America's For-Profit Secret Army

October 13, 2002

With the war on terror already a year old and the possibility of war
against Iraq growing by the day, a modern version of an ancient practice
- one as old as warfare itself - is reasserting itself at the Pentagon.
Mercenaries, as they were once known, are thriving - only this time they
are called private military contractors, and some are even subsidiaries
of Fortune 500 companies.

The Pentagon cannot go to war without them.

Often run by retired military officers, including three- and four-star
generals, private military contractors are the new business face of war.
Blurring the line between military and civilian, they provide stand-ins
for active soldiers in everything from logistical support to battlefield
training and military advice at home and abroad.

Some are helping to conduct training exercises using live ammunition for
American troops in Kuwait, under the code name Desert Spring. One has
just been hired to guard President Hamid Karzai of Afghanistan, the
target of a recent assassination attempt. Another is helping to write
the book on airport security. Others have employees who don their old
uniforms to work under contract as military recruiters and instructors
in R.O.T.C. classes, selecting and training the next generation of

In the darker recesses of the world, private contractors go where the
Pentagon would prefer not to be seen, carrying out military exercises
for the American government, far from Washington's view. In the last few
years, they have sent their employees to Bosnia, Nigeria, Macedonia,
Colombia and other global hot spots.

Motivated as much by profits as politics, these companies - about 35 all
told in the United States - need the government's permission to be in
business. A few are somewhat familiar names, like Kellogg Brown & Root,
a subsidiary of the Halliburton Company that operates for the government
in Cuba and Central Asia. Others have more cryptic names, like DynCorp;
Vinnell, a subsidiary of TRW; SAIC; ICI of Oregon; and Logicon, a unit
of Northrop Grumman. One of the best known, MPRI, boasts of having "more
generals per square foot than in the Pentagon."

During the Persian Gulf war in 1991, one of every 50 people on the
battlefield was an American civilian under contract; by the time of the
peacekeeping effort in Bosnia in 1996, the figure was one in 10. No one
knows for sure how big this secretive industry is, but some military
experts estimate the global market at $100 billion. As for the public
companies that own private military contractors, they say little if
anything about them to shareholders.

"Contractors are indispensible," said John J. Hamre, deputy secretary of
defense in the Clinton administration. "Will there be more in the
future? Yes, and they are not just running the soup kitchens."

That means even more business, and profits, for contractors who perform
tasks as mundane as maintaining barracks for overseas troops, as
sophisticated as operating weapon systems or as secretive as
intelligence-gathering in Africa. Many function near, or even at, the
front lines, causing concern among military strategists about their
safety and commitment if bullets start to fly.

The use of military contractors raises other troubling questions as
well. In peace, they can act as a secret army outside of public view. In
war, while providing functions crucial to the combat effort, they are
not soldiers. Private contractors are not obligated to take orders or to
follow military codes of conduct. Their legal obligation is solely to an
employment contract, not to their country.

Private military contractors are flushing out drug traffickers in
Colombia and turning the rag-tag militias of African nations into
fighting machines. When a United Nations arms embargo restricted the
American military in the Balkans, private military contractors were sent
instead to train the local forces.

At times, the results have been disastrous.

In Bosnia, employees of DynCorp were found to be operating a sex-slave
ring of young women who were held for prostitution after their passports
were confiscated. In Croatia, local forces, trained by MPRI, used what
they learned to conduct one of the worst episodes of "ethnic cleansing,"
an event that left more than 100,000 homeless and hundreds dead and
resulted in war-crimes indictments. No employee of either firm has ever
been charged in these incidents.

In Peru last year, a plane carrying an American missionary and her
infant was accidentally shot down when a private military contractor
misidentified it as on a drug smuggling flight.

MPRI, formerly known as Military Professionals Resources Inc., may
provide the best example of how skilled retired soldiers cash in on
their military training. Its roster includes Gen. Carl E. Vuono, the
former Army chief of staff who led the gulf war and the Panama invasion;
Gen. Crosbie E. Saint, the former commander of the United States Army in
Europe; and Gen. Ron Griffith, the former Army vice chief of staff.
There are also dozens of retired top-ranked generals, an admiral and
more than 10,000 former military personnel, including elite special
forces, on call and ready for assignment.

"We can have 20 qualified people on the Serbian border within 24 hours,"
said Lt. Gen. Harry E. Soyster, the company's spokesman and a former
director of the Defense Intelligence Agency. "The Army can't do that.
But contractors can."

For that, MPRI is paid well. Its revenue exceeds $100 million a year,
mainly from Pentagon and State Department contracts. Retired military
personnel working for MPRI receive two to three times their Pentagon
salaries, in addition to their retirement benefits and corporate
benefits like stock options and 401(k) plans. MPRI's founders became
millionaires in July 2000, when they and about 35 equity holders sold
the company for $40 million in cash to L-3 Communications, a military
contractor traded on the New York Stock Exchange.

Within the military, the use of contractors is Defense Department policy
for filling the gaps as the number of troops falls. At the time of the
gulf war, there were 780,000 Army troops; today there are 480,000. Over
the same period, overall military forces have fallen by 500,000.

Pentagon officials did not respond to many telephone calls and e-mail
messages requesting interviews, but they have maintained that
contractors are a cost-effective way of extending the military's reach
when Congress and the American public are reluctant to pay for more

"The main reason for using a contractor is that it saves you from having
to use troops, so troops can focus on war fighting," said Col. Thomas W.
Sweeney, a professor of strategic logistics at the Army War College in
Carlisle, Pa. "It's cheaper because you only pay for contractors when
you use them."

But one person's cost-saving device can be another's "guns for hire," as
David Hackworth, a former Army colonel and frequent critic of the
military, called them.

"These new mercenaries work for the Defense and State Department and
Congress looks the other way," Colonel Hackworth, a highly decorated
Vietnam veteran, said. "It's a very dangerous situation. It allows us to
get into fights where we would be reluctant to send the Defense
Department or the C.I.A. The American taxpayer is paying for our own
mercenary army, which violates what our founding fathers said."

They are not mercenaries in the classic sense. Most, but not all,
private military contractors are unarmed, even when they oversee others
with guns. They have even formed a trade group, the International Peace
Operations Association, to promote industry standards.

"We don't want to risk getting contracts by being called mercenaries,"
said Doug Brooks, president of the association. "But we can do things on
short notice and keep our mouths shut."

That, some critics say, is part of the problem. By using for-profit
soldiers, the government, especially the executive branch, can evade
Congressional limits on troop strength. For instance, in Bosnia, where a
cap of 20,000 troops was imposed by Congress, the addition of 2,000
contractors helped skirt that restriction.

Contractors also allow the administration to carry out foreign policy
goals in low-level skirmishes around the globe - often fueled by ethnic
hatreds and a surplus of cold war weapons - without having to fear the
media attention that comes if American soldiers are sent home in body

At least five DynCorp employees have been killed in Latin America, with
no public outcry. Denial is easier for the government when those working
overseas do not wear uniforms - they often wear fatigues or
military-looking clothes but not official uniforms.

"If you sent in troops, someone will know; if contractors, they may
not," said Deborah Avant, an associate professor of political science at
George Washington University and author of many studies on the subject.

Only a few members of Congress have expressed concern about the

"There are inherent difficulties with the increasing use of contactors
to carry out U.S. foreign policy," said Senator Patrick J. Leahy,
Democrat of Vermont and the chairman of the foreign operations
subcommittee. "This is especially true when it involves `private'
soldiers who are not as accountable as U.S. military personnel.
Accountability is a serious issue when it comes to carrying guns or
flying helicopters in pursuit of U.S. foreign policy goals."

In the House, Representative Jan Schakowsky, an Illinois Democrat, led
the battle against a Bush administration effort to remove the cap that
limits the number of American troops in Colombia to 500 and private
contractors to 300.

"American taxpayers already pay $300 billion a year to fund the world's
most powerful military," Ms. Schakowsky said. "Why should they have to
pay a second time in order to privatize our operations? Are we
outsourcing in order to avoid public scrutiny, controversy or
embarrassment? Is it to hide body bags from the media and thus shield
them from public opinion?"

SUCH concerns are hardly slowing the pace across the Potomac, at MPRI in
Alexandria, Va. The company may look like hundreds of other white-collar
concerns that fill small office buildings in northern Virginia, but
there are telltale signs to the contrary: the sword that serves as the
corporate logo and conference rooms named the Infantry Room, the Cavalry
Room and the Artillery Room. Its art consists of paintings of celebrated
battles, largely from the Civil War.

It's hard to tell where the United States military ends and MPRI begins.
For the last four years, MPRI has run R.O.T.C. training programs at more
than 200 universities, under a contract that has allowed retired
military to put their uniforms back on. It recently lost the contract to
a lower bidder, but MPRI offset the loss with one to provide former
soldiers to run recruitment offices.

The company, which has 900 full-time employees, helps run the United
States Army Force Management School at Fort Belvoir. It also provides
instructors for advanced training classes at Fort Leavenworth, teaches
the Civil Air Patrol and designs courses at Fort Sill, Fort Knox, Fort
Lee and other military centers.

The Pentagon has even hired MPRI to help it write military doctrine -
including the field manual called "Contractors Support on the
Battlefield" that sets rules for how the Army should interact with
private contractors, like itself.

Overseas, MPRI is, if anything, more active. Under a program it calls
"democracy transition," the company has offered countries like Nigeria,
Bosnia, Saudi Arabia, Taiwan, Ukraine, Croatia and Macedonia training in
American-style warfare, including war games, military instruction and
weapons training.

In Croatia, MPRI was brought in to provide border monitors in the early
1990's. Then, in 1994, as the United States grew concerned about the
poor quality of the Croatian forces and their ability to maintain
regional stability, it turned to MPRI. A United Nations arms embargo in
1991, approved by the United States, prohibited the sale of weapons or
the providing of training to any warring party in the Balkans. But the
Pentagon referred MPRI to Croatia's defense minister, who hired the
company to train its forces.

In 1995, MPRI started doing so, teaching the fledgling army military
tactics that MPRI executives had developed while on active duty
commanding the gulf war invasion. Several months later, armed with this
new training, the Croatian army began Operation Storm, one of the
bloodiest episodes of "ethnic cleansing" in the Balkans, an event that
also reshaped the military balance in the region.

The operation drove more than 100,000 Serbs from their homes in a
four-day assault. Investigators for the international war crimes
tribunal in the Hague found that the Croatian army carried out summary
executions and indiscriminately shelled civilians. "In a widespread and
systematic matter, Croatian troops committed murder and other inhumane
acts," investigators said in their report. Several Croatian generals in
charge of the operation have been indicted for war crimes and are being
sought for trial.

"No MPRI employee played a role in planning, monitoring or assisting in
Operation Storm," said Lieutenant General Soyster, the MPRI spokesman.
He did say that a few Croatian graduates of MPRI's training course
participated in the operation.

Yet what happened in Croatia gave MPRI international brand recognition
and more business in that region. When Bosnian Muslims balked in 1995 at
signing the Dayton peace accords out of fear that their army was
ill-equipped to provide sufficient protection, MPRI was called in.

"The Bosnians said they would not sign unless they had help building
their army," said Peter Singer, a foreign policy fellow at the Brookings
Institution who is writing a book on contractors. "And they said they
wanted the same guys who helped the Croatians."

That is who they got. Under a plan worked out by American negotiators,
the Bosnian Muslims hired MPRI using money that was provided by a group
of Islamic nations, including Saudi Arabia, Kuwait, Brunei, the United
Arab Emirates and Malaysia. These nations deposited money in the United
States Treasury, which MPRI drew against.

"It was a brilliant move in that the U.S. government got someone else to
pay for what we wanted from a policy standpoint," Mr. Singer said.

At the moment, MPRI is advertising for special forces for antiterrorist
operations, is bulking up to train American forces in Kuwait and is
looking for people with special skills like basic-training instruction
and counterintelligence. Recently, however, it lost a $4.3 million
contract to provide training to the army in Colombia when officials
there complained about what they called the poor quality of MPRI's

In Africa, MPRI has conducted training programs on security issues for
about 120 African leaders and more than 5,500 African troops. Most
recently, it went toe to toe with the State Department, and won, gaining
permission to do business in Equatorial Guinea, a country with a
deplorable human rights record where the United States does not have an

After two years of lobbying at the State Department, and after being
turned down twice on human rights grounds, MPRI was finally given
approval last year to work with President Teodoro Obiang Nguema, whom
the State Department describes as holding power through torture, fraud
and a 98 percent election mandate. MPRI advised President Obiang on
building a coast guard to protect the oil-rich waters being explored by
Exxon Mobil off the coast.

More recently, when MPRI and President Obiang proposed that MPRI also
help the country build its police and military forces, the State
Department objected and the project is now dormant.

"We thought helping the coast guard would be pretty innocuous in terms
of human rights," Lieutenant General Soyster of MPRI said. But Ms. Avant
of George Washington University disagreed, saying any alliance with
United States military contractors would strengthen President Obiang's

MPRI is not the only company to have run into problems overseas.
DynCorp, a privately held company in Reston, Va., with nearly $2 billion
in annual sales, has been tapped to provide protection for Mr. Karzai in
Afghanistan. DynCorp also provides worldwide protective services for
State Department employees.

In late September, DynCorp settled charges - for an undisclosed sum -
brought by a whistle-blower the company had fired after he complained of
a sex ring run by DynCorp employees in Bosnia. In August, a British
court, meanwhile, ruled in favor of another former DynCorp employee in a
separate whistle-blower case. DynCorp is appealing.

The two employees made similar accusations: that while working in
Bosnia, where DynCorp was providing military equipment maintenance
services, DynCorp employees kept underaged women as sex slaves, even
videotaping a rape. Among the charges was that while the DynCorp
employees trafficked in women - including buying one for $1,000 - the
company turned a blind eye. Since the DynCorp employees involved were
not soldiers, their actions were not subject to military discipline. Nor
did they face local justice; they were simply fired and sent home.

In both cases, after complaining, the two employees who blew the whistle
were fired. Ben Johnston, one of them, said last April in Congressional
testimony: "DynCorp employees were living off post and owning these
children and these women and girls as slaves. Well, that makes all
Americans look bad. I believe DynCorp is the worst diplomat our country
could ever want overseas."

A DynCorp spokesman, Chuck Taylor, said the company "felt horrible" and
held its own internal investigation before firing the employees who
operated the ring.

DynCorp also handles aerial anti-narcotics efforts for the United States
government in the skies over Colombia and nearby countries - where
several employees have been killed. Because of Congressional caps on the
use of private military contractors, DynCorp has hired local citizens;
two were recently killed.

Still, in its recruiting material, the company plays up the excitement
of this type of work: "Being the best is never easy and when your office
is the cockpit of a twin-engine plane swooping low over the Colombian
jungle, the challenges can often be enormous."

Incidents like these - sex rings, deals with dictators, misused military
training and tragic accidents - raise questions about the use of
contractors. To whom are they accountable: the United States government
or their contract? When such incidents occur, who bears the

Moreover, while the general mantra about military privatization is that
it saves money, there are few studies to prove the case - and in fact,
reports exist to the contrary.

For instance, Kellogg Brown & Root, which was paid $2.2 billion to
provide logistics support to American troops in the Balkans, was the
subject of a General Accounting Office report entitled, "Army Should Do
More to Control Contract Costs in the Balkans." The office found that
the Army was not exercising enough oversight on Kellogg Brown & Root as
contract costs rose, to the benefit of the company. Still, the company
continues to pick up new business.

Questions about security and control are even more basic. In the
battlefield, a commander cannot give orders to a contractor as he can a
soldier. Contractors are not compelled by an oath of office, as soldiers
are, but instead by an employment contract that provides little
flexibility. Nor are contractors subject to the Uniform Code of Military

Contractors cannot arm themselves - they risk losing their status as
noncombatants if they do and, in the extreme, could be declared
mercenaries and subject to execution if captured. Yet in the gulf war,
contractors were in the thick of battle, providing maintenance to tanks
and biological and chemical vehicles as well as flying air support.

Should there be a war in Iraq, the line could be even blurrier.

"There are no rear areas anymore," Colonel Sweeney of the Army War
College said. With chemical and biological weapons, "no place is safe,"
he said.

"You can't draw a map and say `no contractors forward of this line,' "
he added. "The American concept of combat is to take the battle to the
rear areas and be as disruptive as possible. The other guy is thinking
the same thing."

One tenet of warfare is that soldiers handling support functions can
grab a gun and hit the front lines if needed. While this is often
dismissed as a quaint World War II concept, it happened in Somalia in
1993 when Army rangers were in trouble and military supply clerks came
to their rescue. When the support staff is filled with contractors,
would they do the same? Or would commanders in the field become
responsible for the safety of the growing number of contractor employees
at the expense of advancing the battle?

The issue is just beginning to generate some attention in military

"We sort of blur the lines," Col. Steven J. Zamparelli of the Air Force
said in an interview. In an article in 1999 for the Air Force Journal of
Logistics, Colonel Zamaparelli said: "The Department of Defense is
gambling future military victory on contractors' performing operational
functions in the battlefield."

Others in the military are more blunt about the effect on soldiers. "Are
we ultimately trading their blood to save a relatively insignificant
amount in the national budget?" said Lt. Col. Lourdes A. Castillo of the
Air Force, a logistics expert, in a 2000 article in Aerospace Power
Journal. "If this grand experiment undertaken by our national leadership
fails during wartime, the results will be unthinkable."