PENTAGON REPEATING CONTRACTOR MISTAKES

“From the abuses at Abu Ghraib prison to the muti­la­tion of American civil­ians at Falluja, many of the worst moments of the Iraqi occu­pa­tion have involved pri­vate mil­i­tary con­trac­tors ‘out­sourced’ by the Pentagon,” writes Defense Tech pal Peter Singer in a must-​​read Times op-​​ed. “Yet despite the prob­lems and the wide­spread accu­sa­tions of over­billing, it appears the civil­ian lead­er­ship at the Pentagon has learned absolutely noth­ing from the whole expe­ri­ence.“

Last month the Pentagon awarded a $293 mil­lion con­tract for coor­di­na­tion of secu­rity sup­port to a British firm called Aegis Defense Services. The huge con­tract has two aspects: Aegis will be the coor­di­na­tion and man­age­ment hub for the more than 50 other pri­vate secu­rity com­pa­nies in Iraq, and it will pro­vide its own force of up to 75 “close pro­tec­tion teams,” each made up of eight armed civil­ians who are to pro­tect staff mem­bers of the United States Project Management Office.
The con­tract is a case study in what not to do. To begin with, a core prob­lem of the mil­i­tary out­sourc­ing expe­ri­ence has been the lack of coor­di­na­tion, over­sight and man­age­ment from the gov­ern­ment side. So out­sourc­ing that very prob­lem to another pri­vate com­pany has a logic that would do only Kafka proud. In addi­tion, it moves these com­pa­nies fur­ther out­side the bounds of pub­lic over­sight.
Moreover, with the han­dover of Iraqi sov­er­eignty in just weeks, why is the Pentagon, rather than the Iraqis them­selves, mak­ing this deci­sion? Indeed, it seems con­trary to the over­all American strate­gic goal of hand­ing over the respon­si­bil­i­ties for secu­rity to the Iraqis as a pre­lude to get­ting out of the busi­ness our­selves.
The con­tract also repeats the “cost plus” arrange­ment that has proved prob­lem­atic in the past. In effect, this deal rewards com­pa­nies with higher prof­its the more they spend, and thus is ripe for abuse and inef­fi­ciency (as we have seen with the accu­sa­tions of over­billing that have swirled around Halliburton). It has no par­al­lel in the best prac­tices of the busi­ness world, for the very rea­son that it runs counter to every­thing Adam Smith wrote about free markets.

June 15th, 2004 | Uncategorized | Comments Off Both comments and pings are currently closed.