Private Contracting Industry Set for Regulation Efforts are under way to regulate the private-contracting industry used by the U.S. government in Iraq and elsewhere. The move comes after mismanagement of contractors in Iraq, including Blackwater USA.
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Private Contracting Industry Set for Regulation

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Private Contracting Industry Set for Regulation

Private Contracting Industry Set for Regulation

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  • <iframe src="" width="100%" height="290" frameborder="0" scrolling="no" title="NPR embedded audio player">
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The war in Iraq has thrown a spotlight on a rapidly expanding industry. It's the industry for private military contractors. You've likely heard allegations about shootings by Blackwater security guards, but those stories are just the beginning. Blackwater is only one of the companies operating in Iraq, and Iraq is only one of the places where private military contractors do business.

NPR's Jackie Northam has this survey of the contractor's world.

JACKIE NORTHAM: In Afghanistan, armed bodyguards from a private U.S. security firm protect President Hamid Karzai. In neighboring Uzbekistan, pilots and aircraft contracted by the U.S. government shuttle cargo and passengers. In North Africa, the U.S. uses private military companies to train local armed forces.

The privatization of traditional jobs once handled by U.S. government workers has spread hundreds of thousands of civilian contractors around the world.

Mr. WILLIAM GOLDEN ( If it weren't for contractor, the federal government just may as well at this point turn off the light switch and call it quits.

NORTHAM: William Golden is the president of, a clearing house for thousands of jobs that require federal security clearances. Golden says he has a wide variety of contracting positions available on every continent.

Mr. GOLDEN: I've been looking for gardeners for the CIA. I've been looking for a top-secret chaplain for a while, for software developers who know how to remote troubleshoot satellites. I'm looking for interrogators, linguists, intelligence analysts, program managers, psychologists.

NORTHAM: Federal contracts have grown from about $200 billion in the year 2000 to more than $415 billion last year. But the reliance on contractors has been steadily building since the 1990s when the focus was on creating a leaner government, primarily by outsourcing and privatization.

Allison Stanger is a professor of political science at Middlebury College and author of a book on privatization of American power. Stanger says contractors are flexible and can move quickly.

Professor ALLISON STANGER (Middlebury College): Contractors provide wonderful surge capacity. If you need them for a little bit of time, you hire them, they do the job, and they're out of there.

NORTHAM: Richard Friedman, the president of the National Strategy Forum in Chicago, says contractors from private industry often are much further ahead of the technology curve.

Mr. RICHARD FRIEDMAN (National Strategy Forum): Government people traditionally are not keeping pace with the technological issues. Therefore, government has to outsource with people who have these technical skills.

NORTHAM: Contractors can also provide political cover. There are now more contractors in Iraq than soldiers, which helps hide the real number of people it takes to wage the war and occupy the country.

William Golden with says even beyond Iraq the reliance on contractors isn't healthy. Golden says the U.S. government has a responsibility to groom people in fields such as intelligence, interrogation, and communication, which can take years of training and nurturing.

Mr. GOLDEN: Industry doesn't work that way. Industry can be very mercenary in its viewpoint of we charge by the hour for what's getting done. Training - if you want education, that's on your own time, which often means it never gets done.

NORTHAM: While the number of contractors have flourished, not so with contracting managers, the people with expertise in choosing, negotiating, writing and managing contracts. As the federal government increased outsourcing in the 1990s, it also started to slash the number of contract managers.

When the Iraq War began, government agencies were tasked with contracting out massive rebuilding projects in Iraq. The drastically reduced contracting staff were overwhelmed. Analysts say this helped contribute to some disastrous results - waste, fraud, faulty workmanship. But Friedman, with the National Strategy Forum, says poorly managed contracts are not isolated to Iraq. Friedman says the industry has grown vast and quickly, but with very little oversight.

Mr. FRIEDMAN: The overall problem is that nobody is minding the store, there is no specific standard, and there is no overall agreed-upon policy.

NORTHAM: There are now efforts to organize the contracting industry, create rules and regulations, and decide on legal frameworks, a slow but necessary process for an industry that shows no sign of slowing down.

Jackie Northam, NPR News, Washington.

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