (justly or unjustly), and privitzing one's supply line in-theater. The latter case by default creates a monopoly in the short term, as there will not be competitor the military can go to should the supply chain contractor refuse to work w/o pay... or having its fee doubled on the spot, or whatever. In the immediate term, unless the contract stipulates that the contractor can be compelled to work and provide services in the immediate term (as is plainly not the case with the likes of KBR), the military does indeed default to a stance of pointed weakness vis à vis their contractors in-theater.

[Porcupine_Pal]

US mercenary armies are wrong on so many levels. Proprietary companies, earning money through the use of deadly force; answerable only to their shareholders; free to contract with others; able to compete for political patronage with lobbyists and political contributions. A Milton Friedman nightmare.

Nonetheless, there are so many, even more basic wrongs that need righting - it will be hard to find a meaningful place in line for this egregious abuse.

[Phoenician in a time of Romans]

This is easy to resolve. Tell KBR that if they refuse to work, they will be escorted off of the base. Let the KBR employees fend for themselves without the protection of the Army.

"Go ahead - there's plenty more Third Worlders to employ where they came from."

[ThatLeftTurnInABQ]

The day Osama Bin Laden is interrupted in his recruitment of volunteers to fly airplanes into tall buildings by a John Clesse type who raises his hand at the back of the cave and asks "Do I receive health insurance and a parking space with this job?" will be the day we've got 'em licked.

In that case, maybe we are doing better in the GWOT than the pessimists claim:

LA Times: Penalty for crossing an Al Qaeda boss? A nasty memo

LONDON -- Mohammed Atef was furious.

The Al Qaeda leader had learned that a subordinate had broken the rules repeatedly. So he did his duty as the feared military chief of a global terror network: He fired off a nasty memo

In two pages mixing flowery religious terms with itemized complaints, the Egyptian boss accused the militant of misappropriating cash, a car, sick leave, research papers and an air conditioner during "an austerity situation" for the network. He demanded a detailed letter of explanation.

"I was very upset by what you did," Atef wrote. "I obtained 75,000 rupees for you and your family's trip to Egypt. I learned that you did not submit the voucher to the accountant, and that you made reservations for 40,000 rupees and kept the remainder claiming you have a right to do so. . . . Also with respect to the air-conditioning unit, . . . furniture used by brothers in Al Qaeda is not considered private property. . . .

hat-tip to John Cole: Sheikh Ratbert

[EoH]

It also means that with KBR in Cheney's back pocket - or is it the other way round? - the Army was not willing to play hardball. It and the Pentagon have intentionally outsourced critical functions - probably at the non-negotiable direction of political appointees. But it still holds the purse.

The Army could have said: You want to stop serving meals or delivering fuel over a routine contract audit dispute? Fine. Here's what we'll do:

We'll hold you in breach. Which will put you in breach of every other contract you have with us and make you ineligible to do future business with any entity of the US Government.

Within 24 hours, that'll be on the front page of every dead-tree and online newspaper and financial magazine in the literate world. Your shareholders will go batshit and your stock will tank.

Then we'll start auditing the heck out of every other contract you've got with us. We conservatively estimate that will result in $10-20 billion in claims against you within a year. We'll take cash.

Those audits might also reveal serial criminal conduct. Which means jail time for the perps and possibly for their managers. They and their supervisors and other executives might become material witnesses, which means we'll have their passports yanked until this mess is sorted out. Could take a while.

The list goes on, but you get the picture. The odds were not as weighted in KBR's favor as you suggest, with a single exception. Cheney, and hence Bush, would have told the Army, Gates and the Pentagon, to STFU and pay the bill. That would pit the Army and the taxpayers against the White House and its corporate overseers.

That's a fight we ought to have more than the one in Iraq. But we won't have it. For one reason, if the Army and Gates attempted it, Cheney would have had executives fired seriatum until one of them finally said, "Yes, sir" and paid the bill.

The fault is not in our stars, but in our White House.

[Davidkevin]

If the general had been a real general and not a bureaucrat in uniform, he would have had the KBR manager arrested for sabotage in time of war. That's a death penalty crime, isn't it?

I think that would have ensured non-interruption of meal services.

[OCSteve]

I agree with this completely:

To my mind, we should not allow any company to assume any critical function in wartime without putting in place some guarantee that it will go on performing that function whether it wants to or not. If it's impossible to do that legally, then that function should not be outsourced. Period. We cannot allow any private company to threaten to stop supplying our troops during wartime.

A deployed army simply can not rely on the whims of a civilian company controlling their supply line. I don’t think I’m contradicting many military historians when I claim that your supply line is your most critical asset. It probably would have taken another 10,000 soldiers to handle what was contracted out to KBR, but the military does have cooks and construction specialists and supply sergeants. I think that KBR’s responsibility should have ended at delivering supplies to ports in Kuwait.

On a side note, not meant to approve or minimize or excuse any of this, or anything else shady that KBR or this administration has done. But…

It strikes me that KBR seems to almost always be discussed as if it is some new evil of BushCo or a branch of the Republican Party (“Bush administration theory of government”, “sending all the private work to their buddies”, “the guys at the Cheney level are avaricious, amoral cretans”, “the most connected republican”, “bush romance with crony capitalism”, “the bidding of "Dick" Cheney and Karl Rove”, “It also means that with KBR in Cheney's back pocket - or is it the other way round”, etc.). That’s just not the case. KBR and its predecessors have been getting large government contracts for nearly a century. And they’ve done that since their start the old fashioned way - by financially supporting (buying) politicians.

Brown & Root won its first military contract 22 years before Dick Cheney was born. Brown & Root financed Lyndon B. Johnson starting with his first run for Congress in 1937. The first major federal investigation (into the company’s campaign finance contributions) was allegedly derailed by FDR personally. They built bases and ships in WWII. Along with 3 other companies they built 85% of the Army’s infrastructure during the Vietnam War (complete with charges of overcharging, accounting lapses, war profiteering, and cronyism on the part of the Johnson administration). Clinton awarded them the NATO support contract for the Balkans. They won their first LOGCAP contract in 1995. If there are politicians responsible for what KBR is today, Johnson and FDR would be the most likely candidates.

BushCo did not bring KBR into military contracting – they’ve been an integral part of it for nearly a century. As far as their Afghanistan/Iraq involvement – I’m open to the argument that they are perpetrating (more) fraud today, or delivering less value for the dollar today, or that the Army should have been expanded to handle this all w/o civilian contractors, or that the bid process was not competitive, or any number of other arguments. Certainly Bush is responsible for creating the near perfect conditions for a few billion dollars to go unaccountably missing here and there. But KBR is not some new manifestation of Bush/Cheney (or Republicans in general). That’s not to say that anyone here claimed it was. But whenever KBR or Halliburton are discussed you’d think that they are wholly owned subsidiaries of Cheney Inc. rather than business as usual - just as its been for a century.

[Slartibartfast]

Bingo, OC. But regardless of where all of this started, it's become painfully clear that putting critical functions outside of the command chain is highly problematic. There is always going to be civilian support of the military, but let's not have that be something that's pervasive to the point that it affects combat operations to any nontrivial degree.

[Jesurgislac]

OCSteve: But whenever KBR or Halliburton are discussed you’d think that they are wholly owned subsidiaries of Cheney Inc. rather than business as usual - just as its been for a century.

I agree that the historical background should be borne in mind (though many Republicans disagree) but:

(Center for Public Integrity, August 2, 2000) Under Cheney, Halliburton—largely through its Brown & Root subsidiary—has garnered $2.3 billion in U.S. government contracts. This is almost double the $1.2 billion it earned from the government in the five years before he arrived. Most of the contracts have been with the U.S. Army for engineering work in a variety of hot spots, including Bosnia, Albania, Kosovo and Haiti.

And Halliburton was closely tied to the oil for food financial shenanigans - why do you suppose that what was being built up to be an awesomely big deal (a great distractor from the disappearing billions) just fizzled out and went nowhere?

Dick Cheney got billions for Halliburton from the public purse when he was CEO: the figures strongly suggest that his "leadership" massively increased their ability to get loads of money from US taxpayers - not to mention the oil money from Iraq, which of course Cheney has claimed to have no notion of.

Dick Cheney then became Vice President of the United States - and Halliburton's income from US taxpayers just soared.

Now, to Republicans who trust Dick Cheney as a man of perfect and true integrity, or who believe that the proper place for US taxpayers' money to go is to wealthy corporations, none of this is relevant.

If you're not in that group, you have to admit it's pretty damn relevant.

[Brett Bellmore]

"But regardless of where all of this started, it's become painfully clear that putting critical functions outside of the command chain is highly problematic."

I absolutely agree, I'm simply pointing out that this was a natural consequence of Bush's rather bone headed decision, post 9-11, to not ask for an increase in troop ceilings. It's simply stupid to set out on a series of wars with a peacetime military.

Bush did it, I suspect, because the still wanted to be the "domestic policy" President he ran claiming he'd be, and didn't want the wars he thought were necessary to get in the way of domestic spending.

But that's the sort of tough choice the job implies. Bush is a lousy President, and has been from the start.

[Jesurgislac]

Brett, it was made clear to Bush & Co that they couldn't have a successful occupation of Iraq without troop levels of up to 500,000. Rumsfeld was aware of this. Eric Shinseki spelled this out to the Senate Committee on Armed Services. The House Budget Committee were made aware that the military expertise said that there needed to be several hundred thousand U.S. troops in Iraq for the occupation to succeed.

It's been a popular meme since the 2006 election that all of this can be blamed on Bush. True, he's a disaster area President, and the Republicans who voted for him and vocally supported him despite this have a lot to apologize for - but the weak-kneed refusal of Congress in 2002 and 2003 to stand up to the Bush administration in their rush to war has also a lot of the blame.

Plus of course the refusal of the mainstream media in the US to be clear that the war in Iraq was unwinnable and that the politicians who were supporting it were either knaves or fools.

[OCSteve]

Slarti: No disagreement. (A deployed army simply can not rely on the whims of a civilian company controlling their supply line. … I think that KBR’s responsibility should have ended at delivering supplies to ports in Kuwait.)

Jes: No disagreement. (I’m open to the argument that they are perpetrating (more) fraud today … or that the bid process was not competitive, or any number of other arguments. Certainly Bush is responsible for creating the near perfect conditions for a few billion dollars to go unaccountably missing here and there.)

I just think it’s relevant to occasionally challenge what seems to be the accepted knowledge that this is all somehow new and a creation of Bush/Cheney.

[Katherine]

I vaguely remember reading that the ball for the current wave of privatization got rolling when Cheney was SecDef, but it's not as if the Clinton administration didn't participate in LOGCAP too. (The use of contractors and interrogators and in combat, I believe is a Bush II-era thing, though I'm not 100% certain.)

[Jesurgislac]

OCSteve: I just think it’s relevant to occasionally challenge what seems to be the accepted knowledge that this is all somehow new and a creation of Bush/Cheney.

I don't think anyone seriously believes that big corporations getting money for jam from the government began when Dick Cheney became VPOTUS. I've never seen any account of this saying that massive corruption resulting from big corporations having intimate connections with the highest powers of government is new. Just that for the CEO to become VPOTUS, and the administration of which he is VPOTUS to award loadsamoney contracts to the company of which he was CEO, is a peculiarly blatant example of this kind of corruption.

And it's what's happening right now. Current corruption - especially current corruption involving a politician who is still in office - is much more interesting than past corruption involving politicians now out of office.

It may be cosy and comforting to think it's all happened before - indeed, I've noticed that's a fairly consistent Republican meme - but we don't actually need Republicans who hate corruption to feel cosy and comforted, do we?

[Katherine]

That should be "[t]he use of contractors AS interrogators and in combat". And I think my recollection about LOGCAP was correct. See this link (it's to a NY Times mag article quoted by Daniel Drezner--I totally disagree with most of Drezner's post, but can't find a live link the original article figure OCSteve & Slarti will find Drezner preferable as a source to HalliburtonWatch.Com):

In 1992 the Defense Department, under Dick Cheney, hired Brown & Root to write a classified report detailing how private companies could help the military logistically in the world's hot spots. Not long after, the Pentagon awarded the first five-year Logcap -- to Brown & Root. Then Bill Clinton won the election, and Cheney, in 1995, became C.E.O. of Halliburton, Brown & Root's parent company.

I do think that the company got a whole heck of a lot more in contracts under the Clinton administration than under Bush the elder, and maybe the 1992 report just hastened something that was coming anyway.

[OCSteve]

Jes: It may be cosy and comforting to think it's all happened before - indeed, I've noticed that's a fairly consistent Republican meme - but we don't actually need Republicans who hate corruption to feel cosy and comforted, do we?

“cosy and comforting”? Not at all actually. It’s rather depressing that we haven’t managed to get a handle on it over the course of all these years. Occasionally its more in-your-face, but it’s always been there.

[OCSteve]

(And of course if I had my druthers, I like to see all forms of corruption cleaned up in the Republican Party first. Not holding my breath though.)

[ral]

OT, one more Friedman Unit, almost to the day. Amazing, isn't it?

[OCSteve]

Katherine: I do think that the company got a whole heck of a lot more in contracts under the Clinton administration than under Bush the elder, and maybe the 1992 report just hastened something that was coming anyway.

Oh I certainly won’t claim that didn’t stink to the heavens. Cheney hires Brown & Root to do a study that recommends privatization. Pentagon awards first Logcap to Brown & Root. Cheney becomes CEO of Halliburton. Nothing to see here…

Then in 1997 Halliburton actually lost the bid to DynCorp. But they were so embedded in Bosnia at that point that the Clinton administration had little choice but to give the contract to Halliburton anyway. Then…

GAO said KBR's cost-overruns in the Balkans inflated the original contract price by 32 percent. After KBR was effectively fired by the Army in 1997, the LOGCAP contract was awarded to Halliburton competitor DynCorp. But, after Cheney became vice president in 2001, DynCorp was fired and KBR was re-awarded the contract.

Surprise!

(Of course I had to link to HalliburtonWatch after you said I wouldn’t prefer it as a source just to be contrary.) ;)

[Jesurgislac]

OCSteve: It’s rather depressing that we haven’t managed to get a handle on it over the course of all these years.

It's a perennial problem in politics, though - people want things to go their way, and if you are very rich you have the money to make things go your way

And of course the Republican Party - or any political party which devotes itself to furthering the interests of the very rich exclusively - will have practically an inbuilt problem with corruption.

(Of course I had to link to HalliburtonWatch after you said I wouldn’t prefer it as a source just to be contrary.) ;)

You devil, you: after I'd carefully avoided linking to any articles on HW...

[Katherine]

"Cheney hires Brown & Root to do a study that recommends privatization. Pentagon awards first Logcap to Brown & Root."

I think I remembered this because of its resemblance to the process by which Cheney became VP...

[John Thullen]

OCSteve, Slart, and others are of course correct to point out the history of military and other contracting with private firms.

That such contracting has been suffused with political corruption and/or favoritism from the beginning is like noticing one's palms are greasy after lubing the axles on your car --- it comes with the territory --- the territory being to my mind that NOTHING gets done in the world on a completely honest, objective basis, much as we wish it would.

What IS different now is the development of an impermeable and unthinking ideology that says "privatize everything --- government can do nothing right -- and what's left of government should be run like a business at all times and in every case, even if it means that folks stop feeding the troops in the field because the bill was not paid on time."

This is as misguided as demanding that all private sector enterprises should be nationalized each time something goes wrong.

Even though the payment/administrative side of healthcare should be nationalized and the airline industry seems so dysfunctional during all economic times that it could use a swarm of commissars to kick bureaucratic butt.

So there.

[Jesurgislac]

It's not funny because it's true.

Where did the funny go, Thullen?

[John Thullen]

"Where did the funny go, Thullen?"

I'm having my funny gland checked and serviced next week. Maybe my funny fluids are leaking.

My Funoculist is a dour type, despite the rubber chicken that passes for a diploma on his wall. He doesn't even find it funny when I turn the tables and ask him how he's doing?

But he'll hook me up to the laughoscanometer and if there is any funny left in me, he'll find it.

[russell]

I just think it’s relevant to occasionally challenge what seems to be the accepted knowledge that this is all somehow new

I appreciate what you're saying, OC, but I think the relationship of Cheney to both Halliburton and, through them, KBR is a bit closer than normal.

Also not discussed here so far, I think, is the use of private contractors for security. In other words, private folks bearing arms. Folks like Blackwater etc.

They aren't just there to provide security for other private entities, they are providing security details for the State Department, among others. AFAIK, that is also unprecedented, and is problematic in ways that supply line problems doesn't even touch.

These guys are approaching things, quite deliberately, in ways that are pretty far removed from what we've done before.

Thanks -

[EoH]

No, privatization isn't new, it's been going on for decades at least. What is new is its scope, variety and depth, and its apparent irreversibility, which violates a basic tenet of outsourcing - retaining the ability to recover the activity whole and at a manageable cost when conditions change.

What is also new is its White House's patronage and that it's happening and accelerating during wartime. Far more so than during the few weeks of Gulf War I.

Cheney isn't the first political patron of KBR or military contractors in general. More often they've been CongressCritters protecting their coffers and home district employment. But as with his vice presidency overall, Cheney wields enormous influence. He has shadow representatives in key federal agencies, he hates whistleblowers and oversight of any kind, and exacts retribution against anyone who speaks out against waste, fraud and abuse. It's like stealing caviar from the mouth of a CEO. The chilling effects on oversight and best sourcing practices are obvious.

Outsourcers have carte blanche from Congress, too. How many Congressional investigations have there been of individual contractors or contractors as a group? KBR, Blackwater? How many DOJ investigations or prosecutions? About as many as the number of ACLU conventions Cheney has attended. There were routine during the Second World War, Korea and Vietnam. Because as the late Sen. Dirksen once remarked, a billion here and a billion there and pretty soon you're talking about real money.

Military outsourcing - and even more critically, intelligence outsourcing - today is novel and enormous in scope. It remains undebated. Cheney has worked hard to keep it that way, but he has lots of friends in Congress, and their attendant lobbyists, who agree with him.

[Nombrilisme Vide]

They aren't just there to provide security for other private entities, they are providing security details for the State Department, among others. AFAIK, that is also unprecedented, and is problematic in ways that supply line problems doesn't even touch.

They're not just sticking strictly to "security" either:

Moreover, contrary to the terms of its contract, Blackwater sometimes engaged in offensive operations with the American military, instead of confining itself to its protective mission, the staff found. (NYT)

U.S. Embassy officials dispatched Blackwater helicopters to evacuate the [Polish] ambassador and others. Blackwater was not involved in protecting the Polish convoy. (WaPo)

And they're looking to the future:

Unlike national and multinational armies, which tend to get bogged down by political and logistical limitations, Black said, Blackwater could have a small, nimble, brigade-size force ready to move into a troubled region on short notice. (VaPi)

[mu]

People, please, learn a bit of history so you won't be surprised when the aristocrats keep doing the same things over and over again. War Is a Racket, it always has been.

http://www.ratical.org/ratville/CAH/warisaracket.html

http://en.wikipedia.org/wiki/War_Is_a_Racket

http://www.amazon.com/War-Racket-Antiwar-Americas-Decorated/dp/0922915865

[Fledermaus]

It’s rather depressing that we haven’t managed to get a handle on it over the course of all these years.

I agree, OCS - but there has not been ANY incentive to restrain military spending. The gov't and military officials need good jobs when they get out (I imagine military pay - even at high rank - doesn't pay nearly as well as Senior VP at KBR. Meanwhile there's some national consensus that we can never, ever cut military spending, it must go up up up otherwise we'll all be killed in our sleep by the indians Spanish Nazis communists Islamofacists.

[russell]

Unlike national and multinational armies, which tend to get bogged down by political and logistical limitations

Aha, the heart of the matter:

The ability to project power without having to put up with legal or Constitutional restraints or limitations on where, when, how, or on who it is projected.

And, of course, this is presented as a wonderful innovation, a bright shiny new feature.

It's nothing new, and by "nothing new" I mean it long predates our nation. It predates nation states, for that matter.

A glance at the history of private armies, and their use by unaccountable executives and/or private entities, should be enough to sober up anyone. If we don't stop this, it's going to blow up in our face, and we'll never know what hit us.

Thanks -

[russell]

I tell you that I find no such savor in eating butter and sleeping, as when I hear cried "On them!" and from both sides hear horses neighing through their head-guards, and hear shouted "To aid! To aid!" and see the dead with lance truncheons, the pennants still on them, piercing their sides.

Papiol, be glad to go speedily to "Yea and Nay", and tell him there's too much peace about.

Bertran de Born, baron and troubador, 12-13th C.

de Born later appears in Dante's "Inferno", wandering the eighth circle of hell, carrying his own severed head like a lantern.

I'm with Thullen, poets should rule the world.

Thanks -