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Last Updated: 07/12/2006
How Privatized is War?
Pujya J Pascal

Some security analysts believe that the private sector is so firmly embedded in combat and occupation that the phenomenon may have reached the point of no return. The U.S. army estimates that of the $87 billion earmarked in the year 2003 for the broader Iraqi campaigns including Central Asia and Afghanistan, one third has been spent on contracts to private companies. Pujya Pascal discusses corporate adventurism in the context of the latest concerns relating to Private Military Companies.


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How Privatized is War?



By   Pujya J Pascal

Nowhere has the role of Private Military Companies (PMCs) been more integral and more controversial than in the U.S. War in Iraq. The past couple of years have seen increased publicity, though much of it has been highly sensationalized by the media, of the activities and role of the PMCs operating in Iraq.[1] The war came to be known as the ‘the first privatized war’ primarily because it was estimated that around 15,000 to 20,000 private military and security companies were working in Iraq from the time the attack was launched.[2] Some security analysts believe that the private sector is so firmly embedded in combat and occupation that the phenomenon may have reached the point of no return.[3] While there is a dearth if accurate accounting and monitoring of the contracts, the U.S. army estimates that of the $87 billion earmarked in the year 2003 for the broader Iraqi campaigns including Central Asia and Afghanistan, one third has been spent on contracts to private companies. [4]


This article seeks to find out whether privatization of military is merely a symptom of corporate adventurism or has it already made inroads into the realm of international politics as an effective ‘force multiplier’ in the most recent wars conducted under the leadership of the USA.


Areas of Operations

The operations in Iraq are reflections of the changes in the ways states prosecute warfare. Though the lack of stability and security in Iraq has created the space for PMCs to step in and assist the U.S. and UK forces, the major driving force behind their engagement is the monetary gains involved in these services. Reportedly, more than 1,500 South Africans including members of the South African Police Services and former members of the South African National Defense Force (SANDF) are believed to be engaged in Iraq.[5] Although a handful of U.S. companies have the lucrative contracts to train the new Iraqi army and to recruit and train an Iraqi police force, it is a field in which British companies dominate, with nearly half of the dozen private firms in Iraq coming from the UK.[6]  


While the PMCs offer military support functions during conflict, the private sector is even more deeply involved in the War’s aftermath.[7] It is a trend that has been growing worldwide since the end of the cold war, a booming business that entails replacing soldiers wherever possible with highly paid civilians and hired guns not subject to standard military disciplinary procedures.


Today well over 20,000 civilian contractors support the coalition forces in Iraq, and according to a May 4, 2004 letter to the House of Armed Services Committee from Secretary of Defense Donald Rumsfeld, that number was expected to increase after the June 28 handover of power to the Iraqis.[8] Admittedly, private corporations have penetrated Western warfare so deeply that they are now the second largest contributor to coalition forces in Iraq after the Pentagon. A Guardian investigation established that the proportion of contracted security personnel in the firing line in Iraq was 10 times greater than during the first Gulf War. In 1991, for every private contractor, there were about 100 service men and women; now there are 10.[9] It is important to note that official U.S. military doctrine has long held that critical operations must be kept inside the force. It has also held that civilians accompanying the force should not be put into roles where they must carry or use weapons, allowing the carriage of small weapons only in the most extraordinary circumstances. However, what used to be an exception has now turned into a rule.


The PMC contractors are as various in their duties as members of the military itself: they perform tasks as ‘banal as preparing meals and operating supply trucks, as dangerous as conducting armed raids and driving the car in a convoy through hostile territory, and as sensitive as interrogating prisoners’.[10] Private Military Companies have been carrying out three crucial functions in Iraq:

§         military support dealing with prison interrogation,

§         military training and advice, and

§         tactical military roles of providing convoy security, non- military site security and personal security.


PMC operations in Iraq tread the difficult line in providing protection in a manner that meets the intricate demands of corporate, military and government ethics, and come at a significant price. Some of the significant PMCs and security companies operating in Iraq have been listed below:


  • Aegis Defense Services (UK): Won a contract valued up to $293m for three years to provide men to provide security in all major Iraqi government projects following the handover of sovereignty.
  • ArmourGroup (UK): Has a £ 876,000 contract to supply 20 security guards for the Foreign Office. The firm also employs about 500 Gurkhas to guard executives with the U.S. firms KBR and Bechtel.
  • Blackwater (US): The companies’ personnel guarded Paul Bremer, the head of the CPA among other duties. The firm was awarded a $21m no-bid contract to supply security guards and two helicopters for Bremer. Also when an attack by hundreds of Iraqi militia was launched on the U.S. governments’ headquarters in Najaf, it was not repulsed by the U.S. military but by eight Blackwater commandos. In a field that often lacks transparency and sometimes includes dubious characteristics, Blackwater is a firm with reputation for professionalism. It has never had a major allegation of malfeasance against it.
  • Control Risks Group (UK): UK government’s largest contract has reportedly earned the company £ 23.5m. It has won the contract to distribute the new Iraqi currency, a job it also carried out in 2003.
  • Dyncorp (US): Dyncorp International, a unit of Computer Sciences Corporation (CSC), has been prominent for its hiring of police officers in the US to train police recruits in Iraq.
  • Titan (US): Being awarded the contract of providing translators to the U.S. Army since 1990, the services in translation has been listed as the single most important source of income, accounting for 10.3 per cent of its $1,800 mi revenue. Titan has been involved in supporting both reconstruction efforts and military interrogation and later got involved in the prison abuse for which it withdrew its demand as well.


The private military sector has been undergoing a significant quantitative and qualitative change in the past few years. But it is Iraq that has focused world attention on the activities performed by them in the battlefield. Though not noticed for their post-combat operations, PMCs gained prominence due to their commitments during the war itself. The U.S. Navy relied on civilian contractors to help operate the guided missile systems on some of its ships apart from relying on them for base operations such as equipment maintenance, biological and chemical detection, fuel and material transport and medical services. In fact, there have been instances, many more than reported, where experienced PMC personnel have gone to the rescue of U.S. soldiers in danger zones.


A host of tactical and operational functions is performed by the PMCs. Often the role is not to act as a substitute for the military or to be adjunct to the campaign. Rather, it is to provide reconstruction agencies and those companies involved in the rebuilding process with on the ground risk assessment and security support to enable them to work as safely and effectively as possible. This is not entirely the privatization of war, but an established private sector activity in many parts of the world. Iraq is different only in the scale and complexity of the assignment.



Costs Involved in Operations: The Economics


PMCs and their parent companies usually do not make details available concerning their contracts, salaries, or number of employees. Given the obvious danger of working in war zones where personnel are potential targets, it seems reasonable that PMC contractors especially those with highly sought after skills in short supply, can command high salaries. PMC personnel with skills similar to Special Operation Forces (SOF) personnel are mostly in a position to command high salaries. Some claim that they can earn more than £ 80,000 a year. Reportedly, companies are offering yearly salaries ranging from $100,000 to nearly $200,000 to entice senior SOF personnel to switch careers.[11] Short term, high risk work can fetch higher pay packages and it is claimed that a personnel working for a seven-day contract in cities like Fallujah can make $1,000 a day.[12] However, most of the financial rewards can be overplayed especially since the downsides for PMC contractors can be considerable, such as:


  • Most companies enforce regular periods of unpaid mandatory leave out of country on their employees every few months for rest and recharge;
  • The dangers are considerable, and the work frequently demands a high level of experience and training;
  • Although for some the income is tax-free, under U.S. law, U.S. citizens are liable to U.S. tax if they reside within the country for more than one year;
  • Additional insurance and retirement contributions are the responsibility of individual contractors.


The lure of higher salaries is reportedly causing an exodus of the U.S. military’s most seasoned members of SOF to higher-paying civilian security jobs. While few details have been released about the amounts involved in specific contracts, it is estimated that of the $18.6 billion allocated by the Bush administration for Iraq’s “reconstruction,” at least 25 percent will be used to pay security companies.[13] David Claridge, director of a London based security firm has estimated that Iraq contracts have boosted the annual revenue of British-based PMCs alone from $320 million to over $1.7 billion.[14]


Just as information regarding the money involved in operations undertaken by PMCs in Iraq is not disclosed totally, the number of contractors working in there is not certain either. With the growing demand for PMCs in Iraq, many former SOF personnel are planning to form their own security firms. However, it seems likely that any proliferation of security companies will precede a period of consolidation.


During major combat operations phase of the Iraq War, private military officials carried out important tasks. They have been essential to the US effort in Iraq, helping Washington to make up for troop shortage and doing jobs that US forces would prefer not to. They have also been involved in some of the most controversial aspects of war including prison abuse.[15]


Working in over 50 conflict zones, the industry is representative of a broader globalization.[16] The PMCs in Iraq are carrying out essential jobs that soldiers have done in the past- from handling logistics and maintenance to training to fighting battles- and they have taken more casualties than an ally. However, while performing tasks crucial to the operation, they are not formally part of the force, creating a critical disconnect in such areas as intelligence sharing as well as confusion over rights and responsibilities in the midst of combat.


During the occupation of Iraq, the demand for private assistance skyrocketed and led to the most important of all functions- the dramatic and the controversial expansion of the Private Military Companies in the realm of combat. Before Iraq PMCs had fought in several combat zones, the most notable being Executive Outcomes’ (EO) participation in the Sierra Leone and Angola wars. But Iraq is the first time that companies have played tactical roles alongside large numbers of U.S troops in the field.[17]


The costs have been high. The mounting deaths and injuries to civilian contractors in Iraq have cost the federal government millions of dollars for hundreds of workers and their compensation claims. Federal law requires all U.S. government contractors and subcontractors to obtain workers’ compensation insurance for civilian employees who work overseas. If an injury or death claim is related to a "war-risk hazard," the War Hazards Compensation Act provides for government reimbursement to insurance carriers. Since January 2003, there have been claims for 476 injuries and 80 deaths in Iraq.[18]


Among the many casualties reported, the most gruesome deaths recorded were of the four civilian security personnel who got killed on

Pujay Pascal is a graduate alumna of the University for Peace