The Fractal Looking-glass
One of the fascinating features of the American military misadventure in Iraq has been the seeing the organizational changes in our armed forces, which reached their apex with this deployment. The Pentagon has been moving away from the traditional idea of an army which has cooks, truckdrivers and typists as well as fighters, toward a more 'streamlined' force structure, where the actual Army has primarily fighters, and less directly combat-related functions are provided either by reserve units, or by private contractors.
The mission in Iraq has seen private contractors to a much greater extent than ever before. This is in keeping with Donald Rumsfeld's beliefs about having a high-tech, light and flexible military, and a general Republican emphasis on privatization of government.
If you accept the assumption that a for-profit company will be able to do anything more efficiently and flexibly than a governmental organization, it makes sense to buy the services the government wants from contractors, rather than to do it itself. This leads to situations that seem odd to the public, like important visitors to Iraq being guarded by private security guards, rather than US soldiers.
That assumption about the relative efficiency of private contractors rests on a theory that, in a competitive market, businesses are forced to constantly work to cut costs and improve efficiency, lest they lose the market to other businesses who do, and fail. Through competition, the market constantly provides the most efficient organization for any function. Government, it is argued, doesn't benefit from these competitive pressures, and therefore must be less efficient.
Believers in privatization are so enthusiatic about the increased efficiency effect of the market that they suggest a private contractor can not only provide the service the government needs, it can do it so much cheaper that it can add on a profit margin and still come out costing less than having the government do it.
If this is ever true, it certainly seems like it isn't true in the area of military contracting, particularly in a war zone. The drive to contain costs evaporates in a world of cost-plus contracts, and a limited pool of suppliers limits competition. Instead of a theoretically agile and cost-efficient military force providing excellent service without the "clumsy bureaucracy" of government, you end up with a big mess.
Like this:
That the Defense Department hasn't been providing proper oversight and administration of these contracts, or that, years after being requested by Democrats in Congress to provide documentation, nothing has happened, is no surprise to me. No more surprising, actually, than the top layer of 'overhead and profit' padding on that contract belonging to KBR, the Halliburton subsidiary. (Do you suppose that the Army might have been more aggressive about this investigation if the Vice President didn't have a financial interest in one of the companies involved? I guess we'll never know.)
(tip of the hat to Firedoglake)
The mission in Iraq has seen private contractors to a much greater extent than ever before. This is in keeping with Donald Rumsfeld's beliefs about having a high-tech, light and flexible military, and a general Republican emphasis on privatization of government.
If you accept the assumption that a for-profit company will be able to do anything more efficiently and flexibly than a governmental organization, it makes sense to buy the services the government wants from contractors, rather than to do it itself. This leads to situations that seem odd to the public, like important visitors to Iraq being guarded by private security guards, rather than US soldiers.
That assumption about the relative efficiency of private contractors rests on a theory that, in a competitive market, businesses are forced to constantly work to cut costs and improve efficiency, lest they lose the market to other businesses who do, and fail. Through competition, the market constantly provides the most efficient organization for any function. Government, it is argued, doesn't benefit from these competitive pressures, and therefore must be less efficient.
Believers in privatization are so enthusiatic about the increased efficiency effect of the market that they suggest a private contractor can not only provide the service the government needs, it can do it so much cheaper that it can add on a profit margin and still come out costing less than having the government do it.
If this is ever true, it certainly seems like it isn't true in the area of military contracting, particularly in a war zone. The drive to contain costs evaporates in a world of cost-plus contracts, and a limited pool of suppliers limits competition. Instead of a theoretically agile and cost-efficient military force providing excellent service without the "clumsy bureaucracy" of government, you end up with a big mess.
Like this:
The world watched in horror when an Iraqi mob killed four Blackwater contractors guarding a convoy and dragged their mutilated bodies through the streets of Fallujah in March 2004.In the Rumsfeld Defense Department, privatization isn't a way to cut governmental costs, it's a way for companies to take the government's money, while eliminating direct control and accountability for the people doing the work.
On Thursday, the Army said that Blackwater was not authorized to guard convoys or carry weapons.
The revelation came at a congressional hearing that offered a window into the murky world of private contracting in Iraq. Representatives fumed about billions in misspent money, shoddy construction projects and the hiring of unqualified political operatives to rebuild Iraq. ...
The hearing Thursday of the House Government Reform Committee gave a raw look at a wide range of problems with private contractors in Iraq: a $75 million police academy in Baghdad where sewage oozes from the ceiling, and a multimillion-dollar contract to build 142 health clinics that resulted in only six being completed.
Committee members have tried to get answers on the Blackwater contract for almost two years, since The News & Observer detailed how multiple layers of contracts inflated war costs.
At the lowest level, Blackwater security guards were paid $600 a day. Blackwater added a 36 percent markup, plus overhead costs, and sent the bill to a Kuwaiti company that ordinarily runs hotels, according to the contract.
That company, Regency Hotel, tacked on its costs and a profit and sent an invoice to ESS. The food company added its costs and profit and sent its bill to Kellogg Brown & Root, which also added overhead and a profit and presented the final bill to the Pentagon.
In November 2004, Rep. Henry Waxman of California, the ranking Democrat on the committee, asked the Army for an accounting of the costs and copies of all contracts and invoices. The Army has not responded or provided documents, [Maryland Representative Chris] Van Hollen said.
That the Defense Department hasn't been providing proper oversight and administration of these contracts, or that, years after being requested by Democrats in Congress to provide documentation, nothing has happened, is no surprise to me. No more surprising, actually, than the top layer of 'overhead and profit' padding on that contract belonging to KBR, the Halliburton subsidiary. (Do you suppose that the Army might have been more aggressive about this investigation if the Vice President didn't have a financial interest in one of the companies involved? I guess we'll never know.)
(tip of the hat to Firedoglake)
posted by Paul at 9:01 AM |
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