Erik Prince, the infamous founder of Blackwater, is back in the public eye pushing a full privatization of the war in Afghanistan. Prince, an ex-Navy SEAL billionaire and brother of Secretary of Education Betsy DeVos, sold Blackwater and went off the radar in 2010 after a series of scandals. But last year, Prince was recruited by the Trump administration to propose a new Afghanistan strategy. In response, Prince promoted installing an American viceroy in Afghanistan similar to the East India Company contracting model. Last week, he doubled down on contracting former special operations forces. These recommendations align with his long-stated goal “to do for the national security apparatus what FedEx did to the postal service.” This ambition may seem outlandish, but the US is actually not too far off from achieving Prince’s vision.
For the first time in the history of major American wars, contractors outnumbered military troops under the George W. Bush administration. At the height of the wars, there were estimates of 190,000 contractors and 160,000 servicepersons deployed in Iraq, and estimates of 104,000 contractors and 64,000 servicepersons in Afghanistan.
These security contractors represent a challenge to conventional foreign policy, which holds that powerful states are not supposed to outsource war to private forces. When security contractors proliferate in countries like Sierra Leone and Papua New Guinea, academics view this as an indicator of “state failure.” As such, the embrace of security contracting by the world’s largest military is puzzling.
But while private contracting may reflect weakness, it also helps sustain American power. Primarily, outsourcing keeps down the political costs of deployment by avoiding counting contractors as part of the official war effort. Indeed, following the 9/11 attacks, the CIA’s then number three official, Buzzy Krongard, remarked: “The war will be won in large measure by forces you do not know about, in actions you will not see and in ways you may not want to know about, but we will prevail.” Krongard’s reference to “forces you do not know about” could be a general nod to physical forces or events. But the statement also foreshadowed the unprecedented contractor force authorized by high-level government officials (Cheney and Rumsfeld, among the many).
To be clear, FedEx is not a problem in itself. I have used it plenty of times. But “FedExing” the national security apparatus is a different ballgame.
What then do Prince’s return to the public sphere and the privatizing trend mean for foreign policy? To be clear, FedEx is not a problem in itself. I have used it plenty of times. But “FedExing” the national security apparatus is a different ballgame, and one that academics have long found troubling. In particular, I want to highlight three mismatches between the US government and contractors that should worry us all.
First, there is a human capital shortfall in properly overseeing contractors. During the contracting boom in 2006, the US federal workforce (excluding USPS) was the same size as it was in 1963. However, the size of the federal budget had grown three-fold. Each federal employee was now responsible for overseeing a million dollars more with the same resources. The government has made investments, especially in computers, in the last 40 years, but these are not enough to keep track of an additional $2 trillion. Critically, the human capital shortfall also sustains the demand for contractors while making it more difficult to oversee them. One consequence is the oversight of contractors by … other contractors.
Second, there is a financial mismatch in the number of resources at stake. General government contracting is dominated by weapons manufacturers like Lockheed Martin, which as the largest federal contractor received $36.8 billion in 2016. This is more than the budgets of the Departments of Commerce, Interior, the Small Business Administration, and Congress combined. In terms of war contracting, the US government admits spending $85 billion on Iraq contracts. But a 2013 investigation by The Financial Times estimates the US spent at least $138 billion on security contractors in Iraq, with former Halliburton subsidiary, Kellogg, Brown and Root (KBR), awarded the highest contract value of at least $39.5 billion (rounding out the top three were Agility Logistics at $7.2 billion and Kuwait Petroleum at $6.3 billion). Government resources cannot hold a candle to these high-rolling contractors with powerful incentives and deep pockets to maintain their business.
Third, the structure of contracts creates regulatory uncertainty. Even if the government overcomes the personnel and financial obstacles to create better oversight, monitoring compliance is a challenge. Consider that a federal contract can go through as many as three layers of subcontracts and that companies can refuse to publicly disclose subcontractors for proprietary reasons. The implications for regulatory compliance are huge. For instance, in 2004, four Blackwater contractors were killed in Fallujah and their families filed a wrongful death suit against the firm. The slain contractors had inadequate protection, including vehicles without armor, which the families claimed was against their contract. In a separate investigation of the incident, it took a Congressional oversight committee three years to determine whose contract Blackwater was operating under. It eventually turned out to be subcontracted by Halliburton, which Halliburton denied throughout.
These three mismatches together point to the dangers of a shadow force in US foreign policy that is hard to oversee, regulate, or resist. Whether Erik Prince fulfills his dream of “FedExing national security,” the fact of the matter is that we are already a long way down that path. The administration of the “businessman president” isn’t likely to turn back.
This piece is part of a special series, in honor of Inkstick’s one-year anniversary, which looks to the future of US foreign policy under President Donald J. Trump and beyond. To read the rest of the series, click here.