Blackwater: Private Army In The News Again Jeremy Scahill has been investigating Blackwater, a military contractor with a long involvement in the Iraq war. His latest story, published Nov. 23 in The Nation, uncovers the contractor's involvement in a covert program in Pakistan run by the U.S. Joint Special Command.

Blackwater: Private Army In The News Again

Blackwater: Private Army In The News Again

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Journalist Jeremy Scahill testifies on the topic of private military contracting in Iraq before the Senate Democratic Policy Committee on September 21, 2007. Lauren Victoria Burke/AP hide caption

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Lauren Victoria Burke/AP

Journalist Jeremy Scahill testifies on the topic of private military contracting in Iraq before the Senate Democratic Policy Committee on September 21, 2007.

Lauren Victoria Burke/AP

There's an abundance of journalist coverage of U.S. involvement in the Iraq war, but Jeremy Scahill has found a niche investigating Blackwater, a military contractor with a long involvement in the war. He's broken many stories in The Nation, and his latest, published Nov. 23, uncovers the contractor's involvement in a covert program run by the U.S. Joint Special Command (JSOC).

Scahill says that even though tax payers are funding this shadow army, their operations are shrouded in secrecy.

In his article, Scahill reports that Blackwater (which has officially changed its name to Xe Services LLC) is operating in Pakistan under a program that includes planning targeted assassinations and kidnappings of Taliban and Al Qaeda suspects. Blackwater operatives also run a secret U.S. military drone bombing campaign that runs parallel to the CIA's predator strikes.

Scahill is a Polk-award winning journalist and the author of the 2007 book Blackwater: The Rise of the World's Most Powerful Mercenary Army.

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This is FRESH AIR, I'm Terry Gross. The private military company Blackwater, which has played a major role in the wars in Iraq and Afghanistan, is at the center of several controversies and lawsuits. Recent stories broken by my guest, Jeremy Scahill, as well as the New York Times, ABC News and Vanity Fair, have raised many questions about how much access private companies should have to classified intelligence and what role, if any, they should be allowed to play in covert military and CIA operations.

Jeremy Scahill has been investigating Blackwater for several years. He's the author of the book "Blackwater," which was first published in 2007, and he's been writing about the company in The Nation magazine, where he's the national security correspondent.

Jeremy Scahill, welcome back to FRESH AIR. Now, we're going to be focusing on Blackwater, but really, they're just one of many private contractors now in Iraq and Afghanistan. Let's start with an overview of how many private contractors and how many different companies are actually in Iraq and Afghanistan now.

Mr. JEREMY SCAHILL (Author, "Blackwater"; National Security Correspondent, The Nation): Well, right now, according to the latest DOD census, there's about 250 to 260,000 uniformed members of the United States military operating in Iraq, Afghanistan and in support of those operations. However, there's a statistic that almost never goes mentioned, and that is that there is an equal number of contractors in Iraq and Afghanistan right now, meaning that the U.S. military is of equal size to the contractor force in both of those wars.

In Afghanistan, it's more pronounced, though, Terry, because you have about 68,000 U.S. troops operating alongside a whopping 104,000 contractors. And with the recently announced surge in troops, that number's expect to grow at a one-to-one ratio with U.S. troops. So it's quite stunning, the number of contractors that are currently deployed on the U.S. government payroll.

There are about 600 corporations that service the wars in Iraq and Afghanistan, and these range from KBR, which specializes in logistics, to Blackwater, DynCorp and Triple Canopy, which are essentially paramilitary forces that are working for either the Department of Defense, the Department of State or the CIA.

GROSS: What are the implications of that ratio of private contractors to military people?

Mr. SCAHILL: Well, I mean, this is a stunning rarity in the military history of the United States, where you actually have a theater of war, Afghanistan, where the U.S. military is actually the second-largest force operating in the country. This is a system that was not the invention of George W. Bush, it was certainly a bipartisan program, but the Bush administration really changed the way U.S. wars are waged.

You no longer need to depend on nation-state allies to provide you with troops or other support forces. You can simply rent an army. And the reality is that U.S. taxpayers are now funding what is essentially a shadow army. Their deaths don't get counted in the official death tolls. Their injuries don't get counted. And also, the operations of these companies are often shrouded in secrecy and are very difficult to obtain information on by journalists and the U.S. Congress.

GROSS: How does the Obama administration compare to the Bush administration in its use of private contractors so far?

Mr. SCAHILL: Well, there's sort of a contradiction here because President Obama, when he was a senator, was really one of the few lawmakers that zeroed in on this as a problem. In fact, Senator Obama put forward the legislation that became the leading Democratic legislation to try to address the widespread use of contractors. And the Obama strategy when he was in the Senate was to try to bring them into the fold, regulate them, make them accountable, bring them under some system of law.

I say contradiction, though, because while Obama and Secretary of State Hillary Clinton, prior to taking power in January of 2009, were very critical of these companies, they've actually used them in a more widespread way than the Bush administration had when it was in power for eight years.

So the reality is that there was a rhetoric of trying to crack down on these contractors, but then a reality of realizing that without them, President Obama's strategy in Iraq, and indeed in Afghanistan, would simply not be possible.

GROSS: Let's talk about the some of the recent Blackwater news. You broke a story last month about Blackwater being involved with the Joint Special Operations Command in Karachi, in a secret program. What's the secret program?

Mr. SCAHILL: Well, this actually goes back to 2006. The Bush administration struck a deal with the government of Pervez Musharraf in Pakistan that would allow U.S. Special Operations forces to cross the border from Afghanistan into Pakistan if they were, quote, "following the target" - in other words, if they were chasing Osama bin Laden or some of his deputies, U.S. Special Forces, according to the understanding, could go into Pakistan to hunt them down with the agreement that the Pakistanis would say they had not given permission for it and that they could condemn it as basically a violation of their sovereignty.

The reality at the time was that U.S. forces were stretched very thin in both Iraq and Afghanistan, and so the Joint Special Operations Command began hiring former Special Forces operators, and Blackwater sort of had the premium on those characters from the Navy Seals, Delta Force, Army Rangers. They would hire them on an operation-to-operation basis in both Afghanistan and, beginning in 2006, in Pakistan.

So Blackwater had an arrangement with JSOC, the Join Special Operations Command, to do a few things. One was to plan operations that are referred to in the industry as snatch-and-grab operations: taking out a high-value target, rendering him and then interrogating him.

They also began working on both the CIA's drone-bombing campaign, which is a story that was broken by the New York Times earlier this year, in addition to a parallel drone-bombing campaign that was being operated by the U.S. military.

And so Blackwater became a central part of both JSOC's operations in Pakistan, which are classified and covert and are being denied by the Pentagon and the White House all the way up and down, as well as the CIA's.

And I have to say, Terry, that while we've seen a number of issue - incidents where Blackwater forces have been accused of using excessive force, of killing civilians, the guys that are working on these sensitive operations are part of a division of Blackwater called Blackwater Select.

These are not cowboy yahoos that are running around trying to kill people with no justification. These are guys that were top-of-the-line Special Forces operators that were the Chechnya, Bosnia, Somalia. These aren't 25-year-old guys. They're in their mid-30s, some of them in their 40s. And the reason they were hired is because they'd been there, they'd done that, and there was a need for those kinds of services at the time.

GROSS: So you've described some of the secret programs that Blackwater is alleged to have been involved with. Do you think that that poses problems?

Mr. SCAHILL: Well, it doesn't matter what I think. The issue here, as has been expressed to me by members of Congress and members of the military, is that when you outsource these kinds of sensitive operations to private contractors -and in the case of Blackwater, a company that's headed by a very political right-wing guy - you're creating a situation where guys who don't actually have permanent security clearances are given access to very sensitive intelligence that the Intelligence Committee itself does not even have access to.

So what you're essentially saying is we trust this private company more than we trust lawmakers. Perhaps the most outrageous part of this, to members of the U.S. military, is that some of these operations have actually taken place outside of the traditional military chain of command, so that you have JSOC essentially being the supported force in a war zone, and the command structure is either supporting it or is in the dark. And that, with the sources I talked to, is one of the most offensive aspects of this.

GROSS: We should mention that JSOC, the Joint Special Operation Command, is not accountable to Congress. They don't report to Congress. And I guess that's what you mean by Congress being left in the dark about things that private contractors know.

Mr. SCAHILL: Right. You know, I talked to Lawrence Wilkerson, who was then-Secretary of State Colin Powell's chief of staff, and he described to me how, under the Bush administration, JSOC essentially acted as a direct surrogate of the administration. And, in fact, General McChrystal, who is now the commander of all U.S. and NATO forces in Afghanistan, ran JSOC from 2003 to 2008, and Colonel Wilkerson described to me how some of the operatives working on these secret JSOC programs would get in trouble in countries around the world.

And he cited one example in Latin America, where he said that a Special Forces guy actually murdered a taxi driver, and the CIA had to render him - in other words, abduct him - and fly him back to the United States to get him out of that Latin American country.

So you can see the issue there, where you have the military Special Forces engaged in operations, and the chief of mission in a country, the ambassador or the CIA station chief, don't even know they're there. You could imagine what kind of chaos that would cause behind the scenes when a lethal action goes down.

GROSS: Now you mentioned the snatch-and-grab program that Blackwater is alleged to have been involved with. Did you mention the targeted assassination program?

Mr. SCAHILL: Well, the targeted assassination program is something that bled into both JSOC and the CIA throughout the duration of Blackwater's relationship with these two entities. Adam Ciralsky, who's a former CIA lawyer, wrote in a Vanity Fair piece that's going to hit newsstands in January that Erik Prince, for years - at least since 2004, 2005 - was providing members of a secret Blackwater team to the CIA as part of a global hit team that would hunt down al-Qaida operatives.

So you have that program, where Blackwater was working on black ops for the CIA. And then you have a second, parallel program, which is the JSOC targeted assassination program, and that, generally speaking, has been in the form of drone-bombing campaigns, where Blackwater guys are helping to track targets, develop a pattern of their routine, and then present JSOC with options to take them out.

So when we talk about the assassination program, for the CIA, it sounds like it was actually training teams to go and hit people in countries around the world. And when it came to JSOC, it seems like it was more focused on the drone-bombing campaign.

GROSS: So did your sources tell you what activities the private contractors from Blackwater participated in, in the drone campaign?

Mr. SCAHILL: Well, what we know from the CIA end of it, from the great reporting of Jim Risen and Mark Mazzetti in the New York Times is that Blackwater operatives were actually loading Hellfire Missiles onto the drones that would then be used to strike at targets inside of Pakistan.

My sources, however, tell me that with JSOC, the Blackwater guys were much more involved than just putting munitions on drone aircraft that they actually were involved with mission planning. Now, that would be a very serious crossing of the line because that traditionally would be a role for the uniformed United States Armed Forces, but my understanding from my military intelligence sources is that Blackwater guys - and these were the real veteran Special Forces guys - were actually planning these missions and helping to select targets. And that's something that has really raised eyebrows on Capitol Hill.

GROSS: Now at the time that Blackwater is alleged to have been involved in these secret operations with JSOC, the Joint Special Operations Command, the head of JSOC was General Stanley McChrystal, who is now, under the Obama administration, the head of military forces in Afghanistan. So he, I would imagine, would know a lot about this.

(Soundbite of laughter)

Mr. SCAHILL: There are two people that probably know more about this than anyone, and they happen to be the two top military officials in Afghanistan right now. One of them, of course, is General McChrystal, who was the head of JSOC from 2003 to 2008. And the other is Admiral William McRaven, who is the current head of JSOC and was McChrystal's deputy and, in fact, took over JSOC after McChrystal was promoted.

I've talked to former Bush administration officials that have described an incredibly cozy relationship between former Secretary of Defense Donald Rumsfeld, former Vice President Dick Cheney and General McChrystal, where General McChrystal was essentially reporting directly to Rumsfeld and Cheney on operations, and they were effectively carving JSOC out of the broader military chain of command.

So General McChrystal, if he was asked about this in front of the Congress, especially in camera or in closed-door hearings, I'm sure would have a lot to say - or not to say, Terry, as the case often is.

GROSS: So are you suggesting that you think that General McChrystal was working closely with Dick Cheney's office during the Bush administration?

Mr. SCAHILL: I have no doubt about it, based on what I've heard from people who were in the know during the Bush administration. I've also heard from people that Cheney helped coordinate the testimony of General McChrystal about the death of Pat Tillman in Afghanistan, which was determined to be a friendly-fire incident, and that Cheney actually colluded with General McChrystal to attempt to cover up that death.

GROSS: Were you surprised when President Obama chose General McChrystal as the head of forces in Afghanistan?

Mr. SCAHILL: Was I surprised? No. I wasn't surprised because I think that a lot of people misread President Obama, and a lot of his supporters, I think, erroneously viewed him as a dove that was going to substantially change the way that wars are waged.

I think that Obama selected the man that his advisors were telling him was the best person to prosecute this war, and I think that President Obama bought into General McChrystal's famed coin, or counterinsurgency doctrine, for Afghanistan.

So was I surprised? No. But I also share the concerns of those who have followed General McChrystal's career and those that say when you have the Special Forces rise to the top of the command in the way that they have over the past eight or nine years, that there's cause for serious concern because these are guys that are used to operating off the books, away from oversight and in the darkest corners of the world, committing acts that no one ever finds out about or attributes to them.

So that, I think, would be the concern, is that McChrystal is used to not being accountable to anyone, and I think that's the concern about having him running the whole show.

GROSS: If you're just joining us, my guest is journalist Jeremy Scahill. He's the author of the 2007 book "Blackwater." He's been covering the story, breaking a lot of news in The Nation magazine, where he covers national security. We'll talk more about Blackwater after we take a short break. This is FRESH AIR.

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GROSS: My guest is Jeremy Scahill. He covers national security for The Nation magazine. We're talking about Blackwater and other private contractors in Iraq and Afghanistan.

Blackwater is facing several charges now. One of them has to do with a massacre in Baghdad in 2007. Would you describe what you know of that massacre?

Mr. SCAHILL: Right. On the afternoon of September 16th, 2007, a convoy of three armored vehicles operated by Blackwater pulled into a very crowded intersection known as Nisour Square, and it's unclear what happened or how the shooting began. The Blackwater guys say that they were victims of an armed ambush. Witnesses on the ground, including those from the United States military, say that Blackwater forces just opened fire on the crowd, unprovoked. And after about 12 to 15 minutes of sustained gunfire, you had 17 Iraqi civilians that were dead, more than 20 others wounded.

When the military and the FBI investigated, they determined - the U.S. military and the FBI investigated, they determined that there was no provocation and that there were people that were shot in the back as they were attempting to flee the Blackwater gunmen.

Senior members of the Bush administration colluded with Blackwater in the aftermath of that killing to try to cover up the incident. In fact, the State Department's first statement about that massacre was, in fact, written by a Blackwater contractor named Darren Hanner on State Department stationery.

Well, the Justice Department investigated this, and they determined that 14 of the 17 deaths that day were manslaughter. And so six Blackwater operatives were indicted on manslaughter charges. One of them, a young man named Jeremy Ridgeway, pled guilty to one charge and is cooperating with the government, and that trial is set to begin early next year.

The most recent news on that is that the government has dropped charges against one of those men. So in reality, Terry, four men at this point are going to stand trial on charges that they gunned down those Iraqis without any provocation.

GROSS: Will this be the first trial of its kind in which private contractors are being held accountable for manslaughter in the theater of war?

Mr. SCAHILL: There was one prosecution under the Patriot Act of a CIA contractor named David Passaro for the abuse of a detainee in Afghanistan early on in the war on terror. But this is certainly the first trial of its type and of this magnitude, in the sense that you have diplomatic security operatives -and that's what Blackwater guys were working as that day - being charged with manslaughter.

There is no precedent for this. And I have to say that I've talked to legal experts on both sides of the coin here, and this is going to be a very tough case for the government to win because U.S. law at the time of this killing was written in such a way that it's unclear that it applies directly to these Blackwater men because they weren't working for the Department of Defense, where they could either be court-martialed or prosecuted under a civilian law in the U.S. that applies to DOD contractors. They were working for the State Department. It's unclear if the law they're being prosecuted under actually applies to them.

GROSS: If it doesn't, what would the implications be?

Mr. SCAHILL: Well, the implications would be that we have a firm confirmation that there actually is no U.S. law that could be used to prosecute these kinds of crimes, and the Iraqis, up until very recently, were stripped of their legal ability to prosecute contractors in their country. That was implemented by Paul Bremer, who was the first person that Blackwater protected in Iraq in 2003. When he left the country after being President Bush's essentially envoy there, he issued an edict that immunized contractors from prosecution in Iraqi courts.

So Terry, if these guys are not convicted or - I mean, if they're not convicted because the law doesn't apply to them. If they're not convicted because a jury determines they didn't do it, that's one thing. If they're not convicted because the law doesn't apply to them in the view of a judge or jury, then it's a stunning moment in the United States of America because it's a confirmation that these forces truly are above the law.

GROSS: Now, there's a civil lawsuit. This is a separate story. There's a civil lawsuit against Blackwater in which there were two affidavits submitted, and you broke what those affidavits had to say. Tell us about the affidavits.

Mr. SCAHILL: Well, John Doe Number One and John Doe Number Two is how these affidavits were signed, and these were affidavits submitted in support of the plaintiffs in the cases against Blackwater that are being heard in Virginia.

And John Doe One and John Doe Two are former Blackwater employees, and they allege that Erik Prince is a Christian crusader who rewards the destruction of Muslim life and that he views his goal in the world as waging a war against Islam.

They also allege that Blackwater has been involved with arms smuggling into Iraq, using Erik Prince's private airplanes, that Blackwater puts unauthorized weapons into dog food bags and smuggles them into Iraq. And perhaps the most inflammatory allegation that was made in these affidavits is the allegation that Erik Prince may have murdered or facilitated the murder of individuals that are believed to be cooperating with federal authorities in their criminal probe of Blackwater.

And I should say, Terry, that both of these individuals said that they were cooperating with the Department of Justice criminal investigation. But those -their cooperation wouldn't be publicly known to me or anyone else because it would be part of a grand jury, and those proceedings are sealed.

GROSS: Do you take these affidavit statements seriously?

Mr. SCAHILL: I take them seriously, not just on their surface, but because I've heard the similar allegations from other former Blackwater employees and executives that I know to not be John Doe Number One and John Doe Number Two.

They're very serious allegations, and so to print something like that as a journalist, I think you have to do more diligence than simply read an affidavit, and we certainly did that. And I believe that this is something that a lot of people at Blackwater are talking about and are concerned about.

GROSS: Jeremy Scahill will talk more about Blackwater in the second half of the show. He's the national security correspondent for The Nation and author of the 2007 book "Blackwater." I'm Terry Gross, and this is FRESH AIR.

(Soundbite of music)


This is FRESH AIR. I'm Terry Gross back with Polk Award-winning journalist Jeremy Scahill. He spent the past few years investigating the private military contractor Blackwater, which has played a major role in the wars in Iraq and Afghanistan. Scahill is the author of the 2007 book "Blackwater," and is the national security correspondent for The Nation.

When we left off, we were talking about a civil suit against Blackwater in which two affidavits submitted by former Blackwater employees, each known only as John Doe, make several allegations against Erik Prince, the founder of Blackwater, including that he's a Christian crusader and that he may have facilitated the murder of individuals cooperating with the criminal probe of Blackwater.

So in one of these affidavits, John Doe A or B says that Prince views himself as a Christian crusader tasked with eliminating Muslims and the Islamic faith from the globe and that his companies encouraged and rewarded the destruction of Iraqi life.

That's a really strong statement. It...

Mr. SCAHILL: Well, I mean...

GROSS: Yeah.

Mr. SCAHILL: ...that was one of the least shocking things that I read in there because, you know, I've been tracking this story since 2004 and it's abundantly clear to me that Erik Prince views himself, and I don't say this rhetorically, Terry, Erik Prince views himself as a Christian crusader. There's almost no doubt about that. I wasn't stunned at all when I read that. Everyone at Blackwater knows that.

GROSS: What do you think people mean when they describe Erik Prince, the head of Blackwater, as a Christian crusader? What has he done that might fit that description?

Mr. SCAHILL: Well, the first time that that term officially came to the public light was in the form of these affidavits in terms of coming from people from within the company. And the description that they offer is that Erik Prince actually encouraged a climate where people were using - regularly using racist terms like Haji to describe Iraqis or other Muslims, and that there were operations where Blackwater men were encouraged to go night hunting in helicopters with night vision goggles and they were essentially shooting Iraqis for sport.

The Department of Justice has a filing in the criminal case against Blackwater where they say that some Blackwater operatives viewed the killing of Iraqis as - innocent Iraqis - as payback for 9/11. And you also have a culture at Blackwater where Erik Prince himself, my understanding is, has given speeches to people about the epic crusade that they're on and has in fact used that term himself - the term crusade.

So it would be the combination of encouraging an environment where racist terms are being used to describe innocent Iraqis, where they're night hunting, where they're celebrating their kills, as they're called, and just the general tone for the operations that's set in Iraq and Afghanistan.

GROSS: Now, in this profile of Erik Prince in Vanity Fair that you mentioned, it says that he was a CIA asset - a CIA spy. Is there any hint of when he was?

Mr. SCAHILL: Well, I'll tell you what I know about this, Terry. In 2002, Blackwater was first hired by the CIA on a black contract - a covert contract -to go inside of Afghanistan as part of a force that would protect CIA operatives and operations and they originally guarded the CIA outpost in Kabul and then in a border town called Shkin along the Afghan/Pakistan border, and then the line started to gray, where you had Blackwater guys supposed to be guarding the CIA but in fact they would end up going out on missions with them. And because they were former Special Forces guys, it seemed like a natural fit to the CIA and to Blackwater.

Prince himself not long after that, my understanding is, tried to join the CIA. And in fact in the Vanity Fair article he actually acknowledges this, that he was rejected by the CIA. So what happened, Terry, to answer your question directly, is that beginning in 2004, 2005, Prince started working in a different way with the CIA and they opened up what they call a 201 file on him that essentially made him an asset that had been vetted by the CIA. So he wasn't officially an employee but he became an asset of the CIA.

And Prince used his - one of his actual homes to train special secret forces that were going to be working for the CIA in sensitive operations around the world, according to Vanity Fair, and that really kicked off this different level of a relationship between Erik Prince and the CIA. So 2004, 2005 is when things started to get really intense Erik Prince, Blackwater and the CIA. It also was a time when a bunch of high level CIA guys jumped over to Blackwater and took up employment with Erik Prince.

GROSS: If Erik Prince was a CIA asset, and I don't think we really have any way of proving that, but if he was, does that raise any question?

Mr. SCAHILL: Sure. I mean if Erik Prince was a CIA asset and was funding operations out of his own pocket, which Vanity Fair reported and which I've also heard from other people, essentially Erik Prince was bankrolling operations where there was no contract on paper for them, there was no knowledge in the intelligence committees, not with the Gang of Eight, not the broader permanent Select Committee on Intelligence.

What that means is that you have an individual from the private sector that's being hired on a contract explicitly to prevent Congress from having oversight of those operations. That certainly is what members of the intelligence committee I've talked with believe happened here.

So the dramatic concern I think would be that you have truly clandestine operations that not even the most trusted members of Congress are allowed to have access to, and yet, Erik Prince, owner of the largest private army in the United States, is able to have access to all this information, be involved with activities that somebody somewhere has deemed so important that they can't even be briefed to the Congress. That's a very serious cause for concern, I think.

GROSS: Now, this isn't how Erik Prince sees it. He's quoted in that Vanity Fair profile as saying: I'm painted as this war profiteer by Congress, meanwhile, I'm paying for all sorts of intelligence activities to support American national security out of my own pocket.

So obviously in his mind, or at least in this quotation, he sees himself as being very patriotic and really helping America by bankrolling these operations.

Mr. SCAHILL: Oh, I don't...

GROSS: Something that he should be applauded for in his mind.

Mr. SCAHILL: I don't question for one minute that Erik Prince views himself as a patriot, as a true American, and someone that has risked his life and his personal fortune in the pursuit of American national security. I wouldn't doubt that that's how he perceives himself. But let's be clear here. What we're talking about is a man who has incredible faith placed in him by someone within government, so much faith that they say you can engage in these lethal operations and we're not going to tell anyone about them.

What if, Terry, Erik Prince funds an operation where they bump somebody off in Germany, and oops, it's the wrong person? And then the German government finds out about it and we have an incredible firestorm that's created, that Congress hadn't been briefed on it, senior people at CIA might not be aware of it, and Erik Prince and his guys bump this guy off because somebody gave him a wink and a nod at the Central Intelligence Agency?

This is an incredible amount of faith being placed in a character who has a very unsavory record when it comes to respecting human rights and the rights of civilians in war zones. I think this is something that should be very, very controversial to both Democrats and Republicans - in fact, to all Americans.

GROSS: Just curious, why did you use Germany as the country for that example?

Mr. SCAHILL: Well, I chose Germany because - well, because in the Vanity Fair article Adam Ciralsky describes Blackwater being part of an operation that tracked an al-Qaida suspect in Germany. And I think that, you know, that raised eyebrows not only with me but with other people in the Congress and in the intelligence community because we don't have a declaration of war against Germany and generally that's not how things are done. You coordinate with the intelligence services of an allied nation.

GROSS: You've written that you think that Erik Prince might've had ulterior motives in being profiled in Vanity Fair and that you call it a possible case of gray mail. Would you explain what you mean?

Mr. SCAHILL: Right. Well, I talked to former prosecutors and military and constitutional law experts that said that what Erik Prince is doing in this Vanity Fair piece is trying to preempt the successful prosecution or indictment of himself. And what gray mailing is Terry - it was used by Oliver North's lawyers, it's been used by other alleged CIA assets who have been caught up in an operation that they claimed was a part of an official operation or a classified operation - and what they'll do in these cases is they will essentially put forward a little bit of information that is classified or controversial to show the government, look, this is just the tip of the iceberg. I can peel away all the layers of this if you want to go there with me. If you come at me hard with some kind of an indictment, which could happen with Erik Prince in a number of cases, I'm going to come back and I'm going to put on the table all of the stuff that I did for the United States government and we're going to have a real trial here.

So the gray mailing is sort of saying to the government, I dare you to come after me for something that I did while I was working for you and try to prosecute me criminally. It's actually brilliant because it has worked many times and that is what the legal experts that I talked to believe Erik Prince was doing in talking to Vanity Fair.

And he talked to a very trusted source. Adam Ciralsky himself left the CIA under very contentious circumstances, then actually filed a lawsuit against the CIA and is no stranger to controversy involving the CIA.

GROSS: Well, if you're just joining us, my guest is Jeremy Scahill. We're talking about Blackwater and some of the latest news involving that private military contractor.

Jeremy, let's take a short break here and then we'll come back and talk some more about Blackwater and private contractors in Iraq and Afghanistan.

This is FRESH AIR.

(Soundbite of music)

GROSS: My guest is Jeremy Scahill. He covers national security for The Nation magazine. We're talking about Blackwater and other private contractors in Iraq and Afghanistan.

What is Blackwater's presence now in Iraq and Afghanistan? What parts of their contract were cancelled and what do they still have?

Mr. SCAHILL: Well, let me start at the top of the pyramid with something that I think is quite jolting to a lot of people that don't know this. Hillary Clinton as a candidate for president vowed to ban Blackwater and she co-sponsored legislation that sought to ban them. Hillary Clinton is now guarded in part by Blackwater when she visits Afghanistan, just to give you a sense of how deep this company remains embedded under the Obama administration.

In Iraq, the Obama administration elected not to renew Blackwater's massive security contract to guard all U.S. diplomats in that country, which they had from the beginning of the U.S. invasion. But what's happened is that Blackwater has an aviation contract that allows Blackwater operatives to be armed and they ferry around U.S. officials. That contract has been extended indefinitely by the Obama administration and the reason that Congress has been told that's happening is because there's not another company with the identical force to Blackwater's air force in Iraq. So Blackwater remains in Iraq right now on a $120 million aviation contract.

In Afghanistan, Blackwater still has the prime contract to guard all U.S. diplomats, including the U.S. ambassador, Ambassador Eikenberry, as well as visiting U.S. diplomats and congressional delegations. So they continue on and they will be for at least another year and probably beyond that as the premiere private security force for the U.S. embassy in terms of guarding convoys. They don't guard the embassy itself but they guard the convoys, all members of Congress that visit, Hillary Clinton, Richard Holbrooke, etcetera.

Simultaneously, Blackwater works on a very large contract, in the hundreds of millions, for the Department of Defense, where they're engaged in training operations, which is a big part of the Obama strategy. They also work for the Drug Enforcement Agency - the U.S. Drug Enforcement Agency - training Afghan counternarcotics forces, and as of a couple of months ago they were still working for the CIA, although the latest news is that Leon Panetta, the CIA director, is trying to purge all Blackwater contracts from the agency. So the short answer, Terry, is that Blackwater is very much alive and active in Afghanistan. It's on its way out in Iraq, but it's still hanging on.

GROSS: Now, in talking about Blackwater, we've using the name Blackwater. But Blackwater officially changed its name to Xe, X-E. So I asked you before when we started which name we should use - should we go with Xe? Should we go with Blackwater? You suggested Blackwater.

Mr. SCAHILL: Well...

GROSS: That is how the company's commonly known. So what is the rebranding, the Xe about?

Mr. SCAHILL: I have to say, Terry, you're so two weeks ago. It's now U.S. Training Center.

GROSS: Oh, you're kidding.

(Soundbite of laughter)

Mr. SCAHILL: They changed it. It's funny because, you know..

GROSS: Did Xe not catch on?

(Soundbite of laughter)

Mr. SCAHILL: Right. Well, I mean people don't know how to - I mean how brilliant is it though that you pick a name that no one can figure out how to pronounce at first, that when you try to Google it, you know, you get Xerox and Xena and all of these things.

(Soundbite of laughter)

Mr. SCAHILL: I mean try finding a federal contract for Xe and, you know, you're going to get every photocopying contract the U.S. government has ever signed. So...

GROSS: You speak from experience, I guess.

(Soundbite of laughter)

Mr. SCAHILL: Right. Right. So it's sort of a brilliant rebrand - it looks crude but in a way it's sort of deviously brilliant. So you've got Xe Company, U.S. Training Center, Paravant, Greystone, XPG LLC, EP Investments. I mean there's -I found like 12, 15 different corporate registrations of companies that Erik Prince owns. And you know, no one in Blackwater has stopped calling it Blackwater. No matter how many times someone repeats the name Xe Company or U.S. Training Center, everybody talks about it as Blackwater.

GROSS: All right.

(Soundbite of laughter)

GROSS: That's interesting. A lot of people have been - well, some people, anyways, have been leaking to you about Blackwater and about Erik Prince. Why are people leaking?

Mr. SCAHILL: Well, you know, I've talked to let's say a half a dozen or so former Blackwater people in the last two months, and some of these are people that have taken up employment with other companies like Blackwater, and I've a sort of common narrative, and that is that people worked for years at that company. They adored Erik Prince. They looked up to him. They thought that it was a noble company, and they started to realize that there were ulterior motives at play.

Some people professed a sort of shock when they started to hear Erik Prince talk in sort of messianic tones about the mission in Iraq or Afghanistan. Others said that there was a sort of culture of immorality at Blackwater, of wife swapping and infidelity that they said didn't jibe with the public perception of Blackwater. And then others said that they didn't want to be a part of what they perceived as illegal operations. I have talked to people that have witnessed the placement of illegal weapons in dog food bags. That came out in these affidavits, but for a couple years I have been hearing about that.

Other people that said that Blackwater was firing medical and mental health personnel that refused to clear individuals for deployment, that had made racist statements or were addicted to steroids or other drugs that they were using in the war zones. And so, I think that people have left for their own reasons. And as disgruntled as you could portray them, I have yet to hear someone that truly just seemed like they were trying to harm the company but rather people that were saying: I was a part of this for too long and my penance is I want people to know about it.

GROSS: Now are your links mostly from former Blackwater employees or do you also have people who are talking to you from the CIA?

Mr. SCAHILL: Well, I have people that have talked to me from the CIA. I have people that have talked to me from military intelligence. I have a source in Special Forces and then I have a number of Blackwater people that I talked to.

GROSS: And are the CIA and military people uncomfortable with the arrangement with Blackwater? Is that why those people are leaking to you?

Mr. SCAHILL: Well, I'll sort of put this in an informal way. I've been a little bit amused by what I perceive as the military special forces taking no small amount of pleasure in watching the CIA take all of the heat on this Blackwater story. And I think that there is great frustration at the CIA that they are being portrayed as the sort of ultimate bad guy in this, the people that hired Erik Prince and made all these secret deals. When, in reality, the military was doing essentially the same thing, and I'm understanding maybe even more of these things with Blackwater than the CIA was.

So, but, you know, one of the sources that came to me with some information from within the military intelligence bureaucracy is a supporter of the strategy that President Obama is implementing in Afghanistan and Pakistan, and said that he is deeply offended that these operations are happening away from any system of oversight and law when it comes to Blackwater and, in fact, JSOC operating essentially off the books. And the sense that I have had from people in government that have talked to me is that they believe that they can't be silent and that the public has a right to know about this. And if the generals aren't going to brief it to the Congress or the White House, then it's their responsibility as responsible citizens to make sure the public has access to this information.

GROSS: Have you ever been to one of the Blackwater compounds or met the head of Blackwater, Erik Prince?

Mr. SCAHILL: Well, I'm not allowed on the Blackwater compound but I've - I mean I've tried, you know, many, many times to get access to - official access to Erik Prince or to Blackwater's compounds. I did track down Erik Prince at a meeting of the American Enterprise Institute a few years ago and I tried to interview him. And he actually - at the time I was - I didn't have a video camera I just had an audio recorder and he hit down my microphone when I started talking to him and tried to kind of leave the room. And it was almost like this cat and mouse. I kind of just walking around the room asking him questions. And I had the press person from the American Enterprise Institute, which is a leading neocon think tank, grabbing my arm and saying he is not part of a press conference. And then this big force reconnaissance Marine, a former force reconnaissance Marine that works for Erik Prince sort of stepped in front of me and said, can I help you with something? And it was almost like I went back to puberty and I was like, I want to ask Mr. Prince a question. Anyway�

(Soundbite of laughter)

Mr. SCAHILL: �that was my epic run in with Erik Prince. But other than that he - no Blackwater officials have ever agreed to sit down and talk with me. They have answered on a couple of occasions questions by email that I've submitted to them and usually just to say, you know, your full of BS and this isn't true.

GROSS: You referred at one point to Blackwater as being America's largest private army. Do you think of them as a private army? What does that mean?

Mr. SCAHILL: Well, there are two divisions within Blackwater that people - most people have never even heard of. One is Blackwater Select. We talked about that a bit. Those are the guys that service covert and classified programs. And then the other is referred to internally in Blackwater as AOB, Army of Blackwater. And those are the guys that work primarily for the U.S. State Department. They certainly perceive themselves that way.

But, in terms, of me using the term army what else do you call a company that has a 7,000 acre private military base, that has its own aviation division, that actually rents aircrafts to the U.S. armed forces for use in sensitive operations in Afghanistan and elsewhere, has it's own Maritime Division and has multiple locations in the United States where they are training law enforcement, military and special forces? All of those - and they're all intelligence company. So, in a way they're more than an army. They're almost a small, parallel national security structure.

GROSS: Well, Jeremy Scahill, thank you so much for talking with us.

Mr. SCAHILL: Thank you, Terry.

GROSS: Jeremy Scahill is the author of the book, �Blackwater,� and is the national security correspondent for The Nation Magazine.

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